AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
ON FEBRUARY 9, 2024
REGISTRATION NO. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933
VUZIX CORPORATION
(Exact name of registrant as specified in its
charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
04-3392453
I.R.S. Employer Identification Number
25 Hendrix Road, Suite A
West Henrietta, New York 14586
585-359-5900
(Address, including zip code, and telephone number,
including area code of registrant’s principal executive offices)
Paul Travers
Chief Executive Officer
25 Hendrix Road, Suite A
West Henrietta, New York 14586
585-359-5900
(Name, address, including zip code, and telephone
number, including area code, of agent for service)
Copies to:
Gregory Sichenzia, Esq.
Sichenzia Ross Ference Carmel LLP
1185 Avenue of the Americas, 31st
Floor
New York, New York 10036
Phone: 212-930-9700
Fax: 212-930-9725
Approximate date of commencement of proposed
sale to the public: From time to time after the effective date of this registration statement.
If
the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please
check the following box: ¨
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415
under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plants, check
the following box: x
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act,
please check the following and list the Securities Act registration statement number of the earlier effective registration statement
for the same offering. ¨
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box
and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ¨
If
this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become
effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ¨
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register
additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following
box. ¨
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer”, “smaller reporting company”
and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
| |
¨ |
Large accelerated filer |
|
¨ |
Accelerated filer |
|
| |
x |
Non-accelerated filer |
|
x |
Smaller reporting company |
|
| |
|
|
¨ |
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 7(a)(2)(B) of Securities Act.
The registrant hereby amends this Registration
Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which
specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to
said Section 8(a), may determine.
EXPLANATORY NOTE
This registration statement contains two prospectuses:
| · | a
base prospectus, which covers the offering, issuance and sale by us of our common stock,
preferred stock, warrants and/or units representing two or more of the foregoing securities;
and |
| · | a
sales agreement prospectus which covers the offering, issuance and sale by us of up to a
maximum aggregate offering price of $50,000,000 of our common stock that may be issued and
sold from time to time under an Open Market Sale AgreementSM, or the sales agreement,
with Jefferies LLC. |
The base prospectus immediately follows this
explanatory note. The specific terms of any securities to be offered pursuant to the base prospectus will be specified in a prospectus
supplement to the base prospectus.
The sales agreement prospectus immediately follows
the base prospectus. The $50,000,000 of our common stock that may be offered, issued and sold under the sales agreement prospectus is
included in the $300,000,000 of securities that may be offered, issued and sold by us under the base prospectus. Upon any termination
of the sales agreement, any portion of the $50,000,000 of securities included in the sales agreement prospectus that has not been sold
pursuant to the sales agreement will become available for sale in other offerings pursuant to the base prospectus with a corresponding
prospectus supplement.
The information in this prospectus
is not complete and may be changed. We may not sell these securities until the registration statement relating to these securities that
has been filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and
it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
(Subject to Completion, Dated February 9,
2024)
PROSPECTUS
$300,000,000
Common Stock
Preferred Stock
Warrants
Units
We may from time to time, in one or more offerings
at prices and on terms that we will determine at the time of each offering, sell common stock, preferred stock, warrants, or a combination
of these securities, or units, for an aggregate initial offering price of up to $300,000,000. This prospectus describes the general manner
in which our securities may be offered using this prospectus. Each time we offer and sell securities, we will provide you with a prospectus
supplement that will contain specific information about the terms of that offering. Any prospectus supplement may also add, update, or
change information contained in this prospectus. You should carefully read this prospectus and the applicable prospectus supplement as
well as the documents incorporated or deemed to be incorporated by reference in this prospectus before you purchase any of the securities
offered hereby.
This prospectus may not be used to offer and
sell securities unless accompanied by a prospectus supplement.
Our common stock is currently traded on the Nasdaq
Capital Market under the symbol “VUZI.” On February 7, 2024, the last reported sales price for our common stock was $1.68
per share. The prospectus supplement will contain information, where applicable, as to any other listing of the securities on the Nasdaq
Capital Market or any other securities market or exchange covered by the prospectus supplement.
We are a “smaller reporting company”
under the federal securities laws and, as such, we have elected to comply with certain reduced public company reporting requirements
for this prospectus and for future filings. See “Prospectus Summary—Implications of Being a Smaller Reporting Company.”
The securities offered by this prospectus
involve a high degree of risk. Before making any investment decision, you should carefully review and consider all the information in
this prospectus and the documents incorporated by reference herein, including the risks and uncertainties described under “Risk
Factors” beginning on page 4, in addition to Risk Factors contained in the applicable prospectus supplement.
Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus.
Any representation to the contrary is a criminal offense.
We may offer the securities directly or through
agents or to or through underwriters or dealers. If any agents or underwriters are involved in the sale of the securities their names,
and any applicable purchase price, fee, commission or discount arrangement between or among them, will be set forth, or will be calculable
from the information set forth, in an accompanying prospectus supplement. We can sell the securities through agents, underwriters or
dealers only with delivery of a prospectus supplement describing the method and terms of the offering of such securities. See “Plan
of Distribution.”
This prospectus is dated , 2024
Table of Contents
You should rely only on the information contained
or incorporated by reference in this prospectus or any prospectus supplement. We have not authorized anyone to provide you with information
different from that contained or incorporated by reference into this prospectus. If any person does provide you with information that
differs from what is contained or incorporated by reference in this prospectus, you should not rely on it. No dealer, salesperson or
other person is authorized to give any information or to represent anything not contained in this prospectus. You should assume that
the information contained in this prospectus or any prospectus supplement is accurate only as of the date on the front of the document
and that any information contained in any document we have incorporated by reference is accurate only as of the date of the document
incorporated by reference, regardless of the time of delivery of this prospectus or any prospectus supplement or any sale of a security.
These documents are not an offer to sell or a solicitation of an offer to buy these securities in any circumstances under which the offer
or solicitation is unlawful.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement
that we filed with the Securities and Exchange Commission, or SEC, using a “shelf” registration process. Under this shelf
registration process, we may sell any combination of the securities described in this prospectus in one of more offerings up to a total
dollar amount of proceeds of $300,000,000. This prospectus describes the general manner in which our securities may be offered by this
prospectus. Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms
of that offering. The prospectus supplement may also add, update or change information contained in this prospectus or in documents incorporated
by reference in this prospectus. The prospectus supplement that contains specific information about the terms of the securities being
offered may also include a discussion of certain U.S. Federal income tax consequences and any risk factors or other special considerations
applicable to those securities. To the extent that any statement that we make in a prospectus supplement is inconsistent with statements
made in this prospectus or in documents incorporated by reference in this prospectus, you should rely on the information in the prospectus
supplement, provided that if a statement in any document is inconsistent with a statement in another document having a later date - for
example, a document incorporated by reference in this prospectus or any prospectus supplement - the statement in the document having
the later date modifies or supersedes the earlier statement. You should carefully read both this prospectus and any prospectus supplement
together with the additional information described under “Where You Can Find More Information” before buying any securities
in this offering.
The terms “Vuzix,” the “Company,”
“we,” “our” or “us” in this prospectus refer to Vuzix Corporation and its wholly-owned subsidiaries,
unless the context suggests otherwise.
We intend to apply for various trademarks that
we use in connection with the operation of our business. This prospectus may also contain trademarks, service marks and trade names of
third parties, which are the property of their respective owners. Our use or display of third parties’ trademarks, service marks,
trade names or products in this prospectus is not intended to, and does not imply a relationship with, or endorsement or sponsorship
by us. Solely for convenience, the trademarks, service marks and trade names referred to in this prospectus may appear without the ®,
SM and ™ symbols, but the omission of such references is not intended to indicate, in any way, that we will not assert, to the
fullest extent under applicable law, our rights or the right of the applicable owner of these trademarks, service marks and trade names.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This prospectus and the documents and information
incorporated by reference in this prospectus include forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange
Act. These statements are based on our management’s beliefs and assumptions and on information currently available to our management.
Forward-looking statements include statements concerning:
| · | trends in our operating expenses,
including personnel costs, research and development expense, sales and marketing expense,
and general and administrative expense; |
| · | the effect of competitors and competition
in our markets; |
| · | our wearable products and their market
acceptance and future potential; |
| · | our ability to develop, timely introduce
and effectively manage the introduction of new products and services or improve our existing
products and services; |
| · | expected technological advances by
us or by third parties and our ability to leverage them; |
| · | our ability to attract and retain
customers; |
| · | our ability to accurately forecast
consumer demand and adequately manage inventory; |
| · | our ability to deliver an adequate
supply of product to meet demand; |
| · | our
ability to maintain and promote our brand and expand brand awareness; |
| · | our
ability to detect, prevent, or fix defects in our products; |
| · | our
reliance on third-party suppliers, contract manufacturers and logistics providers and our
limited control over such parties; |
| · | trends
in revenue, costs of revenue, and gross margin and our possible or assumed future results
of operations; |
| · | our
ability to attract and retain highly skilled employees; |
| · | the
impact of foreign currency exchange rates; |
| · | the
effect of future regulations; |
| · | the
sufficiency of our existing cash and cash equivalent balances and cash flow from operations
to meet our working capital and capital expenditure needs for at least the next 12 months; |
| · | our
anticipated use of net proceeds from any offering of our securities pursuant to this prospectus; |
| · | general
market, political, economic and business conditions; and |
| · | other
risks and uncertainties described in this prospectus, including those under the section entitled
“Risk Factors.” |
All statements in this prospectus and the documents
and information incorporated by reference in this prospectus that are not historical facts are forward-looking statements. We may, in
some cases, use terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,”
“intends,” “may,” “plans,” “potential,” “predicts,” “projects,”
“should,” “will,” “would” or similar expressions or the negative of such items that convey uncertainty
of future events or outcomes to identify forward-looking statements.
Forward-looking statements are made based on
management’s beliefs, estimates and opinions on the date the statements are made and we undertake no obligation to update forward-looking
statements if these beliefs, estimates and opinions or other circumstances should change, except as may be required by applicable law.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements.
ABOUT VUZIX
Overview
We are engaged in the design, manufacture, marketing
and sale of wearable computing devices and augmented reality wearable display devices, also referred to as head mounted displays (or
HMDs), heads-up displays (HUDs) or near-eye displays, in the form of Smart Glasses and Augmented Reality (AR) glasses. Our wearable display
devices are worn like eyeglasses or attach to a head-worn mount. These devices typically include cameras, sensors, and a computer that
enable the user to view, record and interact with video and digital content, such as computer data, the internet, social media or entertainment
applications. Our wearable display products integrate display technology with our advanced optics to produce compact high-resolution
display engines, less than half an inch diagonally, which when viewed through our Smart Glasses products create virtual images that appear
comparable in size to that of a computer monitor or a large-screen television.
With respect to our Smart Glasses and AR products,
we are focused on the enterprise, industrial, commercial, security, first responder, medical, and defense markets. We also provide custom
solutions and engineering services to third parties, including OEMs, of waveguides to enable fully-integrated wearable display systems,
including HMDs to commercial, industrial and defense customers. We do not offer “work-for-hire” services per se but rather
offer our engineering services for projects that we expect could result in advancing our technology and potentially lead to long-term
supply or OEM relationships.
All of the mobile displays and wearable and mobile
electronics markets in which we compete, including mobile and wearable displays and electronics, have been and continue to be subject
to consistent and rapid technological change, with ever greater capabilities and performance, including mobile devices with larger screen
sizes and improved display resolutions as well as, in many cases, reductions in pricing for mobile devices. As a result, we must continue
to improve our products’ performance and lower our costs. We believe our intellectual property portfolio gives us a leadership
position in the design and manufacturing of micro-display projection engines, waveguides, mechanical packaging, ergonomics, and optical
systems.
We reported a net loss of $30,268,511 for the
nine months ended September 30, 2023, a net loss of $40,763,573 for the year ended December 31, 2022, a net loss of $40,377,160
for the year ended December 31, 2021, and a net loss of $17,952,172 for the year ended December 31, 2020. We have an accumulated
deficit of $274,104,227 as of September 30, 2023.
Corporate Information
Our principal executive offices are located at
25 Hendrix Road, West Henrietta, New York 14586. Our telephone number is +1-585-359-5900. We maintain an Internet website at www.vuzix.com.
The information contained on, connected to or that can be accessed via our website is not part of this prospectus. We have included our
website address in this prospectus as an inactive textual reference only and not as an active hyperlink.
Implications of Being a Smaller Reporting Company
We are a “smaller reporting company,”
meaning that the market value of our shares held by non-affiliates plus the aggregate amount of gross proceeds to us as a result of this
offering is less than $700 million and our annual revenue was less than $100 million during the most recently completed fiscal year.
We may continue to be a smaller reporting company after this offering if either: (i) the market value of our shares held by non-affiliates
is less than $250 million; or (ii) our annual revenue was less than $100 million during the most recently completed fiscal year
and the market value of our shares held by non-affiliates is less than $700 million. If we are a smaller reporting company, we may continue
to rely on exemptions from certain disclosure requirements that are available to smaller reporting companies. Specifically, as a smaller
reporting company, we may choose to present only the two most recent fiscal years of audited financial statements in our Annual Report
on Form 10-K and, similar to emerging growth companies, smaller reporting companies have reduced disclosure obligations regarding
executive compensation.
RISK FACTORS
Investing in our securities involves a high degree
of risk. Before making an investment decision, you should consider carefully the risks, uncertainties and other factors described below
and in our most recent Annual Report on Form 10-K, as supplemented and updated by subsequent quarterly reports on Form 10-Q
and current reports on Form 8-K that we have filed or will file with the SEC, which are incorporated by reference into this prospectus.
See “Where You Can Find More Information” below.
Our business, affairs, prospects, assets, financial
condition, results of operations and cash flows could be materially and adversely affected by these risks. For more information about
our SEC filings, please see “Where You Can Find More Information”.
The sale of a substantial amount of our
common stock, including resale of the shares of common stock by certain selling stockholders in the public market, could adversely affect
the prevailing market price of our common stock.
We
have registered for resale by certain selling stockholders up to 2,843,754 shares of our common stock that have been issued or may be
issuable by us, as described in our prospectus dated May 8, 2023, filed with the SEC on May 9, 2023. These shares are issuable
pursuant to a License, a Stock Purchase and a Shareholders’ Agreement with Atomistic SAS and its two principals, as described in
our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on March 1, 2023. 1,397,500
of these shares have been issued by us to date, of which none have been sold by the selling stockholders under that prospectus, and up
to 1,446,252 additional shares may be issuable by us in the future and will be eligible for sale under that prospectus. Sales of substantial
amounts of our common stock by these or other selling stockholders in the public market, or the perception that such sales might occur,
could adversely affect the market price of our common stock. We cannot predict if and when the selling stockholders may sell such shares
in the public market.
USE OF PROCEEDS
We will retain broad discretion over the use
of the net proceeds from the sale of the securities offered hereby. Unless otherwise indicated in a prospectus supplement, we intend
to use the net proceeds from the sale of the securities under this prospectus for general corporate purposes, including expanding our
technologies and products, and for general working capital purposes.
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock
is intended as a summary only and therefore is not a complete description of our capital stock. This description is based upon, and is
qualified by reference to, our certificate of incorporation, our bylaws, and applicable provisions of Delaware corporate law. You should
read our certificate of incorporation and our bylaws, in each case, as amended and supplemented, which are filed as exhibits to the registration
statement of which this prospectus forms a part, for the provisions that are important to you. We refer in this section to our third
amended and restated certificate of incorporation as our certificate of incorporation, and we refer to our amended and restated bylaws
as our bylaws.
Our authorized capital stock consists of 100,000,000
shares of common stock, $0.001 par value per share and 5,000,000 shares of preferred stock, par value $0.001 per share, all of which
shares of preferred stock are undesignated.
Common Stock
As of December 31, 2023, we had outstanding
64,725,108 shares of common stock.
Holders of the Company’s common stock are
entitled to one vote for each share on all matters submitted to a stockholder vote. Holders of common stock do not have cumulative
voting rights. Therefore (subject to the rights of the holders of any outstanding preferred stock), holders of a majority of the
shares of common stock voting for the election of directors can elect all of the directors to our Board of Directors. Holders of
the Company’s common stock representing one-third of the voting power of the Company’s capital stock issued, outstanding
and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting of stockholders. A
vote by the holders of a majority of the Company’s outstanding shares is required to effectuate certain fundamental corporate changes
such as a liquidation, merger or an amendment to the Company’s certificate of incorporation.
Holders of the Company’s common stock are
entitled to share in all dividends that the Board of Directors, in its discretion, declares from legally available funds. In the
event of a liquidation, dissolution or winding up, each outstanding share entitles its holder to participate pro rata in all assets that
remain after payment of liabilities and after providing for each class of stock, if any, having preference over the common stock. The
Company’s common stock has no pre-emptive rights, no conversion rights, and there are no redemption provisions applicable to the
Company’s common stock.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Computershare
Trust Company.
Listing
Our common stock is currently traded on the Nasdaq Capital Market
under the symbol “VUZI.”
Preferred Stock
As of December 31, 2023, no shares of our
preferred stock were issued and outstanding.
Our Certificate of Incorporation authorizes our
Board of Directors to issue preferred stock from time to time with such designations, preferences, conversion or other rights, voting
powers, restrictions, dividends or limitations as to dividends or other distributions, qualifications or terms or conditions of redemption
as shall be determined by the Board of Directors for each class or series of stock. Preferred stock is available for possible future
financings or acquisitions and for general corporate purposes without further authorization of stockholders unless such authorization
is required by applicable law, the rules of the Nasdaq Capital Market or other securities exchange or market on which our stock
is then listed or admitted to trading.
Our Board of Directors may authorize the issuance
of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of common
stock. The issuance of preferred stock, while providing flexibility in connection with possible acquisitions and other corporate purposes
could, under some circumstances, have the effect of delaying, deferring or preventing a change-in-control of the Company.
A prospectus supplement relating to any series
of preferred stock being offered will include specific terms relating to the offering. Such prospectus supplement will include:
| · | the
title and stated or par value of the preferred stock; |
| · | the
number of shares of the preferred stock offered, the liquidation preference per share and
the offering price of the preferred stock; |
| · | the
dividend rate(s), period(s) and/or payment date(s) or method(s) of calculation
thereof applicable to the preferred stock; |
| · | whether
dividends shall be cumulative or non-cumulative and, if cumulative, the date from which dividends
on the preferred stock shall accumulate; |
| · | the
provisions for a sinking fund, if any, for the preferred stock; |
| · | any
voting rights of the preferred stock; |
| · | the
provisions for redemption, if applicable, of the preferred stock; |
| · | any
listing of the preferred stock on any securities exchange; |
| · | the
terms and conditions, if applicable, upon which the preferred stock will be convertible into
our common stock, including the conversion price or the manner of calculating the conversion
price and conversion period; |
| · | if
appropriate, a discussion of Federal income tax consequences applicable to the preferred
stock; and |
| · | any
other specific terms, preferences, rights, limitations or restrictions of the preferred stock. |
The terms, if any, on which the preferred stock
may be convertible into or exchangeable for our common stock will also be stated in the preferred stock prospectus supplement. The terms
will include provisions as to whether conversion or exchange is mandatory, at the option of the holder or at our option, and may include
provisions pursuant to which the number of shares of our common stock to be received by the holders of preferred stock would be subject
to adjustment.
DESCRIPTION OF WARRANTS
We may issue warrants for the purchase of preferred
stock or common stock. Warrants may be issued independently or together with any preferred stock or common stock, and may be attached
to or separate from any offered securities. Each series of warrants will be issued under a separate warrant agreement to be entered into
between a warrant agent specified in the agreement and us. The warrant agent will act solely as our agent in connection with the warrants
of that series and will not assume any obligation or relationship of agency or trust for or with any holders or beneficial owners of
warrants. This summary of some provisions of the securities warrants is not complete. You should refer to the securities warrant agreement,
including the forms of securities warrant certificate representing the securities warrants, relating to the specific securities warrants
being offered for the complete terms of the securities warrant agreement and the securities warrants. The securities warrant agreement,
together with the terms of the securities warrant certificate and securities warrants, will be filed with the SEC in connection with
the offering of the specific warrants.
The applicable prospectus supplement will describe
the following terms, where applicable, of the warrants in respect of which this prospectus is being delivered:
| · | the
title of the warrants; |
| · | the
aggregate number of the warrants; |
| · | the
price or prices at which the warrants will be issued; |
| · | the
designation, amount and terms of the offered securities purchasable upon exercise of the
warrants; |
| · | if
applicable, the date on and after which the warrants and the offered securities purchasable
upon exercise of the warrants will be separately transferable; |
| · | the
terms of the securities purchasable upon exercise of such warrants and the procedures and
conditions relating to the exercise of such warrants; |
| · | any
provisions for adjustment of the number or amount of securities receivable upon exercise
of the warrants or the exercise price of the warrants; |
| · | the
price or prices at which and currency or currencies in which the offered securities purchasable
upon exercise of the warrants may be purchased; |
| · | the
date on which the right to exercise the warrants shall commence and the date on which the
right shall expire; |
| · | the
minimum or maximum amount of the warrants that may be exercised at any one time; |
| · | information
with respect to book-entry procedures, if any; |
| · | if
appropriate, a discussion of Federal income tax consequences; and |
| · | any
other material terms of the warrants, including terms, procedures and limitations relating
to the exchange and exercise of the warrants. |
Warrants for the purchase of common stock or
preferred stock will be offered and exercisable for U.S. dollars only. Warrants will be issued in registered form only.
Upon receipt of payment and the warrant certificate
properly completed and duly executed at the corporate trust office of the warrant agent or any other office indicated in the applicable
prospectus supplement, we will, as soon as practicable, forward the purchased securities. If less than all of the warrants represented
by the warrant certificate are exercised, a new warrant certificate will be issued for the remaining warrants.
Prior to the exercise of any securities warrants
to purchase common stock or preferred stock, holders of the warrants will not have any of the rights of holders of the common stock or
preferred stock purchasable upon exercise, including in the case of securities warrants for the purchase of common stock or preferred
stock, the right to vote or to receive any payments of dividends on the preferred stock or common stock purchasable upon exercise.
DESCRIPTION OF UNITS
As specified in the applicable prospectus supplement,
we may issue units consisting of shares of common stock, shares of preferred stock or warrants or any combination of such securities.
The applicable prospectus supplement will specify
the following terms of any units in respect of which this prospectus is being delivered:
| · | the
terms of the units and of any of the common stock, preferred stock and warrants comprising
the units, including whether and under what circumstances the securities comprising the units
may be traded separately; |
| · | a
description of the terms of any unit agreement governing the units; and |
| · | a
description of the provisions for the payment, settlement, transfer or exchange of the units. |
PLAN OF DISTRIBUTION
We may sell the securities offered through this
prospectus (i) to or through underwriters or dealers, (ii) directly to purchasers, including our affiliates, (iii) through
agents, (iv) in an “at the market offering,” within the meaning of Rule 415(a)(4) of the Securities Act or
(v) through a combination of any of these methods. The securities may be distributed at a fixed price or prices, which may be changed,
market prices prevailing at the time of sale, prices related to the prevailing market prices, or negotiated prices.
The prospectus supplement will include the following
information:
| · | the
terms of the offering; |
| · | the
names of any underwriters or agents and the amounts of securities underwritten or purchased
by each of them, if any; |
| · | the
name or names of any managing underwriter or underwriters; |
| · | the
public offering price or purchase price of the securities or other consideration therefor; |
| · | any
over-allotment options under which underwriters may purchase additional securities from us; |
| · | any
delayed delivery arrangements; |
| · | any
underwriting discounts or agency fees and other items constituting underwriters’ or
agents’ compensation; |
| · | any
discounts or concessions allowed or reallowed or paid to dealers; |
| · | the
net proceeds to us from the sale of the securities; and |
| · | any
securities exchange or market on which the securities may be listed. |
Sale through Underwriters or Dealers
Only underwriters named in the prospectus supplement
are underwriters of the securities offered by the prospectus supplement.
If underwriters are used in the sale, the underwriters
will acquire the securities for their own account, including through underwriting, purchase, security lending or repurchase agreements
with us. The underwriters may resell the securities from time to time in one or more transactions, including negotiated transactions.
Underwriters may sell the securities in order to facilitate transactions in any of our other securities (described in this prospectus
or otherwise), including other public or private transactions and short sales. Underwriters may offer securities to the public either
through underwriting syndicates represented by one or more managing underwriters or directly by one or more firms acting as underwriters.
Unless otherwise indicated in the prospectus supplement, the obligations of the underwriters to purchase the securities will be subject
to certain conditions, and the underwriters will be obligated to purchase all the offered securities if they purchase any of them. The
underwriters may change from time to time any initial public offering price and any discounts or concessions allowed or reallowed or
paid to dealers.
If dealers are used in the sale of securities
offered through this prospectus, we will sell the securities to them as principals. They may then resell those securities to the public
at varying prices determined by the dealers at the time of resale. The prospectus supplement will include the names of the dealers and
the terms of the transaction.
Direct Sales and Sales through Agents
We may sell the securities offered through this
prospectus directly. In this case, no underwriters or agents would be involved. Such securities may also be sold through agents designated
from time to time. The prospectus supplement will name any agent involved in the offer or sale of the offered securities and will describe
any commissions payable to the agent. Unless otherwise indicated in the prospectus supplement, any agent will agree to use its reasonable
best efforts to solicit purchases for the period of its appointment.
We may sell the securities directly to institutional
investors or others who may be deemed to be underwriters within the meaning of the Securities Act with respect to any sale of those securities.
The terms of any such sales will be described in the prospectus supplement.
Delayed Delivery Contracts
If the prospectus supplement indicates, we may
authorize agents, underwriters or dealers to solicit offers from certain types of institutions to purchase securities at the public offering
price under delayed delivery contracts. These contracts would provide for payment and delivery on a specified date in the future. The
contracts would be subject only to those conditions described in the prospectus supplement. The applicable prospectus supplement will
describe the commission payable for solicitation of those contracts.
Continuous Offering Program
Without limiting the generality of the foregoing,
we may enter into a continuous offering program equity distribution agreement with a broker-dealer, under which we may offer and sell
shares of our common stock from time to time through a broker-dealer as our sales agent. If we enter into such a program, sales of the
shares of common stock, if any, will be made by means of ordinary brokers’ transactions on the Nasdaq Capital Market at market
prices, block transactions and such other transactions as agreed upon by us and the broker-dealer. Under the terms of such a program,
we also may sell shares of common stock to the broker-dealer, as principal for its own account at a price agreed upon at the time of
sale. If we sell shares of common stock to such broker-dealer as principal, we will enter into a separate terms agreement with such broker-dealer,
and we will describe this agreement in a separate prospectus supplement or pricing supplement.
Market Making, Stabilization and Other Transactions
Unless the applicable prospectus supplement states
otherwise, other than our common stock, all securities we offer under this prospectus will be a new issue and will have no established
trading market. We may elect to list offered securities on an exchange or in the over-the-counter market. Any underwriters that we use
in the sale of offered securities may make a market in such securities, but may discontinue such market making at any time without notice.
Therefore, we cannot assure you that the securities will have a liquid trading market. We have no current plans for listing of the preferred
stock, warrants or units on any securities exchange or quotation system; any such listing with respect to any particular preferred stock,
warrants or units will be described in the applicable prospectus supplement or other offering materials, as the case may be.
Any underwriter may also engage in stabilizing
transactions, syndicate covering transactions and penalty bids in accordance with Rule 104 under the Securities Exchange Act. Stabilizing
transactions involve bids to purchase the underlying security in the open market for the purpose of pegging, fixing or maintaining the
price of the securities. Syndicate covering transactions involve purchases of the securities in the open market after the distribution
has been completed in order to cover syndicate short positions.
Penalty bids permit the underwriters to reclaim
a selling concession from a syndicate member when the securities originally sold by the syndicate member are purchased in a syndicate
covering transaction to cover syndicate short positions. Stabilizing transactions, syndicate covering transactions and penalty bids may
cause the price of the securities to be higher than it would be in the absence of the transactions. The underwriters may, if they commence
these transactions, discontinue them at any time.
Any underwriters or agents that are qualified
market makers on the Nasdaq Capital Market may engage in passive market making transactions in our common stock on the Nasdaq Capital
Market in accordance with Regulation M under the Exchange Act, during the business day prior to the pricing of the offering, before the
commencement of offers or sales of our common stock. Passive market makers must comply with applicable volume and price limitations and
must be identified as passive market makers. In general, a passive market maker must display its bid at a price not in excess of the
highest independent bid for such security; if all independent bids are lowered below the passive market maker’s bid, however, the
passive market maker’s bid must then be lowered when certain purchase limits are exceeded. Passive market making may stabilize
the market price of the securities at a level above that which might otherwise prevail in the open market and, if commenced, may be discontinued
at any time.
General Information
Agents, underwriters, and dealers may be entitled,
under agreements entered into with us, to indemnification by us against certain liabilities, including liabilities under the Securities
Act. Our agents, underwriters, and dealers, or their affiliates, may be customers of, engage in transactions with or perform services
for us, in the ordinary course of business.
Offer Restrictions-Canada
This prospectus is not and under no circumstances
is to be construed as a prospectus, advertisement or a public offering of the common stock under Canadian securities laws. The securities
being registered hereunder have not been and will not be qualified by a prospectus for the offer or sale to the public in Canada under
applicable Canadian securities laws. No securities commission or similar regulatory authority in Canada has reviewed this prospectus
or in any way passed upon the merits of the securities being registered hereunder and any representation to the contrary is an offence.
LEGAL MATTERS
The validity of the issuance of the securities
offered by this prospectus will be passed upon for us by Sichenzia Ross Ference Carmel LLP, New York, New York.
EXPERTS
The
consolidated financial statements of Vuzix Corporation as of and for the years ended December 31, 2022 and December 31, 2021
appearing in Vuzix Corporation’s Annual
Report on Form 10-K for the year ended December 31, 2022, have been audited by Freed Maxick CPAs, P.C., as set forth
in its report thereon, included therein, and incorporated herein by reference. Such financial statements are incorporated
herein by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We
file annual, quarterly and special reports, along with other information with the SEC. Our SEC filings are available to the public over
the Internet at the SEC’s website at http://www.sec.gov and on our website at www.vuzix.com. Information contained
in, or that can be accessed through, our website is not a part of this prospectus and is not incorporated by reference in this prospectus.
This prospectus is part of a registration statement
on Form S-3 that we filed with the SEC to register the securities offered hereby under the Securities Act of 1933, as amended. This
prospectus does not contain all of the information included in the registration statement, including certain exhibits and schedules.
You may obtain the registration statement and exhibits to the registration statement from the SEC or from the SEC’s internet site.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This prospectus is part of a registration statement
filed with the SEC. The SEC allows us to “incorporate by reference” into this prospectus the information that we file with
them, which means that we can disclose important information to you by referring you to those documents. The information incorporated
by reference is considered to be part of this prospectus, and information that we file later with the SEC will automatically update and
supersede this information. The following documents are incorporated by reference and made a part of this prospectus:
Any information in any of the foregoing documents
will automatically be deemed to be modified or superseded to the extent that information in this prospectus or in a later filed document
that is incorporated or deemed to be incorporated herein by reference modifies or replaces such information.
We also incorporate by reference into this prospectus
all documents filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination
of any offering of securities made by this prospectus. Nothing in this prospectus shall be deemed to incorporate information furnished
but not filed with the SEC (including without limitation, information furnished under Item 2.02 or Item 7.01 of Form 8-K, and any
exhibits relating to such information).
Any statement contained in this prospectus or
in a document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained herein or in the applicable prospectus supplement or in any
other subsequently filed document which also is or is deemed to be incorporated by reference modifies or supersedes the statement. Any
statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
The information about us contained in this prospectus
should be read together with the information in the documents incorporated by reference. You may request a copy of any or all of these
filings, at no cost, by writing or telephoning us at: Investor Relations, Vuzix Corporation, 25 Hendrix Road, West Henrietta, New York
14586, telephone number +1-585-359-5900.
$300,000,000
Common Stock
Preferred Stock
Warrants
Units
PROSPECTUS
, 2024
We have not authorized any dealer, salesperson
or other person to give any information or represent anything not contained in this prospectus. You must not rely on any unauthorized
information. If anyone provides you with different or inconsistent information, you should not rely on it. This prospectus does not offer
to sell any securities in any jurisdiction where it is unlawful. Neither the delivery of this prospectus, nor any sale made hereunder,
shall create any implication that the information in this prospectus is correct after the date hereof.
The information in this prospectus
is not complete and may be changed. We may not sell these securities or accept an offer to buy these securities until the registration
statement of which this prospectus forms a part filed with the Securities and Exchange Commission is effective. This prospectus is not
an offer to sell these securities, and it is not soliciting offers to buy these securities in any jurisdiction where such offer or sale
is not permitted.
Subject to completion, dated
February 9, 2024
PROSPECTUS
Up to $50,000,000
Common Stock
We have entered into an Open Market Sale AgreementSM (the
“Sales Agreement”), with Jefferies LLC (“Jefferies”), dated February 9, 2024, relating to shares of our common
stock offered by this prospectus. In accordance with the terms of the Sales Agreement, we may offer and sell shares of our common stock
having an aggregate offering price of up to $50,000,000 from time to time through Jefferies, acting as our sales agent.
Our common stock is listed on The Nasdaq Capital
Market (“Nasdaq”) under the symbol “VUZI.” On February 7, 2024, the last reported sale price of our common
stock on Nasdaq was $1.68 per share.
Sales of our common stock, if any, under this
prospectus may be made in sales deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated
under the Securities Act of 1933, as amended (the “Securities Act”). Jefferies is not required to sell any specific amount
of our common stock, but will act as our sales agent and use commercially reasonable efforts to sell on our behalf all of the shares
of common stock requested to be sold by us, consistent with its normal trading and sales practices, on mutually agreed terms between
Jefferies and us. There is no arrangement for funds to be received in any escrow, trust or similar arrangement.
Jefferies will receive from us a commission equal
to 3.0% of the gross proceeds of any shares of common stock sold under the Sales Agreement. In connection with the sale of our common
stock on our behalf, Jefferies will be deemed to be an “underwriter” within the meaning of the Securities Act and the compensation
of Jefferies will be deemed to be underwriting commissions or discounts. See “Plan of Distribution” beginning on page S-9
for additional information regarding the compensation to be paid to Jefferies. We have also agreed to provide indemnification and contribution
to Jefferies with respect to certain liabilities, including liabilities under the Securities Act and the Securities Exchange Act of 1934,
as amended (the “Exchange Act”).
We are
a “smaller reporting company” under the federal securities laws and, as such, we have elected to comply with certain reduced
public company reporting requirements for this prospectus and for future filings. See “Prospectus Summary—Implications of
Being a Smaller Reporting Company.”
An investment
in our securities involves a high degree of risk. Please read “Risk Factors” on page S-3 of this prospectus and in the
documents incorporated by reference into this prospectus before investing in our securities.
Neither the Securities and Exchange Commission
nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus
.. Any representation to the contrary is a criminal offense.
Jefferies
The date of this prospectus is , 2024
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement
on Form S-3 that we filed with the Securities and Exchange Commission (the “SEC”), using a “shelf” registration
process. Under this registration statement, we may offer up to $300,000,000 of our securities. Under this prospectus, we may offer shares
of our common stock having an aggregate offering price of up to $50,000,000 from time to time at prices and on terms to be determined
by market conditions at the time of offering. The $50,000,000 of shares of our common stock that may be sold under this prospectus are
included in the $300,000,000 of our securities that may be sold under the registration statement.
Before buying any of the common stock that we
are offering, we urge you to carefully read this prospectus, together with the information incorporated by reference as described under
the headings “Where You Can Find More Information” and “Incorporation of Certain Information by Reference” in
this prospectus. These documents contain important information that you should consider when making your investment decision.
To the extent there is a conflict between the
information contained in this prospectus, on the one hand, and the information contained in any document incorporated by reference into
this prospectus that was filed with the Securities and Exchange Commission (the “SEC”), before the date of this prospectus,
on the other hand, you should rely on the information in this prospectus. If any statement in one of these documents is inconsistent
with a statement in another document having a later date — for example, a document incorporated by reference into this prospectus—
the statement in the document having the later date modifies or supersedes the earlier statement.
We further note that the representations, warranties
and covenants made by us in any agreement that is filed as an exhibit to any document that is incorporated by reference herein were made
solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties
to such agreement, and should not be deemed to be a representation, warranty or covenant to you. Moreover, such representations, warranties
or covenants were accurate only as of the date when made. Accordingly, such representations, warranties and covenants should not be relied
on as accurately representing the current state of our affairs.
You should rely only on the information contained
or incorporated by reference in this prospectus and any free writing prospectuses we may provide to you in connection with this offering.
We have not, and Jefferies has not, authorized any other person to provide you with different information. If anyone provides you with
different or inconsistent information, you should not rely on it. We are not, and Jefferies is not, making an offer to sell or seeking
an offer to buy our common stock under this prospectus in any jurisdiction where the offer or sale is not permitted. Persons outside
the United States who come into possession of this prospectus must inform themselves about, and observe any restrictions relating to,
the offering of the securities and the distribution of this prospectus outside the United States. Furthermore, you should not consider
this prospectus to be an offer or solicitation relating to the securities if the person making the offer or solicitation is not qualified
to do so, or if it is unlawful for you to receive such an offer or solicitation. You should not assume that the information contained
in this prospectus or free writing prospectus is accurate as of any date other than the date on the front cover of those documents, or
that the information contained in any document incorporated by reference is accurate as of any date other than the date of the document
incorporated by reference, regardless of the time of delivery of this prospectus or any sale of a security. Our business, financial condition,
results of operations and prospects may have changed since those dates. It is important for you to read and consider all information
contained in this prospectus, the documents incorporated by reference herein, and any free writing prospectus prepared by or on behalf
of us that we may authorize for use in connection with this offering, in their entirety, before making an investment decision. You should
also read and consider the information in the documents to which we have referred you in the sections entitled “Where You Can Find
More Information” and “Incorporation of Certain Information by Reference” in this prospectus.
In this prospectus, unless the context otherwise
requires, references to “Vuzix,” “we,” “our” and “us” refer, collectively, to Vuzix Corporation,
a Delaware corporation, and its wholly-owned subsidiaries.
This prospectus contains references to our trademarks
and to trademarks belonging to other entities. Solely for convenience, trademarks and trade names referred to in this prospectus, including
logos, artwork and other visual displays, may appear without the ® or TM symbols, but such references are not intended to indicate,
in any way, that their respective owners will not assert, to the fullest extent under applicable law, their rights thereto. We do not
intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship
of us by, any other companies.
PROSPECTUS SUMMARY
This summary highlights certain information
about this offering and selected information contained elsewhere in or incorporated by reference into this prospectus. This summary is
not complete and does not contain all of the information that you should consider before deciding whether to invest in our shares of
common stock. You should carefully read this entire prospectus, including the information incorporated herein, including the “Risk
Factors” section contained in this prospectus and the other documents incorporated by reference into this prospectus.
Business Overview
We are engaged in the design, manufacture, marketing
and sale of wearable computing devices and augmented reality wearable display devices, also referred to as head mounted displays (or
HMDs), heads-up displays (HUDs) or near-eye displays, in the form of Smart Glasses and Augmented Reality (AR) glasses. Our wearable display
devices are worn like eyeglasses or attach to a head-worn mount. These devices typically include cameras, sensors, and a computer that
enable the user to view, record and interact with video and digital content, such as computer data, the internet, social media or entertainment
applications. Our wearable display products integrate display technology with our advanced optics to produce compact high-resolution
display engines, less than half an inch diagonally, which when viewed through our Smart Glasses products create virtual images that appear
comparable in size to that of a computer monitor or a large-screen television.
With respect to our Smart Glasses and AR products,
we are focused on the enterprise, industrial, commercial, security, first responder, medical, and defense markets. We also provide custom
solutions and engineering services to third parties, including OEMs, of waveguides to enable fully-integrated wearable display systems,
including HMDs to commercial, industrial and defense customers. We do not offer “work-for-hire” services per se but rather
offer our engineering services for projects that we expect could result in advancing our technology and potentially lead to long-term
supply or OEM relationships.
All of the mobile displays
and wearable and mobile electronics markets in which we compete, including mobile and wearable displays and electronics, have been and
continue to be subject to consistent and rapid technological change, with ever greater capabilities and performance, including mobile
devices with larger screen sizes and improved display resolutions as well as, in many cases, reductions in pricing for mobile devices.
As a result, we must continue to improve our products’ performance and lower our costs. We believe our intellectual property portfolio
gives us a leadership position in the design and manufacturing of micro-display projection engines, waveguides, mechanical packaging,
ergonomics, and optical systems.
We reported a net loss
of $30,268,511 for the nine months ended September 30, 2023, a net loss of $40,763,573 for the year ended December 31, 2022,
a net loss of $40,377,160 for the year ended December 31, 2021, and a net loss of $17,952,172 for the year ended December 31,
2020. We have an accumulated deficit of $274,104,227 as of September 30, 2023.
Corporate Information
Our
principal executive offices are located at 25 Hendrix Road, West Henrietta, New York 14586, and our telephone number is +1-585-359-5900.
Our website address is www.vuzix.com. The information contained therein or connected thereto shall not be deemed to be incorporated
into this prospectus or the registration statement of which it forms a part. The information on our website is not part of this prospectus.
For additional information about us, please refer
to other documents we have filed with the SEC and that are incorporated by reference into this prospectus, as listed under the heading
“Incorporation of Certain Information by Reference.”
THE OFFERING
| Common stock offered by us |
|
Shares of our
common stock having an aggregate offering price of up to $50,000,000. |
| |
|
|
| Common stock to be outstanding after this offering |
|
Up to 93,089,513 shares of common stock (as more fully described in the
notes following this table), assuming sales of 29,761,905 shares of our common stock in this offering at an offering price of $1.68 per
share, which was the last reported sale price of our common stock on Nasdaq on February 7, 2024. The actual number of shares issued
will vary depending on the sales price under this offering. |
| |
|
|
| Plan of Distribution |
|
“At the market offering”
that may be made from time to time through our sales agent, Jefferies, on the Nasdaq Capital Market or such other national securities
exchange on which our common stock is then listed. See the section entitled “Plan of Distribution” on page S-9 of
this prospectus. |
| |
|
|
| Use of Proceeds |
|
Our management will retain
broad discretion regarding the allocation and use of any net proceeds. We intend to use the net proceeds from this offering for general
corporate purposes, including, without limitation, working capital to accelerate new technology development, new product development,
purchases of technology and possible related acquisitions of other firms. See the section titled “Use of Proceeds” on
page S-7 of this prospectus. |
| |
|
|
| Risk Factors |
|
See “Risk Factors”
beginning on page S-3 of this prospectus and in the documents incorporated by reference herein for a discussion of factors you
should consider carefully before investing in our common stock. |
| |
|
|
| Nasdaq Capital Market
symbol |
|
“VUZI” |
The number of shares of our common stock to be
outstanding after this offering is based on 63,327,608 shares of our common stock outstanding as of September 30, 2023, and excludes
as of that date:
| |
● |
2,911,308
shares of our common stock issuable upon the exercise of outstanding stock options, with a weighted average exercise price of $7.60
per share; |
| |
|
|
| |
● |
5,784,000
shares of our common stock issuable upon the exercise of outstanding stock options under the Company’s Long-Term Incentive
Plan, all with an exercise price of $19.00 per share, with 375,000 options currently vested and the remaining portion vesting upon
the achievement of certain equity market capitalization milestones, and revenue and EBITDA operational milestones; |
| |
|
|
| |
● |
3,849,804
shares of our common stock available for future issuance under our equity incentive plans; and |
| |
|
|
| |
● |
1,397,500
shares of our common stock issued to the founders of Atomistic SAS on November 20, 2023 for the achievement of certain technological
milestones under a license agreement entered into between the Company, Atomistic SAS and such founders. |
RISK FACTORS
An investment in our common stock involves
a high degree of risk. Prior to making a decision about investing in our common stock, you should carefully consider the risk factors
described below and the risk factors discussed in the sections entitled “Risk Factors” contained in our most recent Annual
Report on Form 10-K, and our other filings with the SEC and incorporated by reference in this prospectus, together with all of the
other information contained in this prospectus. Additional risks and uncertainties not presently known to us, or that we currently view
as immaterial, may also impair our business. Our business, financial condition and results of operations could be materially and adversely
affected as a result of these risks. This could cause the trading price of our common stock to decline, resulting in a loss of all or
part of your investment.
Risks Related to this Offering
We will have broad discretion in the use
of the net proceeds from this offering and, despite our efforts, we may use the net proceeds in a manner that does not increase the value
of your investment.
We currently intend to use the net proceeds from
this offering for general corporate purposes, including, without limitation, working capital to accelerate new technology development,
new product development, purchases of technology, and possible related acquisitions of other firms. However, we have not determined the
specific allocation of the net proceeds among these potential uses. Our management will have broad discretion over the use and investment
of the net proceeds from this offering, and, accordingly, investors in this offering will need to rely upon the judgment of our management
with respect to the use of proceeds, with only limited information concerning our specific intentions. These proceeds could be applied
in ways that do not improve our operating results or increase the value of your investment.
You may experience immediate and substantial
dilution in the net tangible book value per share of the common stock you purchase in the offering. In addition, we may issue additional
equity or convertible debt securities in the future, which may result in additional dilution to you.
The offering price per share in this offering
may exceed the pro forma net tangible book value per share of our common stock outstanding as of September 30, 2023. Assuming that
an aggregate of 29,761,905 shares of our common stock are sold at a price of $1.68 per share, the last reported sale price of our common
stock on Nasdaq on February 7, 2024, for aggregate gross proceeds of approximately $50,000,000, and after deducting commissions and
estimated aggregate offering expenses payable by us, you will experience immediate dilution of approximately $0.47 per share, representing
the difference between our pro forma as adjusted net tangible book value per share as of September 30, 2023 after giving effect to
this offering and the assumed offering price. The exercise of outstanding stock options could result in further dilution of your investment.
See the section titled “Dilution” below for a more detailed illustration of the dilution you would incur if you participate
in this offering. In addition, to the extent we need to raise additional capital in the future and we issue additional shares of common
stock or securities convertible or exchangeable for our common stock, our then existing stockholders may experience dilution and the new
securities may have rights senior to those of our common stock offered in this offering.
You may experience future dilution as a
result of future equity offerings.
To raise additional capital, we may in the future
offer additional shares of our common stock or other securities convertible into or exchangeable for our common stock at prices that
may not be the same as the price per share in this offering. We may sell shares or other securities in any other offering at a price
per share that is less than the price per share paid by investors in this offering, and investors purchasing shares or other securities
in the future could have rights superior to existing stockholders. The price per share at which we sell additional shares of our common
stock, or securities convertible or exchangeable into common stock, in future transactions may be higher or lower than the price per
share paid by investors in this offering.
The actual number of shares we will issue
under the Sales Agreement, at any one time or in total, is uncertain.
Subject to certain limitations in the Sales Agreement
and compliance with applicable law, we have the discretion to deliver instruction to Jefferies to sell shares of our common stock at
any time throughout the term of the Sales Agreement. The number of shares that are sold through Jefferies after our instruction will
fluctuate based on a number of factors, including the market price of our common stock during the sales period, the limits we set with
Jefferies in any instruction to sell shares, and the demand for our common stock during the sales period. Because the price per share
of each share sold will fluctuate during this offering, it is not currently possible to predict the number of shares that will be sold
or the gross proceeds to be raised in connection with those sales.
The common stock offered hereby will be
sold in “at the market offerings,” and investors who buy shares at different times will likely pay different prices.
Investors who purchase shares in this offering
at different times will likely pay different prices, and so may experience different levels of dilution and different outcomes in their
investment results. We will have discretion, subject to market demand, to vary the timing, prices, and numbers of shares sold in this
offering. Investors may experience a decline in the value of the shares they purchase in this offering as a result of sales made at prices
lower than the prices they paid.
The sale of a substantial amount of our
common stock, including resale of the shares of common stock by certain selling stockholders in the public market, could adversely affect
the prevailing market price of our common stock.
We have registered for resale by certain selling
stockholders up to 2,843,754 shares of our common stock that have been issued or may be issuable by us, as described in our prospectus
dated May 8, 2023, filed with the SEC on May 9, 2023. These shares are issuable pursuant to a License, a Stock Purchase and
a Shareholders’ Agreement with Atomistic SAS and its two principals, as described in our Annual Report on Form 10-K for the
year ended December 31, 2022, filed with the SEC on March 1, 2023. 1,397,500 of these shares have been issued by us to date,
of which none have been sold by the selling stockholders under that prospectus, and up to 1,446,254 additional shares may be issuable
by us in the future and will be eligible for sale under that prospectus. Sales of substantial amounts of our common stock by these or
other selling stockholders in the public market, or the perception that such sales might occur, could adversely affect the market price
of our common stock. We cannot predict if and when the selling stockholders may sell such shares in the public market.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents and information
incorporated by reference in this prospectus include forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange
Act. These statements are based on our management’s beliefs and assumptions and on information currently available to our management.
Forward-looking statements include statements concerning:
| · | trends in our operating expenses,
including personnel costs, research and development expense, sales and marketing expense,
and general and administrative expense; |
| · | trends in revenue, costs of revenue,
and gross margin and our possible or assumed future results of operations; |
| · | the effect of competitors and competition
in our markets; |
| · | our wearable products and their market
acceptance and future potential; |
| · | our ability to develop, timely introduce
and effectively manage the introduction of new products and services or improve our existing
products and services; |
| · | expected technological advances by
us or by third parties and our ability to leverage them; |
| · | our ability to attract and retain
customers; |
| · | our ability to accurately forecast
customer demand, deliver an adequate supply of product and adequately manage inventory; |
| · | our
ability to maintain and promote our brand and expand brand awareness; |
| · | our
ability to detect, prevent, or fix defects in our products; |
| · | our
reliance on third-party suppliers, contract manufacturers and logistics providers and our
limited control over such parties; |
| · | our
ability to attract and retain highly skilled employees; |
| · | the
impact of foreign currency exchange rates; |
| · | the
effect of future regulations; |
| · | the
sufficiency of our existing cash and cash equivalent balances and cash flow from operations
to meet our working capital and capital expenditure needs for at least the next 12 months; |
| · | our
anticipated use of net proceeds from any offering of our securities pursuant to this prospectus; |
| · | general
market, political, economic and business conditions; and |
| · | other
risks and uncertainties described in this prospectus, including those under the section entitled
“Risk Factors.” |
All statements in this prospectus and the documents
and information incorporated by reference in this prospectus that are not historical facts are forward-looking statements. We may, in
some cases, use terms such as “anticipates,” “believes,” “could,” “estimates,” “expects,”
“intends,” “may,” “plans,” “potential,” “predicts,” “projects,”
“should,” “will,” “would” or similar expressions or the negative of such items that convey uncertainty
of future events or outcomes to identify forward-looking statements.
Forward-looking statements are made based on
management’s beliefs, estimates and opinions on the date the statements are made and we undertake no obligation to update forward-looking
statements if these beliefs, estimates and opinions or other circumstances should change, except as may be required by applicable law.
Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results,
levels of activity, performance or achievements.
USE OF PROCEEDS
We may issue and sell shares of our common stock
having aggregate gross sales proceeds of up to $50,000,000 from time to time. Because there is no minimum offering amount required as
a condition to close this offering, the actual total public offering amount, commissions and proceeds to us, if any, are not determinable
at this time.
We will retain broad discretion over the use
of the net proceeds from the sale of the securities offered hereby. We currently intend to use the net proceeds from this offering for
general corporate purposes, including, without limitation, new technology development, new product development, purchases of technology,
and possible related acquisitions of other firms. The precise amount and timing of the application of such proceeds will depend upon
our funding requirements and the availability and cost of other capital. As of the date of this prospectus, we cannot specify with certainty
all of the particular uses for the net proceeds that we will have from the sale of the shares of our common stock. Pending the use of
the net proceeds from this offering, if any, we may invest the net proceeds in investment grade, short-term interest-bearing obligations,
such as money-market funds, certificates of deposit, or direct or guaranteed obligations of the United States government, or hold the
net proceeds as cash.
DILUTION
If you purchase shares of our common stock in
this offering, your interest will be diluted to the extent of the difference between the public offering price per share and the net
tangible book value per share of our common stock after this offering. We calculate net tangible book value per share by dividing our
net tangible assets (tangible assets less total liabilities) by the number of shares of our common stock issued and outstanding as of
September 30, 2023.
Our historical net tangible book value as of September 30,
2023 was $63,271,244, or approximately $1.00 per share of our common stock. Our pro forma net tangible book value as of September 30,
2023 was $66,555,369 or approximately $1.03 per share of our common stock. Pro forma net tangible book value represents our net tangible
book value after giving effect to cash paid and 1,397,500 shares of our common stock issued to the founders of Atomistic SAS on November 20,
2023 for the achievement of certain technological milestones under a license agreement entered into between the Company, Atomistic SAS
and such founders. Pro forma net tangible book value per share represents pro forma net tangible book value divided by the total number
of shares outstanding as of September 30, 2023, after giving effect to the pro forma adjustment described above. After giving effect
to the sale of our common stock in the aggregate amount of $50,000,000 in this offering, at an assumed offering price of $1.68 per share,
the last reported sale price of our common stock on Nasdaq on February 7, 2024, and after deducting estimated offering expenses and
commissions payable by us (net proceeds of $48,116,000), our adjusted net tangible book value as of September 30, 2023 would have
been approximately $114,671,369, or approximately $1.21 per share of our common stock. This represents an immediate increase in the net
tangible book value of approximately $0.18 per share of our common stock to our existing stockholders and an immediate dilution in net
tangible book value of approximately $0.47 per share of our common stock to new investors. The following table illustrates per share dilution:
| Assumed public offering price per share |
|
|
|
|
|
$ |
1.68 |
|
| Historical net tangible book value per share as of September 30, 2023 |
|
$ |
1.00 |
|
|
|
|
|
| Increase in historical net tangible book value per share attributable to the pro forma adjustments described above |
|
|
0.03 |
|
|
|
|
|
| Pro forma net tangible book value per share as of September 30, 2023 |
|
|
1.03 |
|
|
|
|
|
| Increase in pro forma net tangible book value per share attributable to this offering |
|
|
0.18 |
|
|
|
|
|
| Pro forma as adjusted net tangible book value per share as of September 30, 2023, after giving effect to this offering |
|
|
|
|
|
|
1.21 |
|
| Dilution per share to new investors purchasing shares in this offering |
|
|
|
|
|
$ |
0.47 |
|
The table above assumes for illustrative purposes
that an aggregate of 29,761,905 shares of our common stock are sold at a price of $1.68 per share, the last reported sale price of our
common stock on Nasdaq on February 7, 2024, for aggregate gross proceeds of $50,000,000. The shares sold in this offering, if any,
will be sold from time to time at various prices. An increase of $0.25 per share in the price at which the shares are sold from the assumed
offering price to $1.93 per share, assuming all of our common stock in the aggregate amount of $50,000,000 is sold at that price, would
increase our adjusted net tangible book value per share after the offering to $1.27 per share and would increase the dilution in net tangible
book value per share to new investors in this offering to $0.66 per share, after deducting estimated offering expenses and commissions
payable by us. A decrease of $0.25 per share in the price at which the shares are sold from the assumed offering price to $1.43 per share
shown in the table above, assuming all of our common stock in the aggregate amount of $50,000,000 is sold at that price, would decrease
our adjusted net tangible book value per share after the offering to $1.15 per share and would decrease the dilution in net tangible book
value per share to new investors in this offering to $0.28 per share, after deducting estimated offering expenses and commissions payable
by us. This information is supplied for illustrative purposes only.
Unless we indicate otherwise, all information
in this prospectus is based on 63,327,608 shares of our common stock outstanding as of September 30, 2023, and excludes as of that
date:
| |
● |
2,911,308
shares of our common stock issuable upon the exercise of outstanding stock options, with a weighted average exercise price of $7.60
per share; |
| |
● |
5,784,000
shares of our common stock issuable upon the exercise of outstanding stock options under the Company’s Long-Term Incentive
Plan, all with an exercise price of $19.00 per share, with 375,000 options currently vested and the remaining portion vesting upon
the achievement of certain equity market capitalization milestones, and revenue and EBITDA operational milestones; and |
| |
|
|
| |
● |
3,849,804
shares of our common stock available for future issuance under our equity incentive plans. |
| |
|
|
| |
● |
1,397,500
shares of our common stock issued to the founders of Atomistic SAS on November 20, 2023 for the achievement of certain technological
milestones under a license agreement entered into between the Company, Atomistic SAS and such founders. |
To the extent that outstanding options and/or
warrants are exercised, or we issue other shares, investors purchasing shares in this offering could experience further dilution. In
addition, we may choose to raise additional capital due to market conditions or strategic considerations, even if we believe we have
sufficient funds for our current or future operating plans. To the extent that we raise additional capital through the sale of equity
or convertible debt securities, the issuance of those securities could result in further dilution to our stockholders.
PLAN OF DISTRIBUTION
We have entered into a Sales Agreement with Jefferies,
under which we may offer and sell up to $50,000,000 of our shares of common stock from time to time through Jefferies acting as agent.
Sales of our shares of common stock, if any, under this prospectus will be made by any method that is deemed to be an “at the market
offering” as defined in Rule 415(a)(4) under the Securities Act.
Each time we wish to issue and sell shares of
our common stock under the Sales Agreement, we will notify Jefferies of the number of shares to be issued, the dates on which such sales
are anticipated to be made, any limitation on the number of shares to be sold in any one day and any minimum price below which sales
may not be made. Once we have so instructed Jefferies, unless Jefferies declines to accept the terms of such notice, Jefferies has agreed
to use its commercially reasonable efforts consistent with its normal trading and sales practices to sell such shares up to the amount
specified on such terms. The obligations of Jefferies under the Sales Agreement to sell our shares of common stock are subject to a number
of conditions that we must meet.
The settlement of sales of shares between us
and Jefferies is generally anticipated to occur on the second trading day following the date on which the sale was made. Sales of our
shares of common stock as contemplated in this prospectus will be settled through the facilities of The Depository Trust Company or by
such other means as we and Jefferies may agree upon. There is no arrangement for funds to be received in an escrow, trust or similar
arrangement.
We will pay Jefferies a commission equal to 3.0%
of the aggregate gross proceeds we receive from each sale of our shares of common stock. Because there is no minimum offering amount required
as a condition to close this offering, the actual total public offering amount, commissions and proceeds to us, if any, are not determinable
at this time. In addition, we have agreed to reimburse Jefferies for the fees and disbursements of its counsel payable upon execution
of the Sales Agreement, in an amount not to exceed $75,000 and up to $15,000 after we file each annual report on Form 10-K and quarterly
report on Form 10-Q or file certain other financial information (in each case, unless sales under the Sales Agreement are suspended
or unless we and Jefferies otherwise agree). We estimate that the total expenses for the offering, excluding any commissions or expense
reimbursement payable to Jefferies under the terms of the Sales Agreement, will be approximately $384,000. The remaining sale proceeds,
after deducting any other transaction fees, will equal our net proceeds from the sale of such shares.
Jefferies will provide written confirmation to
us before the open on The Nasdaq Capital Market on the day following each day on which shares of our common stock are sold under the
Sales Agreement. Each confirmation will include the number of shares sold on that day, the aggregate gross proceeds of such sales and
the proceeds to us.
In connection with the sale of our shares of
common stock on our behalf, Jefferies may be deemed to be an “underwriter” within the meaning of the Securities Act, and
the compensation of Jefferies will be deemed to be underwriting commissions or discounts. We have agreed to indemnify Jefferies against
certain civil liabilities, including liabilities under the Securities Act. We have also agreed to contribute to payments Jefferies may
be required to make in respect of such liabilities.
The offering of our shares of common stock pursuant
to the Sales Agreement will terminate in accordance with the terms set forth therein.
The
offering of our shares of common stock pursuant to the Sales Agreement will terminate upon the earlier of (i) the sale of
all shares of our common stock subject to the Sales Agreement; and (ii) the termination of the Sales Agreement as permitted therein.
We and Jefferies may each terminate the Sales Agreement at any time upon ten trading days’ prior notice.
This
summary of the material provisions of the Sales Agreement does not purport to be a complete statement of its terms and conditions.
A copy of the Sales Agreement is filed as an exhibit to the registration statement of which this prospectus forms a part.
Jefferies and its affiliates may in the future
provide various investment banking, commercial banking, financial advisory and other financial services for us and our affiliates, for
which services they may in the future receive customary fees. In the course of its business, Jefferies may actively trade our securities
for its own account or for the accounts of customers, and, accordingly, Jefferies may at any time hold long or short positions in such
securities.
A prospectus in electronic format may be made
available on a website maintained by Jefferies, and Jefferies may distribute the prospectus electronically.
Offer Restrictions-Canada
This prospectus is not and under no circumstances
is to be construed as a prospectus, advertisement or a public offering of the common stock under Canadian securities laws. The securities
being registered hereunder have not been and will not be qualified by a prospectus for the offer or sale to the public in Canada under
applicable Canadian securities laws. No securities commission or similar regulatory authority in Canada has reviewed this prospectus
or in any way passed upon the merits of the securities being registered hereunder and any representation to the contrary is an offence.
LEGAL MATTERS
The validity of the issuance of the common stock
offered by this prospectus will be passed upon for us by Sichenzia Ross Ference Carmel LLP, New York, New York. Jefferies LLC is being
represented in connection with this offering by Paul Hastings LLP, New York, New York.
EXPERTS
The consolidated financial statements of
Vuzix Corporation as of and for the years ended December 31, 2022 and December 31, 2021 appearing in Vuzix Corporation’s Annual
Report on Form 10-K for the year ended December 31, 2022, have been audited by Freed Maxick CPAs, P.C., as set forth
in its report thereon, included therein, and incorporated herein by reference. Such financial statements are incorporated herein by
reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports,
proxy statements and other information with the SEC. Our SEC filings are also available to the public at the SEC’s web site at
http://www.sec.gov.
We make available free of charge, on or through
our website www.vuzix.com, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8–K,
and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act as soon as reasonably
practicable after we electronically file the material with, or furnish it to, the SEC. The references to www.vuzix.com in this prospectus
and the documents incorporated by reference herein are inactive textual references only, and the information found on our internet website
is not incorporated by reference into, and should not be considered part of, this prospectus supplement or the documents incorporated
by reference herein.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The
SEC allows us to incorporate by reference information contained in documents we file with it, which means that we can disclose important
information to you by referring you to those documents already on file with the SEC that contain that information. The information incorporated
by reference is considered to be part of this prospectus, and later information that we file with the SEC will automatically update and
supersede this information. The following documents are incorporated by reference and made a part of this prospectus:
Any information in any of the foregoing documents
will automatically be deemed to be modified or superseded to the extent that information in this prospectus or in a later filed document
that is incorporated or deemed to be incorporated herein by reference modifies or replaces such information.
We also incorporate by reference into this prospectus
all documents filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination
of any offering of securities made by this prospectus. Nothing in this prospectus shall be deemed to incorporate information furnished
but not filed with the SEC (including without limitation, information furnished under Item 2.02 or Item 7.01 of Form 8-K, and any
exhibits relating to such information).
Any statement contained in this prospectus or
in a document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained herein or in any other subsequently filed document which also
is or is deemed to be incorporated by reference modifies or supersedes the statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a part of this prospectus.
Upon written or oral request, we will provide
at no cost to the requester a copy of all of the information that has been incorporated by reference in this prospectus but not delivered
with this prospectus. You may obtain copies of these documents from us, without charge (other than exhibits, unless the exhibits are
specifically incorporated by reference), by contacting Investor Relations, Vuzix Corporation, 25 Hendrix Road, West Henrietta, New York
14586. Our telephone number is +1-585-359-5900.
You may also access the documents incorporated
by reference in this prospectus through our website at www.vuzix.com. Except for the specific incorporated documents listed above, no
information available on or through our website shall be deemed to be incorporated in this prospectus or the registration statement of
which it forms a part.
Up to $50,000,000
Common Stock
PROSPECTUS
Jefferies
, 2024
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the costs and
expenses payable by the Registrant in connection with this offering, other than underwriting commissions and discounts, all of which
are estimated except for the SEC registration fee.
| Item | |
Amount | |
| SEC registration fee | |
$ | 14,436 | (1) |
| FINRA filing fee | |
$ | 15,170 | |
| Printing and engraving expenses | |
| * | |
| Legal fees and expenses | |
| * | |
| Accounting fees and expenses | |
| * | |
| Transfer agent and registrar’s fees and expenses | |
| * | |
| Miscellaneous expenses | |
| * | |
| | |
| | |
| Total | |
| * | |
| (1) | Excludes the registration fee previously paid in connection with unsold
securities pursuant to Rule 415(a)(6) (see Exhibit 107 to this registration statement). |
| * | These fees are calculated based on the securities offered and
the number of issuances and accordingly cannot be estimated at this time. The applicable prospectus supplement will set forth the estimated
amount of expenses of any offering of securities. |
Item 15. Indemnification of Directors
and Officers.
Section 145 of the Delaware General Corporation
Law provides that a corporation may indemnify directors and officers as well as other employees and individuals against expenses including
attorneys' fees, judgments, fines and amounts paid in settlement in connection with various actions, suits or proceedings, whether civil,
criminal, administrative or investigative other than an action by or in the right of the corporation, a derivative action, if they acted
in good faith and in a manner they reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, if they had no reasonable cause to believe their conduct was unlawful. A similar standard is applicable
in the case of derivative actions, except that indemnification only extends to expenses including attorneys' fees incurred in connection
with the defense or settlement of such actions, and the statute requires court approval before there can be any indemnification where
the person seeking indemnification has been found liable to the corporation. The statute provides that it is not exclusive of other indemnification
that may be granted by a corporation's certificate of incorporation, bylaws, agreement, a vote of stockholders or disinterested directors
or otherwise.
Our Amended and Restated Certificate of Incorporation
and By-Laws provide that we will indemnify and hold harmless, to the fullest extent permitted by Section 145 of the Delaware General
Corporation Law, as amended from time to time, each person that such section grants us the power to indemnify.
The Delaware General Corporation Law permits
a corporation to provide in its certificate of incorporation that a director of the corporation shall not be personally liable to the
corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability for:
| · | any
breach of the director's duty of loyalty to the corporation or its stockholders; |
| · | acts
or omissions not in good faith or which involve intentional misconduct or a knowing violation
of law; |
| · | payments
of unlawful dividends or unlawful stock repurchases or redemptions; |
| · | or
any transaction from which the director derived an improper personal benefit. |
Insofar as indemnification for liabilities arising
under the Securities Act may be permitted to directors, officers or controlling persons of ours, pursuant to the foregoing provisions,
or otherwise, we have been advised that, in the opinion of the Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by us of expenses incurred or paid by a director, officer or controlling person of ours in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities
being registered hereunder, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of such issue.
Item 16. Exhibits.
Exhibit
Number |
Description
of Document |
| |
|
| 1.1 |
Form of Underwriting
Agreement.* |
| 1.2 |
Open Market Sale AgreementSM
between Vuzix Corporation and Jefferies LLC dated February 9, 2024.** |
| 4.1 |
Amended and Restated Certificate
of Incorporation (incorporated by reference to Exhibit 3.2 to the Amendment No. 3 to the Registration Statement on Form S-1,
filed with the SEC October 16, 2009). |
| 4.2 |
Certificate of Amendment
to Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Current
Report on Form 8-K, filed with the SEC on February 7, 2013). |
| 4.3 |
Certificate of Amendment
to Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Current
Report on Form 8-K, filed with the SEC on June 30, 2014). |
| 4.4 |
Certificate of Designation
of Series A Preferred Stock (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K,
filed with the SEC on January 2, 2015). |
| 4.5 |
Amended and Restated Bylaws
(incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed with the SEC on June 24,
2020). |
| 4.6 |
Form of Certificate
of Designation.* |
| 4.7 |
Form of Common Stock
Certificate (incorporated by reference to Exhibit 4.1 of the Registrant’s Registration Statement on Form S-1/A (File
No. 333-160417), filed with the SEC on November 10, 2009). |
| 4.8 |
Form of Preferred
Stock Certificate.* |
| 4.9 |
Form of Warrant Agreement.* |
| 4.10 |
Form of Warrant Certificate.* |
| 4.11 |
Form of Stock Purchase
Agreement.* |
| 4.12 |
Form of Unit Agreement.* |
| 5.1 |
Opinion of Sichenzia Ross
Ference Carmel LLP.** |
| 5.2 |
Opinion of Sichenzia Ross
Ference Carmel LLP relating to the sales agreement prospectus.** |
| 23.1 |
Consent of Freed Maxick
CPAs, P.C., independent registered public accounting firm.** |
| 23.2 |
Consent of Sichenzia Ross
Ference Carmel LLP (contained in Exhibit 5.1).** |
| 23.3 |
Consent of Sichenzia Ross
Ference Carmel LLP (contained in Exhibit 5.2).** |
| 24.1 |
Power of Attorney (included
on the signature page to the Registration Statement). |
| 107 |
Filing Fee Table.** |
* To
be filed, if necessary, by amendment or as an exhibit to a document to be incorporated or deemed to be incorporated by reference in this
registration statement, including a Current Report on Form 8-K.
** Filed
herewith.
Item 17. Undertakings
| (a) | The undersigned registrant hereby undertakes: |
| (1) | To file, during any period in which
offers or sales are being made, a post-effective amendment to this registration statement: |
| (i) | To include any prospectus required by
section 10(a)(3) of the Securities Act of 1933; |
| (ii) | To reflect in the prospectus any facts
or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the maximum aggregate offering price
set forth in the “Calculation of Registration Fee” table in the effective registration
statement; and |
| (iii) | To include any material information
with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement; |
provided,
however, Paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the registration statement
is on Form S-3 or Form F-3 and the information required to be included in a post-effective amendment by those paragraphs is
contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is contained in a form of prospectus
filed pursuant to Rule 424(b) that is part of the registration statement.
| (2) | That, for the purpose of determining
any liability under the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the initial bona fide
offering thereof. |
| (3) | To remove from registration by means
of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering. |
| (4) | That, for the purpose of determining
liability under the Securities Act of 1933 to any purchaser: |
| (A) | Each prospectus filed by the registrant
pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement
as of the date the filed prospectus was deemed part of and included in the registration statement;
and |
| (B) | Each prospectus required to be filed
pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement
in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i),
(vii), or (x) for the purpose of providing the information required by section 10(a) of
the Securities Act of 1933 shall be deemed to be part of and included in the registration
statement as of the earlier of the date such form of prospectus is first used after effectiveness
or the date of the first contract of sale of securities in the offering described in the
prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person
that is at that date an underwriter, such date shall be deemed to be a new effective date
of the registration statement relating to the securities in the registration statement to
which that prospectus relates, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof. Provided, however, that no statement
made in a registration statement or prospectus that is part of the registration statement
or made in a document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a purchaser
with a time of contract of sale prior to such effective date, supersede or modify any statement
that was made in the registration statement or prospectus that was part of the registration
statement or made in any such document immediately prior to such effective date. |
| (5) | That, for the purpose of determining
liability of the registrant under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities, the undersigned registrant undertakes that in a primary offering
of securities of the undersigned registrant pursuant to this registration statement, regardless
of the underwriting method used to sell the securities to the purchaser, if the securities
are offered or sold to such purchaser by means of any of the following communications, the
undersigned registrant will be a seller to the purchaser and will be considered to offer
or sell such securities to such purchaser: |
| (i) | Any preliminary prospectus or prospectus
of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| (ii) | Any free writing prospectus relating
to the offering prepared by or on behalf of the undersigned registrant or used or referred
to by the undersigned registrant; |
| (iii) | The portion of any other free writing
prospectus relating to the offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the undersigned registrant; and |
| (iv) | Any other communication that is an offer
in the offering made by the undersigned registrant to the purchaser. |
| (b) | The registrant hereby undertakes that
for purposes of determining any liability under the Securities Act of 1933, each filing of
the registrant’s annual report pursuant to section 13(a) or section 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan’s annual report pursuant to section 15(d) of the Securities Exchange Act
of 1934) that is incorporated by reference in the registration statement shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| (c) | Insofar as indemnification for liabilities
arising under the Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or controlling person
of the registrant in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered,
the registrant will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Securities Act of
1933 and will be governed by the final adjudication of such issue. |
SIGNATURES
Pursuant to the requirements of the Securities
Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3
and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City
of West Henrietta, State of New York, on February 9, 2024.
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Vuzix Corporation |
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By: |
/s/ Paul Travers |
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Paul Travers |
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Its: |
Chief Executive Officer |
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(Principal Executive Officer) |
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By: |
/s/ Grant Russell |
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Grant Russell |
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Its: |
Chief Financial Officer |
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(Principal Financial and Accounting Officer) |
Each person whose signature appears below constitutes
and appoints Paul Travers and Grant Russell, and each of them severally, as his true and lawful attorney in fact and agent, with full
powers of substitution and re-substitution, for him and in his name, place and stead, in any and all capacities, to sign any or all amendments
(including post effective amendments) to the Registration Statement, and to sign any registration statement for the same offering covered
by this Registration Statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933,
as amended, and all post effective amendments thereto, and to file the same, with all exhibits thereto, and all documents in connection
therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, each acting alone, full power
and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully to
all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorney-in-fact and
agent, each acting alone, or his or her substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities
Act of 1933, this registration statement has been signed below by the following persons in the capacities and on the dates indicated.
| /s/
Paul Travers |
February 9,
2024 |
| Paul Travers |
|
Chief Executive Officer and Director
(principal executive officer) |
|
| |
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| /s/
Grant Russell |
February 9,
2024 |
| Grant Russell |
|
Chief Financial Officer and Director
(principal financial and accounting officer) |
|
| |
|
| /s/
Edward Kay |
February 9,
2024 |
| Edward Kay |
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| Director |
|
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| /s/
Emily Nagle Green |
February 9,
2024 |
| Emily Nagle Green |
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| Director |
|
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| /s/
Timothy Harned |
February 9,
2024 |
| Timothy Harned |
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| Director |
|
| |
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| /s/
Azita Arvani |
February 9,
2024 |
| Azita Arvani |
|
| Director |
|
| |
|
| /s/
Raj Rajgopal |
February 9,
2024 |
| Raj Rajgopal |
|
| Director |
|
Exhibit 1.2
OPEN
MARKET SALE AGREEMENTSM
February 9, 2024
JEFFERIES LLC
520 Madison Avenue
New York, New York 10022
Ladies and Gentlemen:
Vuzix
Corporation, a Delaware corporation (the “Company”), proposes, subject to the terms and conditions stated herein,
to issue and sell from time to time through Jefferies LLC, as sales agent and/or principal (the “Agent”), shares of
the Company’s common stock, par value $0.001 per share (the “Common Shares”), having an aggregate offering price
of up to $50,000,000 on the terms set forth in this agreement (this “Agreement”).
Section 1. DEFINITIONS
(a) Certain
Definitions. For purposes of this Agreement, capitalized terms used herein and not otherwise defined shall have the following respective
meanings:
“Affiliate”
of a Person means another Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under
common control with, such first- mentioned Person. The term “control” (including the terms “controlling,” “controlled
by” and “under common control with”) means the possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.
“Agency Period”
means the period commencing on the date of this Agreement and expiring on the earliest to occur of (x) the date on which the Agent
shall have placed the Maximum Program Amount pursuant to this Agreement and (y) the date this Agreement is terminated pursuant to
Section 7.
“Commission”
means the U.S. Securities and Exchange Commission.
“Exchange Act”
means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission thereunder.
“Floor Price”
means the minimum price set by the Company in the Issuance Notice below which the Agent shall not sell Shares during the applicable period
set forth in the applicable Issuance Notice, which may be adjusted by the Company at any time during the period set forth in the applicable
Issuance Notice by delivering written notice of such change to the Agent and which in no event shall be less than $1.00 without the prior
written consent of the Agent, which may be withheld in the Agent’s sole discretion.
SM “Open Market Sale Agreement” is a service
mark of Jefferies LLC
“Issuance Amount”
means the aggregate Sales Price of the Shares to be sold by the Agent pursuant to any Issuance Notice.
“Issuance Notice”
means a written notice delivered to the Agent by the Company in accordance with this Agreement in the form attached hereto as Exhibit A
that is executed by its Chief Executive Officer, President or Chief Financial Officer.
“Issuance Notice
Date” means any Trading Day during the Agency Period that an Issuance Notice is delivered pursuant to Section 3(b)(i).
“Issuance Price”
means the Sales Price less the Selling Commission.
“Maximum Program
Amount” means Common Shares with an aggregate Sales Price of the lesser of (a) the number or dollar amount of Common Shares
registered under the effective Registration Statement (defined below) pursuant to which the offering is being made, (b) the number
of authorized but unissued Common Shares (less Common Shares issuable upon exercise, conversion or exchange of any outstanding securities
of the Company or otherwise reserved from the Company’s authorized capital stock), (c) the number or dollar amount of Common
Shares permitted to be sold under Form S-3 (including General Instruction I.B.6 thereof, if applicable), or (d) the number
or dollar amount of Common Shares for which the Company has filed a Prospectus (defined below).
“Person”
means an individual or a corporation, partnership, limited liability company, trust, incorporated or unincorporated association, joint
venture, joint stock company, governmental authority or other entity of any kind.
“Principal Market”
means the Nasdaq Capital Market or such other national securities exchange on which the Common Shares, including any Shares, are then
listed.
“Rule 462(b) Registration
Statement” means any registration statement filed by the Company pursuant to Rule 462(b) under the Securities Act
in connection with the offer and sale of Shares.
“Sales Price”
means the actual sale execution price of each Share placed by the Agent pursuant to this Agreement.
“Securities Act”
means the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder.
“Selling Commission”
means three percent (3%) of the gross proceeds of Shares sold pursuant to this Agreement, or as otherwise agreed between the Company
and the Agent with respect to any Shares sold pursuant to this Agreement.
“Settlement
Date” means the second business day, or such other time period as required by the Exchange Act or by the rules promulgated
thereunder, following each Trading Day during the period set forth in the applicable Issuance Notice on which Shares are sold pursuant
to this Agreement, when the Company shall deliver to the Agent the amount of Shares sold on such Trading Day and the Agent shall deliver
to the Company the Issuance Price received on such sales.
“Shares”
means the Company’s Common Shares issued or issuable pursuant to this Agreement.
“Trading Day”
means any day on which the Principal Market is open for trading.
Section 2. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and
warrants to, and agrees with, the Agent that as of (1) the date of this Agreement, (2) each Issuance Notice Date, (3) each
Settlement Date, (4) each Triggering Event Date (as defined below) and (5) as of each Time of Sale (as defined below) (each
of the times referenced above is referred to herein as a “Representation Date”), except as may be disclosed in the
Prospectus (including any documents incorporated by reference therein and any supplements thereto) on or before a Representation Date:
(a) Registration
Statement. The Company has prepared and will file with the Commission a shelf registration statement on Form S-3 that contains
a base prospectus (the “Base Prospectus”) and a sales agreement prospectus specifically relating to the Shares (the
“Sales Agreement Prospectus”). Such registration statement registers the issuance and sale by the Company of
the Shares under the Securities Act. The Company may file one or more additional registration statements from time to time that will
contain a base prospectus and related prospectus or prospectus supplement, if applicable, with respect to the Shares. Except where the
context otherwise requires, such registration statement(s), including any information deemed to be a part thereof pursuant to Rule 430B
under the Securities Act, including all financial statements, exhibits and schedules thereto and all documents incorporated or deemed
to be incorporated therein by reference pursuant to Item 12 of Form S-3 under the Securities Act as from time to time amended or
supplemented, is herein referred to as the “Registration Statement,” and the Base Prospectus and Sales Agreement Prospectus,
together with any prospectus supplement filed with the Commission pursuant to Rule 424(b) under the Securities Act relating
to a particular issuance of the Shares, including all documents incorporated or deemed to be incorporated therein by reference pursuant
to Item 12 of Form S-3 under the Securities Act, in each case, as from time to time amended or supplemented, is referred to herein
as the “Prospectus,” except that if any revised prospectus is provided to the Agent by the Company for use in connection
with the offering of the Shares that is not required to be filed by the Company pursuant to Rule 424(b) under the Securities
Act, the term “Prospectus” shall refer to such revised prospectus from and after the time it is first provided to
the Agent for such use. The Registration Statement at the time it originally became effective is herein called the “Original
Registration Statement.” As used in this Agreement, the terms “amendment” or “supplement” when applied
to the Registration Statement or the Prospectus shall be deemed to include the filing by the Company with the Commission of any document
under the Exchange Act after the date hereof that is or is deemed to be incorporated therein by reference.
All
references in this Agreement to financial statements and schedules and other information which is “contained,” “included”
or “stated” in the Registration Statement or the Prospectus (and all other references of like import) shall be deemed to
mean and include all such financial statements and schedules and other information which is or is deemed to be incorporated by reference
in or otherwise deemed under the Securities Act to be a part of or included in the Registration Statement or the Prospectus, as the case
may be, as of any specified date; and all references in this Agreement to amendments or supplements to the Registration Statement or
the Prospectus shall be deemed to mean and include, without limitation, the filing of any document under the Exchange Act which is or
is deemed to be incorporated by reference in or otherwise deemed under the Securities Act to be a part of or included in the Registration
Statement or the Prospectus, as the case may be, as of any specified date.
At the time the Registration
Statement was or will be originally declared effective and at the time the Company’s most recent annual report on Form 10-K
was filed with the Commission, if later, the Company met the then-applicable requirements for use of Form S-3 under the Securities
Act. During the Agency Period, each time the Company files an annual report on Form 10-K the Company will meet the then-applicable
requirements for use of Form S-3 under the Securities Act.
(b) Compliance
with Registration Requirements. The Original Registration Statement will be declared effective by the Commission under the Securities
Act prior to the first Issuance Notice Date following the date hereof, and any Rule 462(b) Registration Statement filed after
the date hereof that relates to the Shares will be automatically effective following such filing and prior to the delivery of any Issuance
Notice related to Shares registered thereby. The Company has complied to the Commission’s satisfaction with all requests of the
Commission for additional or supplemental information. No stop order suspending the effectiveness of the Registration Statement or any
Rule 462(b) Registration Statement is in effect and no proceedings for such purpose have been instituted or are pending or,
to the knowledge of the Company, are contemplated or threatened by the Commission.
The Prospectus when filed
will comply in all material respects with the Securities Act and, if filed with the Commission through its Electronic Data Gathering,
Analysis and Retrieval system (“EDGAR”) (except as may be permitted by Regulation S-T under the Securities Act),
will be identical to the copy thereof delivered to the Agent for use in connection with the issuance and sale of the Shares. Each of
the Registration Statement, any Rule 462(b) Registration Statement and any post-effective amendment thereto, at the time it
became effective and at each Representation Date, complied and will comply in all material respects with the Securities Act and did not
and will not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading. As of the date of this Agreement, the Prospectus and any Free Writing Prospectus (as defined
below) if, and when available, considered together (collectively, the “Time of Sale Information”) did not contain
any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. The Prospectus, as amended or supplemented, as of its date and at each Representation Date,
did not and will not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made, not misleading. The representations and warranties set
forth in the three immediately preceding sentences do not apply to statements in or omissions from the Registration Statement, any Rule 462(b) Registration
Statement, or any post-effective amendment thereto, or the Prospectus, or any amendments or supplements thereto, made in reliance upon
and in conformity with information relating to the Agent furnished to the Company in writing by the Agent expressly for use therein,
it being understood and agreed that the only such information furnished by the Agent to the Company consists of the information described
in Section 6 below. There are no contracts or other documents required to be described in the Prospectus or to be filed
as exhibits to the Registration Statement which have not been described or filed as required. The Registration Statement and the offer
and sale of the Shares as contemplated hereby meet the requirements of Rule 415 under the Securities Act and comply in all material
respects with said rule.
(c) Subsidiaries.
All of the direct and indirect subsidiaries (as such term is defined in Rule 405 under the Securities Act) of the Company (each,
a “Subsidiary”) are set forth in the Prospectus. The Company owns, directly or indirectly, all of the capital stock
or other equity interests of each Subsidiary free and clear of any lien, charge, pledge, security interest, encumbrance, right of first
refusal, preemptive right or other restriction (collectively, “Liens”), and all of the issued and outstanding shares
of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to
subscribe for or purchase securities.
(d) Organization
and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing
and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority
to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary
is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational
or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign
corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification
necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected
to result in a Material Adverse Change (as defined below) and no action, claim, suit, investigation or proceeding (including, without
limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened has been instituted
in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.
(e) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by this Agreement and otherwise to carry out its obligations hereunder. The execution and delivery of this Agreement by the Company and
the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action on the part of the Company
and no further action is required by the Company, the Company’s Board of Directors (the “Board of Directors”)
or the Company’s stockholders in connection herewith other than in connection with the Required Approvals (as defined below). This
Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute
the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited
by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application
affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by
applicable law.
(f) No
Conflicts. The execution, delivery and performance by the Company of this Agreement, the issuance and sale of the Shares and the
consummation by it of the transactions contemplated hereby do not and will not (i) conflict with or violate any provision of the
Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents,
or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under,
result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights
of termination, amendment, anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time
or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary
is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary
is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to
result in a Material Adverse Change.
(g) Filings,
Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to,
or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in
connection with the execution, delivery and performance by the Company of this Agreement, other than such filings as are required to
be made under applicable state securities laws (collectively, the “Required Approvals”).
(h) Issuance
of Shares. The Shares are duly authorized and, when issued and paid for in accordance with this Agreement, will be duly and validly
issued, fully paid and nonassessable, free and clear of all Liens. The holder of the Shares will not be subject to personal liability
by reason of being such holder. The Shares are not and will not be subject to the preemptive rights of any holders of any security of
the Company or similar contractual rights granted by the Company. All corporate action required to be taken for the authorization, issuance
and sale of the Shares has been duly and validly taken. The Shares conform in all material respects to all statements with respect thereto
contained in the Registration Statement.
(i) Capitalization.
The capitalization of the Company is as set forth in the Prospectus as of the dates set forth therein. The Company has not issued any
capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock
options under the Company’s stock option plans, the issuance of shares of Common Stock or any securities of the Company 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 (“Common Stock Equivalents”) to employees pursuant to the Company’s employee
stock option or purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date
of the most recently filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right
of participation, or any similar right to participate in the transactions contemplated hereby. Except as set forth in the Registration
Statement and the Prospectus, there are no outstanding options, warrants, rights to subscribe to, calls or commitments of any character
whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person
any right to subscribe for or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments,
understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock
or Common Stock Equivalents or the capital stock of any Subsidiary. The issuance and sale of the Shares will not obligate the Company
or any Subsidiary to issue shares of Common Stock or other securities to any Person (other than the issuance of the Shares). There are
no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange
or reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding
securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts,
commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the
Company or such Subsidiary. The Company does not have any stock appreciation rights or “phantom stock” plans or agreements
or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued,
fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding
shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. The authorized shares
of the Company conform in all material respects to all statements relating thereto contained in the Registration Statement and the Prospectus.
The offers and sales of the Company’s securities were at all relevant times either registered under the Securities Act and the
applicable state securities or Blue Sky laws or, based in part on the representations and warranties of the purchasers, exempt from such
registration requirements. No further approval or authorization of any stockholder, the Board of Directors or others is required for
the issuance and sale of the Shares. There are no stockholders agreements, voting agreements or other similar agreements with respect
to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the
Company’s stockholders.
(j) SEC
Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be
filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof,
for the two years preceding the date hereof (or such shorter period as the Company was required by law 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 Securities Act and the Exchange Act, as applicable, and none
of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not
misleading. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration
Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s
rules and guidelines applicable thereto. The financial statements of the Company included in the SEC Reports comply in all material
respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect
at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting principles
applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial
statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly
present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof
and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial,
year-end audit adjustments. The agreements and documents described in the Registration Statement and the Prospectus conform to the descriptions
thereof contained therein and there are no agreements or other documents required by the Securities Act and the rules and regulations
thereunder to be described in the Registration Statement or the Prospectus or to be filed with the Commission as exhibits to the Registration
Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which
the Company is a party or by which it is or may be bound or affected and (i) that is referred to in the Registration Statement or
the Prospectus, or (ii) is material to the Company’s business, has been duly authorized and validly executed by the Company,
is in full force and effect in all material respects and is enforceable against the Company and, to the Company’s knowledge, the
other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally, (y) as enforceability of any indemnification or contribution
provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding
therefore may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the
best of the Company’s knowledge, any other party is in default thereunder and, to the best of the Company’s knowledge, no
event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder. To the best
of the Company’s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result
in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic
or foreign, having jurisdiction over the Company or any of its assets or businesses, including, without limitation, those relating to
environmental laws and regulations.
(k) Material
Changes; Undisclosed Events, Liabilities or Developments. Except as otherwise disclosed in the Registration Statement or the Prospectus,
subsequent to the respective dates as of which information is given in the Registration Statement and the Prospectus: (i) there
has been no material adverse change, or any development that could be reasonably expected to result in a material adverse change, in
(A) the condition, financial or otherwise, or in the earnings, business, properties, operations, operating results, assets, liabilities
or prospects of the Company and its Subsidiaries, considered as one entity or (B) the ability of the Company to consummate the transactions
contemplated by this Agreement or perform its obligations hereunder (any such change being referred to herein as a “Material
Adverse Change”), (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not
required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission,
(iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution
of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital
stock, (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company
stock option plans and (vi) no officer or director of the Company has resigned from any position with the Company. The Company does
not have pending before the Commission any request for confidential treatment of information. Except for the issuance of the Shares contemplated
by this Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected
to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations,
assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this
representation is made or deemed made that has not been publicly disclosed at least one Trading Day prior to the date that this representation
is made. Unless otherwise disclosed in the Prospectus, the Company has not: (i) issued any securities or incurred any liability
or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution on
or in respect to its capital stock.
(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, an “Action”)
which (i) adversely affects or challenges the legality, validity or enforceability of this Agreement or the issuance of the Shares
or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Change. Neither
the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation
of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge
of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former
director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration
statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.
(m) Labor
Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company,
which could reasonably be expected to result in a Material Adverse Change. None of the Company’s or its Subsidiaries’ employees
is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company
nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their
relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary,
is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary
information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third
party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability
with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local
and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours,
except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Change.
(n) Compliance.
Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been
waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company
or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit
agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not
such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other
governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority,
including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health
and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected
to result in a Material Adverse Change.
(o) Regulatory
Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal,
state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the Prospectus, except
where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Change (each, a “Material
Permit”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or modification
of any Material Permit. The disclosures in the Registration Statement concerning the effects of Federal, State, local and all foreign
regulation on the Company’s business as currently contemplated are correct in all material respects.
(p) Title
to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to, or have valid and marketable rights
to lease or otherwise use, all real property and all personal property that is material to the business of the Company and the Subsidiaries,
in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not
materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens
for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP, and
the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company
and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are
in compliance.
(q) Intellectual
Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications,
service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights
necessary or required for use in connection with their respective businesses as described in the Prospectus and which the failure to
so have could have a Material Adverse Change (collectively, the “Intellectual Property Rights”). None of, and neither
the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired,
terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this
Agreement, except with respect to possible expirations of existing granted patents. Neither the Company nor any Subsidiary has received,
since the date of the latest audited financial statements included in the Prospectus, a written notice of a claim or otherwise has any
knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not have or reasonably
be expected to not have a Material Adverse Change. To the knowledge of the Company, all such Intellectual Property Rights are enforceable
and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company and its Subsidiaries
have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except
where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Change.
(r) Insurance.
The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in
such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not
limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that it will
not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers
as may be necessary to continue its business without a significant increase in cost.
(s) Transactions
with Affiliates and Employees. Except as set forth in the Prospectus, 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.
(t) Sarbanes-Oxley;
Internal Accounting Controls. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the
Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated
by the Commission thereunder that are effective as of the date hereof. The Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s
general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in
conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s
general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure
controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and
designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it
files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s
rules and forms. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures
of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange
Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under the
Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their
evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting
(as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely
to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.
(u) Certain
Fees. Except as set forth in the Prospectus, no brokerage or finder’s fees or commissions are or will be payable by the Company,
any Subsidiary or Affiliate of the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated by this Agreement. To the Company’s knowledge, there are no
other arrangements, agreements or understandings of the Company or, to the Company’s knowledge, any of its stockholders that may
affect the Agent’s compensation, as determined by FINRA.
(v) Investment
Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares will not be or be
an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. The Company
shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the
Investment Company Act of 1940, as amended.
(w) Registration
Rights. Except as disclosed in the Prospectus, no Person has any right to cause the Company or any Subsidiary to effect the registration
under the Securities Act of any securities of the Company or any Subsidiary.
(x) Listing
and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) of the Exchange Act, and the Company
has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common
Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration.
The Company has not, in the 12 months preceding the date hereof, received notice from the Principal Market to the effect that the Company
is not in compliance with the listing or maintenance requirements of such Principal Market. The Company is, and has no reason to believe
that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Common
Stock is currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation
and the Company is current in payment of the fees of the Depository Trust Company (or such other established clearing corporation) in
connection with such electronic transfer.
(y) 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 Agent and the Company fulfilling their obligations or exercising
their rights under this Agreement.
(z) No
Integrated Offering. Neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or
indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause
this offering of the Shares to be integrated with prior offerings by the Company for purposes of any applicable shareholder approval
provisions of any Principal Market on which any of the securities of the Company are listed or designated.
(aa) Solvency.
After giving effect to the receipt by the Company of the proceeds from the sale of the Shares 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 date hereof. The Prospectus sets forth as of
the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any
Subsidiary has commitments. Neither the Company nor any Subsidiary is in default with respect to any Indebtedness.
(bb) Tax
Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material
Adverse Change, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and
all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has
paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns,
reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes
for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no
basis for any such claim. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration
Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of
such consolidated financial statements. The term “taxes” mean all federal, state, local, foreign, and other net income, gross
income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll,
employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments,
or charges of any kind whatsoever, together with any interest and any penalties, additions to tax, or additional amounts with respect
thereto. The term “returns” means all returns, declarations, reports, statements, and other documents required to be filed
in respect to taxes.
(cc) Anti-Corruption
and Anti-Bribery Laws. Neither the Company nor any of its Subsidiaries nor any director, officer, or employee of the Company
or any of its Subsidiaries, nor to the knowledge of the Company, any agent, affiliate or other person acting on behalf of the Company
or any of its Subsidiaries has, in the course of its actions for, or on behalf of, the Company or any of its Subsidiaries (i) used
any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expenses relating to political activity; (ii) made
or taken any act in furtherance of an offer, promise, or authorization of any direct or indirect unlawful payment or benefit to any foreign
or domestic government official or employee, including of any government-owned or controlled entity or public international organization,
or any political party, party official, or candidate for political office; (iii) violated or is in violation of any provision of
the U.S. Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”), the UK Bribery Act 2010, or any other applicable
anti-bribery or anti-corruption law; or (iv) made, offered, authorized, requested, or taken an act in furtherance of any unlawful
bribe, rebate, payoff, influence payment, kickback or other unlawful payment or benefit. The Company and its Subsidiaries and, to the
knowledge of the Company, the Company’s affiliates have conducted their respective businesses in compliance with the FCPA and have
instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued
compliance therewith.
(dd) Money
Laundering Laws. The operations of the Company and its Subsidiaries are, and have been conducted at all times, in compliance with
applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar applicable
rules, regulations or guidelines, issued, administered or enforced by any governmental agency (collectively, the “Money Laundering
Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator
involving the Company or any of its Subsidiaries with respect to the Money Laundering Laws is pending or, to the knowledge of the Company,
threatened.
(ee) Sanctions.
Neither the Company nor any of its Subsidiaries, directors, officers, or employees, nor, to the knowledge of the Company, after due
inquiry, any agent, affiliate or other person acting on behalf of the Company or any of its Subsidiaries is currently the subject or
the target of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury (“OFAC”)
or the U.S. Department of State, the United Nations Security Council, the European Union, His Majesty’s Treasury of the United
Kingdom, or other relevant sanctions authority (collectively, “Sanctions”); nor is the Company or any of its Subsidiaries
located, organized or resident in a country or territory that is the subject or the target of Sanctions, including, without limitation,
the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic, the Crimea region and the non-government
controlled areas of the Zaporizhzhia and Kherson Regions of Ukraine, Cuba, Iran, North Korea and Syria; and the Company will not
directly or indirectly use the proceeds of this offering, or lend, contribute or otherwise make available such proceeds to any subsidiary,
or any joint venture partner or other person or entity, for the purpose of financing the activities of or business with any person, or
in any country or territory, that at the time of such financing, is the subject or the target 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 applicable Sanctions. For the past five years, the Company and its Subsidiaries have not knowingly engaged in and are
not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or was the
subject or the target of Sanctions or with any Sanctioned Country.
(ff) Export
Compliance. The Company and each of its Subsidiaries has not, nor has any director, officer, agent, employee or other Person acting
on behalf of the Company or any of its Subsidiaries violated or failed to comply with any applicable law related to the export or reexport
of goods (including hardware, software and technology), services and know-how except in such cases as would not reasonably be expected,
individually or in the aggregate, to have a Material Adverse Change.
(gg) Accountants.
Freed Maxick CPAs, P.C., which has expressed its opinion with respect to the financial statements (which term as used in this Agreement
includes the related notes thereto) filed with the Commission as a part of the Registration Statement and the Prospectus, is (i) an
independent registered public accounting firm as required by the Securities Act, the Exchange Act, and the rules of the Public Company
Accounting Oversight Board (“PCAOB”), (ii) in compliance with the applicable requirements relating to the qualification
of accountants under Rule 2-01 of Regulation S-X under the Securities Act and (iii) a registered public accounting firm as
defined by the PCAOB whose registration has not been suspended or revoked and who has not requested such registration to be withdrawn.
(hh) U.S.
Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning
of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Agent’s request.
(ii) Bank
Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of
1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal
Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent
(5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total equity of
a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries
or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and
to regulation by the Federal Reserve.
(jj) FINRA
Affiliation. No officer, director or, to the knowledge of the Company, any beneficial owner of 10% or more of the Company’s
unregistered securities has any direct or indirect affiliation or association with any FINRA member (as determined in accordance with
the rules and regulations of FINRA) that is participating in the Offering. The Company will advise the Agent if it learns that any
officer, director or owner of 10% or more of the Company’s outstanding shares of Common Stock or Common Stock Equivalents is or
becomes an affiliate or associated person of a FINRA member firm.
(kk) Officers’
Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to the Agent shall be deemed a representation
and warranty by the Company to the Agent as to the matters covered thereby.
(ll) Board
of Directors. The Board of Directors is comprised of the persons disclosed as such in the Prospectus. 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 Principal Market. At least one member of the Board of Directors qualifies
as a “financial expert” as such term is defined under the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder
and the rules of the Principal Market. In addition, at least a majority of the persons serving on the Board of Directors qualify
as “independent” as defined under the rules of the Principal Market.
(mm) Environmental
Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local
and foreign laws relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater,
land surface or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants,
contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment,
or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous
Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice
letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”);
(ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their
respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in
each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate,
a Material Adverse Change.
(nn) Ineligible
Issuer Status. The Company is not an “ineligible issuer” in connection with the offering of the Shares pursuant to Rules 164,
405 and 433 under the Securities Act. Any Free Writing Prospectus that the Company is required to file pursuant to Rule 433(d) under
the Securities Act has been, or will be, filed with the Commission in accordance with the requirements of the Securities Act. Each Free
Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule 433(d) under the Securities Act or
that was prepared by or behalf of or used or referred to by the Company complies or will comply in all material respects with the requirements
of Rule 433 under the Securities Act including timely filing with the Commission or retention where required and legending, and
each such Free Writing Prospectus, as of its issue date and at all subsequent times through the completion of the issuance and sale of
the Shares did not, does not and will not include any information that conflicted, conflicts with or will conflict with the information
contained in the Registration Statement or the Prospectus, including any document incorporated by reference therein. Except for the Free
Writing Prospectuses, if any, and electronic road shows, if any, furnished to you before first use, the Company has not prepared, used
or referred to, and will not, without your prior consent, prepare, use or refer to, any Free Writing Prospectus.
(oo) Statistical
and Market-Related Data. All statistical, demographic and market-related data included in the Registration Statement or the Prospectus
are based on or derived from sources that the Company reasonably and in good faith believes to be reliable and accurate and such data
is consistent with the sources from which they are derived, in each case in all material respects
(pp) ERISA
Compliance. Except as otherwise disclosed in the Prospectus, 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 Internal Revenue Code of 1986, as amended, and the regulations and published interpretations thereunder (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.
(qq) No
Outstanding Loans or Other Extensions of Credit. The Company does not have any outstanding extension of credit, in the form of a
personal loan, to or for any director or executive officer (or equivalent thereof) of the Company except for such extensions of credit
as are expressly permitted by Section 13(k) of the Exchange Act.
(rr) Cybersecurity.
The Company and its Subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software,
websites, applications, and databases (collectively, “IT Systems”) are adequate for, and operate and perform in all
material respects as required in connection with the operation of the business of the Company and its Subsidiaries as currently conducted,
free and clear of all material bugs, errors, defects, Trojan horses, time bombs, malware and other corruptants. The Company and its Subsidiaries
have implemented and maintained commercially reasonable physical, technical and administrative controls, policies, procedures, and safeguards
to maintain and protect their material confidential information and the integrity, continuous operation, redundancy and security of all
IT Systems and data, including “Personal Data,” used in connection with their businesses. “Personal Data”
means (i) a natural person’s name, street address, telephone number, e-mail address, photograph, social security number or
tax identification number, driver’s license number, passport number, credit card number, bank information, or customer or account
number; (ii) any information which would qualify as “personally identifying information” under the Federal Trade Commission
Act, as amended; (iii) “personal data” as defined by GDPR; (iv) any information which would qualify as “protected
health information” under the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information
Technology for Economic and Clinical Health Act (collectively, “HIPAA”); and (v) any other piece of information
that allows the identification of such natural person, or his or her family, or permits the collection or analysis of any data related
to an identified person’s health or sexual orientation. During the past five (5) years, there have been no breaches, violations,
outages or unauthorized uses of or accesses to same, except for those that have been remedied without material cost or liability or the
duty to notify any other person, nor any incidents under internal review or investigations relating to the same. The Company and its
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 Personal Data and to the protection of such IT Systems and Personal Data from unauthorized use, access,
misappropriation or modification.
(ss) Compliance
with Data Privacy Laws. The Company and its Subsidiaries are, and at all times during the past five (5) years were, in material
compliance with all applicable state and federal data privacy and security laws and regulations, including without limitation HIPAA,
and the Company and its Subsidiaries have taken commercially reasonable actions to prepare to comply with, and since May 25, 2018,
have been and currently are in compliance with, the European Union General Data Protection Regulation (“GDPR”) (EU
2016/679) (collectively, the “Privacy Laws”). To ensure compliance with the Privacy Laws, the Company and its Subsidiaries
have in place, comply with, and take appropriate steps reasonably designed to ensure compliance in all material respects with their policies
and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling, and analysis of Personal
Data (the “Policies”). The Company and its Subsidiaries have at all times during the past five (5) years made
all disclosures to users or customers required by applicable Privacy Laws, and none of such disclosures made or contained in any Policy
have, to the knowledge of the Company, been inaccurate or in violation of any applicable Privacy Laws in any material respect. The Company
further certifies that during the past five (5) years neither it nor any subsidiary: (i) has received notice of any actual
or potential liability under or relating to, or actual or potential violation of, any of the Privacy Laws, and has no knowledge of any
event or condition that would reasonably be expected to result in any such notice; (ii) is currently conducting or paying for, in
whole or in part, any investigation, remediation, or other corrective action pursuant to any Privacy Law; or (iii) is a party to
any order, decree, or agreement that imposes any obligation or liability under any Privacy Law.
Any certificate signed by
any officer or representative of the Company or any of its Subsidiaries and delivered to the Agent or counsel for the Agent in connection
with an issuance of Shares shall be deemed a representation and warranty by the Company to the Agent as to the matters covered thereby
on the date of such certificate.
The Company acknowledges
that the Agent and, for purposes of the opinions to be delivered pursuant to Section 4(p) hereof, counsel to the
Company and counsel to the Agent, will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents to
such reliance.
Section 3. ISSUANCE AND SALE OF COMMON SHARES
(a) Sale
of Securities. On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions
herein set forth, the Company and the Agent agree that the Company may from time to time seek to sell Shares through the Agent, acting
as sales agent, or directly to the Agent, acting as principal, as follows, with an aggregate Sales Price of up to the Maximum Program
Amount, based on and in accordance with Issuance Notices as the Company may deliver, during the Agency Period.
(b) Mechanics
of Issuances.
(i) Issuance
Notice. Upon the terms and subject to the conditions set forth herein, on any Trading Day during the Agency Period on which the conditions
set forth in Section 5(a) and Section 5(b) shall have been satisfied, the Company may exercise
its right to request an issuance of Shares by delivering to the Agent an Issuance Notice; provided, however, that (A) in no event
may the Company deliver an Issuance Notice to the extent that the sum of (x) the aggregate Sales Price of the requested Issuance
Amount, plus (y) the aggregate Sales Price of all Shares issued under all previous Issuance Notices effected pursuant to this Agreement,
would exceed the Maximum Program Amount; and (B) prior to delivery of any Issuance Notice, the period set forth for any previous
Issuance Notice shall have expired or been terminated. An Issuance Notice shall be considered delivered on the Trading Day that it is
received by e-mail to the persons set forth in Schedule A hereto and confirmed by the Company by telephone (including a voicemail message
to the persons so identified), with the understanding that, with adequate prior written notice, the Agent may modify the list of such
persons from time to time.
(ii) Agent
Efforts. Upon the terms and subject to the conditions set forth in this Agreement, upon the receipt of an Issuance Notice, the Agent
will use its commercially reasonable efforts consistent with its normal sales and trading practices to place the Shares with respect
to which the Agent has agreed to act as sales agent, subject to, and in accordance with the information specified in, the Issuance Notice,
unless the sale of the Shares described therein has been suspended, cancelled or otherwise terminated in accordance with the terms of
this Agreement. For the avoidance of doubt, the parties to this Agreement may modify an Issuance Notice at any time provided they both
agree in writing to any such modification.
(iii) Method
of Offer and Sale. The Shares may be offered and sold (A) in privately negotiated transactions with the consent of the Company;
(B) as block transactions; or (C) by any other method permitted by law deemed to be an “at the market offering”
as defined in Rule 415(a)(4) under the Securities Act, including sales made directly on the Principal Market or sales made
into any other existing Principal Market of the Common Shares. Nothing in this Agreement shall be deemed to require either party to agree
to the method of offer and sale specified in the preceding sentence, and (except as specified in clauses (A) and (B) above)
the method of placement of any Shares by the Agent shall be at the Agent’s discretion.
(iv) Confirmation
to the Company. If acting as sales agent hereunder, the Agent will provide written confirmation to the Company no later than the
opening of the Trading Day next following the Trading Day on which it has placed Shares hereunder setting forth the number of shares
sold on such Trading Day, the corresponding Sales Price and the Issuance Price payable to the Company in respect thereof.
(v) Settlement.
Each issuance of Shares will be settled on the applicable Settlement Date for such issuance of Shares and, subject to the provisions
of Section 5, on or before each Settlement Date, the Company will, or will cause its transfer agent to, electronically
transfer the Shares being sold by crediting the Agent or its designee’s account at The Depository Trust Company through its Deposit/Withdrawal
At Custodian (DWAC) System, or by such other means of delivery as may be mutually agreed upon by the parties hereto and, upon receipt
of such Shares, which in all cases shall be freely tradable, transferable, registered shares in good deliverable form, the Agent will
deliver, by wire transfer of immediately available funds, the related Issuance Price in same day funds delivered to an account designated
by the Company prior to the Settlement Date. The Company may sell Shares to the Agent as principal at a price agreed upon by the parties
at each relevant time Shares are sold pursuant to this Agreement (each, a “Time of Sale”).
(vi) Suspension
or Termination of Sales. Consistent with standard market settlement practices, the Company or the Agent may, upon notice to the other
party hereto in writing or by telephone (confirmed immediately by verifiable email), suspend any sale of Shares, and the period set forth
in an Issuance Notice shall immediately terminate; provided, however, that (A) such suspension and termination shall not affect
or impair either party’s obligations with respect to any Shares placed or sold hereunder prior to the receipt of such notice; (B) if
the Company suspends or terminates any sale of Shares after the Agent confirms such sale to the Company, the Company shall still be obligated
to comply with Section 3(b)(v) with respect to such Shares; and (C) if the Company defaults in its obligation
to deliver Shares on a Settlement Date, the Company agrees that it will hold the Agent harmless against any loss, claim, damage or expense
(including, without limitation, penalties, interest and reasonable legal fees and expenses), as incurred, arising out of or in connection
with such default by the Company. The parties hereto acknowledge and agree that, in performing its obligations under this Agreement,
the Agent may borrow Common Shares from stock lenders in the event that the Company has not delivered Shares to settle sales as required
by subsection (v) above, and may use the Shares to settle or close out such borrowings. The Company agrees that no such notice shall
be effective against the Agent unless it is made to the persons identified in writing by the Agent pursuant to Section 3(b)(i).
(vii) No
Guarantee of Placement, Etc. The Company acknowledges and agrees that (A) there can be no assurance that the Agent will be successful
in placing Shares; (B) the Agent will incur no liability or obligation to the Company or any other Person if it does not sell Shares;
and (C) the Agent shall be under no obligation to purchase Shares on a principal basis pursuant to this Agreement, except as otherwise
specifically agreed by the Agent and the Company.
(viii) Material
Non-Public Information. Notwithstanding any other provision of this Agreement, the Company and the Agent agree that the Company shall
not deliver any Issuance Notice to the Agent, and the Agent shall not be obligated to place any Shares, during any period in which the
Company is in possession of material non-public information.
(c) Fees.
As compensation for services rendered, the Company shall pay to the Agent, on the applicable Settlement Date, the Selling Commission
for the applicable Issuance Amount (including with respect to any suspended or terminated sale pursuant to Section 3(b)(vi))
by the Agent deducting the Selling Commission from the applicable Issuance Amount.
(d) Expenses.
The Company agrees to pay all costs, fees and expenses incurred in connection with the performance of its obligations hereunder and in
connection with the transactions contemplated hereby, including without limitation (i) all expenses incident to the issuance and
delivery of the Shares (including all printing and engraving costs); (ii) all fees and expenses of the registrar and transfer agent
of the Shares; (iii) all necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Shares;
(iv) all fees and expenses of the Company’s counsel, independent public or certified public accountants and other advisors;
(v) all costs and expenses incurred in connection with the preparation, printing, filing, shipping and distribution of the Registration
Statement (including financial statements, exhibits, schedules, consents and certificates of experts), the Prospectus, any Free Writing
Prospectus (as defined below) prepared by or on behalf of, used by, or referred to by the Company, and all amendments and supplements
thereto, and this Agreement; (vi) all filing fees, attorneys’ fees and expenses incurred by the Company or the Agent in connection
with qualifying or registering (or obtaining exemptions from the qualification or registration of) all or any part of the Shares for
offer and sale under the state securities or blue sky laws or the provincial securities laws of Canada, and, if requested by the Agent,
preparing and printing a “Blue Sky Survey” or memorandum and a “Canadian wrapper,” and any supplements
thereto, advising the Agent of such qualifications, registrations, determinations and exemptions; (vii) the reasonable fees and
disbursements of the Agent’s counsel, including the reasonable fees and expenses of counsel for the Agent in connection with,
FINRA review, if any, and approval of the Agent’s participation in the offering and distribution of the Shares; (viii) the
filing fees incident to FINRA review, if any; (ix) the costs and expenses of the Company relating to investor presentations on any
“road show” undertaken in connection with the marketing of the offering of the Shares, including, without limitation, expenses
associated with the preparation or dissemination of any electronic road show, expenses associated with the production of road show slides
and graphics, fees and expenses of any consultants engaged in connection with the road show presentations with the prior approval of
the Company, travel and lodging expenses of the representatives, employees and officers of the Company and, with the prior written approval
of the Company, of the Agent and any such consultants, and the cost of any aircraft chartered with the prior written approval of the
Company in connection with the road show; and (x) the fees and expenses associated with listing the Shares on the Principal Market.
The fees and disbursements of Agent’s counsel pursuant to subsections (vi) and (vii) above shall not exceed (A) $75,000
in connection with execution of this Agreement and (B) $15,000 in connection with each Triggering Event Date (as defined below)
on which the Company is required to provide a certificate pursuant to Section 4(o).
Section 4. ADDITIONAL COVENANTS
The Company covenants and
agrees with the Agent as follows, in addition to any other covenants and agreements made elsewhere in this Agreement:
(a) Exchange
Act Compliance. During the Agency Period, the Company shall (i) file, on a timely basis, with the Commission all reports and
documents required to be filed under Section 13, 14 or 15 of the Exchange Act in the manner and within the time periods required
by the Exchange Act; and (ii) either (A) include in its quarterly reports on Form 10-Q and its annual reports on Form 10-K,
a summary detailing, for the relevant reporting period, (1) the number of Shares sold through the Agent pursuant to this Agreement
and (2) the net proceeds received by the Company from such sales or (B) prepare a prospectus supplement containing, or include
in such other filing permitted by the Securities Act or Exchange Act (each an “Interim Prospectus Supplement”), such
summary information and, at least once a quarter and subject to this Section 4, file such Interim Prospectus Supplement pursuant
to Rule 424(b) under the Securities Act (and within the time periods required by Rule 424(b) and Rule 430B under
the Securities Act).
(b) Securities
Act Compliance. After the date of this Agreement, the Company shall promptly advise the Agent in writing (i) of the receipt
of any comments of, or requests for additional or supplemental information from, the Commission; (ii) of the time and date of any
filing of any post-effective amendment to the Registration Statement, any Rule 462(b) Registration Statement or any amendment
or supplement to the Prospectus or any Free Writing Prospectus; (iii) of the time and date that any post-effective amendment to
the Registration Statement or any Rule 462(b) Registration Statement becomes effective; and (iv) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto, any
Rule 462(b) Registration Statement or any amendment or supplement to the Prospectus or of any order preventing or suspending
the use of any Free Writing Prospectus or the Prospectus, or of any proceedings to remove, suspend or terminate from listing or quotation
the Common Shares from any securities exchange upon which they are listed for trading or included or designated for quotation, or of
the threatening or initiation of any proceedings for any of such purposes. If the Commission shall enter any such stop order at any time,
the Company will use its best efforts to obtain the lifting of such order as soon as practicable. Additionally, the Company agrees that
it shall comply with the provisions of Rule 424(b) and Rule 433, as applicable, under the Securities Act and will use
its reasonable efforts to confirm that any filings made by the Company under such Rule 424(b) or Rule 433 were received
in a timely manner by the Commission.
(c) Amendments
and Supplements to the Prospectus and Other Securities Act Matters. If any event shall occur or condition exist as a result of which
it is necessary to amend or supplement the Prospectus so that the Prospectus does not include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances when the Prospectus
is delivered to a purchaser, not misleading, or if in the opinion of the Agent or counsel for the Agent it is otherwise necessary to
amend or supplement the Prospectus to comply with applicable law, including the Securities Act, the Company agrees (subject to Section 4(d) and
4(f)) to promptly prepare, file with the Commission and furnish at its own expense to the Agent, amendments or supplements to the Prospectus
so that the statements in the Prospectus as so amended or supplemented will not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements therein, in light of the circumstances when the Prospectus is delivered
to a purchaser, not misleading or so that the Prospectus, as amended or supplemented, will comply with applicable law including the Securities
Act. Neither the Agent’s consent to, or delivery of, any such amendment or supplement shall constitute a waiver of any of the Company’s
obligations under Sections 4(d) and 4(f).
(d) Agent’s
Review of Proposed Amendments and Supplements. Prior to amending or supplementing the Registration Statement (including any registration
statement filed under Rule 462(b) under the Securities Act) or the Prospectus (excluding any amendment or supplement through
incorporation of any report filed under the Exchange Act, and excluding any prospectus supplement not relating to the sale of the Shares
hereunder), the Company shall furnish to the Agent for review, a reasonable amount of time prior to the proposed time of filing or use
thereof, a copy of each such proposed amendment or supplement, and the Company shall not file or use any such proposed amendment or supplement
without the Agent’s prior consent, and to file with the Commission within the applicable period specified in Rule 424(b) under
the Securities Act any prospectus required to be filed pursuant to such Rule.
(e) Use
of Free Writing Prospectus. Neither the Company nor the Agent has prepared, used, referred to or distributed, or will prepare, use,
refer to or distribute, without the other party’s prior written consent, any “written communication” that constitutes
a “free writing prospectus” as such terms are defined in Rule 405 under the Securities Act with respect to the offering
contemplated by this Agreement (any such free writing prospectus being referred to herein as a “Free Writing Prospectus”).
(f) Free
Writing Prospectuses. The Company shall furnish to the Agent for review, a reasonable amount of time prior to the proposed time of
filing or use thereof, a copy of each proposed Free Writing Prospectus or any amendment or supplement thereto to be prepared by or on
behalf of, used by, or referred to by the Company and the Company shall not file, use or refer to any proposed Free Writing Prospectus
or any amendment or supplement thereto without the Agent’s consent. The Company shall furnish to the Agent, without charge, as
many copies of any Free Writing Prospectus prepared by or on behalf of, or used by the Company, as the Agent may reasonably request.
If at any time when a prospectus is required by the Securities Act (including, without limitation, pursuant to Rule 173(d)) to be
delivered in connection with sales of the Shares (but in any event if at any time through and including the date of this Agreement) there
occurred or occurs an event or development as a result of which any Free Writing Prospectus prepared by or on behalf of, used by, or
referred to by the Company conflicted or would conflict with the information contained in the Registration Statement or included or would
include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements
therein, in light of the circumstances prevailing at that subsequent time, not misleading, the Company shall promptly amend or supplement
such Free Writing Prospectus to eliminate or correct such conflict or so that the statements in such Free Writing Prospectus as so amended
or supplemented will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the
statements therein, in light of the circumstances prevailing at such subsequent time, not misleading, as the case may be; provided,
however, that prior to amending or supplementing any such Free Writing Prospectus, the Company shall furnish to the Agent for review,
a reasonable amount of time prior to the proposed time of filing or use thereof, a copy of such proposed amended or supplemented Free
Writing Prospectus and the Company shall not file, use or refer to any such amended or supplemented Free Writing Prospectus without the
Agent’s consent.
(g) Filing
of Agent Free Writing Prospectuses. The Company shall not take any action that would result in the Agent or the Company being required
to file with the Commission pursuant to Rule 433(d) under the Securities Act a Free Writing Prospectus prepared by or on behalf
of the Agent that the Agent otherwise would not have been required to file thereunder.
(h) Copies
of Registration Statement and Prospectus. After the date of this Agreement through the last time that a prospectus is required by
the Securities Act (including, without limitation, pursuant to Rule 173(d)) to be delivered in connection with sales of the Shares,
the Company agrees to furnish the Agent with copies (which may be electronic copies) of the Registration Statement and each amendment
thereto, and with copies of the Prospectus and each amendment or supplement thereto in the form in which it is filed with the Commission
pursuant to the Securities Act or Rule 424(b) under the Securities Act, both in such quantities as the Agent may reasonably
request from time to time; and, if the delivery of a prospectus is required under the Securities Act or under the blue sky or securities
laws of any jurisdiction at any time on or prior to the applicable Settlement Date for any period set forth in an Issuance Notice in
connection with the offering or sale of the Shares and if at such time any event has occurred as a result of which the Prospectus as
then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order
to make the statements therein, in light of the circumstances under which they were made when such Prospectus is delivered, not misleading,
or, if for any other reason it is necessary during such same period to amend or supplement the Prospectus or to file under the Exchange
Act any document incorporated by reference in the Prospectus in order to comply with the Securities Act or the Exchange Act, to notify
the Agent and to request that the Agent suspend offers to sell Shares (and, if so notified, the Agent shall cease such offers as soon
as practicable); and if the Company decides to amend or supplement the Registration Statement or the Prospectus as then amended or supplemented,
to advise the Agent promptly by telephone (with confirmation in writing) and to prepare and cause to be filed promptly with the Commission
an amendment or supplement to the Registration Statement or the Prospectus as then amended or supplemented that will correct such statement
or omission or effect such compliance; provided, however, that if during such same period the Agent is required to deliver a prospectus
in respect of transactions in the Shares, the Company shall promptly prepare and file with the Commission such an amendment or supplement.
(i) Blue
Sky Compliance. The Company shall cooperate with the Agent and counsel for the Agent to qualify or register the Shares for sale under
(or obtain exemptions from the application of) the state securities or blue sky laws or Canadian provincial securities laws (or other
foreign laws) of those jurisdictions designated by the Agent, shall comply with such laws and shall continue such qualifications, registrations
and exemptions in effect so long as required for the distribution of the Shares. The Company shall not be required to qualify as a foreign
corporation or to take any action that would subject it to general service of process in any such jurisdiction where it is not presently
qualified or where it would be subject to taxation as a foreign corporation. The Company will advise the Agent promptly of the suspension
of the qualification or registration of (or any such exemption relating to) the Shares for offering, sale or trading in any jurisdiction
or any initiation or threat of any proceeding for any such purpose, and in the event of the issuance of any order suspending such qualification,
registration or exemption, the Company shall use its best efforts to obtain the withdrawal thereof as soon as practicable.
(j) Earnings
Statement. As soon as practicable, the Company will make generally available to its security holders and to the Agent an earnings
statement (which need not be audited) covering a period of at least twelve months beginning with the first fiscal quarter of the Company
occurring after the date of this Agreement which shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
under the Securities Act.
(k) Listing;
Reservation of Shares. (a) The Company will maintain the listing of the Shares on the Principal Market; and (b) the Company
will reserve and keep available at all times, free of preemptive rights, Shares for the purpose of enabling the Company to satisfy its
obligations under this Agreement.
(l) Transfer
Agent. The Company shall engage and maintain, at its expense, a registrar and transfer agent for the Shares.
(m) Due
Diligence. During the term of this Agreement, the Company will reasonably cooperate with any reasonable due diligence review conducted
by the Agent in connection with the transactions contemplated hereby, including, without limitation, providing information and making
available documents and senior corporate officers, during normal business hours and at the Company’s principal offices or virtually,
as the Agent may reasonably request from time to time.
(n) Representations
and Warranties. The Company acknowledges that each delivery of an Issuance Notice and each delivery of Shares on a Settlement Date
shall be deemed to be (i) an affirmation to the Agent that the representations and warranties of the Company contained in or made
pursuant to this Agreement are true and correct as of the date of such Issuance Notice or of such Settlement Date, as the case may be,
as though made at and as of each such date, except as may be disclosed in the Prospectus (including any documents incorporated by reference
therein and any supplements thereto); and (ii) an undertaking that the Company will advise the Agent if any of such representations
and warranties will not be true and correct as of the Settlement Date for the Shares relating to such Issuance Notice, as though made
at and as of each such date (except that such representations and warranties shall be deemed to relate to the Registration Statement
and the Prospectus as amended and supplemented relating to such Shares).
(o) Deliverables
at Triggering Event Dates; Certificates. The Company agrees that on or prior to the date of the first Issuance Notice and, during
the term of this Agreement after the date of the first Issuance Notice, upon:
(i) the
filing of the Prospectus or the amendment or supplement of any Registration Statement or Prospectus (other than a prospectus supplement
relating solely to an offering of securities other than the Shares or a prospectus filed pursuant to Section 4(a)(ii)(B)), by means
of a post-effective amendment, sticker or supplement, but not by means of incorporation of documents by reference into the Registration
Statement or Prospectus;
(ii) the
filing with the Commission of an annual report on Form 10-K or a quarterly report on Form 10-Q (including any Form 10-K/A
or Form 10-Q/A containing amended financial information or a material amendment to the previously filed annual report on Form 10-K
or quarterly report on Form 10-Q), in each case, of the Company; or
(iii) the
filing with the Commission of a current report on Form 8-K of the Company (i) containing amended financial information (other
than information “furnished” pursuant to Item 2.02 or 7.01 of Form 8-K or to provide disclosure pursuant to Item 8.01
of Form 8-K relating to reclassification of certain properties as discontinued operations in accordance with Statement of Financial
Accounting Standards No. 144) and/or (ii) disclosing any material transaction requiring the filing of historical or pro forma
financial statements under Item 9.01 of Form 8-K and subject to the guidance set forth in Section 2050.3 of the Financial Reporting
Manual of the Commission which is material to the offering of securities of the Company in the Agent’s reasonable discretion;
(any such event, a “Triggering Event
Date”), the Company shall furnish the Agent (but in the case of clause (C) above only if the Agent reasonably determines
that the information contained in such current report on Form 8-K of the Company is material) with a certificate as of the Triggering
Event Date, in the form and substance satisfactory to the Agent and its counsel, substantially similar to the form previously provided
to the Agent and its counsel, modified, as necessary, to relate to the Registration Statement and the Prospectus as amended or supplemented,
(A) confirming that the representations and warranties of the Company contained in this Agreement are true and correct, (B) confirming
that the Company has performed all of its obligations hereunder to be performed on or prior to the date of such certificate and as to
the matters set forth in Section 5(a)(iii) hereof, and (C) containing any other certification that the Agent
shall reasonably request. The requirement to provide a certificate under this Section 4(o) shall be waived for any Triggering
Event Date occurring at a time when no Issuance Notice is pending or a suspension is in effect, which waiver shall continue until the
earlier to occur of the date the Company delivers instructions for the sale of Shares hereunder (which for such calendar quarter shall
be considered a Triggering Event Date) and the next occurring Triggering Event Date. Notwithstanding the foregoing, if the Company subsequently
decides to sell Shares following a Triggering Event Date when a suspension was in effect and did not provide the Agent with a certificate
under this Section 4(o), then before the Company delivers the instructions for the sale of Shares or the Agent sells any Shares
pursuant to such instructions, the Company shall provide the Agent with a certificate in conformity with this Section 4(o) dated
as of the date that the instructions for the sale of Shares are issued.
(p) Legal
Opinions. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which
the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable and excluding
the date of this Agreement, a negative assurances letter and the written legal opinion of Sichenzia Ross Ference Carmel LLP, counsel
to the Company, Harter Secrest & Emery LLP, intellectual property counsel to the Company, and Paul Hastings LLP, counsel to
the Agent, each dated the date of delivery, in form and substance reasonably satisfactory to Agent and its counsel, substantially similar
to the form previously provided to the Agent and its counsel, modified, as necessary, to relate to the Registration Statement and the
Prospectus as then amended or supplemented. In lieu of such opinions for subsequent periodic filings, in the discretion of the Agent,
the Company may furnish a reliance letter from such counsel to the Agent, permitting the Agent to rely on a previously delivered opinion
letter, modified as appropriate for any passage of time or Triggering Event Date (except that statements in such prior opinion shall
be deemed to relate to the Registration Statement and the Prospectus as amended or supplemented as of such Triggering Event Date).
(q) Comfort
Letter. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date with respect to which
the Company is obligated to deliver a certificate pursuant to Section 4(o) for which no waiver is applicable and excluding
the date of this Agreement, the Company shall cause Freed Maxick CPAs, P.C., the independent registered public accounting firm who has
audited or reviewed the financial statements included or incorporated by reference in the Registration Statement, to furnish the Agent
a comfort letter, dated the date of delivery, in form and substance reasonably satisfactory to the Agent and its counsel, substantially
similar to the form previously provided to the Agent and its counsel; provided, however, that any such comfort letter will only be required
on the Triggering Event Date specified to the extent that it contains financial statements filed with the Commission under the Exchange
Act and incorporated or deemed to be incorporated by reference into a Prospectus. If requested by the Agent, the Company shall also cause
a comfort letter to be furnished to the Agent in connection with any material transaction or event requiring the filing of a current
report on Form 8-K containing material amended financial information of the Company, including the restatement of the Company’s
financial statements; provided, that, such comfort letter shall not be required to be delivered to the Agent unless and until the Company
delivers an Issuance Notice that is effective on or after the date of occurrence of such material transaction or event. Subject to the
preceding sentence, the Company shall be required to furnish no more than one comfort letter hereunder per each filing of an annual report
on Form 10-K or a quarterly report on Form 10-Q.
(r) Secretary’s
Certificate. On or prior to the date of the first Issuance Notice and on or prior to each Triggering Event Date, the Company
shall furnish the Agent a certificate executed by the Secretary of the Company, signing in such capacity, dated the date of delivery
(i) certifying that attached thereto are true and complete copies of the resolutions duly adopted by the Board of Directors of
the Company authorizing the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby
(including, without limitation, the issuance of the Shares pursuant to this Agreement), which authorization shall be in full force
and effect on and as of the date of such certificate, (ii) certifying and attesting to the office, incumbency, due authority
and specimen signatures of each Person who executed this Agreement for or on behalf of the Company, and (iii) containing any
other certification that the Agent shall reasonably request.
(s) Agent’s
Own Account; Clients’ Account. The Company consents to the Agent trading, in compliance with applicable law, in the Common
Shares for the Agent’s own account and for the account of its clients at the same time as sales of the Shares occur pursuant to
this Agreement.
(t) Investment
Limitation. The Company shall not invest, or otherwise use the proceeds received by the Company from its sale of the Shares in such
a manner as would require the Company or any of its Subsidiaries to register as an investment company under the Investment Company Act.
(u) Market
Activities. The Company has neither taken, nor will take, directly or indirectly, any action designed to or that might be reasonably
expected to cause or result in stabilization or manipulation of the price of the Shares or any other reference security, whether to facilitate
the sale or resale of the Shares or otherwise, and the Company will, and shall cause each of its Affiliates to, comply with all applicable
provisions of Regulation M. If the limitations of Rule 102 of Regulation M (“Rule 102”) do not apply with
respect to the Shares or any other reference security pursuant to any exception set forth in Section (d) of Rule 102,
then promptly upon notice from the Agent (or, if later, at the time stated in the notice), the Company will, and shall cause each of
its Affiliates to, comply with Rule 102 as though such exception were not available but the other provisions of Rule 102 (as
interpreted by the Commission) did apply. The Company shall promptly notify the Agent if it no longer meets the requirements set forth
in Section (d) of Rule 102.
(v) Notice
of Other Sale. Without the written consent of the Agent, the Company will not, directly or indirectly, offer to sell, sell, contract
to sell, grant any option to sell or otherwise dispose of any Common Shares or securities convertible into or exchangeable for Common
Shares (other than Shares hereunder), warrants or any rights to purchase or acquire Common Shares, or effect a reverse stock split, recapitalization,
share consolidation, reclassification or similar transaction affecting the outstanding Common Shares, during the period beginning on
the third Trading Day immediately prior to the date on which any Issuance Notice is delivered to the Agent hereunder and ending on the
third Trading Day immediately following the Settlement Date with respect to Shares sold pursuant to such Issuance Notice; and will not
directly or indirectly enter into any other “at the market” or continuous equity transaction to offer to sell, sell, contract
to sell, grant any option to sell or otherwise dispose of any Common Shares (other than the Shares offered pursuant to this Agreement)
or securities convertible into or exchangeable for Common Shares, warrants or any rights to purchase or acquire, Common Shares prior
to the termination of this Agreement; provided, however, that such restrictions will not be required in connection with the Company’s
(i) offer, issuance or sale of Common Shares, options to purchase Common Shares or Common Shares issuable upon the exercise of options
or other equity awards pursuant to any employee or director share option, incentive or benefit plan, share purchase or ownership plan,
long-term incentive plan, dividend reinvestment plan, inducement award under the rules of the Principal Market or other compensation
plan of the Company or its Subsidiaries, as in effect on the date of this Agreement, (ii) offer, issuance or sale of Common Shares
issuable upon exchange, conversion or redemption of securities or the exercise or vesting of warrants, options or other equity awards
outstanding at the date of this Agreement, and (iii) modification of any outstanding options, warrants of any rights to purchase
or acquire Common Shares.
Section 5. CONDITIONS TO DELIVERY OF ISSUANCE NOTICES AND
TO SETTLEMENT
(a) Conditions
Precedent to the Right of the Company to Deliver an Issuance Notice and the Obligation of the Agent to Sell Shares. The right of
the Company to deliver an Issuance Notice hereunder is subject to the satisfaction, on the date of delivery of such Issuance Notice,
and the obligation of the Agent to use its commercially reasonable efforts to place Shares during the applicable period set forth in
the Issuance Notice is subject to the satisfaction, on each Trading Day during the applicable period set forth in the Issuance Notice,
of each of the following conditions:
(i) Accuracy
of the Company’s Representations and Warranties; Performance by the Company. The representations and warranties of the Company
contained in this Agreement are true and correct as of the date of the Issuance Notice (other than representations and warranties made
as of a specific date that shall be true and correct as of such date), and the Company shall have delivered the certificate required
to be delivered pursuant to Section 4(o) on or before the date on which delivery of such certificate is required pursuant
to Section 4(o). The Company shall have performed, satisfied and complied with all covenants, agreements and conditions required
by this Agreement to be performed, satisfied or complied with by the Company at or prior to such date, including, but not limited to,
the covenants contained in Section 4(p), Section 4(q) and Section 4(r).
| (ii) | No Injunction. No statute, rule,
regulation, executive order, decree, ruling or injunction shall have been enacted, entered,
promulgated or endorsed by any court or governmental authority of competent jurisdiction
or any self-regulatory organization having authority over the matters contemplated hereby
that prohibits or directly and materially adversely affects any of the transactions contemplated
by this Agreement, and no proceeding shall have been commenced that may have the effect of
prohibiting or materially adversely affecting any of the transactions contemplated by this
Agreement. |
| (iii) | Material Adverse Changes. Except
as disclosed in the Prospectus and the Time of Sale Information, (a) in the judgment
of the Agent there shall not have occurred any Material Adverse Change; and (b) there
shall not have occurred any downgrading, nor shall any notice have been given of any intended
or potential downgrading or of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any securities of the Company or
any of its Subsidiaries by any “nationally recognized statistical rating organization”
as such term is defined for purposes of Section 3(a)(62) of the Exchange Act. |
| (iv) | No
Suspension of Trading in or Delisting of Common Shares; Other Events. The trading of
the Common Shares (including without limitation the Shares) shall not have been suspended
by the Commission, the Principal Market or FINRA and the Common Shares (including without
limitation the Shares) shall have been approved for listing or quotation on and shall not
have been delisted from the Nasdaq Stock Market, the New York Stock Exchange or any of their
constituent markets. There shall not have occurred (and be continuing in the case of occurrences
under clauses (i) and (ii) below) any of the following: (i) trading or
quotation in any of the Company’s securities shall have been suspended or limited by
the Commission or by the Principal Market or trading in securities generally on the Principal
Market either shall have been suspended or limited, or minimum or maximum prices shall have
been generally established on any of such stock exchanges by the Commission or FINRA; (ii) a
general banking moratorium shall have been declared by any of federal or New York, authorities;
or (iii) there shall have occurred any outbreak or escalation of national or international
hostilities or any crisis or calamity, or any change in the United States or international
financial markets, or any substantial change or development involving a prospective substantial
change in United States’ or international political, financial or economic conditions,
as in the judgment of the Agent is material and adverse and makes it impracticable to market
the Shares in the manner and on the terms described in the Prospectus or to enforce contracts
for the sale of securities. |
(b) Documents
Required to be Delivered on each Issuance Notice Date. The Agent’s obligation to use its commercially reasonable efforts to
place Shares hereunder shall additionally be conditioned upon the delivery to the Agent on or before the Issuance Notice Date of a certificate
in form and substance reasonably satisfactory to the Agent, executed by the Chief Executive Officer, President or Chief Financial Officer
of the Company, to the effect that all conditions to the delivery of such Issuance Notice shall have been satisfied as at the date of
such certificate (which certificate shall not be required if the foregoing representations shall be set forth in the Issuance Notice).
(c) No
Misstatement or Material Omission. The Agent shall not have advised the Company that the Registration Statement, the Prospectus or
the Time of Sale Information, or any amendment or supplement thereto, contains an untrue statement of fact that in the Agent’s
reasonable opinion is material, or omits to state a fact that in the Agent’s reasonable opinion is material and is required to
be stated therein or is necessary to make the statements therein not misleading.
Section 6. INDEMNIFICATION AND CONTRIBUTION
(a) Indemnification
of the Agent. The Company agrees to indemnify and hold harmless the Agent, its officers and employees, and each person, if any, who
controls the Agent within the meaning of the Securities Act or the Exchange Act against any loss, claim, damage, liability or expense,
as incurred, to which the Agent or such officer, employee or controlling person may become subject, under the Securities Act, the Exchange
Act, other federal or state statutory law or regulation, or the laws or regulations of foreign jurisdictions where Shares have been offered
or sold or at common law or otherwise (including in settlement of any litigation), insofar as such loss, claim, damage, liability or
expense (or actions in respect thereof as contemplated below) arises out of or is based upon (i) 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 under the Securities Act, 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; (ii) any untrue statement or alleged
untrue statement of a material fact contained in any Free Writing Prospectus that the Company has used, referred to or filed, or is required
to file, pursuant to Rule 433(d) of the Securities Act or the Prospectus (or any amendment or supplement thereto), or the omission
or alleged omission therefrom of a material fact necessary in order to make the statements therein, in light of the circumstances under
which they were made, not misleading; or (iii) any act or failure to act or any alleged act or failure to act by the Agent in connection
with, or relating in any manner to, the Common Shares or the offering contemplated hereby, and which is included as part of or referred
to in any loss, claim, damage, liability or action arising out of or based upon any matter covered by clause (i) or (ii) above,
provided that the Company shall not be liable under this clause (iii) to the extent that a court of competent jurisdiction shall
have determined by a final judgment that such loss, claim, damage, liability or action resulted directly from any such acts or failures
to act undertaken or omitted to be taken by the Agent through its bad faith or willful misconduct, and to reimburse the Agent and each
such officer, employee and controlling person for any and all expenses (including the fees and disbursements of counsel chosen by the
Agent) as such expenses are reasonably incurred by the Agent or such officer, employee or controlling person in connection with investigating,
defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action; provided, however, that the foregoing
indemnity agreement shall not apply to any loss, claim, damage, liability or expense to the extent, but only to the extent, arising out
of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity
with written information furnished to the Company by the Agent expressly for use in the Registration Statement, any such Free Writing
Prospectus or the Prospectus (or any amendment or supplement thereto), it being understood and agreed that the only such information
furnished by the Agent to the Company consists of the information set forth in the first two sentences of the tenth paragraph under the
caption “Plan of Distribution” in the Prospectus (the “Agent Information”). The indemnity agreement set
forth in this Section 6(a) shall be in addition to any liabilities that the Company may otherwise have.
(b) Indemnification
of the Company, its Directors and Officers. The Agent agrees to indemnify and hold harmless the Company, each of its directors, each
of its officers who signed the Registration Statement and each person, if any, who controls the Company within the meaning of the Securities
Act or the Exchange Act against any loss, claim, damage, liability or expense, as incurred, to which the Company or any such director,
officer or controlling person may become subject, under the Securities Act, the Exchange Act, other federal or state statutory law or
regulation, or the laws or regulations of foreign jurisdictions where Shares have been offered or sold or at common law or otherwise
(including in settlement of any litigation), insofar as such loss, claim, damage, liability or expense (or actions in respect thereof
as contemplated below) arises out of or is based upon (i) 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
under the Securities Act, 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 (ii) any untrue statement or alleged untrue statement of a material fact contained
in any Free Writing Prospectus that the Company has used, referred to or filed, or is required to file, pursuant to Rule 433(d) of
the Securities Act or the Prospectus (or any amendment or supplement thereto), or the omission or alleged omission therefrom 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;
and to reimburse the Company and each such director, officer and controlling person for any and all expenses (including the fees and
disbursements of one counsel chosen by the Company) as such expenses are reasonably incurred by the Company or such officer, director
or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability,
expense or action; provided, however, that the foregoing indemnity agreement shall apply to any loss, claim damage, liability or expense
only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made
in reliance upon and in conformity with written information furnished to the Company by the Agent expressly for use in the Registration
Statement, any such Free Writing Prospectus or the Prospectus (or any amendment or supplement thereto), it being understood and agreed
that the only such information furnished by the Agent to the Company consists of the Agent Information. The indemnity agreement set forth
in this Section 6 (b) shall be in addition to any liabilities that the Agent may otherwise have.
(c) Notifications
and Other Indemnification Procedures. Promptly after receipt by an indemnified party under this Section 6 of notice
of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 6, notify the indemnifying party in writing of the commencement thereof, but the omission so to notify
the indemnifying party will not relieve it from any liability which it may have to any indemnified party for contribution or otherwise
than under the indemnity agreement contained in this Section 6 or to the extent it is not prejudiced as a proximate
result of such failure. In case any such action is brought against any indemnified party and such indemnified party seeks or intends
to seek indemnity from an indemnifying party, the indemnifying party will be entitled to participate in, and, to the extent that it shall
elect, jointly with all other indemnifying parties similarly notified, by written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel reasonably satisfactory
to such indemnified party; provided, however, if the defendants in any such action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that a conflict may arise between the positions of the indemnifying party
and the indemnified party in conducting the defense of any such action or that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to the indemnifying party, the indemnified party or parties
shall have the right to select separate counsel to assume such legal defenses and to otherwise participate in the defense of such action
on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified party of such
indemnifying party’s election so to assume the defense of such action and approval by the indemnified party of counsel, the indemnifying
party will not be liable to such indemnified party under this Section 6 for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified party shall have employed separate
counsel in accordance with the proviso to the preceding sentence (it being understood, however, that the indemnifying party shall not
be liable for the fees and expenses of more than one separate counsel (together with local counsel), representing the indemnified parties
who are parties to such action), which counsel (together with any local counsel) for the indemnified parties shall be selected by the
Agent (in the case of counsel for the indemnified parties referred to in Section 6(a) above) or by the Company (in the case
of counsel for the indemnified parties referred to in Section 6(b) above), (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of commencement
of the action or (iii) the indemnifying party has authorized in writing the employment of counsel for the indemnified party at the
expense of the indemnifying party, in each of which cases the fees and expenses of counsel shall be at the expense of the indemnifying
party and shall be paid as they are incurred.
(d) Settlements.
The indemnifying party under this Section 6 shall not be liable for any settlement of any proceeding effected without
its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the indemnifying party agrees
to indemnify the indemnified party against any loss, claim, damage, liability or expense by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party
for fees and expenses of counsel as contemplated by Section 6(c) hereof, the indemnifying party agrees that it shall
be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more
than thirty (30) calendar days after receipt by such indemnifying party of the aforesaid request; and (ii) such indemnifying
party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying
party shall, without the prior written consent of the indemnified party, effect any settlement, compromise or consent to the entry of
judgment in any pending or threatened action, suit or proceeding in respect of which any indemnified party is or could have been a party
and indemnity was or could have been sought hereunder by such indemnified party, unless such settlement, compromise or consent includes
an unconditional release of such indemnified party from all liability on claims that are the subject matter of such action, suit or proceeding.
(e) Contribution.
If the indemnification provided for in this Section 6 is for any reason held to be unavailable to or otherwise insufficient
to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or expenses referred to therein, then each
indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified party, as incurred, as a result of any
losses, claims, damages, liabilities or expenses referred to therein (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company, on the one hand, and the Agent, on the other hand, from the offering of the Shares pursuant to this
Agreement; or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion
as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of
the Company, on the one hand, and the Agent, on the other hand, in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative benefits received
by the Company, on the one hand, and the Agent, on the other hand, in connection with the offering of the Shares pursuant to this Agreement
shall be deemed to be in the same respective proportions as the total gross proceeds from the offering of the Shares (before deducting
expenses) received by the Company bear to the total Selling Commissions received by the Agent. The relative fault of the Company, on
the one hand, and the Agent, 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,
on the one hand, or the Agent, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The
amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall
be deemed to include, subject to the limitations set forth in, Section 6(c), any legal or other fees or expenses reasonably
incurred by such party in connection with investigating or defending any action or claim. The provisions set forth in Section 6(c) with
respect to notice of commencement of any action shall apply if a claim for contribution is to be made under this Section 6(e); provided,
however, that no additional notice shall be required with respect to any action for which notice has been given under Section 6(c) for
purposes of indemnification.
The
Company and the Agent agree that it would not be just and equitable if contribution pursuant to this Section 6(e) were
determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred
to in this Section 6(e).
Notwithstanding
the provisions of this Section 6(e), the Agent shall not be required to contribute any amount in excess
of the Selling Commissions received by the Agent in connection with the offering contemplated hereby. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. For purposes of this Section 6(e), each officer and employee
of the Agent and each person, if any, who controls the Agent within the meaning of the Securities Act or the Exchange Act shall have
the same rights to contribution as the Agent, 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 the Securities Act and the Exchange Act shall have
the same rights to contribution as the Company.
Section 7. TERMINATION & SURVIVAL
(a) Term.
Subject to the provisions of this Section 7, the term of this Agreement shall continue from the date of this Agreement
until the end of the Agency Period, unless earlier terminated by the parties to this Agreement pursuant to this Section 7.
(b) Termination;
Survival Following Termination.
(i) Either
party may terminate this Agreement prior to the end of the Agency Period, by giving written notice as required by this Agreement, upon
ten (10) Trading Days’ notice to the other party; provided that, (A) if the Company terminates this Agreement after the
Agent confirms to the Company any sale of Shares, the Company shall remain obligated to comply with Section 3(b)(v) with
respect to such Shares and (B) Section 2, Section 6, Section 7 and Section 8
shall survive termination of this Agreement. If termination shall occur prior to the Settlement Date for any sale of Shares, such
sale shall nevertheless settle in accordance with the terms of this Agreement.
(ii) In
addition to the survival provision of Section 7(b)(i), the respective indemnities, agreements, representations, warranties
and other statements of the Company, of its officers and of the Agent set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf of the Agent or the Company or any of its or their partners,
officers or directors or any controlling person, as the case may be, and, anything herein to the contrary notwithstanding, will survive
delivery of and payment for the Shares sold hereunder and any termination of this Agreement.
Section 8. MISCELLANEOUS
(a) Press
Releases and Disclosure. The Company may issue a press release describing the material terms of the transactions contemplated hereby
as soon as practicable following the date of this Agreement, and may file with the Commission a Current Report on Form 8-K, with
this Agreement attached as an exhibit thereto, describing the material terms of the transactions contemplated hereby, and the Company
shall consult with the Agent prior to making such disclosures, and the parties hereto shall use all commercially reasonable efforts,
acting in good faith, to agree upon a text for such disclosures that is reasonably satisfactory to all parties hereto. No party hereto
shall issue thereafter any press release or like public statement (including, without limitation, any disclosure required in reports
filed with the Commission pursuant to the Exchange Act) related to this Agreement or any of the transactions contemplated hereby without
the prior written approval of the other party hereto, except as may be necessary or appropriate in the reasonable opinion of the party
seeking to make disclosure to comply with the requirements of applicable law or stock exchange rules. If any such press release or like
public statement is so required, the party making such disclosure shall consult with the other party prior to making such disclosure,
and the parties shall use all commercially reasonable efforts, acting in good faith, to agree upon a text for such disclosure that is
reasonably satisfactory to all parties hereto.
(b) No
Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (i) the transactions contemplated by this Agreement,
including the determination of any fees, are arm’s-length commercial transactions between the Company and the Agent, (ii) when
acting as a principal under this Agreement, the Agent is and has been acting solely as a principal is not the agent or fiduciary of the
Company, or its stockholders, creditors, employees or any other party, (iii) the Agent has not assumed nor will assume an advisory
or fiduciary responsibility in favor of the Company with respect to the transactions contemplated hereby or the process leading thereto
(irrespective of whether the Agent has advised or is currently advising the Company on other matters) and the Agent does not have any
obligation to the Company with respect to the transactions contemplated hereby except the obligations expressly set forth in this Agreement,
(iv) the Agent and its Affiliates may be engaged in a broad range of transactions that involve interests that differ from those
of the Company, and (v) the Agent has not provided any legal, accounting, regulatory or tax advice with respect to the transactions
contemplated hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
(c) Research
Analyst Independence. The Company acknowledges that the Agent’s research analysts and research departments are required to
and should be independent from their respective investment banking divisions and are subject to certain regulations and internal policies,
and as such the Agent’s research analysts may hold views and make statements or investment recommendations and/or publish research
reports with respect to the Company or the offering contemplated by this Agreement that differ from the views of their respective investment
banking divisions. The Company understands that the Agent is a full service securities firm and as such from time to time, subject to
applicable securities laws, may effect transactions for its own account or the account of its customers and hold long or short positions
in debt or equity securities of the companies that may be the subject of the transactions contemplated by this Agreement.
(d) Notices.
All communications hereunder shall be in writing and shall be mailed, hand delivered, sent via electronic mail (if applicable) or telecopied
and confirmed to the parties hereto as follows:
If
to the Agent:
Jefferies LLC
520 Madison Avenue
New York, NY 10022
Facsimile: (646) 786-5719
Attention: General Counsel
and an additional copy (which shall
not constitute notice) to:
Paul
Hastings LLP
MetLife Building
200 Park Avenue
New York, New York
Attention: Siavosh Salimi and William Magioncalda
If to the Company:
Vuzix
Corporation
25 Hendrix Road,
West
Henrietta, New York 14586
Attention: Chief Executive Officer.
Attention: General Counsel
with a copy (which shall not constitute
notice) to:
Sichenzia
Ross Ference Carmel LLP
1185 Avenue of the Americas, 31st Floor
New York, New York 10036
Attention: Gregory Sichenzia
Facsimile: (212) 930-9725
Any party hereto may change the address for receipt
of communications by giving written notice to the others in accordance with this Section 8(d).
(e) Successors.
This Agreement will inure to the benefit of and be binding upon the parties hereto, and to the benefit of the employees, officers and
directors and controlling persons referred to in Section 6, and in each case their respective successors, and no other
person will have any right or obligation hereunder. The term “successors” shall not include any purchaser of the Shares as
such from the Agent merely by reason of such purchase.
(f) Partial
Unenforceability. The invalidity or unenforceability of any Article, Section, paragraph or provision of this Agreement shall not
affect the validity or enforceability of any other Article, Section, paragraph or provision hereof. If any Article, 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.
(g) Recognition
of U.S. Special Resolutions Regimes. In the event that the Agent is a Covered Entity and becomes subject to a proceeding under a
U.S. Special Resolution Regime, the transfer from the Agent 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 the
Agent is a Covered Entity and the Agent or a BHC Act Affiliate of the Agent becomes subject to a proceeding under a U.S. Special Resolution
Regime, Default Rights under this Agreement that may be exercised against the Agent 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.
(h) Governing
Law Provisions. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York applicable
to agreements made and to be performed in such state. Any legal suit, action or proceeding arising out of or based upon this Agreement
or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United
States of America located in the Borough of Manhattan in the City of New York or the courts of the State of New York in each case located
in the Borough of Manhattan in the City of New York (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
(a “Related Judgment”), 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.
(i) General
Provisions. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written or
oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This Agreement
may be executed in two or more counterparts, each one of which shall be an original, with the same effect as if the signatures thereto
and hereto were upon the same instrument, and may be delivered by facsimile transmission or by electronic delivery of a portable document
format (PDF) file (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)). This Agreement may not be amended or
modified unless in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in
writing by each party whom the condition is meant to benefit. The Article and Section headings herein are for the convenience
of the parties only and shall not affect the construction or interpretation of this Agreement.
[Signature Page Immediately Follows]
If the foregoing is in accordance
with your understanding of our agreement, kindly sign and return to the Company the enclosed copies hereof, whereupon this instrument,
along with all counterparts hereof, shall become a binding agreement in accordance with its terms
| |
Very truly yours, |
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VUZIX CORPORATION |
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|
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By: |
/s/ Grant Russell |
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Name: Grant Russell |
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|
Title: Chief Financial Officer |
The foregoing Agreement is hereby confirmed and
accepted by the Agent in New York, New York as of the date first above written.
JEFFERIES LLC
| By: |
/s/ Michael Magarro |
|
| |
Name: Michael Magarro |
|
| |
Title: Managing Director |
|
EXHIBIT A
ISSUANCE NOTICE
[Date]
Jefferies LLC
520 Madison Avenue
New York, New York 10022
Attn: [__________]
Reference is made to the Open Market Sale Agreement
between Vuzix Corporation (the “Company”) and Jefferies LLC (the “Agent”) dated as of February 9,
2024. The Company confirms that all conditions to the delivery of this Issuance Notice are satisfied as of the date hereof.
Date of Delivery of Issuance Notice (determined pursuant to Section 3(b)(i)):
_______________________
Issuance Amount (equal to the total Sales Price for such Shares):
| $ |
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| Number of days in selling period: |
|
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| First date of selling period: |
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| Last date of selling period: |
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| Settlement Date(s) if other than standard
T+2 settlement: |
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Floor Price Limitation (in no event less than
$1.00 without the prior written consent of the Agent, which consent may be withheld in the Agent’s sole discretion): $ ____ per
share
Schedule A
Notice Parties
The Company
Grant Russell
Eric Black
The Agent
Michael Magarro
Exhibit 5.1
February 9, 2024
Vuzix Corporation
25 Hendrix Road, Suite A
West Henrietta, New York 14586
Re: Registration Statement on Form S-3
Ladies and Gentlemen:
We have acted as counsel to Vuzix Corporation,
a Delaware corporation (the “Company”), in connection with the registration, pursuant to a registration statement on Form S-3
(the “Registration Statement”), filed by the Company with the Securities and Exchange Commission (the “Commission”)
under the Securities Act of 1933, as amended (the “Act”), relating to the offering and sale from time to time, as set forth
in the Registration Statement, any amendment thereto the form of base prospectus contained therein (the “Prospectus”), and
one or more supplements to the Prospectus (each, a “Prospectus Supplement”), by the Company of up to $300,000,000 aggregate
initial offering price of securities consisting of (i) shares of the Company’s common stock, par value $0.001 per share (the
“Common Stock”), (ii) shares of the Company’s preferred stock, par value $0.001 per share (the “Preferred
Stock”), (iii) warrants (“Warrants”) to purchase Common Stock or Preferred Stock, or (iv) units consisting
of Common Stock, Preferred Stock, or Warrants, or any combination thereof, in one or more series (the “Units”). The Common
Stock, Preferred Stock, Warrants and Units are collectively referred to herein as the “Securities.”
You have requested our opinion as to the matters
set forth below in connection with the Registration Statement. For the purposes of rendering the opinions set forth below, we have examined
(i) the Registration Statement, including the exhibits filed therewith or incorporated by reference therein, (ii) the Prospectus,
(iii) the Company’s amended and restated articles of incorporation, as amended or supplemented (the “Articles of Incorporation”),
(iv) the Company’s amended and restated bylaws, as amended (the “Bylaws”), (v) the corporate resolutions and
other actions of the Company that authorize and provide for the filing of the Registration Statement, and we have made such other investigation
as we have deemed appropriate. We have not independently established any of the facts so relied on.
We have assumed the accuracy and completeness
of each document submitted to us, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the
conformity to authentic original documents of all copies submitted to us or filed with the Commission as conformed and certified or reproduced
copies and the due execution and delivery of all documents where due execution and delivery are prerequisites to the effectiveness thereof.
As to any facts material to our opinion, we have made no independent investigation of such facts and have relied, to the extent that we
deem such reliance proper, upon certificates of public officials and officers or other representatives of the Company. We have further
assumed the legal capacity of natural persons, that persons identified to us as officers of the Company are actually serving in such capacity,
that the representations of officers and employees of the Company are correct as to questions of fact, that the board of directors of
the Company (“Board”) will have taken all action necessary to set the issuance price of the Securities to be offered and sold
and that each party to the documents we have examined or relied on (other than the Company) has the power, corporate or other, to enter
into and perform all obligations thereunder and also have assumed the due authorization by all requisite action, corporate or other, the
execution and delivery by such parties of such documents, and the validity and binding effect thereof on such parties. We have not independently
verified any of these assumptions.
Vuzix Corporation
February 9, 2024
Page 2
All references in this opinion letter to the Board
are intended to include an authorized committee thereof empowered and authorized to act under the Delaware General Corporation Law in
lieu of the full board of directors of the Company.
Based upon the foregoing and in reliance thereon,
and subject to the assumptions, exceptions, qualifications and limitations set forth herein, we are of the opinion that:
| 1. | With respect to Securities constituting Common Stock to be sold by the Company, when (i) the Board
has taken all necessary corporate action to authorize and approve the issuance of such Common Stock, the terms of the offering thereof
and related matters including without limitation the due reservation of any Common Stock for issuance; and (ii) such Common Stock
has been issued and delivered, with certificates representing such Common Stock having been duly executed, countersigned, registered and
delivered or, if uncertificated, valid book-entry notations therefor having been made in the share register of the Company, in each case
in accordance with the Articles of Incorporation and Bylaws and either in accordance with the terms of the applicable definitive purchase,
underwriting or similar agreement approved by the Board or, if such Common Stock is issuable upon the exercise of Warrants, the applicable
warrant agreement therefor, against payment (or delivery) of the consideration therefor provided for therein, such Common Stock (including
any Common Stock duly issued upon exercise of Warrants that are exercisable to purchase Common Stock) will have been duly authorized and
validly issued and will be fully paid and non-assessable. |
| 2. | With respect to Securities constituting Preferred Stock, when (i) the Board has taken all necessary
corporate action to authorize and approve the issuance and terms of the shares of the series of such Preferred Stock, the terms of the
offering thereof and related matters, including the adoption of a resolution fixing the number of shares in any series of Preferred Stock
and the designation of relative rights, preferences and limitations in any series of Preferred Stock and the filing of a certificate of
designation with respect to the series with the Secretary of State of the State of Delaware as required by Section 151(g) of
the Delaware General Corporation Law, the payment in full of any filing fees attendant thereto, and the due reservation of any Common
Stock and Preferred Stock for issuance; and (ii) such Preferred Stock has been issued and delivered, with certificates representing
such Preferred Stock having been duly executed, countersigned, registered and delivered or, if uncertificated, valid book-entry notations
therefor having been made in the share register of the Company, in each case in accordance with the Articles of Incorporation or Bylaws
and either in accordance with the terms of the applicable definitive purchase, underwriting or similar agreement approved by the Board
or, if such Preferred Stock is issuable upon the exercise of Warrants, the applicable warrant agreement therefor, against payment (or
delivery) of the consideration therefor provided for therein, such Preferred Stock (including any Preferred Stock duly issued upon exercise
of Warrants that are exercisable to purchase Preferred Stock) will have been duly authorized and validly issued and will be fully paid
and non-assessable. |
| 3. | With respect to the Warrants, when (i) the Board has taken all necessary corporate action to approve
the creation of and the issuance and terms of the Warrants, the terms of the offering thereof and related matters; (ii) the warrant
agreement or agreements relating to the Warrants have been duly authorized and validly executed and delivered by the Company and the warrant
agent appointed by the Company; and (iii) the Warrants or certificates representing the Warrants have been duly executed, countersigned,
registered and delivered in accordance with the appropriate warrant agreement or agreements and the applicable definitive purchase, underwriting
or similar agreement approved by the Board, upon payment of the consideration therefor provided for therein, the Warrants will be validly
issued and will be valid and binding obligations of the Company, enforceable against the Company in accordance with their terms. |
| 4. | With respect to Securities constituting Units, when (i) the Board has taken all necessary corporate
action to approve the creation of and the issuance and terms of the Units, terms of the offering thereof and related matters; (ii) the
agreement or agreements relating to the Securities comprising the Units have been duly authorized and validly executed and delivered by
the Company; and (iii) the certificates representing the Securities comprising the Units have been duly executed, countersigned,
registered and delivered in accordance with the appropriate agreements, the Units will be valid and binding obligations of the Company
enforceable against the Company in accordance with the their terms. |
Vuzix Corporation
February 9, 2024
Page 3
The opinions and other matters in this letter
are qualified in their entirety and subject to the following:
| A. | With respect to the opinions above, we have assumed that, in the case of each offering and sale of Securities,
(i) the Registration Statement, and any amendments thereto (including post-effective amendments), will have become effective under
the Act and such effectiveness or qualification shall not have been terminated, suspended or rescinded; (ii) a Prospectus Supplement
will have been prepared and filed with the Commission describing such Securities; (iii) such Securities will have been issued and
sold in compliance with applicable United States federal and state securities Laws (hereinafter defined) and pursuant to and in the manner
stated in the Registration Statement and the applicable Prospectus Supplement and there will not have occurred any change in law or fact
affecting the validity of any of the opinions rendered herein; (iv) unless such Securities constitute Common Stock or Preferred Stock
issuable upon exchange or conversion of Securities constituting Common Stock or Preferred Stock, or Common Stock or Preferred Stock issuable
upon exercise of Warrants, a definitive purchase, underwriting or similar agreement with respect to the issuance and sale of such Securities
will have been duly authorized, executed and delivered by the Company and the other parties thereto; (v) at the time of the issuance
of such Securities, (a) the Company will validly exist and be duly qualified and in good standing under the laws of its jurisdiction
of incorporation and (b) the Company shall have taken any action required to be taken by the Company, based on the type of Security
being offered, to authorize the offer and issuance thereof, and such authorization shall remain in effect and unchanged at all times during
which the Securities are offered and issued and shall not have been modified or rescinded (subject to the further assumption that the
sale of any Security takes place in accordance with such authorization), the Board shall have duly established the terms of such Security
and duly authorized and taken any other necessary corporate action to approve the issuance and sale of such Company in conformity with
the Articles of Incorporation and Bylaws (subject to the further assumption that neither the Articles of Incorporation nor Bylaws have
been amended from the date hereof in a manner that would affect the validity of any of the opinions rendered herein), and such authorization
shall remain in effect and unchanged at all times during which the Securities are offered and issued and shall not have been modified
or rescinded (subject to the further assumption that the sale of any Security takes place in accordance with such authorization); (vi) the
terms of such Securities and of their issuance and sale will have been established in conformity with and so as not to violate, or result
in a default under or breach of, the amended and restated certificate of incorporation and Bylaws of the Company and any applicable law
or any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or
governmental or regulatory body having jurisdiction over the Company; (vii) if such Securities constitute Common Stock or Preferred
Stock, (a) sufficient shares of Common Stock or Preferred Stock will be authorized for issuance under the amended and restated certificate
of incorporation of the Company that have not otherwise been issued or reserved for issuance and (b) the consideration for the issuance
and sale of such Common Stock or Preferred Stock established by the Board and provided for in the applicable definitive purchase, underwriting
or similar agreement (or, if Common Stock or Preferred Stock is issuable upon exercise of Warrants, the applicable warrant agreement)
will not be less than the par value of such Common Stock or Preferred Stock; (viii) if such Securities constitute Common Stock or
Preferred Stock issuable upon exercise of Warrants, the action with respect to such Warrants referred to in Paragraph 3 above will have
been taken; and (ix) if such Securities constitute Warrants that are exercisable for Securities constituting Common Stock or Preferred
Stock, the Company will have then taken all necessary action to authorize and approve the issuance of such Common Stock or Preferred Stock
upon exercise of such Warrants, the terms of such exercise and related matters and to reserve such Common Stock or Preferred Stock for
issuance upon such exercise. |
| B. | This letter is limited to matters governed by the Delaware General Corporation Law and by the laws of
the State of New York (“Laws”). We are not opining on, and we assume no responsibility for, the applicability to or effect
on any of the matters covered herein of (a) any other laws; (b) the laws of any other jurisdiction; or (c) the laws of
any county, municipality or other political subdivision or local governmental agency or authority. |
| C. | This letter is limited to the matters stated herein, and no opinion is implied or may be inferred beyond
the matters expressly stated. We assume herein no obligation, and hereby disclaim any obligation, to make any inquiry after the date hereof
or to advise you of any future changes in the foregoing or of any fact or circumstance that may hereafter come to our attention. |
Vuzix Corporation
February 9, 2024
Page 4
| D. | To the extent they purport to relate to liabilities resulting from or based upon gross negligence, recklessness
or other conduct committed or omitted willfully or in bad faith or any violation of federal or state securities or blue sky laws, this
letter expresses no opinions concerning the enforceability of indemnification provisions. |
| E. | The matters expressed in this letter are subject to and qualified and limited by (i) applicable bankruptcy,
insolvency, fraudulent transfer and conveyance, reorganization, receivership, moratorium and similar laws affecting creditors’ rights
and remedies generally; and (ii) general principles of equity, whether such principles are considered in a proceeding of law or at
equity; and (iii) an implied covenant of good faith, reasonableness, fair dealing and standards of materiality (regardless of whether
enforcement is sought in a proceeding at law or in equity). |
| F. | We express no opinion as to any provision in any stock purchase contract, unit purchase agreement, other
agreement pursuant to which any Securities are to be issued or governed, or the Articles of Incorporation or Bylaws (i) that purports
to waive forum non conveniens or trial by jury; (ii) that relates to judgments in currencies other than U.S. dollars; (iii) that
releases, exculpates or exempts a party from, or requires indemnification or contribution of a party for, liability for its own negligence
or misconduct; (iv) that purports to allow any party to unreasonably interfere in the conduct of the business of another party; (v) that
purports to require any party to pay any amounts due to another party without a reasonable accounting of the sums purported to be due;
(vi) that purports to prohibit the assignment of rights that that may be assigned pursuant to applicable law regardless of an agreement
not to assign such rights; (vii) that purports to require that amendments to any agreement be in writing; (viii) relating to
powers of attorney, severability or set-off; (ix) that purports to limit access exclusively to any particular courts; (x) that
provides a waiver of stay, extension or usury laws or of unknown future rights; and (xi) providing that decisions by a party are
conclusive or may be made in its sole discretion. We express no opinion concerning whether a U.S. federal court would accept jurisdiction
in any dispute, action, suit or proceeding arising out of or relating to any agreement or the transactions contemplated thereby. |
We hereby consent to the filing of this opinion
as Exhibit 5.1 to the Registration Statement and to the use of our name under the caption “Legal Matters” in the Registration
Statement and in the Prospectus and in any supplement thereto. In giving this consent, we do not thereby admit that we are experts with
respect to any part of the Registration Statement, the prospectus or any prospectus supplement within the meaning of the term “expert,”
as used in Section 11 of the Securities Act or the rules and regulations promulgated thereunder by the Commission, nor do we
admit that we are within the category of persons whose consent is required under Section 7 of the Act or the rules and regulations
of the Commission promulgated thereunder.
Very truly yours,
/s/ Sichenzia Ross Ference Carmel LLP
Sichenzia Ross Ference Carmel LLP
Exhibit 5.2
February 9, 2024
Vuzix Corporation
25 Hendrix Road, Suite A
West Henrietta, New York 14586
Re: Open Market Sale Agreement with Jefferies
LLC
Ladies and Gentlemen:
We have acted as counsel to Vuzix Corporation,
a Delaware corporation (the “Company”), in connection with the sale through Jefferies LLC as the sales agent (the “Sales
Agent”) from time to time by the Company of shares of the Company’s common stock, $0.001 par value per share (the “Common
Stock”), having an aggregate offering price of up to $50,000,000 (the “Shares”) all of which are authorized but heretofore
unissued shares to be offered and sold pursuant to an automatic Registration Statement on Form S-3 (the “Registration Statement”)
filed with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Securities
Act”), on February 9, 2024, and the prospectus contained therein dated February 9, 2024 for the sale of the Shares (the
“Prospectus”), and that certain Open Market Sale AgreementSM dated as of February 9, 2024, between the Sales
Agent and the Company (the “Sale Agreement”).
In connection with the preparation of this opinion,
we have examined the Registration Statement and the Prospectus and such documents and considered such questions of law as we have deemed
necessary or appropriate. We have assumed the authenticity of all documents submitted to us as originals, the conformity to originals
of all documents submitted to us as copies thereof and the genuineness of all signatures. As to questions of fact material to our opinions,
we have relied upon the certificates of certain officers of the Company without independent investigation or verification. We have also
assumed that there will exist, under the Company’s amended and restated articles of incorporation, as amended or supplemented, the
requisite number of authorized but unissued shares of Common Stock.
Based on the foregoing, we are of the opinion
that the Shares have been duly authorized and, when issued and sold in the manner described in the Sale Agreement and in accordance with
the Registration Statement and the Prospectus, will be validly issued, fully paid and non-assessable.
The opinions expressed in this opinion letter
are limited to the Delaware General Corporation Law and the reported judicial decisions interpreting such statute and provisions and the
laws of the state of New York and the federal laws of the United States of America. We are not opining on, and we assume no responsibility
for, the applicability to or effect on any of the matters covered herein of (a) any other laws of the State of Delaware; (b) the
laws of any other jurisdiction; or (c) the laws of any county, municipality or other political subdivision or local governmental
agency or authority.
We hereby consent to the use of this opinion as
an exhibit to the Registration Statement and to the use of our name under the caption “Legal Matters” in the Prospectus. In
giving our consent, we do not thereby admit that we are experts with respect to any part of the Registration Statement or the Prospectus
within the meaning of the term “expert” as used in Section 11 of the Securities Act or the rules and regulations
promulgated thereunder by the Commission, nor do we 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/ Sichenzia Ross Ference Carmel LLP
Sichenzia Ross Ference Carmel LLP
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
We consent to the incorporation by reference in
this Registration Statement on Form S-3 and related Prospectus of Vuzix Corporation (the “Company”) of our report dated
March 1, 2023, relating to the consolidated financial statements, the financial statement schedules and the effectiveness of internal
control over financial reporting of Vuzix Corporation appearing in the Annual Report in Form 10-K of Vuzix Corporation for the year
ended December 31, 2022.
We also consent to the reference to our firm under
the caption “Experts.”
/s/ Freed Maxick CPAs, P.C.
Buffalo, New York
February 9, 2024
Exhibit 107
Calculation of Filing Fee Table
S-3
(Form Type)
VUZIX CORPORATION
(Exact Name of Registrant as Specified in its Charter)
Table 1: Newly Registered and Carry Forward
Securities
| |
Security
Type |
Security
Class
Title |
Fee Calculation
or Carry
Forward
Rule |
Amount
Registered |
Proposed
Maximum
Offering
Price Per
Unit |
Maximum
Aggregate
Offering
Price |
Fee
Rate |
Amount of
Registration
Fee |
Carry
Forward
Form Type |
Carry
Forward File
Number |
Carry
Forward
Initial
Effective Date |
Filing Fee
Previously
Paid in
Connection
with Unsold
Securities
to be
Carried
Forward |
| Fees to Be Paid |
Equity |
Common Shares, $0.001 par value per share |
Rule 457(o) |
(1) |
(2) |
(2) |
- |
- |
- |
- |
- |
- |
| |
Equity |
Preferred Stock, $0.001 par value per share |
Rule 457(o) |
(1) |
(2) |
(2) |
- |
- |
- |
- |
- |
- |
| |
Other |
Warrants |
Rule 457(o) |
(1) |
(2) |
(2) |
- |
- |
- |
- |
- |
- |
| |
Other |
Units |
Rule 457(o) |
(1) |
(2) |
(2) |
- |
- |
- |
- |
- |
- |
| |
Unallocated (Universal) Shelf |
|
Rule 457(o) |
(1) |
(2) |
$97,800,000(3)(4) |
$0.0001476 |
$14,436 |
- |
- |
- |
- |
| Fees Previously Paid |
- |
- |
- |
|
|
- |
- |
- |
|
- |
- |
- |
| Carry Forward Securities |
Equity |
Common stock, par value $0.001 per share |
Rule 415(a)(6) |
(4) |
|
- |
- |
- |
S-3 |
333-252673 |
February 9, 2021 |
|
| Carry Forward Securities |
Equity |
Preferred stock, par value $0.001 per share |
Rule 415(a)(6) |
(4) |
|
|
|
|
S-3 |
333-252673 |
February 9, 2021 |
|
| Carry Forward Securities |
Other |
Warrants |
Rule 415(a)(6) |
(4) |
|
|
|
|
S-3 |
333-252673 |
February 9, 2021 |
|
| Carry Forward Securities |
Other |
Units |
Rule 415(a)(6) |
(4) |
|
|
|
|
S-3 |
333-252673 |
February 9, 2021 |
|
| Carry Forward Securities |
Unallocated (Universal) shelf |
Unallocated (Universal) shelf |
Rule 415(a)(6) |
(4) |
|
$202,200,000(4) |
|
|
S-3 |
333-252673 |
February 9, 2021 |
$22,060.02 |
| |
Total Offering Amounts |
|
$300,000,000(1)(4) |
$0.0001476 |
$14,436 |
|
|
|
|
| |
Total Fees Previously Paid |
|
|
|
- |
|
|
|
|
| |
Total Fee Offsets |
|
|
|
- |
|
|
|
|
| |
Net Fee Due |
|
|
|
$14,436 |
|
|
|
|
| (1) | There
is being registered hereunder an unspecified number of shares of (a) common shares,
(b) preferred stock, (c) debt securities, (d) warrants to purchase common
shares, and (e) units, consisting of some or all of these securities in any combination,
as may be sold from time to time by the Registrant. Any securities registered hereunder may
be sold separately or as units with other securities registered hereunder. There is also
being registered hereunder an unspecified number of shares of common shares, as shall be
issuable upon conversion, exchange or exercise of any securities that provide for such issuance.
In no event will the aggregate offering price of all types of securities issued by the Registrant
pursuant to this registration statement exceed $300,000,000. Pursuant to Rule 416(a) under
the Securities Act of 1933, as amended, or the Securities Act, this registration statement
also covers any additional securities that may be offered or issued in connection with any
stock split, stock dividend or similar transaction. |
| (2) | The
proposed maximum aggregate offering price per class of security will be determined from time
to time by the Registrant in connection with the issuance by the Registrant of the securities
registered hereunder and is not specified as to each class of security pursuant to Instruction
2.A.iii.b. to the Calculation of Filing Fee Tables and Related Disclosure on Item 16(b) of
Form S-3 under the Securities Act. |
| (3) | Estimated
solely to calculate the registration fee in accordance with Rule 457(o) under the
Securities Act. The aggregate maximum offering price of all securities issued pursuant to
this registration statement will not exceed $300,000,000. |
| |
(4) |
Pursuant
to Rule 415(a)(6) under the Securities Act, the securities registered pursuant to this registration statement include $202,200,000
of unsold securities (the “Unsold Securities”) previously registered pursuant to the Registration Statement on Form S-3
(File No. 333-252673), filed by the Registrant with the Securities and Exchange Commission on February 2, 2021 and declared
effective on February 9, 2021 (the “Prior Registration Statement”). In connection with the filing of the Prior Registration
Statement, the registrant paid a filing fee of $22,060.02 associated with the offering of the Unsold Securities (based on the filing
fee rate in effect at the time of the filing of the Prior Registration Statement). The filing fee associated with the offering of
the Unsold Securities is hereby carried forward to be applied to the Unsold Securities registered hereunder, and no additional filing
fee is due with respect to the Unsold Securities in connection with the filing of this Registration Statement. The registrant is
also registering new securities on this registration statement with an aggregate initial offering price of $97,800,000 (the “New
Securities”), which aggregate offering price is not specified as to each class of securities. A filing fee of $14,436 with
respect to the New Securities is being paid in connection with the filing of this registration statement. To the extent that, after
the filing date hereof and prior to the effectiveness of this registration statement, the registrant sells any Unsold Securities
pursuant to the Prior Registration Statement, the registrant will identify in a pre-effective amendment to this registration statement
the updated number of Unsold Securities from the Prior Registration Statement to be included in this registration statement pursuant
to Rule 415(a)(6) and the updated amount of new securities to be registered on this registration statement. Pursuant to Rule 415(a)(6),
the offering of securities under the Prior Registration Statement will be deemed terminated as of the date of effectiveness of this
registration statement. |
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