Common Warrants
The Common Warrants to be issued will be exercisable for shares of the Company’s common stock at any time after the closing of the Offering and prior to
the fifth anniversary of the closing at an exercise price of $2.00 per share. The Common Warrants will be exercisable by net exercise.
The form of Common
Warrant provides that the number of shares that may be exercised shall be limited to ensure that, following such exercise, the number of shares of common stock beneficially owned by the Investor does not exceed 4.999% of the total number of shares
of common stock then issued and outstanding, unless the Investor either (i) waives the limitation or (ii) changes the limitation in which case the number of shares that may be exercised shall be limited to ensure that, following such
exercise, the number of shares of common stock beneficially owned by the Investor does not exceed 9.999% of the total number of shares of common stock then issued and outstanding. The form of Common Warrant also provides that the Company may not
effect any exercise of the Common Warrants, and the Common Warrants may not be exercised with respect to any portion of the Common Warrants, to the extent that such exercise would result in the Purchaser and its affiliates beneficially owning more
than 19.99% of the outstanding Common Stock or outstanding voting power of the Company (including shares of Common Stock issuable upon exercise of the Common Warrants).
Registration Rights Agreement
Also on March 28,
2019, the Company entered into a registration rights agreement (the “Registration Rights Agreement”) with the Investors, pursuant to which the Company agreed to register for resale the Shares, as well as the shares of the Company’s
common stock issuable upon exercise of the
Pre-Funded
Warrants and the Common Warrants (the “Warrant Shares”). Under the Registration Rights Agreement, the Company has agreed to file a registration
statement covering the resale by the Investors of their Shares and Warrant Shares (together, the “Registrable Securities”) within 30 days following the closing of the Offering. The Company has agreed to use commercially reasonable efforts
to cause such registration statement to become effective and to keep such registration statement effective until the date the Shares and Warrant Shares covered by such registration statement have been sold or may be resold pursuant to Rule 144
without restriction. The Company has agreed to be responsible for all fees and expenses incurred in connection with the registration of the Registrable Securities.
In the event (i) the registration statement is not filed within 30 days following the closing date, (ii) the registration statement is not declared
effective prior to the earlier of five trading days after the date which the Company is notified by the Securities and Exchange Commission (the “SEC”) that the registration statement will not be reviewed by the SEC staff or is not subject
to further comment by the SEC staff, (iii) the registration statement has not been declared effective within 90 days following the closing date, if the SEC staff determines not to review the registration statement, or within 120 days following
the closing date if the SEC staff determines to review the registration statement or (iii) after the registration statement has been declared effective by the SEC, sales cannot be made pursuant to the registration statement for any reason other
than certain specified reasons, then the Company has agreed to make pro rata payments to each Investor as liquidated damages in an amount equal to 1% of the aggregate amount invested by each such Investor in the Registrable Securities per
30-day
period or pro rata for any portion thereof for each such month during which such event continues.
The Company
has granted the Investors customary indemnification rights in connection with the registration statement. The Investors have also granted the Company customary indemnification rights in connection with the registration statement.
The foregoing descriptions of the Securities Purchase Agreement, the
Pre-Funded
Warrants, the Common Warrants and the
Registration Rights Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Securities Purchase Agreement, the
Pre-Funded
Warrant, the Common Warrant
and the Registration Rights Agreement, copies of which are filed as Exhibits 10.1, 10.2, 10.3 and 10.4 hereto, respectively, and incorporated by reference herein.
The representations, warranties and covenants contained in the Securities Purchase Agreement, the Pre-Funded Warrants, the Common Warrants and the
Registration Rights Agreement were made solely for the benefit of the parties thereto and may be subject to limitations agreed upon by the contracting parties. Accordingly, the Securities Purchase Agreement, the Pre-Funded Warrants, the Common
Warrants and the Registration Rights Agreement are incorporated herein by reference only to provide