committed to purchase up to an aggregate of $100,000,000 of shares of Common Stock over a 36-month term. The Purchase Agreement allows the Company, on any
trading day where the closing sale price of Common Stock is at least $0.25, to direct LPC, by means of a purchase notice to purchase up to 275,000 shares of Common Stock per day, at a per share price equal to the lesser of (i) the lowest sale
price on the date for such purchase; or (ii) the arithmetic average of the three lowest closing trade prices for Common Stock during the ten consecutive trading days ending on the trading day that is immediately preceding the purchase. The
Company can also direct LPC to purchase an amount of stock equal to 30% of the aggregate shares of Common Stock traded on its principal market on any trading day following a date on which the Company submits a purchase notice to LPC, at a purchase
price per share of 97% of the volume-weighted average price for Common Stock traded on its principal market on such date.
On May 12,
2023, the Company entered into an Open Market Sale AgreementSM (the Sales Agreement) with Jefferies LLC (Jefferies), as sales agent. Under the Sales Agreement, the
Company has the right (but not the obligation) to issue and sell through Jefferies, as sales agent and/or principal, shares of Common Stock having an aggregate offering price of up to $75,000,000 (not to exceed the lesser of 39,609,072 shares of
Common Stock or the number of authorized, unissued and available shares of Common Stock at any time). The Company is not obligated to sell any shares of Common Stock under the Sales Agreement. Subject to the terms and conditions of the Sales
Agreement, Jefferies will use commercially reasonable efforts consistent with its normal trading and sales practices, to sell shares of Common Stock from time to time based upon the Companys instructions, including any price, time or size
limits specified by the Company. Upon delivery of a placement notice, and subject to the Companys instructions in that notice, and the terms and conditions of the Sales Agreement generally, Jefferies may sell Common Stock by any method
permitted by law deemed to be an at the market offering as defined by Rule 415(a)(4) promulgated under the Securities Act of 1933, as amended. Although the Sales Agreement did not initially require that the Company establish a reserve
for issuances under the Sales Agreement, the Company agreed that not later than the date that the Company amends its Articles of Incorporation to increase the number of authorized shares of Common Stock, the Company will establish a reserve of
10,000,000 shares for issuance under the Sales Agreement, and thereafter if at any time the number of shares in such reserve consists of less than 5,000,000 shares as a result of sales under the Sales Agreement, the Company will promptly cause such
reserve to again consist of 10,000,000 shares in total. As a result, if the Share Increase Proposal is approved at the Special Meeting and the Company files the Articles of Amendment to increase the total number of authorized shares of Common Stock
from 154,000,000 shares to 308,000,000 shares, the Company will be required to establish a reserve of 10,000,000 shares of Common Stock for issuances under the Sales Agreement.
The availability of additional shares of Common Stock will enhance the Companys flexibility in connection with possible future actions,
such as financings to raise capital to fund its operations; joint ventures or acquisitions; grants under the Companys equity incentive plans; and other corporate purposes. The Board will decide whether, when, and on what terms to issue shares
in connection with any of the purposes described above or for any other opportunity or need that may arise, although no further Board approval will be required to issue shares pursuant to transactions under the Purchase Agreement with LPC or the
Sales Agreement with Jefferies. Except as otherwise required by applicable law or stock exchange rules, authorized but unissued shares of Common Stock may be issued at such time for such purposes and for such consideration as the Board may determine
to be appropriate, without the expense and delay of calling a shareholders meeting to authorize additional shares of Common Stock.
Except as described above, the Company has no arrangements, agreements, or understandings in place at the present time for the issuance or use
of the additional shares of Common Stock to be authorized pursuant to the Share Increase Proposal.
Rights of Additional
Authorized Shares
Any authorized shares of Common Stock, if and when issued, would be part of our existing class of Common Stock and
would have the same rights and privileges as the shares of Common Stock currently
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