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Delaware
(State or other jurisdiction of
incorporation or organization) |
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2836
(Primary Standard Industrial
Classification Code Number) |
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13-4365359
(I.R.S. Employer
Identification Number) |
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Rachael M. Bushey
Joseph Walsh Troutman Pepper Hamilton Sanders LLP 3000 Two Logan Square Philadelphia, Pennsylvania 19103 (215) 981-4331 |
| |
Stephen Older
David Wolpa McGuireWoods LLP 1251 Avenue of the Americas, 20th Floor New York, New York 10020 (212) 548-2100 |
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Large accelerated filer
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Accelerated filer
☐
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Non-accelerated filer
☒
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Smaller reporting company
☒
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Emerging growth company
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Page
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| | | | 1 | | | |
| | | | 11 | | | |
| | | | 62 | | | |
| | | | 64 | | | |
| | | | 65 | | | |
| | | | 66 | | | |
| | | | 67 | | | |
| | | | 69 | | | |
| | | | 83 | | | |
| | | | 124 | | | |
| | | | 130 | | | |
| | | | 134 | | | |
| | | | 143 | | | |
| | | | 143 | | | |
| | | | 143 | | | |
| | | | 144 | | |
| | |
As of June 30, 2022
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(in thousands, except share and per share amounts)
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Actual
|
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Pro Forma
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Cash and cash equivalents
|
| | | $ | 45,771 | | | | | $ | 54,921 | | | | ||
Stockholders’ equity | | | | | | | | | | | | | | | ||
Common stock, par value $0.001 per share; 250,000,000 shares authorized at June 30, 2022; 22,597,907 shares issued and outstanding, actual; 28,184,499 shares issued and outstanding, pro forma
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| | | | 22 | | | | | | 28 | | | | ||
Additional paid-in capital
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| | | | 147,671 | | | | | | 156,815 | | | | ||
Accumulated deficit
|
| | | | (103,594) | | | | | | (103,594) | | | | ||
Accumulated other comprehensive loss
|
| | | | (200) | | | | | | (200) | | | | ||
Total stockholders’ equity
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| | | $ | 43,899 | | | | | $ | 53,049 | | | | ||
Total capitalization
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| | | $ | 43,899 | | | | | $ | 53,049 | | | |
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Assumed public offering price per share
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| | | | | | | | | $ | 1.79 | | |
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Historical net tangible book value per share as of June 30, 2022
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| | | $ | 1.94 | | | | | | | | |
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Decrease in net tangible book value per share as of June 30, 2022 attributable to
investors purchasing in this offering |
| | | | (0.06) | | | | | | | | |
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As adjusted net tangible book value per share as of June 30, 2022 after giving effect to this offering
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| | | | | | | | | | 1.88 | | |
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Increase per share to new investors participating in this offering
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| | | | | | | | | $ | 0.09 | | |
| | |
Six Months Ended
June 30, |
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(in thousands)
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2022
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2021
|
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Change
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Consolidated Statements of Operations Data: | | | | | | | | | | | | | | | | | | | |
Operating Expenses: | | | | | | | | | | | | | | | | | | | |
Research and development
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| | | $ | 15,616 | | | | | $ | 9,324 | | | | | $ | 6,292 | | |
General and administrative
|
| | | | 6,010 | | | | | | 2,243 | | | | | | 3,767 | | |
Total operating expenses
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| | | | 21,626 | | | | | | 11,567 | | | | | | 10,059 | | |
Loss from operations
|
| | | | (21,626) | | | | | | (11,567) | | | | | | (10,059) | | |
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Six Months Ended
June 30, |
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(in thousands)
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2022
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2021
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Change
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Other income (expense): | | | | | | | | | | | | | | | | | | | |
Grant income
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| | | | 12,289 | | | | | | 9,338 | | | | | | 2,951 | | |
Change in the fair value of the derivative liability
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| | | | — | | | | | | 2,209 | | | | | | (2,209) | | |
Change in the fair value of SAFEs
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| | | | — | | | | | | (1,044) | | | | | | 1,044 | | |
Other (expense) income, net
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| | | | (237) | | | | | | 248 | | | | | | (485) | | |
Gain on debt extinguishment
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| | | | — | | | | | | 443 | | | | | | (443) | | |
Interest expense, net
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| | | | (16) | | | | | | (894) | | | | | | 878 | | |
Total other income, net
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| | | | 12,036 | | | | | | 10,300 | | | | | | 1,736 | | |
Loss before income taxes
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| | | | (9,590) | | | | | | (1,267) | | | | | | (8,323) | | |
Net loss
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| | | $ | (9,590) | | | | | $ | (1,267) | | | | | $ | (8,323) | | |
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Six Months Ended
June 30, |
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2022
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2021
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Change
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Clinical programs
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| | | $ | 9,050 | | | | | $ | 1,684 | | | | | $ | 7,366 | | |
Personnel
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| | | | 3,362 | | | | | | 1,936 | | | | | | 1,426 | | |
Manufacturing
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| | | | 2,061 | | | | | | 4,719 | | | | | | (2,658) | | |
Preclinical programs
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| | | | 1,036 | | | | | | 926 | | | | | | 110 | | |
Facilities and other costs
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| | | | 107 | | | | | | 59 | | | | | | 48 | | |
| | | | $ | 15,616 | | | | | $ | 9,324 | | | | | $ | 6,292 | | |
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Year Ended
December 31, |
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(in thousands)
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2021
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2020
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Change
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Consolidated Statements of Operations Data: | | | | | | | | | | | | | | | | | | | |
Operating Expenses: | | | | | | | | | | | | | | | | | | | |
Research and development
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| | | $ | 18,572 | | | | | $ | 12,887 | | | | | $ | 5,685 | | |
General and administrative
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| | | | 10,026 | | | | | | 4,520 | | | | | | 5,506 | | |
Total operating expenses
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| | | | 28,598 | | | | | | 17,407 | | | | | | 11,191 | | |
Loss from operations
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| | | | (28,598) | | | | | | (17,407) | | | | | | (11,191) | | |
Other income (expense): | | | | | | | | | | | | | | | | | | | |
Grant income
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| | | | 17,447 | | | | | | 10,855 | | | | | | 6,592 | | |
Change in the fair value of the derivative liability
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| | | | 2,209 | | | | | | 18 | | | | | | 2,191 | | |
Change in the fair value of the warrant liability
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| | | | — | | | | | | 181 | | | | | | (181) | | |
Change in the fair value of the Simple Agreements for Future
Equity |
| | | | (2,236) | | | | | | — | | | | | | (2,236) | | |
Other (expense) income, net
|
| | | | (88) | | | | | | 394 | | | | | | (482) | | |
Gain (loss) on debt extinguishment
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| | | | 443 | | | | | | (129) | | | | | | 572 | | |
Interest expense, net
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| | | | (893) | | | | | | (1,751) | | | | | | 858 | | |
Total other income, net
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| | | | 16,882 | | | | | | 9,568 | | | | | | 7,314 | | |
Net loss
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| | | $ | (11,716) | | | | | $ | (7,839) | | | | | $ | (3,877) | | |
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Year Ended
December 31, |
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| | |
2021
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2020
|
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Change
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Clinical programs
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| | | $ | 4,679 | | | | | $ | 5,263 | | | | | $ | (584) | | |
Personnel
|
| | | | 4,882 | | | | | | 4,026 | | | | | | 856 | | |
Manufacturing
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| | | | 7,465 | | | | | | 1,798 | | | | | | 5,667 | | |
Preclinical programs
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| | | | 1,426 | | | | | | 1,693 | | | | | | (267) | | |
Facilities and other costs
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| | | | 120 | | | | | | 107 | | | | | | 13 | | |
| | | | $ | 18,572 | | | | | $ | 12,887 | | | | | $ | 5,685 | | |
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Six Months Ended
June 30, |
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| | |
2022
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2021
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Cash flows used in operating activities
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| | | $ | (8,345) | | | | | $ | (1,682) | | |
Cash flows used in investing activities
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| | | | (138) | | | | | | — | | |
Cash flows (used in) provided by financing activities
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| | | | (465) | | | | | | 7,801 | | |
Effect of exchange rate changes on cash and cash equivalents
|
| | | | (2) | | | | | | (8) | | |
Net (decrease) increase in cash and cash equivalents
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| | | $ | (8,950) | | | | | $ | 6,111 | | |
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Less than
1 Year |
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1 to 3
Years |
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3 to 5
Years |
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More than 5
years |
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Total
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Operating lease obligations:
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| | | $ | 149 | | | | | $ | 193 | | | | | $ | 170 | | | | | $ | 191 | | | | | $ | 703 | | |
Total:
|
| | | $ | 149 | | | | | $ | 193 | | | | | $ | 170 | | | | | $ | 191 | | | | | $ | 703 | | |
| | |
Kd (nM)
|
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B maxa
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wt Aβ (1 – 42) oligomers
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| | Site 1:442 ± 70 | | |
7.98 × 105 ± 0.29 × 105
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A673T mutant Aβ (1 – 42) oligomers
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Site 1:1,955 ± 502
|
| |
5.98 × 105 ± 0.50 × 105
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Funding Org
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Year
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Project
|
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Amount
|
| ||||||
National Institute on Aging (NIH)
|
| | | | 2016 | | | |
COG0101 Ph1b first-in-patient trial for CT1812
|
| | | $ | 2,410,669 | | |
National Institute on Aging (NIH)
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| | | | 2016 | | | | COG0102 Ph1b/2a Clinical Trial for CT1812 | | | | $ | 2,410,669 | | |
National Institute on Aging (NIH)
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| | | | 2017 | | | | COG0104 Ph1 SNAP Study: CSF Catheter | | | | $ | 2,527,271 | | |
National Institute on Aging (NIH)
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| | | | 2017 | | | | COG0105 Ph1 SPARC Study: SV2a PET | | | | $ | 4,795,774 | | |
National Institute on Aging (NIH)
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| | | | 2018 | | | | COG0201 Ph2 SHINE Study | | | | $ | 16,848,329 | | |
National Institute on Aging (NIH)
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| | | | 2019 | | | | COG0202 Ph2 SEQUEL Study: qEEG | | | | $ | 5,445,051 | | |
National Institute on Aging (NIH)
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| | | | 2020 | | | | COG0203 Ph2 Study with ACTC | | | | $ | 80,974,766 | | |
National Institute on Aging (NIH)
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| | | | 2021 | | | | COG0108 Study: hAME | | | | $ | 1,642,783 | | |
National Institute on Aging (NIH)
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| | | | 2021 | | | | COG0201 Ph2 SHINE Amendment | | | | $ | 13,634,548 | | |
National Institute on Aging (NIH)
|
| | | | 2021 | | | | COG1201: Study: DLB | | | | $ | 29,498,048 | | |
NIH and others
|
| |
2010 – 2021
|
| | Ten Preclinical Programs | | | | $ | 10,859,971 | | | |||
| | | | | | | | | | | | | $ | 171,047,879 | | |
Underwriter
|
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Number of Shares
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Cantor Fitzgerald & Co.
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Newbridge Securities Corporation
|
| | | |
Total
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| | | |
| | |
Per Share
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Total
|
| ||||||||||||||||||
| | |
Without
Option to Purchase Additional Shares |
| |
With
Option to Purchase Additional Shares |
| |
Without
Option to Purchase Additional Shares |
| |
With
Option to Purchase Additional Shares |
| ||||||||||||
Public offering price
|
| | | $ | | | | | $ | | | | | $ | | | | | $ | | | ||||
Underwriting discounts and commissions (6%)
|
| | | $ | | | | | $ | | | | | $ | | | | | $ | | | ||||
Proceeds to us, before expenses
|
| | | $ | | | | | $ | | | | | $ | | | | | $ | | | |
Item
|
| |
Amount
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SEC registration fee
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| | | $ | 1,267 | | |
FINRA filing fee
|
| | | | 4,813 | | |
Legal fees and expenses
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| | | | 150,000 | | |
Accounting fees and expenses
|
| | | | 60,000 | | |
Printing expenses
|
| | | | 30,000 | | |
Miscellaneous expenses
|
| | | | 3,920 | | |
Total
|
| | | $ | 250,000 | | |
|
Exhibit
number |
| |
Exhibit description
|
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| 24.1* | | | | |
| 107* | | | |
|
Signature
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Title
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Date
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/s/ Lisa Ricciardi
Lisa Ricciardi
|
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Chief Executive Officer, President and Director
(Principal Executive Officer) |
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November 7, 2022
|
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/s/ Andrew Einhorn
Andrew Einhorn
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Interim Chief Financial Officer
(Principal Financial and Accounting Officer) |
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November 7, 2022
|
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/s/ Jack A. Khattar
Jack A. Khattar
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Director (Chairman of the Board)
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November 7, 2022
|
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/s/ Aaron G. L. Fletcher, Ph.D.
Aaron G. L. Fletcher, Ph.D.
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Director
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November 7, 2022
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/s/ Brett P. Monia, Ph.D.
Brett P. Monia, Ph.D.
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Director
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November 7, 2022
|
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/s/ Ellen B. Richstone
Ellen B. Richstone
|
| |
Director
|
| |
November 7, 2022
|
|
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/s/ Peggy Wallace
Peggy Wallace
|
| |
Director
|
| |
November 7, 2022
|
|
Exhibit 1.1
COGNITION THERAPEUTICS, INC.
[_________] Shares of Common Stock
(par value $0.001 per share)
Underwriting Agreement
November [__], 2022
Cantor Fitzgerald & Co.
As Representative of the several
Underwriters listed in Schedule A
Hereto
c/o Cantor Fitzgerald & Co.
499 Park Avenue
New York, NY 10022
Ladies and Gentlemen:
Cognition Therapeutics, Inc., a Delaware corporation (the “Company”), proposes to issue and sell to the several underwriters named in Schedule A (the “Underwriters”) an aggregate of [_______] shares (the “Firm Shares”) of its common stock, par value $0.001 per share (“Common Stock”). In addition, the Company has granted to the Underwriters an option to purchase up to an additional [_________] shares of Common Stock, which are collectively called the “Option Shares.” The Firm Shares and, if and to the extent such option is exercised, the Option Shares, are collectively called the “Offered Shares.” Cantor Fitzgerald & Co. (“Cantor”) has agreed to act as representative of the several Underwriters (in such capacity, the “Representative”) in connection with the offering and sale of the Offered Shares. To the extent there are no additional underwriters listed on Schedule A, the term “Representative” as used herein shall mean Cantor, as Underwriter, and the term “Underwriters” shall mean either the singular or the plural, as the context requires.
The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) a registration statement on Form S-1, File No. 333-[_______]. Such registration statement, as amended or supplemented, including the financial statements, exhibits and schedules thereto, in the form in which it became effective under the Securities Act of 1933, and the rules and regulations promulgated thereunder (collectively, the “Securities Act”), including all documents incorporated or deemed to be incorporated by reference therein and any information deemed to be a part thereof at the time of effectiveness pursuant to Rule 430A or 430B under the Securities Act, is called the “Registration Statement.” Any registration statement filed by the Company pursuant to Rule 462(b) under the Securities Act in connection with the offer and sale of the Offered Shares is called the “Rule 462(b) Registration Statement,” and from and after the date and time of filing of any such Rule 462(b) Registration Statement the term “Registration Statement” shall include the Rule 462(b) Registration Statement. The preliminary prospectus dated November [__], 2022 describing the Offered Shares and the offering thereof is called the “Preliminary Prospectus,” and the Preliminary Prospectus and any other prospectus in preliminary form that describes the Offered Shares and the offering thereof and is used prior to the filing of the Prospectus (as defined below) is called a “preliminary prospectus.” As used herein, the term “Prospectus” shall mean the final prospectus in the form first used by the Underwriters to confirm sales of the Offered Shares or in the form first made available to the Underwriters by the Company to meet requests of purchasers pursuant to Rule 173 under the Securities Act.
As used herein, “Applicable Time” is [____] p.m. (New York time) on November [__], 2022. As used herein, “free writing prospectus” has the meaning set forth in Rule 405 under the Securities Act, and “Time of Sale Prospectus” means the Preliminary Prospectus, as amended or supplemented immediately prior to the Applicable Time, together with the free writing prospectuses, if any, identified on Schedule B hereto and the pricing information set forth on Schedule C hereto. As used herein, “Road Show” means a “road show” (as defined in Rule 433 under the Securities Act) relating to the offering of the Offered Shares contemplated hereby that is a “written communication” (as defined in Rule 405 under the Securities Act). As used herein, “Section 5(d) Written Communication” means each written communication (within the meaning of Rule 405 under the Securities Act) that is made in reliance on Section 5(d) of the Securities Act by the Company or any person authorized to act on behalf of the Company to one or more potential investors that are qualified institutional buyers (“QIBs”) and/or institutions that are accredited investors (“IAIs”), as such terms are respectively defined in Rule 144A and Rule 501(a) under the Securities Act, to determine whether such investors might have an interest in the offering of the Offered Shares; “Section 5(d) Oral Communication” means each oral communication, if any, made in reliance on Section 5(d) of the Securities Act by the Company or any person authorized to act on behalf of the Company made to one or more QIBs and/or one or more IAIs to determine whether such investors might have an interest in the offering of the Offered Shares; “Marketing Materials” means any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the offering of the Offered Shares, including any Road Show or investor presentations made to investors by the Company (whether in person or electronically); and “Permitted Section 5(d) Communication” means the Section 5(d) Written Communication(s) and Marketing Materials listed on Schedule D attached hereto.
All references in this Agreement to financial statements and schedules and other information which are “contained,” “included” or “stated” in, or “part of” the Registration Statement, the Rule 462(b) Registration Statement, the Preliminary Prospectus, any preliminary prospectus, the Time of Sale Prospectus 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 the Registration Statement, the Rule 462(b) Registration Statement, the Preliminary Prospectus, any preliminary prospectus, the Time of Sale Prospectus or the Prospectus, as the case may be.
All references in this Agreement to amendments or supplements to the Registration Statement, the Preliminary Prospectus, any preliminary prospectus, the Time of Sale Prospectus or the Prospectus shall be deemed to mean and include the filing of any document under the Securities Exchange Act of 1934, as amended and the rules and regulations promulgated thereunder (collectively, the “Exchange Act”), that is or is deemed to be incorporated by reference in the Registration Statement, the Preliminary Prospectus, any preliminary prospectus or the Prospectus, as the case may be.
-2-
All references in this Agreement to (i) the Registration Statement, the Preliminary Prospectus, any preliminary prospectus or the Prospectus, any amendments or supplements to any of the foregoing, or any free writing prospectus, shall include any copy thereof filed with the Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval System (“EDGAR”) and (ii) the Prospectus shall be deemed to include any “electronic Prospectus” provided for use in connection with the offering of the Offered Shares as contemplated by Section 3(n) below.
In the event that the Company has only one subsidiary, then all references herein to “subsidiaries” of the Company shall be deemed to refer to such single subsidiary, mutatis mutandis.
The Company hereby confirms its agreements with the Underwriters as follows:
1. Representations and Warranties of the Company. The Company represents and warrants to each Underwriter as of the date of this Agreement, the Applicable Time, the First Closing Date (as hereinafter defined) and each Option Closing Date (as hereinafter defined), if any, as follows:
(a) Compliance with Registration Requirements. The Registration Statement has become effective under the Securities Act. The Company has complied, to the Commission’s satisfaction, with all requests of the Commission for additional or supplemental information, if any. No stop order suspending the effectiveness of the Registration Statement is in effect and no proceedings for such purpose have been instituted or are pending or, to the best knowledge of the Company, are contemplated or threatened by the Commission. The documents incorporated or deemed to be incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus, at the time they were or hereafter are filed with the Commission, or became effective under the Exchange Act, as the case may be, complied and will comply in all material respects with the requirements of the Exchange Act.
(b) Disclosure. Each preliminary prospectus and the Prospectus when filed complied in all material respects with the Securities Act and, if filed by electronic transmission pursuant to EDGAR, was identical (except as may be permitted by Regulation S-T under the Securities Act) to the copy thereof delivered to the Underwriters for use in connection with the offer and sale of the Offered Shares. Each of the Registration Statement and any post-effective amendment thereto, at the time it became or becomes effective and at all subsequent times, 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 Applicable Time, the Time of Sale Prospectus did not, and at the First Closing Date and at each, if applicable, Option Closing Date (as defined in Section 2), the Time of Sale Prospectus, as then amended or supplemented by the Company, if applicable, will not, contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Prospectus as of its date (as amended or supplemented) did not, and at the First Closing Date and each, as applicable, Option Closing 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 the 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 or any post-effective amendment thereto, or the Prospectus or the Time of Sale Prospectus, or any amendments or supplements thereto, made in reliance upon and in conformity with written information relating to any Underwriter furnished to the Company in writing by the Representative expressly for use therein, it being understood and agreed that the only such information consists of the information described in Section 9(b) below. There are no contracts or other documents required to be described in the Time of Sale Prospectus or the Prospectus or to be filed as an exhibit to the Registration Statement which have not been described or filed as required.
-3-
(c) Free Writing Prospectuses; Road Show. As of the determination date referenced in Rule 164(h) under the Securities Act, the Company was not, is not or will not be (as applicable) an “ineligible issuer” in connection with the offering of the Offered Shares pursuant to Rules 164, 405 and 433 under the Securities Act. Each 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 on 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 public offer and sale of the Offered Shares did not, does not and will not include any information that conflicted, conflicts or will conflict with the information contained in the Registration Statement, the Prospectus or any preliminary prospectus and not superseded or modified. Except for the free writing prospectuses, if any, identified in Schedule B, and electronic road shows, if any, furnished to the Representative before first use, the Company has not prepared, used or referred to, and will not, without the Representative’s prior written consent, prepare, use or refer to, any free writing prospectus. Each Road Show, when considered together with the Time of Sale Prospectus, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.
(d) Emerging Growth Company. From the time of initial confidential submission of the Registration Statement to the Commission (or, if earlier, the first date on which the Company engaged directly or through any person authorized to act on its behalf in any Section 5(d) Written Communication or Section 5(d) Oral Communication) through the date hereof, the Company has been and is an “emerging growth company,” as defined in Section 2(a) of the Securities Act (an “Emerging Growth Company”).
(e) Testing-the-Waters Materials. The Company (i) has not alone engaged in any Section 5(d) Written Communication or Section 5(d) Oral Communication other than Permitted Section 5(d) Communications with the consent of the Representatives with entities that are QIBs or IAIs and (ii) has not authorized anyone other than the Representatives to engage in such Permitted Section 5(d) Communications. The Company reconfirms that the Representatives have been authorized to act on its behalf in undertaking Marketing Materials, Section 5(d) Oral Communications and Section 5(d) Written Communications. The Company has not distributed or approved for distribution any Section 5(d) Written Communications other than those listed on Schedule D hereto. Any individual Permitted Section 5(d) Communication does not conflict with the information contained in the Registration Statement or the Time of Sale Prospectus, complied in all material respects with the Securities Act, and when taken together with the Time of Sale Prospectus as of the Applicable Time, did not, and as of the First Closing Date and as of each Option Closing Date, as the case may be, 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 the light of the circumstances under which they were made, not misleading.
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(f) Distribution of Offering Material By the Company. Prior to the later of (i) the expiration or termination of the option granted to the several Underwriters in Section 2 and (ii) the completion of the Underwriters’ distribution of the Offered Shares, the Company has not distributed and will not distribute any offering material in connection with the offering and sale of the Offered Shares other than the Registration Statement, the Time of Sale Prospectus, the Prospectus or any free writing prospectus reviewed and consented to by the Representative, and the free writing prospectuses, if any, identified on Schedule B hereto and any Permitted Section 5(d) Communications.
(g) Financial Information. The consolidated financial statements of the Company included or incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus, if any, together with the related notes and schedules, present fairly, in all material respects, the consolidated financial position of the Company and the Subsidiaries (as defined below) as of the dates indicated and the consolidated results of operations, cash flows and changes in stockholders’ equity of the Company for the periods specified and have been prepared in compliance with the requirements of the Securities Act and Exchange Act and in conformity with GAAP (as defined below) applied on a consistent basis during the periods involved, except as may be expressly stated in the related notes thereto; there are no financial statements (historical or pro forma) that are required to be included or incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus that are not included or incorporated by reference as required; the Company and the Subsidiaries (as defined below) do not have any material liabilities or obligations, direct or contingent (including any off-balance sheet obligations), not described in the Registration Statement (excluding the exhibits thereto), the Time of Sale Prospectus and the Prospectus; and all disclosures contained or incorporated by reference in the Registration Statement, the Time of Sale Prospectus and the Prospectus and the Issuer Free Writing Prospectuses, if any, regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations of the Commission) comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K under the Securities Act, to the extent applicable. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement and the Prospectus fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s rules and guidelines applicable thereto.
(h) Conformity with EDGAR Filing. The Preliminary Prospectus and Final Prospectus delivered to the Underwriter for use in connection with the sale of the Offered Shares pursuant to this Agreement will be identical to the versions of the Preliminary Prospectus and Final Prospectus created to be transmitted to the Commission for filing via EDGAR, except to the extent permitted by Regulation S-T.
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(i) Organization. The Company and each of its subsidiaries (as defined in Rule 405 under the Securities Act) (“Subsidiaries”) are duly organized, validly existing as a corporation and in good standing under the Laws of their respective jurisdictions of organization. The Company and each of its Subsidiaries are duly licensed or qualified as a foreign corporation for transaction of business and in good standing under the Laws of each other jurisdiction in which their respective ownership or lease of property or the conduct of their respective businesses requires such license or qualification, and have all corporate power and authority necessary to own or hold their respective properties and to conduct their respective businesses as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate, have a material adverse effect or would reasonably be expected to have a material adverse effect on or affecting the assets, business, operations, earnings, properties, condition (financial or otherwise), prospects, stockholders’ equity or results of operations of the Company and the Subsidiaries taken as a whole, or prevent or materially interfere with the consummation of the transactions contemplated hereby (a “Material Adverse Effect”).
(j) Subsidiaries. Except as set forth in the Registration Statement, the Time of Sale Prospectus and the Prospectus, the Company has no subsidiary that is a "significant subsidiary" of the Company within the meaning of Rule 1.01 of Regulation S-X under the Act.
(k) No Violation or Default. Neither the Company nor any of its Subsidiaries is (i) in violation of its charter or by-laws or similar organizational documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound or to which any of the property or assets of the Company or any of its Subsidiaries are subject; or (iii) in violation of any Law of any Governmental Authority, except, in the case of each of clauses (ii) and (iii) above, for any such violation or default that would not, individually or in the aggregate, have a Material Adverse Effect. To the Company’s knowledge, no other party under any material contract or other agreement to which it or any of its Subsidiaries is a party is in default in any respect thereunder where such default would have a Material Adverse Effect.
(l) No Material Adverse Effect. Subsequent to the respective dates as of which information is given in the Registration Statement, the Time of Sale Prospectus, the Prospectus and the Free Writing Prospectuses, if any (including any document deemed incorporated by reference therein), there has not been (i) any Material Adverse Effect or the occurrence of any development that the Company reasonably expects will result in a Material Adverse Effect, (ii) any transaction which is material to the Company and the Subsidiaries taken as a whole, (iii) any obligation or liability, direct or contingent (including any off-balance sheet obligations), incurred by the Company or any Subsidiary, which is material to the Company and the Subsidiaries taken as a whole, (iv) any material change in the capital stock or outstanding long-term indebtedness of the Company or any of its Subsidiaries or (v) any dividend or distribution of any kind declared, paid or made on the capital stock of the Company or any Subsidiary, other than in each case above in the ordinary course of business or as otherwise disclosed in the Registration Statement or Prospectus (including any document incorporated by reference therein).
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(m) Capitalization. The issued and outstanding shares of capital stock of the Company have been validly issued, are fully paid and nonassessable and, other than as disclosed in the Registration Statement, the Time of Sale Prospectus or the Prospectus, are not subject to any preemptive rights, rights of first refusal or similar rights. The Company has an authorized, issued and outstanding capitalization as set forth in the Registration Statement and the Prospectus as of the dates referred to therein (other than the grant of additional options under the Company’s existing stock option plans, or changes in the number of outstanding shares of Common Stock of the Company due to the issuance of shares upon the exercise or conversion of securities exercisable for, or convertible into, Common Stock outstanding on the date hereof) and such authorized capital stock conforms to the description thereof set forth in the Registration Statement, the Time of Sale Prospectus and the Prospectus. The description of the securities of the Company in the Registration Statement, the Time of Sale Prospectus and the Prospectus is complete and accurate in all material respects. Except as disclosed in or contemplated by the Registration Statement, the Time of Sale Prospectus or the Prospectus, as of the date referred to therein, the Company does not have outstanding any options to purchase, or any rights or warrants to subscribe for, or any securities or obligations convertible into, or exchangeable for, or any contracts or commitments to issue or sell, any shares of capital stock or other securities.
(n) Authorization; Enforceability. The Company has full legal right, power and authority to enter into this Agreement and perform the transactions contemplated hereby. This Agreement has been duly authorized, executed and delivered by the Company and is a legal, valid and binding agreement of the Company enforceable in accordance with its terms, except to the extent that enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general equitable principles.
(o) Authorization of the Offered Shares. The Offered Shares have been duly authorized for issuance and sale pursuant to this Agreement and, when issued and delivered by the Company against payment therefor pursuant to this Agreement, will be duly and validly issued, fully paid and nonassessable, free and clear of any pledge, lien, encumbrance, security interest or other claim, including any statutory or contractual preemptive rights, resale rights, rights of first refusal or other similar rights, and will be registered pursuant to Section 12 of the Exchange Act. The Offered Shares, when issued, will conform to the description thereof set forth in or incorporated into the Registration Statement, the Time of Sale Prospectus and the Prospectus.
(p) No Consents Required. No consent, approval, authorization, order, registration or qualification of or with any Governmental Authority is required for the execution, delivery and performance by the Company of this Agreement, the issuance and sale by the Company of the Offered Shares, except for such consents, approvals, authorizations, orders and registrations or qualifications as may be required under applicable state securities Laws or Laws of the Financial Industry Regulatory Authority Inc. (“FINRA”) or NASDAQ (as defined below) in connection with the sale of the Offered Shares.
(q) No Preferential Rights. Except as set forth in the Registration Statement, the Time of Sale Prospectus and the Prospectus, (i) no person, as such term is defined in Rule 1-02 of Regulation S-X promulgated under the Securities Act (each, a “Person”), has the right, contractual or otherwise, to cause the Company to issue or sell to such Person any Common Stock or shares of any other capital stock or other securities of the Company, (ii) no Person has any preemptive rights, resale rights, rights of first refusal, rights of co-sale, or any other rights (whether pursuant to a “poison pill” provision or otherwise) to purchase any Common Stock or shares of any other capital stock or other securities of the Company, (iii) no Person has the right to act as an underwriter or as a financial advisor to the Company in connection with the offer and sale of the Common Stock, and (iv) no Person has the right, contractual or otherwise, to require the Company to register under the Securities Act any Common Stock or shares of any other capital stock or other securities of the Company, or to include any such shares or other securities in the Registration Statement or the offering contemplated thereby, whether as a result of the filing or effectiveness of the Registration Statement or the sale of the Offered Shares as contemplated thereby or otherwise.
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(r) Independent Public Accounting Firm. Ernst & Young LLP (the “Accountant”), whose report on the consolidated financial statements of the Company is filed with the Commission as part of the Company’s most recent Annual Report on Form 10-K filed with the Commission and incorporated by reference into the Registration Statement and the Prospectus, are and, during the periods covered by their report, were an independent registered public accounting firm within the meaning of the Securities Act and the Public Company Accounting Oversight Board (United States). To the Company’s knowledge, the Accountant is not in violation of the auditor independence requirements of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) with respect to the Company.
(s) Enforceability of Agreements. All agreements between the Company and third parties expressly referenced in the Prospectus are legal, valid and binding obligations of the Company enforceable in accordance with their respective terms, except to the extent that (i) enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar Laws affecting creditors’ rights generally and by general equitable principles and (ii) the indemnification provisions of certain agreements may be limited by federal or state securities Laws or public policy considerations in respect thereof.
(t) No Litigation. There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or governmental proceeding pending or, to the Company’s knowledge, threatened against, or involving the Company or, to the Company’s knowledge, any executive officer or director that is required to be disclosed in the Time of Sale Prospectus, the Prospectus and the Registration Statement which has not been disclosed therein.
(u) Possession of Licenses and Permits. The Company (A) possesses the licenses, permits, certificates, authorizations, consents and approvals (collectively, "Governmental Licenses") issued by the appropriate governmental entities necessary to conduct its business as currently conducted as described in the Time of Sale Prospectus, the Prospectus and the Registration Statement, and (B) has obtained all necessary Governmental Licenses from other persons necessary to conduct its business, except, in each case of clauses (A) and (B), (i) as described in the Time of Sale Prospectus, the Prospectus and the Registration Statement or (ii) to the extent that any failure to possess any Governmental Licenses, provide any notice, make any filing, or obtain any Governmental Licenses would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; none of the Company and subsidiaries is in violation of, or in default under, any Governmental License, except as would not reasonably be expected to have a Material Adverse Effect. All of the Governmental Licenses are valid and in full force and effect, except when the invalidity of such Governmental Licenses or the failure of such Governmental Licenses to be in full force and effect would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Company has not received any notice of proceedings relating to the revocation or modification of any Governmental Licenses which, individually or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a Material Adverse Effect.
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(v) Health Care Authorizations. The Company has submitted and possesses, or qualifies for applicable exemptions to, such valid and current registrations, listings, approvals, clearances, licenses, certificates, authorizations or permits and supplements or amendments thereto (collectively, “Health Care Authorizations”) issued or required by the appropriate local, state, federal, national, supranational or other foreign regulatory agencies or bodies (collectively, “Health Regulatory Agencies”) necessary to conduct its business as described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, including, without limitation, all such Health Care Authorizations required by the FDA, the Australian Therapeutic Goods Administration (“TGA”), the Department of Health and Human Services, the European Commission, the EMA or any other Health Regulatory Agencies engaged in the regulation of Biologics (as defined in the Public Health Service Act of 1944, as amended (42 U.S.C. 6A et seq.)), except as would not be reasonably expected to result in a Material Adverse Effect. The Company has not received any notice of proceedings, or have any knowledge of any threatened proceedings, relating to the revocation or modification of, or non-compliance with, any such Health Care Authorization, except where such revocation, modification or non-compliance would not result in a Material Adverse Effect.
(w) Compliance with Health Care Laws. The Company is, and has been, in compliance with all applicable Health Care Laws, and has not engaged in activities which are, as applicable, cause for false claims liability, civil penalties, or mandatory or permissive exclusion from Medicare, Medicaid or any other state, federal or national health care program, except where such noncompliance, false claims liability or civil penalties would not reasonably be expected to, singly or in the aggregate, result in a Material Adverse Effect. For purposes of this Agreement, "Health Care Laws" means all health care laws applicable to the Company, including, but not limited to: the Federal Food, Drug, and Cosmetic Act (21 U.S.C. Section 301 et seq.), the Anti-Kickback Statute (42 U.S.C. Section 1320a-7b(b)), the Civil Monetary Penalties Law (42 U.S.C. § 1320a-7a), the Physician Payments Sunshine Act (42 U.S.C. § 1320a-7h), the Civil False Claims Act (31 U.S.C. Section 3729 et seq.), the criminal False Claims Law (42 U.S.C. § 1320a-7b(a)), all criminal laws relating to health care fraud and abuse, including but not limited to 18 U.S.C. Sections 286 and 287, and the health care fraud criminal provisions under the U.S. Health Insurance Portability and Accountability Act of 1996 ("HIPAA") (42 U.S.C. Section 1320d et seq.), the exclusion laws (42 U.S.C. § 1320a-7), Basic Health and Human Services Policy for Protection of Human Research Subjects "Common Rule" as codified and enforced by the Department of Health and Human Services in 45 C.F.R. part 46 and enforced by FDA under 21 C.F.R. part 50, Laboratory Animal Welfare Act of 1966, HIPAA, as amended by the Health Information Technology for Economic and Clinical Health Act (42 U.S.C. Section 17921 et seq.), Medicare (Title XVIII of the Social Security Act), Medicaid (Title XIX of the Social Security Act), any and all other applicable comparable local, state, federal, national, supranational and foreign health care laws and the regulations promulgated pursuant to such laws, each as amended from time to time. The Company has not received written notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any court or arbitrator or governmental or regulatory authority or third party alleging that any product operation or activity is in material violation of any Health Care Laws, and, to the knowledge of the Company, no such claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action is threatened. The Company has not received any written notice of adverse filing, warning letter, untitled letter or other correspondence or notice from the FDA, the European Commission, the EMA, the TGA or any other Health Regulatory Agencies, or any other court or arbitrator, alleging or asserting material noncompliance with the Health Care Laws. The Company is not a party to and has no ongoing reporting obligations pursuant to any corporate integrity agreements, deferred prosecution agreements, monitoring agreements, consent decrees, settlement orders, plans of correction or similar agreements with or imposed by any governmental or regulatory authority. Additionally, neither the Company, nor, to the knowledge of the Company, any of its employees, officers or directors has been excluded, suspended or debarred from participation in any U.S. federal health care program or human research study or trial or, to the knowledge of the Company, is subject to a governmental inquiry, investigation, proceeding, or other similar action that could reasonably be expected to result in debarment, suspension or exclusion.
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(x) Research Studies and Trials. (A) The research studies and trials conducted by or, to the Company's knowledge, on behalf of, or sponsored by, the Company, or in which the Company has participated, that are described in the Registration Statement, the Time of Sale Prospectus or the Prospectus, or the results of which are referred to in the Registration Statement, the Time of Sale Prospectus or the Prospectus, as applicable, were and, if still pending, are being, conducted in all material respects in accordance with applicable experimental protocols, procedures and controls pursuant to, where applicable, accepted professional and scientific standards for products or product candidates comparable to those being developed by the Company and all applicable statutes, rules and regulations of the FDA, National Institute of Health Department of Health and Human Services, the European Commission, the EMA, the TGA and any other Health Regulatory Agencies to which it is subject; (B) the descriptions of the results of such studies and trials contained in the Registration Statement, the Time of Sale Prospectus or the Prospectus do not contain any misstatement of a material fact or omit to state a material fact necessary to make such statements not misleading; (C) the Company has no knowledge of any research studies or trials not described in the Registration Statement, the Time of Sale Prospectus and the Prospectus the results of which reasonably call into question in any material respect the results of the research studies and trials described in the Registration Statement, the Time of Sale Prospectus or the Prospectus; (D) the Company has not received any notices or correspondence from the FDA, the European Commission, the EMA, the TGA or any Health Regulatory Agency or any institutional review board or comparable authority requiring or threatening the premature termination, suspension, material modification or clinical hold of any research studies or trials conducted by or on behalf of, or sponsored by, the Company or in which the Company has participated that are described in the Registration Statement, the Time of Sale Prospectus or the Prospectus, and, to the Company's knowledge, there are no reasonable grounds for the same; (E) there has not been any violation of applicable law or regulation by the Company in any of its product development efforts, submissions or reports to the FDA, the European Commission, the EMA, the TGA or any other Health Regulatory Agency that could reasonably be expected to require investigation, corrective action or result in enforcement action, except where such violation would not, singly or in the aggregate, result in a Material Adverse Effect; and (F) the research studies and clinical trials of Company are being conducted in an ethical and human manner under state, national or supra-national applicable laws that are either equal or more stringent than applicable laws and regulations enforced by the Department of Health and Human Services and FDA governing human, animal or non-human primate research participants and test subjects and such studies and the clinical trials are conducted under the auspices of a neutral and independent Institutional Animal Care and Use Committee or Institutional Review Board and applicable state, national, or supra national agencies responsible for oversight.
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(y) Health Care Products Manufacturing. The manufacture of the Company's products by or, to the knowledge of the Company, on behalf of the Company is being conducted in compliance with all applicable Health Care Laws, including, without limitation, the FDA's regulation pertaining to Biologics at 21 CFR Part 600, and, to the extent applicable, the respective counterparts thereof promulgated by the European Commission, the EMA, TGA or other Health Regulatory Agencies. Except as disclosed in the Registration Statement, the Time of Sale Prospectus and the Prospectus, the Company has not had any manufacturing site (whether owned by the Company or, to the knowledge of the Company, that of a third party manufacturer for the Company's products) subject to an FDA, European Commission, EMA, TGA or other Health Regulatory Agency shutdown or import or export prohibition, nor received any FDA, European Commission, EMA or other Health Regulatory Agency "warning letters," or "untitled letters" alleging or asserting material noncompliance with any applicable Health Care Laws, requests to make material changes to the Company's products, processes or operations, or similar correspondence or notice from the FDA, the European Commission, the EMA, the TGA or other Health Regulatory Agency alleging or asserting material noncompliance with any applicable Health Care Laws, other than those that have been satisfactorily addressed and/or closed with the FDA, the European Commission, the EMA or other Health Regulatory Agency. To the knowledge of the Company, none of the FDA, the European Commission, the EMA, the TGA or any other Health Regulatory Agency is considering such action
(z) Possession of Intellectual Property. The Company owns or possesses all licenses or other rights to use all patents, trademarks, service marks, trade names, copyrights, software and design licenses, trade secrets, manufacturing processes, other intangible property rights and know-how as are necessary for the conduct of its business as described in the Time of Sale Prospectus, the Prospectus and the Registration Statement (collectively, "Intellectual Property"), except where the failure to own or possess such Intellectual Property would not reasonably be expected to have a Material Adverse Effect. The Company has not received written notice of any infringement of or conflict with (and the Company does not know of any such infringement of or conflict with) any asserted rights of others with respect to any Intellectual Property used by the Company that would reasonably be expected to have a Material Adverse Effect.
(aa) Company IT Systems. The Company owns or has a valid right to access and use all computer systems, networks, hardware, software, databases, websites and equipment used to process, store, maintain and operate data, information and functions necessary for the conduct of its business (the "Company IT Systems"), except where the failure to own or have the right to access the Company IT Systems would not reasonably be expected to have a Material Adverse Effect. The Company 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 as currently conducted except as would not be reasonably expected, individually or in the aggregate, to have a Material Adverse Effect.
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(bb) No Material Defaults. Neither the Company nor any of the Subsidiaries has defaulted on any installment on indebtedness for borrowed money or on any rental on one or more long-term leases, which defaults, individually or in the aggregate, would have a Material Adverse Effect. The Company has not filed a report pursuant to Section 13(a) or 15(d) of the Exchange Act since the filing of its last Annual Report on Form 10-K, indicating that it (i) has failed to pay any dividend or sinking fund installment on preferred stock or (ii) has defaulted on any installment on indebtedness for borrowed money or on any rental on one or more long-term leases, which defaults, individually or in the aggregate, would have a Material Adverse Effect.
(cc) Certain Market Activities. Neither the Company nor any of its subsidiaries has taken, directly or indirectly, any action designed to or that might cause or result in stabilization or manipulation of the price of the Shares or of any “reference security” (as defined in Rule 100 of Regulation M under the Exchange Act (“Regulation M”)) with respect to the Shares, whether to facilitate the sale or resale of the Offered Shares or otherwise, and has taken no action which would directly or indirectly violate Regulation M.
(dd) Broker/Dealer Relationships. Neither the Company nor any of the Subsidiaries (i) is required to register as a “broker” or “dealer” in accordance with the provisions of the Exchange Act or (ii) directly or indirectly through one or more intermediaries, controls or is a “person associated with a member” or “associated person of a member” (within the meaning set forth in the FINRA Manual).
(ee) No Reliance. The Company has not relied upon the Underwriter or legal counsel for the Underwriter for any legal, tax or accounting advice in connection with the offering and sale of the Offered Shares.
(ff) Payment of Taxes. Except as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect or where such matters are the result of a pending bona fide dispute with taxing authorities, (A) the Company has accurately prepared and timely filed all federal, state, foreign and other tax returns or other statements that are or were required to be filed by it, if any, and has paid or made provision for the payment of all taxes, assessments, governmental or other similar charges, including without limitation, all sales and use taxes and all taxes which it is obligated to withhold from amounts owing to employees, creditors and third parties, with respect to the periods covered by such tax returns (whether or not such amounts are shown as due on any tax return), (B) no deficiency assessment with respect to a proposed adjustment of the Company's federal, state, local or foreign taxes is pending or, to the Company’s knowledge threatened, (C) since the date of the most recent audited financial statements, the Company has not incurred any liability for taxes other than in the ordinary course of its business, and (D) there is no tax lien, whether imposed by any federal, state, foreign or other taxing authority, outstanding against the assets, properties or business of the Company.
(gg) Title to Property. The Company has legal and valid title to all assets and properties described as owned by it in the Time of Sale Prospectus, the Prospectus and the Registration Statement (whether through fee ownership, mineral estates or similar rights of ownership), in each case free and clear of all liens, except as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, and any real property or personal property held under lease by the Company is held under a lease that is valid, existing and enforceable by the Company with such exceptions as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, and the Company has not received any written notice of any material claim that is adverse to the rights of the Company under any lease.
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(hh) Environmental Laws. Except as set forth in the Registration Statement, the Time of Sale Prospectus or the Prospectus, (A) the Company is not in violation of any federal, state, local or foreign statute, law, rule, regulation, ordinance, code, policy or rule of common law or any judicial or administrative interpretation thereof, including any judicial or administrative order, consent, decree or judgment, relating to pollution or protection of human health, the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and regulations relating to the release or threatened release of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum or petroleum products, asbestos-containing materials or mold (collectively, "Hazardous Materials") or to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials (collectively, "Environmental Laws"), except for those violations that would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, (B) the Company has all permits, authorizations and approvals required under any applicable Environmental Laws and is in compliance in all material respects with their requirements, (C) there are no pending or, to the Company’s knowledge, threatened administrative, regulatory or judicial actions, suits, demands, demand letters, claims, liens, notices of noncompliance or violation, investigations or proceedings relating to any Environmental Law against the Company, and (D) to the Company's knowledge, there are no events or circumstances that would reasonably be expected to form the basis of an order for clean-up or remediation, or an action, suit or proceeding by any private party or governmental body or agency, against or affecting the Company relating to Hazardous Materials or any Environmental Laws.
(ii) Disclosure Controls. The Company and each of its Subsidiaries maintain systems 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 generally accepted accounting principles 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’s internal control over financial reporting is effective and the Company is not aware of any material weaknesses in its internal control over financial reporting (other than as set forth in the Registration Statement, Time of Sale Prospectus or Prospectus). Since the date of the latest audited financial statements of the Company included in the Prospectus, there has been no change in the Company’s internal control over financial reporting that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting (other than as set forth in the Registration Statement, Time of Sale Prospectus or Prospectus). The Company has established disclosure controls and procedures (as defined in Exchange Act Rules 13a-15 and 15d-15) for the Company and designed such disclosure controls and procedures to ensure that material information relating to the Company and each of its Subsidiaries is made known to the certifying officers by others within those entities, particularly during the period in which the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, is being prepared. The Company’s certifying officers have evaluated the effectiveness of the Company’s disclosure controls and procedures as of a date within 90 days prior to the filing date of the Form 10-K for the fiscal year most recently ended (such date, the “Evaluation Date”). The Company presented in its Form 10-K for the fiscal year most recently ended the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date and the disclosure controls and procedures are effective. Since the Evaluation Date, there have been no significant changes in the Company’s internal controls (as such term is defined in Item 307(b) of Regulation S-K under the Securities Act) or, to the Company’s knowledge, in other factors that could significantly affect the Company’s internal controls.
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(jj) Sarbanes-Oxley. There is and has been no failure on the part of the Company or any of the Company’s directors or officers, in their capacities as such, to comply in all material respects with any applicable provisions of the Sarbanes-Oxley Act and the rules and regulations promulgated thereunder. Each of the principal executive officer and the principal financial officer of the Company (or each former principal executive officer of the Company and each former principal financial officer of the Company as applicable) has made all certifications required by Sections 302 and 906 of the Sarbanes-Oxley Act with respect to all reports, schedules, forms, statements and other documents required to be filed by it or furnished by it to the Commission. For purposes of the preceding sentence, “principal executive officer” and “principal financial officer” shall have the meanings given to such terms in the Sarbanes-Oxley Act.
(kk) Brokers. Neither the Company nor any of the Subsidiaries has incurred any liability for any finder’s fees, brokerage commissions or similar payments in connection with the transactions herein contemplated, except as may otherwise exist with respect to or pursuant to this Agreement.
(ll) Employment Laws Compliance. The Company has not violated, or received any notice of any violation with respect to, any law, rule, regulation, order, decree or judgment applicable to it and its business, including those relating to transactions with affiliates, environmental, safety or similar laws, federal or state laws relating to discrimination in the hiring, promotion or pay of employees, federal or state wages and hours law, the Employee Retirement Income Security Act of 1974, as amended, or the rules and regulations promulgated thereunder, except for those violations that would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
(mm) Investment Company Act. Neither the Company nor any of the Subsidiaries is, or will be, either after receipt of payment for the Offered Shares or after the application of the proceeds therefrom as described under “Use of Proceeds” in the Registration Statement, the Time of Sale Prospectus or the Prospectus, required to register as an “investment company” or an entity “controlled” by an “investment company,” as such terms are defined in the Investment Company Act of 1940, as amended (the “Investment Company Act”).
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(nn) Money Laundering Laws. The Company has not, and to the Company’s knowledge, none of the officers or directors of the Company have, and, to the Company's knowledge, none of the Company’s employees or agents purporting to act on behalf of the Company, as applicable, have made any payment of funds of the Company or received or retained any funds in violation of any law, rule or regulation relating to the "know your customer" and anti-money laundering laws of any jurisdiction (collectively, the "Money Laundering Laws") and no action, suit or proceeding by or before any governmental entity involving the Company with respect to the Money Laundering Laws is pending or to the Company’s knowledge, threatened.
(oo) Off-Balance Sheet Arrangements. There are no transactions, arrangements and other relationships between and/or among the Company, and/or any of its affiliates and any unconsolidated entity, including any structural finance, special purpose or limited purpose entity (each, an “Off-Balance Sheet Transaction”) that could reasonably be expected to affect materially the Company’s liquidity or the availability of or requirements for its capital resources, including those Off-Balance Sheet Transactions described in the Commission’s Statement about Management’s Discussion and Analysis of Financial Conditions and Results of Operations (Release Nos. 33-8056; 34-45321; FR-61), required to be described in the Prospectus which have not been described as required.
(pp) ERISA. To the knowledge of the Company, each material employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974 (“ERISA”), that is maintained, administered or contributed to by the Company or any of its affiliates for employees or former employees of the Company and any of its Subsidiaries has been maintained in material compliance with its terms and the requirements of any applicable statutes, orders, rules and regulations, including ERISA and the Internal Revenue Code of 1986 (the “Code”); no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred which would result in a material liability to the Company with respect to any such plan excluding transactions effected pursuant to a statutory or administrative exemption; and for each such plan that is subject to the funding rules of Section 412 of the Code or Section 302 of ERISA, no “accumulated funding deficiency” as defined in Section 412 of the Code has been incurred, whether or not waived, and the fair market value of the assets of each such plan (excluding for these purposes accrued but unpaid contributions) exceeds the present value of all benefits accrued under such plan determined using reasonable actuarial assumptions.
(qq) Forward-Looking Statements. Each financial or operational projection or other “forward-looking statement” (as defined by Section 27A of the Securities Act or Section 21E of the Exchange Act) contained in the Registration Statement, the Time of Sale Prospectus or the Prospectus (i) was so included by the Company in good faith and with reasonable basis after due consideration by the Company of the underlying assumptions, estimates and other applicable facts and circumstances and (ii) is accompanied by meaningful cautionary statements identifying those factors that could cause actual results to differ materially from those in such forward-looking statement. No such statement was made with the knowledge of an executive officer or director of the Company that is was false or misleading.
(rr) Margin Rules. Neither the issuance, sale and delivery of the Offered Shares nor the application of the proceeds thereof by the Company as described in the Registration Statement and the Prospectus will violate Regulation T, U or X of the Board of Governors of the Federal Reserve System or any other regulation of such Board of Governors.
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(ss) Insurance. The Company carries, or is covered by, insurance (issued by insurers of recognized financial responsibility) in such amounts and covering such risks as is appropriate for the conduct of its entire business and the value of its assets, all of which insurance is in full force and effect in all material respects.
(tt) Foreign Corrupt Practices Act. Neither the Company nor any of the directors, employees or officers of the Company or, to its knowledge, any other person acting on behalf of the Company has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, or official or employee of any governmental agency or instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder the business of the Company (or assist it in connection with any actual or proposed transaction) that (i) might subject the Company to any damage or penalty in any civil, criminal or governmental litigation or proceeding, (ii) if not given in the past, might have had a Material Adverse Effect or (iii) if not continued in the future, might have a Material Adverse Effect. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the Foreign Corrupt Practices Act of 1977, as amended.
(uu) No Conflicts. Neither the execution of this Agreement, nor the issuance, offering or sale of the Offered Shares, nor the consummation of any of the transactions contemplated herein and therein, nor the compliance by the Company with the terms and provisions hereof and thereof will conflict with, or will result in a breach of, any of the terms and provisions of, or has constituted or will constitute a default under, or has resulted in or will result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any contract or other agreement to which the Company may be bound or to which any of the property or assets of the Company is subject, except (i) such conflicts, breaches or defaults as may have been waived and (ii) such conflicts, breaches and defaults that would not have a Material Adverse Effect; nor will such action result (x) in any violation of the provisions of the organizational or governing documents of the Company, or (y) in any material violation of the provisions of any statute or any order, rule or regulation applicable to the Company or of any Governmental Authority having jurisdiction over the Company.
(vv) OFAC. The Company is not, and, to the Company’s knowledge, none of its directors, officers agents or employees purporting to act on behalf of the Company are currently the target of or reasonably likely to become the target of any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury ("OFAC"); and the Company will not directly or indirectly use the proceeds of the Offering of the Public Securities hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently the target of any U.S. sanctions administered by OFAC.
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(ww) Statistical and Market-Related Data. All statistical, demographic and market-related data included in the Registration Statement, the Time of Sale Prospectus or the Prospectus are based on or derived from sources that the Company believes to be reliable and accurate or represent the Company’s good faith estimates that are made on the basis of data derived from such sources.
(xx) Stock Exchange Listing. The Shares are registered pursuant to Section 12(b) or 12(g) of the Exchange Act and are listed on The NASDAQ Global Market (“NASDAQ”), and the Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Shares under the Exchange Act or delisting the Shares from NASDAQ, nor has the Company received any notification that the Commission or NASDAQ is contemplating terminating such registration or listing. To the Company’s knowledge, it is in compliance with all applicable listing requirements of NASDAQ.
(yy) Related-Party Transactions. There are no business relationships or related-party transactions involving the Company or any of its subsidiaries or any other person required to be described in the Registration Statement, the Time of Sale Prospectus or the Prospectus that have not been described as required.
(zz) FINRA Matters. All of the information provided to the Underwriters or to counsel for the Underwriters by the Company, its counsel, its officers and directors and the holders of any securities (debt or equity) or options to acquire any securities of the Company in connection with the offering of the Offered Shares is true, complete, correct and compliant with FINRA’s rules and any letters, filings or other supplemental information provided to FINRA pursuant to FINRA Rules is true, complete and correct.
(aaa) Parties to Lock-Up Agreements. The Company has furnished to the Underwriters a letter agreement in the form attached hereto as Exhibit A (the “Lock-up Agreement”) from each of the persons listed on Exhibit B. Such Exhibit B lists under an appropriate caption the directors and executive officers of the Company. If any additional persons shall become directors or executive officers of the Company prior to the end of the Company Lock-up Period (as defined below), the Company shall cause each such person, prior to or contemporaneously with their appointment or election as a director or executive officer of the Company, to execute and deliver to CF&CO a Lock-up Agreement.
(bbb) 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 as currently conducted, free and clear of known 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 all “Personal Data” (defined below) and all sensitive, confidential or regulated data (“Confidential 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 the European Union General Data Protection Regulation (“GDPR”) (EU 2016/679); (iv) any information which would qualify as “protected health information” under HIPAA; (v) any “personal information” as defined by the California Consumer Privacy Act (“CCPA”); and (vi) 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. 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, Confidential Data, and Personal Data and to the protection of such IT Systems, Confidential Data, and Personal Data from unauthorized use, access, misappropriation or modification.
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(ccc) Compliance with Data Privacy Laws. The Company and its subsidiaries are, and at all prior times were, in material compliance with all applicable state and federal data privacy and security laws and regulations, including without limitation HIPAA, CCPA, and GDPR (collectively, the “Privacy Laws”). To ensure compliance with the Privacy Laws, the Company has in place, complies with, and takes appropriate steps to ensure compliance in all material respects with their policies and procedures relating to data privacy and security and the collection, storage, use, processing, disclosure, handling, and analysis of Personal Data and Confidential Data (the “Policies”). The Company has at all times made all disclosures to users or customers required by applicable laws and regulatory rules or requirements, and none of such disclosures made or contained in any Policy have been inaccurate or in violation of any applicable laws and regulatory rules or requirements in any material respect. The Company further certifies that 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 of the Company or any of its subsidiaries and delivered to any Underwriter or to counsel for the Underwriters in connection with the offering, or the purchase and sale, of the Offered Shares shall be deemed a representation and warranty by the Company to each Underwriter as to the matters covered thereby.
The Company has a reasonable basis for making each of the representations set forth in this Section 1. The Company acknowledges that the Underwriters and, for purposes of the opinions to be delivered pursuant to Section 6, counsel to the Company and counsel to the Underwriters, will rely upon the accuracy and truthfulness of the foregoing representations and hereby consents to such reliance.
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2. Purchase, Sale and Delivery of the Offered Shares.
(a) The Firm Shares. Upon the terms herein set forth, the Company agrees to issue and sell to the several Underwriters an aggregate of [_____] Firm Shares. On the basis of the representations, warranties and agreements herein contained, and upon the terms but subject to the conditions herein set forth, the Underwriters agree, severally and not jointly, to purchase from the Company the respective number of Firm Shares set forth opposite their names on Schedule A. The purchase price per Firm Share to be paid by the several Underwriters to the Company shall be $[__] per share.
(b) The First Closing Date. Delivery of certificates for the Firm Shares to be purchased by the Underwriters and payment therefor shall be made at the offices of McGuireWoods LLP, 1251 6th Avenue, 20th Floor, New York 10021 (or such other place as may be agreed to by the Company and the Representative) at 9:00 a.m. Eastern time, on November [__], 2022 or such other time and date not later than 5:30 p.m. Eastern time, on November [__], 2022 as the Representative shall designate by notice to the Company (the time and date of such closing are called the “First Closing Date”). The Company hereby acknowledges that circumstances under which the Representative may provide notice to postpone the First Closing Date as originally scheduled include, but are not limited to, any determination by the Company or the Representative to recirculate to the public copies of an amended or supplemented Prospectus or a delay as contemplated by the provisions of Section 11.
(c) The Option Shares; Option Closing Date. In addition, on the basis of the representations, warranties and agreements herein contained, and upon the terms but subject to the conditions herein set forth, the Company hereby grants an option to the several Underwriters to purchase, severally and not jointly, up to an aggregate of [___] Option Shares from the Company at the purchase price per share to be paid by the Underwriters for the Firm Shares. The option granted hereunder may be exercised at any time and from time to time in whole or in part upon notice by the Representative to the Company, which notice may be given at any time within 30 days from the date of this Agreement. Such notice shall set forth (i) the aggregate number of Option Shares as to which the Underwriters are exercising the option and (ii) the time, date and place at which certificates for the Option Shares will be delivered (which time and date may be simultaneous with, but not earlier than, the First Closing Date; and in the event that such time and date are simultaneous with the First Closing Date, the term “First Closing Date” shall refer to the time and date of delivery of certificates for the Firm Shares and such Option Shares). Any such time and date of delivery, if subsequent to the First Closing Date, is called an “Option Closing Date,” shall be determined by the Representative and shall not be earlier than three or later than five full Business Days after delivery of such notice of exercise. If any Option Shares are to be purchased, (a) each Underwriter agrees, severally and not jointly, to purchase the number of Option Shares (subject to such adjustments to eliminate fractional shares as the Representative may determine) that bears the same proportion to the total number of Option Shares to be purchased as the number of Firm Shares set forth on Schedule A opposite the name of such Underwriter bears to the total number of Firm Shares and (b) the Company agrees to sell the number of Option Shares set forth in the paragraph “Introductory” of this Agreement (subject to such adjustments to eliminate fractional shares as the Representative may determine). The Representative may cancel the option at any time prior to its expiration by giving written notice of such cancellation to the Company.
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(d) Public Offering of the Offered Shares. The Representative hereby advises the Company that the Underwriters intend to offer for sale to the public, initially on the terms set forth in the Registration Statement, the Time of Sale Prospectus and the Prospectus, their respective portions of the Offered Shares as soon after this Agreement has been executed as the Representative, in its sole judgment, has determined is advisable and practicable.
(e) Payment for the Offered Shares. (i) Payment for the Offered Shares shall be made at the First Closing Date (and, if applicable, at each Option Closing Date) by wire transfer of immediately available funds to the order of the Company. (ii) It is understood that the Representative has been authorized, for their own account and the accounts of the several Underwriters, to accept delivery of and receipt for, and make payment of the purchase price for, the Firm Shares and any Option Shares the Underwriters have agreed to purchase. CF&Co., individually and not as the Representative of the Underwriters, may (but shall not be obligated to) make payment for any Offered Shares to be purchased by any Underwriter whose funds shall not have been received by the Representative by the First Closing Date or the applicable Option Closing Date, as the case may be, for the account of such Underwriter, but any such payment shall not relieve such Underwriter from any of its obligations under this Agreement.
(f) Delivery of the Offered Shares. The Company shall deliver, or cause to be delivered to the Representative for the accounts of the several Underwriters certificates for the Firm Shares at the First Closing Date, against the irrevocable release of a wire transfer of immediately available funds for the amount of the purchase price therefor. The Company shall also deliver, or cause to be delivered through the facilities of DTC unless the Representative shall otherwise instruct, to the Representative for the accounts of the several Underwriters, certificates for the Option Shares the Underwriters have agreed to purchase at the First Closing Date or the applicable Option Closing Date, as the case may be, against the release of a wire transfer of immediately available funds for the amount of the purchase price therefor. If the Representative so elects, delivery of the Offered Shares may be made by credit to the accounts designated by the Representative through The Depository Trust Company’s full fast transfer or DWAC programs. The certificates for the Offered Shares shall be registered in such names and denominations as the Representative shall have requested at least two full Business Days prior to the First Closing Date (or the applicable Option Closing Date, as the case may be) and shall be made available for inspection on the Business Day preceding the First Closing Date (or the applicable Option Closing Date, as the case may be) at a location in New York City as the Representative may designate. Time shall be of the essence, and delivery at the time and place specified in this Agreement is a further condition to the obligations of the Underwriters.
3. Additional Covenants of the Company.
The Company further covenants and agrees with each Underwriter as follows:
(a) Delivery of Registration Statement, Time of Sale Prospectus and Prospectus. The Company shall furnish to the Representative in New York City, without charge, prior to 10:00 a.m. New York City time on the Business Day next succeeding the date of this Agreement and during the period when a prospectus relating to the Offered Shares is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule) in connection with sales of the Offered Shares, as many copies of the Time of Sale Prospectus, the Prospectus and any supplements and amendments thereto or to the Registration Statement as the Representative may reasonably request.
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(b) Representative’s Review of Proposed Amendments and Supplements. During the period when a prospectus relating to the Offered Shares is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule), the Company (i) will furnish to the Representative for review, a reasonable period of time prior to the proposed time of filing of any proposed amendment or supplement to the Registration Statement, a copy of each such amendment or supplement and (ii) will not amend or supplement the Registration Statement (including any amendment or supplement through incorporation of any report filed under the Exchange Act) without the Representative’s prior written consent. Prior to amending or supplementing any preliminary prospectus, the Time of Sale Prospectus or the Prospectus (including any amendment or supplement through incorporation of any report filed under the Exchange Act), the Company shall furnish to the Representative for review, a reasonable amount of time prior to the time of filing or use of the proposed amendment or supplement, a copy of each such proposed amendment or supplement. The Company shall not file or use any such proposed amendment or supplement without the Representative’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. The Company shall 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.
(c) Free Writing Prospectuses. The Company shall furnish to the Representative 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 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 Representative’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed. The Company shall furnish to each Underwriter, without charge, as many copies of any free writing prospectus prepared by or on behalf of, used by or referred to by the Company as such Underwriter may reasonably request. If at any time when a prospectus is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule) in connection with sales of the Offered Shares (but in any event if at any time through and including the First Closing Date) 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 the light of the circumstances prevailing at such time, not misleading, the Company shall promptly amend or supplement such free writing prospectus to eliminate or correct such conflict 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 the light of the circumstances prevailing at such 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 Representative 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 Representative’s prior written consent, which consent shall not be unreasonably withheld, conditioned or delayed.
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(d) Filing of Underwriter Free Writing Prospectuses. The Company shall not take any action that would result in an Underwriter 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 such Underwriter that such Underwriter otherwise would not have been required to file thereunder.
(e) Amendments and Supplements to Time of Sale Prospectus. If the Time of Sale Prospectus is being used to solicit offers to buy the Offered Shares at a time when the Prospectus is not yet available to prospective purchasers, and any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Time of Sale Prospectus so that the Time of Sale 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 the light of the circumstances when delivered to a prospective purchaser, not misleading, or if any event shall occur or condition exist as a result of which the Time of Sale Prospectus conflicts with the information contained in the Registration Statement, or if, in the opinion of counsel for the Underwriters, it is necessary to amend or supplement the Time of Sale Prospectus to comply with applicable Law, the Company shall (subject to Section 3(b) and Section 3(c)) promptly prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, either amendments or supplements to the Time of Sale Prospectus so that the statements in the Time of Sale 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 the light of the circumstances when delivered to a prospective purchaser, not misleading or so that the Time of Sale Prospectus, as amended or supplemented, will no longer conflict with the information contained in the Registration Statement, or so that the Time of Sale Prospectus, as amended or supplemented, will comply with applicable Law.
(f) Certain Notifications and Required Actions. After the date of this Agreement, the Company shall promptly advise the Representative in writing of: (i) the receipt of any comments of, or requests for additional or supplemental information from, the Commission relating to the Registration Statement; (ii) the time and date of any filing of any post-effective amendment to the Registration Statement or any amendment or supplement to any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus or the Prospectus; (iii) the time and date that any post-effective amendment to the Registration Statement becomes effective; and (iv) the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto or any amendment or supplement to any preliminary prospectus, the Time of Sale Prospectus or the Prospectus or of any order preventing or suspending the use of any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus or the Prospectus, or of any proceedings to remove, suspend or terminate from listing or quotation the 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 reasonably practicable. Additionally, the Company agrees that it shall comply with all applicable provisions of Rule 424(b), Rule 433 and Rule 430A under the Securities Act and will use its reasonable efforts to confirm that any filings made by the Company under Rule 424(b) or Rule 433 were received in a timely manner by the Commission.
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(g) 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 the light of the circumstances when the Prospectus is delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule) to a purchaser, not misleading, or if in the opinion of the Representative or counsel for the Underwriters it is otherwise necessary to amend or supplement the Prospectus to comply with applicable Law, the Company agrees (subject to Section 3(b) and Section 3(c)) to promptly prepare, file with the Commission and furnish, at its own expense, to the Underwriters and to any dealer upon request, 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 the light of the circumstances when the Prospectus is delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule) to a purchaser, not misleading or so that the Prospectus, as amended or supplemented, will comply with applicable Law. Neither the Representative’s consent to, nor delivery of, any such amendment or supplement shall constitute a waiver of any of the Company’s obligations under Section 3(b) or Section 3(c).
(h) Blue Sky Compliance. The Company shall cooperate with the Representative and counsel for the Underwriters to qualify or register the Offered 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 Representative, shall comply with such Laws and shall continue such qualifications, registrations and exemptions in effect so long as required for the distribution of the Offered 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 Representative promptly of the suspension of the qualification or registration of (or any such exemption relating to) the Offered 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 reasonably practicable.
(i) Use of Proceeds. The Company shall apply the net proceeds from the sale of the Offered Shares sold by it in the manner described under the caption “Use of Proceeds” in the Registration Statement, the Time of Sale Prospectus and the Prospectus.
(j) Transfer Agent. The Company shall maintain, at its expense, a registrar and transfer agent for the Shares.
(k) Earnings Statement. The Company will make generally available to its security holders and to the Representative as soon as practicable 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 commencing after the date of this Agreement that will satisfy the provisions of Section 11(a) of the Securities Act and the rules and regulations of the Commission thereunder.
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(l) Continued Compliance with Securities Laws. The Company will comply with the Securities Act and the Exchange Act so as to permit the completion of the distribution of the Offered Shares as contemplated by this Agreement, the Registration Statement, the Time of Sale Prospectus and the Prospectus. Without limiting the generality of the foregoing, the Company will, during the period when a prospectus relating to the Offered Shares is required by the Securities Act to be delivered (whether physically or through compliance with Rule 172 under the Securities Act or any similar rule), file on a timely basis with the Commission and NASDAQ all reports and documents required to be filed under the Exchange Act.
(m) Listing. The Company will use its best efforts to list, subject to notice of issuance, the Shares on NASDAQ.
(n) Company to Provide Copy of the Prospectus in Form That May be Downloaded from the Internet. If requested by the Representative, the Company shall cause to be prepared and delivered, at its expense, within one Business Day from the effective date of this Agreement, to CF&CO, an “electronic Prospectus” to be used in connection with the offering and sale of the Offered Shares. As used herein, the term “electronic Prospectus” means a form of Time of Sale Prospectus, and any amendment or supplement thereto, that meets each of the following conditions: (i) it shall be encoded in an electronic format, satisfactory to CF&CO, that may be transmitted electronically by CF&CO to offerees and purchasers of the Offered Shares; (ii) it shall disclose the same information as the paper Time of Sale Prospectus, except to the extent that graphic and image material cannot be disseminated electronically, in which case such graphic and image material shall be replaced in the electronic Prospectus with a fair and accurate narrative description or tabular representation of such material, as appropriate; and (iii) it shall be in or convertible into a paper format or an electronic format, satisfactory to CF&CO, that will allow investors to store and have continuously ready access to the Time of Sale Prospectus at any future time, without charge to investors (other than any fee charged for subscription to the Internet as a whole and for on-line time). The Company hereby confirms that it has included or will include in the Prospectus filed pursuant to EDGAR or otherwise with the Commission and in the Registration Statement at the time it was declared effective an undertaking that, upon receipt of a request by an investor or his or her representative, the Company shall transmit or cause to be transmitted promptly, without charge, a paper copy of the Time of Sale Prospectus.
(o) Agreement Not to Offer or Sell Additional Shares. During the period commencing on and including the date hereof and continuing through and including the 90th day following the date of the Prospectus (such period, as extended as described below, being referred to herein as the “Lock-up Period”), the Company will not, without the prior written consent of CF&CO (which consent may be withheld in its sole discretion), directly or indirectly: (i) sell, offer to sell, contract to sell or lend any Shares or Related Securities (as defined below); (ii) effect any short sale, or establish or increase any “put equivalent position” (as defined in Rule 16a-1(h) under the Exchange Act) or liquidate or decrease any “call equivalent position “ (as defined in Rule 16a-1(b) under the Exchange Act) of any Shares or Related Securities; (iii) pledge, hypothecate or grant any security interest in; (iv) in any other way transfer or dispose of any Shares or Related Securities; (v) enter into any swap, hedge or similar arrangement or agreement that transfers, in whole or in part, the economic risk of ownership of any Shares or Related Securities, regardless of whether any such transaction is to be settled in securities, in cash or otherwise; (vi) announce the offering of any Shares or Related Securities; (vii) file any registration statement under the Securities Act in respect of any Shares or Related Securities (other than as contemplated by this Agreement with respect to the Offered Shares); or (viii) publicly announce the intention to do any of the foregoing; provided, however, that the Company may (A) effect the transactions contemplated hereby and (B) issue Shares or options to purchase Shares, or issue Shares upon exercise of options, pursuant to any equity incentive, employee stock purchase, stock option, stock bonus or other stock plan or arrangement described in the Registration Statement, the Time of Sale Prospectus and the Prospectus, but only if the holders of such Shares or options agree in writing with the Underwriters not to sell, offer, dispose of or otherwise transfer any such Shares or options during such Lock-up Period without the prior written consent of CF&CO (which consent may be withheld in its sole discretion). For purposes of the foregoing, “Related Securities” shall mean any options or warrants or other rights to acquire Shares or any securities exchangeable or exercisable for or convertible into Shares, or to acquire other securities or rights ultimately exchangeable or exercisable for, or convertible into, Shares.
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(p) Future Reports to the Representative. During the period of five years hereafter, the Company will furnish to the Representative, c/o Cantor Fitzgerald & Co., at 499 Park Avenue, New York, New York 10022, Attention: Equity Capital Markets, with copies to Cantor Fitzgerald & Co., 499 Park Avenue, New York, New York 10022, Attention: General Counsel: (i) as soon as practicable after the end of each fiscal year, copies of the Annual Report of the Company containing the balance sheet of the Company as of the close of such fiscal year and statements of income, stockholders’ equity and cash flows for the year then ended and the opinion thereon of the Company’s independent public or certified public accountants; (ii) as soon as practicable after the filing thereof, copies of each proxy statement, Annual Report on Form 10-K, Quarterly Report on Form 10-Q, Current Report on Form 8-K or other report filed by the Company with the Commission, FINRA or any securities exchange; and (iii) as soon as available, copies of any report or communication of the Company furnished or made available generally to holders of its capital stock; provided, however, that the requirements of this Section 3(p) shall be satisfied to the extent that such reports, statement, communications, financial statements or other documents are available on EDGAR.
(q) Investment Limitation. The Company shall not invest or otherwise use the proceeds received by the Company from its sale of the Offered 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.
(r) No Stabilization or Manipulation; Compliance with Regulation M. The Company will not take, and will ensure that no affiliate of the Company will take, directly or indirectly, without giving effect to activities by the Underwriters, any action designed to or that might cause or result in stabilization or manipulation of the price of the Shares or any reference security with respect to the Shares, whether to facilitate the sale or resale of the Offered Shares or otherwise, and the Company will, and shall cause each of its affiliates to, comply with all applicable provisions of Regulation M.
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(s) Enforce Lock-Up Agreements. During the Lock-up Period, the Company will enforce all agreements between the Company and any of its security holders that restrict or prohibit, expressly or in operation, the offer, sale or transfer of Shares or Related Securities or any of the other actions restricted or prohibited under the terms of the form of Lock-up Agreement. In addition, the Company will direct the transfer agent to place stop transfer restrictions upon any such securities of the Company that are bound by such “lock-up” agreements for the duration of the periods contemplated in such agreements, including “lock-up” agreements entered into by the Company’s officers and directors and stockholders pursuant to Section 6(j) hereof.
(t) Company to Provide Interim Financial Statements. Prior to the First Closing Date and each applicable Option Closing Date, the Company will furnish the Underwriters, as soon as they have been prepared by or are available to the Company, a copy of any unaudited interim financial statements of the Company for any period subsequent to the period covered by the most recent financial statements appearing in the Registration Statement and the Prospectus.
(u) Amendments and Supplements to Permitted Section 5(d)Communications. If at any time following the distribution of any Permitted Section 5(d) Communication, there occurred or occurs an event or development as a result of which such Permitted Section 5(d) Communication included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Representative and will promptly amend or supplement, at its own expense, such Permitted Section 5(d) Communication to eliminate or correct such untrue statement or omission.
The Representative, on behalf of the several Underwriters, may, in its sole discretion, waive in writing the performance by the Company of any one or more of the foregoing covenants or extend the time for their performance.
4. Payment of 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 (i) all expenses incident to the issuance and delivery of the Offered 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 Offered Shares to the Underwriters, (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 Time of Sale Prospectus, the Prospectus, each free writing prospectus prepared by or on behalf of, used by, or referred to by the Company, and each preliminary prospectus, each Permitted Section 5(d) Communication, and all amendments and supplements thereto, and this Agreement, (vi) all filing fees, reasonable and documented attorneys’ fees and expenses incurred by the Company or the Underwriters in connection with qualifying or registering (or obtaining exemptions from the qualification or registration of) all or any part of the Offered 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 Representative, preparing and printing a “Blue Sky Survey” or memorandum and a “Canadian wrapper”, and any supplements thereto, advising the Underwriters of such qualifications, registrations and exemptions, in an amount not to exceed [$7,500], (vii) the fees and expenses of the Underwriters including the fees and expenses of the counsel to the Underwriters, payable upon the execution of this Agreement, in an amount not to exceed $100,000, (viii) the costs and expenses of the Company relating to investor presentations on any “road show”, any Permitted Section 5(d) Communication or any Section 5(d) Oral Communication undertaken in connection with the offering of the Shares, including 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 Representative, employees and officers of the Company and any such consultants, (ix) the fees and expenses associated with listing the Shares on NASDAQ, and (x) all other fees, costs and expenses of the nature referred to in Item 13 of Part II of the Registration Statement. Any such amount payable to the Underwriters may be deducted from the purchase price for the Offered Shares. Except as provided in this Section 4 or in Section 7, Section 9 or Section 10, the Underwriters shall pay their own expenses, including the fees and disbursements of their counsel.
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5. Covenant of the Underwriters. Each Underwriter severally and not jointly covenants with the Company not to take any action that would result in 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 such Underwriter that otherwise would not, but for such actions, be required to be filed by the Company under Rule 433(d).
6. Conditions of the Obligations of the Underwriters. The respective obligations of the several Underwriters hereunder to purchase and pay for the Offered Shares as provided herein on the First Closing Date and, with respect to the Option Shares, each Option Closing Date, shall be subject to the accuracy of the representations and warranties on the part of the Company set forth in Section 1 as of the date hereof and as of the First Closing Date as though then made and, with respect to the Option Shares, as of each Option Closing Date as though then made, to the timely performance by the Company of its covenants and other obligations hereunder, and to each of the following additional conditions:
(a) Comfort Letter. On the date hereof, the Representative shall have received from Ernst & Young LLP, independent registered public accountants for the Company, a letter dated the date hereof addressed to the Underwriters, in form and substance satisfactory to the Representative, containing statements and information of the type ordinarily included in accountant’s “comfort letters” to underwriters, delivered according to Statement of Auditing Standards No. 72 (or any successor bulletin), with respect to the audited and unaudited financial statements and certain financial information contained in the Registration Statement, the Time of Sale Prospectus, and each free writing prospectus, if any.
(b) Compliance with Registration Requirements; No Stop Order; No Objection from FINRA. For a period from and after the date of this Agreement and through and including the First Closing Date and, with respect to any Option Shares purchased after the First Closing Date, each Option Closing Date:
(i) The Company shall have filed the Prospectus with the Commission (including the information required by Rule 430A under the Securities Act) in the manner and within the time period required by Rule 424(b) under the Securities Act; or the Company shall have filed a post-effective amendment to the Registration Statement containing the information required by such Rule 430A, and such post-effective amendment shall have become effective.
(ii) No stop order suspending the effectiveness of the Registration Statement or any post-effective amendment to the Registration Statement shall be in effect, and no proceedings for such purpose shall have been instituted or threatened by the Commission.
(iii) FINRA shall have raised no objection to the fairness and reasonableness of the underwriting terms and arrangements.
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(c) No Material Adverse Effect or Ratings Agency Change. For the period from and after the date of this Agreement and through and including the First Closing Date and, with respect to any Option Shares purchased after the First Closing Date, each Option Closing Date, (a) in the judgment of the Representative there shall not have occurred any Material Adverse Effect, and (b) there shall not have occurred a downgrading in or withdrawal of the rating assigned to any of the Company’s securities (other than asset-backed securities) by any rating organization or a public announcement by any rating organization that it has under surveillance or review its rating of any of the Company’s securities (other than asset-backed securities), the effect of which, in the case of any such action by a rating organization described above, would cause a Material Adverse Effect.
(d) Opinion of Counsel for the Company. On each of the First Closing Date and each Option Closing Date the Representative shall have received the opinion and negative assurance letter of Troutman Pepper Hamilton Sanders LLP, counsel for the Company, dated as of such date, in form and substance reasonably satisfactory to the Representative.
(e) Opinion of Intellectual Property Counsel. On each of the First Closing Date and each Option Closing Date, the Representative shall have received the opinion of DLA Piper LLP (US), counsel for the Company with respect to intellectual property matters, dated as of such date, in form and substance reasonably satisfactory to the Representative.
(f) Opinion of Counsel for the Underwriters. On each of the First Closing Date and each Option Closing Date the Representative shall have received the opinion of McGuireWoods LLP, counsel for the Underwriters in connection with the offer and sale of the Offered Shares, in form and substance satisfactory to the Representative, dated as of such date.
(g) Officers’ Certificate. On each of the First Closing Date and each Option Closing Date, the Representative shall have received a certificate executed by the Chief Executive Officer or President of the Company and the Chief Financial Officer of the Company, dated as of such date, to the effect set forth in Section 6(b)(ii) and further to the effect that:
(i) for the period from and including the date of this Agreement through and including such date, there has not occurred any Material Adverse Effect;
(ii) the representations, warranties and covenants of the Company set forth in Section 1 are true and correct with the same force and effect as though expressly made on and as of such date; and
(iii) the Company has complied with all the agreements hereunder and satisfied all the conditions on its part to be performed or satisfied hereunder at or prior to such date.
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(h) Chief Financial Officer’s Certificate. On each of the First Closing Date and each Option Closing Date, the Representative shall have received a certificate executed by the Chief Financial Officer of the Company, dated as of such date, in the form attached as Exhibit [_] hereto.
(i) Bring-down Comfort Letter. On each of the First Closing Date and each Option Closing Date the Representative shall have received from Ernst & Young LLP, independent registered public accountants for the Company, a letter dated such date, in form and substance satisfactory to the Representative, which letter shall: (i) reaffirm the statements made in the letter furnished by them pursuant to Section 6(a), except that the specified date referred to therein for the carrying out of procedures shall be no more than three Business Days prior to the First Closing Date or the applicable Option Closing Date, as the case may be; and (ii) cover certain financial information contained in the Prospectus.
(j) Lock-Up Agreements. On or prior to the date hereof, the Company shall have furnished to the Representative an agreement in the form of Exhibit A hereto from the directors and officers (as defined in Rule 16a-1(f) under the Exchange Act), and each such agreement shall be in full force and effect on each of the First Closing Date and each Option Closing Date.
(k) Rule 462(b) Registration Statement. In the event that a Rule 462(b) Registration Statement is filed in connection with the offering contemplated by this Agreement, such Rule 462(b) Registration Statement shall have been filed with the Commission on the date of this Agreement and shall have become effective automatically upon such filing.
(l) NASDAQ. The Company shall have submitted a listing of additional shares notification form to NASDAQ with respect to the Offered Shares and shall have received no objection thereto from NASDAQ.
(m) Additional Documents. On or before each of the First Closing Date and each Option Closing Date, the Representative and counsel for the Underwriters shall have received such information, documents and opinions as they may reasonably request for the purposes of enabling them to pass upon the issuance and sale of the Offered Shares as contemplated herein, or in order to evidence the accuracy of any of the representations and warranties, or the satisfaction of any of the conditions or agreements, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Offered Shares as contemplated herein and in connection with the other transactions contemplated by this Agreement shall be satisfactory in form and substance to the Representative and counsel for the Underwriters.
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If any condition specified in this Section 6 is not satisfied when and as required to be satisfied, this Agreement may be terminated by the Representative by notice from the Representative to the Company at any time on or prior to the First Closing Date and, with respect to the Option Shares, at any time on or prior to the applicable Option Closing Date, which termination shall be without liability on the part of any party to any other party, except that Section 4, Section 7, Section 9 and Section 10 shall at all times be effective and shall survive such termination.
7. Reimbursement of Underwriters’ Expenses. If this Agreement is terminated by the Representative pursuant to Section 6, Section 11 or Section 12, or if the sale to the Underwriters of the Offered Shares on the First Closing Date is not consummated because of any refusal, inability or failure on the part of the Company to perform any agreement herein or to comply with any provision hereof, the Company agrees to reimburse the Representative and the other Underwriters (or such Underwriters as have terminated this Agreement with respect to themselves), severally, upon demand for all out-of-pocket expenses that shall have been reasonably incurred by the Representative and the Underwriters in connection with the proposed purchase and the offering and sale of the Offered Shares, including reasonable and documented fees and disbursements of counsel up to $66,000, printing expenses, travel expenses, postage, facsimile and telephone charges.
8. Effectiveness of this Agreement. This Agreement shall become effective upon the execution and delivery hereof by the parties hereto.
9. Indemnification.
(a) Indemnification of the Underwriters. The Company agrees to indemnify and hold harmless each Underwriter, its affiliates and their respective partners, members, directors, officers, employees and agents, and each person, if any, who controls each Underwriter or any affiliate within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act as follows:
(i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, joint or several, arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading, or arising out of any untrue statement or alleged untrue statement of a material fact included in any preliminary prospectus, Time of Sale Prospectus, any free writing prospectus, any Marketing Material, any Section 5(d) Written Communication or the Prospectus (or any amendment or supplement to the foregoing), 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;
(ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, joint or several, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any Governmental Authority, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission; provided that (subject to Section 9(d)) any such settlement is effected with the written consent of the Company, which consent shall not unreasonably be delayed, conditioned or withheld; and
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(iii) against any and all expense whatsoever, as incurred (including the fees and disbursements of counsel), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any Governmental Authority, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission (whether or not a party), to the extent that any such expense is not paid under (i) or (ii) above;
provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made solely in reliance upon and in conformity with the Underwriter Information (as defined below).
(b) Indemnification of the Company, its Directors and Officers. Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless the Company, and its directors, each officer of the Company who signed the Registration Statement and each person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, against any and all loss, liability, claim, damage and expense described in the indemnity contained in Section 9(a), as incurred, but only with respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus, any Section 5(d) Written Communication or the Prospectus (or any amendment or supplement to the foregoing), in reliance upon and in conformity with information relating to such Underwriter and furnished to the Company in writing by such Underwriter or Underwriters expressly for use therein. The Company hereby acknowledges that the only information that the Underwriter or Underwriters has furnished to the Company expressly for use in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, any free writing prospectus, any Section 5(d) Written Communication or the Prospectus (or any amendment or supplement to the foregoing) are the statements set forth in the third sentence of the third paragraph, the fifth paragraph and the first sentence of the thirteenth paragraph under the caption “Underwriting” in the Preliminary Prospectus and Prospectus (the “Underwriter Information”).
(c) Notifications and Other Indemnification Procedures. Any party that proposes to assert the right to be indemnified under this Section 9 will, promptly after receipt of notice of commencement of any action against such party in respect of which a claim is to be made against an indemnifying party or parties under this Section 9, notify each such indemnifying party of the commencement of such action, enclosing a copy of all papers served, but the omission so to notify such indemnifying party will not relieve the indemnifying party from (i) any liability that it might have to any indemnified party otherwise than under this Section 9 and (ii) any liability that it may have to any indemnified party under the foregoing provision of this Section 9 unless, and only to the extent that, such omission results in the forfeiture of substantive rights or defenses by the indemnifying party. If any such action is brought against any indemnified party and it notifies the indemnifying party of its commencement, the indemnifying party will be entitled to participate in and, to the extent that it elects by delivering written notice to the indemnified party promptly after receiving notice of the commencement of the action from the indemnified party, jointly with any other indemnifying party similarly notified, to assume the defense of the action, with counsel reasonably satisfactory to the indemnified party, and after notice from the indemnifying party to the indemnified party of its election to assume the defense, the indemnifying party will not be liable to the indemnified party for any other legal expenses except as provided below and except for the reasonable costs of investigation subsequently incurred by the indemnified party in connection with the defense. The indemnified party will have the right to employ its own counsel in any such action, but the fees, expenses and other charges of such counsel will be at the expense of such indemnified party unless (1) the employment of counsel by the indemnified party has been authorized in writing by the indemnifying party, (2) the indemnified party has reasonably concluded (based on advice of counsel) that there may be legal defenses available to it or other indemnified parties that are different from or in addition to those available to the indemnifying party, (3) a conflict or potential conflict exists (based on advice of counsel to the indemnified party) between the indemnified party and the indemnifying party (in which case the indemnifying party will not have the right to direct the defense of such action on behalf of the indemnified party) or (4) the indemnifying party has not in fact employed counsel to assume the defense of such action or counsel reasonably satisfactory to the indemnified party, in each case, within a reasonable time after receiving notice of the commencement of the action; in each of which cases the reasonable fees, disbursements and other charges of counsel will be at the expense of the indemnifying party or parties. It is understood that the indemnifying party or parties shall not, in connection with any proceeding or related proceedings in the same jurisdiction, be liable for the reasonable fees, disbursements and other charges of more than one separate firm admitted to practice in such jurisdiction (plus local counsel) at any one time for all such indemnified party or parties. All such fees, disbursements and other charges will be reimbursed by the indemnifying party promptly as they are incurred. An indemnifying party will not, in any event, be liable for any settlement of any action or claim effected without its written consent. No indemnifying party shall, without the prior written consent of each indemnified party, settle or compromise or consent to the entry of any judgment in any pending or threatened claim, action or proceeding relating to the matters contemplated by this Section 9 (whether or not any indemnified party is a party thereto), unless such settlement, compromise or consent (1) includes an express and unconditional release of each indemnified party, in form and substance reasonably satisfactory to such indemnified party, from all liability arising out of such litigation, investigation, proceeding or claim and (2) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.
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(d) Settlement Without Consent if Failure to Reimburse. If an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for reasonable fees and expenses of counsel, such indemnifying party agrees that it shall be liable for any settlement of the nature contemplated by Section 9(a)(ii) effected without its written consent if (1) such settlement is entered into more than 45 days after receipt by such indemnifying party of the aforesaid request, (2) such indemnifying party shall have received notice of the terms of such settlement at least 30 days prior to such settlement being entered into and (3) such indemnifying party shall not have reimbursed such indemnified party in accordance with such request prior to the date of such settlement.
10. Contribution. In order to provide for just and equitable contribution in circumstances in which the indemnification provided for in the foregoing paragraphs of Section 9 is applicable in accordance with its terms but for any reason is held to be unavailable or insufficient from the Company or the Underwriters, the Company and the Underwriters will contribute to the total losses, claims, liabilities, expenses and damages (including any investigative, legal and other expenses reasonably incurred in connection with, and any amount paid in settlement of, any action, suit or proceeding or any claim asserted) to which any indemnified party may be subject in such proportion as shall be appropriate to reflect the relative benefits received by the Company on the one hand and the Underwriters on the other hand. The relative benefits received by the Company on the one hand and the Underwriters on the other hand shall be deemed to be in the same proportion as the total net proceeds from the sale of the Offered Shares (before deducting expenses) received by the Company bear to the total compensation received by the Underwriters (before deducting expenses) from the sale of Offered Shares on behalf of the Company. If, but only if, the allocation provided by the foregoing sentence is not permitted by applicable Law, the allocation of contribution shall be made in such proportion as is appropriate to reflect not only the relative benefits referred to in the foregoing sentence but also the relative fault of the Company, on the one hand, and the Underwriters, on the other hand, with respect to the statements or omission that resulted in such loss, claim, liability, expense or damage, or action in respect thereof, as well as any other relevant equitable considerations with respect to such offering. Such relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by the Company or the Underwriters, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such statement or omission. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this Section 10 were to be determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to herein. The amount paid or payable by an indemnified party as a result of the loss, claim, liability, expense, or damage, or action in respect thereof, referred to above in this Section 10 shall be deemed to include, for the purpose of this Section 10, any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim to the extent consistent with Section 9(c). Notwithstanding the foregoing provisions of Section 9 and this Section 10, the Underwriters shall not be required to contribute any amount in excess of the commissions actually received by it under this Agreement and no person found guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section 10, any person who controls a party to this Agreement within the meaning of the Securities Act, any affiliates of the respective Underwriters and any officers, directors, partners, employees or agents of the Underwriters or their respective affiliates, will have the same rights to contribution as that party, and each director of the Company and each officer of the Company who signed the Registration Statement will have the same rights to contribution as the Company, subject in each case to the provisions hereof. Any party entitled to contribution, promptly after receipt of notice of commencement of any action against such party in respect of which a claim for contribution may be made under this Section 10, will notify any such party or parties from whom contribution may be sought, but the omission to so notify will not relieve that party or parties from whom contribution may be sought from any other obligation it or they may have under this Section 10 except to the extent that the failure to so notify such other party materially prejudiced the substantive rights or defenses of the party from whom contribution is sought. Except for a settlement entered into pursuant to the last sentence of Section 9(c), no party will be liable for contribution with respect to any action or claim settled without its written consent if such consent is required pursuant to Section 9(c).
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11. Default of One or More of the Several Underwriters. If, on the First Closing Date or any Option Closing Date, any one or more of the several Underwriters shall fail or refuse to purchase Offered Shares that it or they have agreed to purchase hereunder on such date, and the aggregate number of Offered Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase does not exceed 10% of the aggregate number of the Offered Shares to be purchased on such date, the Representative may make arrangements satisfactory to the Company for the purchase of such Offered Shares by other persons, including any of the Underwriters, but if no such arrangements are made by such date, the other Underwriters shall be obligated, severally and not jointly, in the proportions that the number of Firm Shares set forth opposite their respective names on Schedule A bears to the aggregate number of Firm Shares set forth opposite the names of all such non-defaulting Underwriters, or in such other proportions as may be specified by the Representative with the consent of the non-defaulting Underwriters, to purchase the Offered Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase on such date. If, on the First Closing Date or any Option Closing Date, any one or more of the several Underwriters shall fail or refuse to purchase Offered Shares that it or they have agreed to purchase hereunder on such date, and the aggregate number of Offered Shares which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase exceeds 10% of the aggregate number of Offered Shares to be purchased on such date, and arrangements satisfactory to the Representative and the Company for the purchase of such Offered Shares are not made within 48 hours after such default, this Agreement shall terminate without liability of any party to any other party except that the provisions of Section 4, Section 7, Section 9 and Section 10 shall at all times be effective and shall survive such termination. In any such case either the Representative or the Company shall have the right to postpone the First Closing Date or the applicable Option Closing Date, as the case may be, but in no event for longer than seven days in order that the required changes, if any, to the Registration Statement and the Prospectus or any other documents or arrangements may be effected.
As used in this Agreement, the term “Underwriter” shall be deemed to include any person substituted for a defaulting Underwriter under this Section 11. Any action taken under this Section 11 shall not relieve any defaulting Underwriter from liability in respect of any default of such Underwriter under this Agreement.
12. Termination of this Agreement. Prior to the purchase of the Firm Shares by the Underwriters on the First Closing Date, this Agreement may be terminated by the Representative by notice given to the Company if at any time: (i) trading or quotation in any of the Company’s securities shall have been suspended or limited by the Commission or by NASDAQ, or trading in securities generally on either NASDAQ or the NYSE shall have been suspended or limited, or minimum or maximum prices shall have been generally established on any of such stock exchanges; (ii) a general banking moratorium shall have been declared by any of federal, New York or Delaware authorities; (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 Representative is material and adverse and makes it impracticable to market the Offered Shares in the manner and on the terms described in the Time of Sale Prospectus or the Prospectus or to enforce contracts for the sale of securities; (iv) in the judgment of the Representative there shall have occurred any change, or any development or event involving a prospective change, in the condition, financial or otherwise, or in the business, properties, earnings, results of operations or prospects of the Company and its Subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business; or (v) the Company shall have sustained a loss by strike, fire, flood, earthquake, accident or other calamity of such character as in the judgment of the Representative may interfere materially with the conduct of the business and operations of the Company regardless of whether or not such loss shall have been insured. Any termination pursuant to this Section 12 shall be without liability on the part of (a) the Company to any Underwriter, except that the Company shall be obligated to reimburse the expenses of the Representative and the Underwriters pursuant to Section 4 or Section 7 hereof or (b) any Underwriter to the Company; provided, however, that the provisions of Section 9 and Section 10 shall at all times be effective and shall survive such termination.
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13. No Advisory or Fiduciary Relationship. The Company acknowledges and agrees that (a) the purchase and sale of the Offered Shares pursuant to this Agreement, including the determination of the public offering price of the Offered Shares and any related discounts and commissions, is an arm’s-length commercial transaction between the Company, on the one hand, and the several Underwriters, on the other hand, (b) in connection with the offering contemplated hereby and the process leading to such transaction, each Underwriter is and has been acting solely as a principal and is not the agent or fiduciary of the Company, or its stockholders, or its creditors, employees or any other party, (c) no Underwriter has assumed or will assume an advisory or fiduciary responsibility in favor of the Company with respect to the offering contemplated hereby or the process leading thereto (irrespective of whether such Underwriter has advised or is currently advising the Company on other matters) and no Underwriter has any obligation to the Company with respect to the offering contemplated hereby except the obligations expressly set forth in this Agreement, (d) the Underwriters and their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company, and (e) the Underwriters have not provided any legal, accounting, regulatory or tax advice with respect to the offering contemplated hereby and the Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it deemed appropriate.
14. Representations and Agreements to Survive Delivery. The respective indemnities, agreements, representations, warranties and other statements of the Company, its officers and the several Underwriters 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 any Underwriter or the Company or any of its or their partners, affiliates, officers, directors or employees or any controlling person, as the case may be, and, anything herein to the contrary notwithstanding, will survive delivery of and payment for the Offered Shares sold hereunder and any termination of this Agreement.
15. Notices. All communications hereunder shall be in writing and shall be mailed, hand delivered or telecopied and confirmed to the parties hereto as follows:
If to the Representative: | Cantor Fitzgerald & Co. |
499 Park Avenue | |
New York, NY 10022 | |
Facsimile: (212) 829-4708 | |
Attention: General Counsel |
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with a copy to: | McGuireWoods LLP |
1251 6th Avenue, 20th Floor | |
New York, New York 10020 | |
Attention: Stephen Older |
If to the Company: | Cognition Therapeutics, Inc. | |
2500 Westchester Ave. | ||
Purchase, NY 10577 | ||
Attention: Lisa Ricciardi, Chief Executive Officer | ||
Email: | lricciardi@cogrx.com |
with a copy to: | Troutman Pepper Hamilton Sanders LLP | |
3000 Two Logan Square | ||
Philadelphia, PA 19103 | ||
Attention: Rachael M. Bushey and Joseph Walsh | ||
Email: | rachael.bushey@troutman.com | |
joseph.walsh@troutman.com |
Each party to this Agreement may change such address for notices by sending to the parties to this Agreement written notice of a new address for such purpose. Each such notice or other communication shall be deemed given (i) when delivered personally or by verifiable facsimile transmission (with an original to follow) on or before 4:30 p.m., New York City time, on a Business Day or, if such day is not a Business Day, on the next succeeding Business Day, (ii) on the next Business Day after timely delivery to a nationally-recognized overnight courier and (iii) on the Business Day actually received if deposited in the U.S. mail (certified or registered mail, return receipt requested, postage prepaid).
16. Electronic Notice. An electronic communication (“Electronic Notice”) shall be deemed written notice for purposes of this Section 16 if sent to the electronic mail address specified by the receiving party under separate cover. Electronic Notice shall be deemed received at the time the party sending Electronic Notice receives verification of receipt by the receiving party. Any party receiving Electronic Notice may request and shall be entitled to receive the notice on paper, in a nonelectronic form (“Nonelectronic Notice”) which shall be sent to the requesting party within ten (10) days of receipt of the written request for Nonelectronic Notice.
17. Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the Company and the Underwriters and their respective successors and the parties referred to in Section 11. References to any of the parties contained in this Agreement shall be deemed to include the successors and permitted assigns of such party. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement. Neither party may assign its rights or obligations under this Agreement without the prior written consent of the other party; provided, however, that the Representative may assign its rights and obligations hereunder to an affiliate thereof without obtaining the Company’s consent.
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18. Partial Unenforceability. The invalidity or unenforceability of any section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other section, paragraph or provision hereof. If any section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.
19. Entire Agreement; Amendment; Severability; Waiver. This Agreement (including all schedules and exhibits attached hereto issued pursuant hereto) constitutes the entire agreement and supersedes all other prior and contemporaneous agreements and undertakings, both written and oral, among the parties hereto with regard to the subject matter hereof. Neither this Agreement nor any term hereof may be amended except pursuant to a written instrument executed by the Company and the Representative. In the event that any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable as written by a court of competent jurisdiction, then such provision shall be given full force and effect to the fullest possible extent that it is valid, legal and enforceable, and the remainder of the terms and provisions herein shall be construed as if such invalid, illegal or unenforceable term or provision was not contained herein, but only to the extent that giving effect to such provision and the remainder of the terms and provisions hereof shall be in accordance with the intent of the parties as reflected in this Agreement. No implied waiver by a party shall arise in the absence of a waiver in writing signed by such party. No failure or delay in exercising any right, power, or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any right, power, or privilege hereunder.
20. GOVERNING LAW AND TIME; WAIVER OF JURY TRIAL. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS. SPECIFIED TIMES OF DAY REFER TO NEW YORK CITY TIME. EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
21. CONSENT TO JURISDICTION. EACH PARTY HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS SITTING IN THE CITY OF NEW YORK, BOROUGH OF MANHATTAN, FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH ANY TRANSACTION CONTEMPLATED HEREBY, AND HEREBY IRREVOCABLY WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, THAT SUCH SUIT, ACTION OR PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM OR THAT THE VENUE OF SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH PARTY HEREBY IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS BEING SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY THEREOF (CERTIFIED OR REGISTERED MAIL, RETURN RECEIPT REQUESTED) TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW.
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22. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Delivery of an executed Agreement by one party to the other may be made by facsimile or electronic transmission.
23. Construction.
(a) the section and exhibit headings herein are for convenience only and shall not affect the construction hereof;
(b) words defined in the singular shall have a comparable meaning when used in the plural, and vice versa;
(c) the words “hereof,” “hereto,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement;
(d) wherever the word “include,” “includes” or “including” is used in this Agreement, it shall be deemed to be followed by the words “without limitation”;
(e) references herein to any gender shall include each other gender;
(f) references herein to any law, statute, ordinance, code, regulation, rule or other requirement of any Governmental Authority shall be deemed to refer to such law, statute, ordinance, code, regulation, rule or other requirement of any Governmental Authority as amended, reenacted, supplemented or superseded in whole or in part and in effect from time to time and also to all rules and regulations promulgated thereunder;
(g) if the last day for the giving of any notice or the performance of any act required or permitted under this Agreement is a day that is not a Business Day, then the time for the giving of such notice or the performance of such action shall be extended to the next succeeding Business Day;
(h) “knowledge” means, as it pertains to the Company, the actual knowledge of the officers and directors of the Company, together with the knowledge which they would have had if they had conducted a reasonable inquiry of the relevant persons into the relevant subject matter;
(i) “Governmental Authority” means (i) any federal, provincial, state, local, municipal, national or international government or governmental authority, regulatory or administrative agency, governmental commission, department, board, bureau, agency or instrumentality, court, tribunal, arbitrator or arbitral body (public or private); (ii) any self-regulatory organization; or (iii) any political subdivision of any of the foregoing;
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(j) “Law” means any and all laws, including all federal, state, local, municipal, national or foreign statutes, codes, ordinances, guidelines, decrees, rules, regulations and by-laws and all judicial, arbitral, administrative, ministerial, departmental or regulatory judgments, orders, directives, decisions, rulings or awards or other requirements of any Governmental Authority, binding on or affecting the person referred to in the context in which the term is used and rules, regulations and policies of any stock exchange on which securities of the Company are listed for trading; and
(k) “Business Day” means any day on which NASDAQ and commercial banks in the City of New York are open for business.
24. General Provisions.
Each of the parties hereto acknowledges that it is a sophisticated business person who was adequately represented by counsel during negotiations regarding the provisions hereof, including the indemnification provisions of Section 9 and the contribution provisions of Section 10, and is fully informed regarding said provisions. Each of the parties hereto further acknowledges that the provisions of Section 9 and Section 10 hereof fairly allocate the risks in light of the ability of the parties to investigate the Company, its affairs and its business in order to assure that adequate disclosure has been made in the Registration Statement, any preliminary prospectus, the Time of Sale Prospectus, each free writing prospectus and the Prospectus (and any amendments and supplements to the foregoing), as contemplated by the Securities Act and the Exchange Act.
[Signature Page Follows]
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If the foregoing correctly sets forth the understanding between the Company and the Underwriters, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between the Company and the Underwriters.
Very truly yours, | ||
COGNITION THERAPEUTICS, INC. | ||
By: | ||
Name: Lisa Ricciardi | ||
Title: Chief Executive Officer | ||
ACCEPTED as of the date first-above written: | ||
CANTOR FITZGERALD & CO. | ||
By: | ||
Name: | ||
Title: | ||
For itself and the other several Underwriters named in Schedule A to this Agreement. |
Signature Page
Cognition Therapeutics. Inc.. – Underwriting Agreement
SCHEDULE A
Underwriters | Number of Firm Shares to be Purchased | ||
Cantor Fitzgerald & Co. | [●] | ||
[___] | [●] | ||
Total | [●] |
SCHEDULE B
Free Writing Prospectuses Included in the Time of Sale Prospectus
[None]
Schedule C
Pricing Information
Firm Shares: [ _____ ]
Option Shares: [_____ ]
Price to Public: $[_____]
Underwriters’ Discount: $[_____]
Schedule D
Permitted Section 5(d) Communications
1. |
Exhibit A
Form of Lock-up Agreement
[Sent under separate cover]
Exhibit B
Parties to Lock-up Agreement
1. | Anthony Caggiano |
2. | Andrew Einhorn |
3. | Aaron Fletcher |
4. | Jack Khattar |
5. | Brett Monia |
6. | Lisa Ricciardi |
7. | Ellen Richstone |
8. | Peggy Wallace |
9. | Entities affiliated with BIOS Memory SPV I, LP |
Exhibit 5.1
Troutman Pepper Hamilton Sanders LLP Philadelphia, PA 19103-2799
troutman.com |
November 7, 2022 |
Cognition Therapeutics, Inc.
2500 Westchester Ave.
Purchase, NY 10577
Re: Registration Statement on Form S-1
Ladies and Gentlemen:
We have acted as counsel to Cognition Therapeutics, Inc., a Delaware corporation (the “Company”), in connection with the proposed issuance and sale of up to 5,586,592 shares (the “Shares”) of common stock, $0.001 par value per share (“Common Stock”). The Shares are included in a registration statement on Form S-1 under the Securities Act of 1933, as amended (the “Securities Act”), filed with the Securities and Exchange Commission (the “Commission”) on November 7, 2022 (the “Registration Statement”). The term “Shares” shall include any additional shares of Common Stock registered by the Company pursuant to Rule 462(b) under the Securities Act in connection with the offering contemplated by the Registration Statement. This opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act, and no opinion is expressed herein as to any matter pertaining to the contents of the Registration Statement or related prospectus, other than as expressly stated herein with respect to the issue of the Shares.
As such counsel, we have examined such matters of fact and questions of law as we have considered appropriate for purposes of this letter, including, but not limited to, (a) the Registration Statement and the prospectus included in the Registration Statement (the “Prospectus”), (b) the Company’s Third Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws, each as currently in effect and (c) originals or copies certified to our satisfaction of such records, documents, certificates, memoranda, opinions and other instruments as in our judgment are necessary or appropriate to enable us to render the opinion expressed below, and assumed that the Shares will be sold at a price and on terms established by the Board of Directors of the Company or a duly authorized committee thereof. With your consent, we have relied upon certificates and other assurances of officers of the Company and others as to factual matters without having independently verified such factual matters. In our examination of the aforesaid documents, we have assumed the genuineness of all signatures, the legal capacity of all natural persons, the accuracy and completeness of all documents submitted to us, the authenticity of all original documents, and the conformity to authentic original documents of all documents submitted to us as copies (including pdfs). We are opining herein as to General Corporation Law of the State of Delaware (the “Corporation Act”), and we express no opinion with respect to any other laws.
Cognition Therapeutics, Inc. November 7, 2022 Page 2 |
|
Subject to the foregoing and the other matters set forth herein, it is our opinion that, as of the date hereof, when the Shares shall have been duly registered on the books of the transfer agent and registrar therefor in the name or on behalf of the purchasers, and have been issued by the Company against payment therefor (not less than par value) in the circumstances contemplated by the form of underwriting agreement most recently filed as an exhibit to the Registration Statement, the issue and sale of the Shares will have been duly authorized by all necessary corporate action of the Company, and the Shares will be validly issued, fully paid and nonassessable.
In rendering the foregoing opinion, we have assumed that the Company will comply with all applicable notice requirements regarding uncertificated shares provided in the Corporation Act.
This opinion is for your benefit in connection with the Registration Statement and may be relied upon by you and by persons entitled to rely upon it pursuant to the applicable provisions of the Securities Act. We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm in the Registration Statement under the heading “Legal Matters.”
We further consent to the incorporation by reference of this letter and consent into any registration statement filed pursuant to Rule 462(b) with respect to the Shares. In giving such consent, we do not thereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.
Very truly yours, | |
/s/ Troutman Pepper Hamilton Sanders LLP | |
Troutman Pepper Hamilton Sanders LLP |
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Exhibit 10.29
OFFICE LEASE AGREEMENT
between
RJ EQUITIES LP
(Landlord)
and
COGNITION THERAPEUTICS, INC.
(Tenant)
Dated: August 31, 2022
TABLE OF CONTENTS
ARTICLE 1. | BASIC TERMS | 1 | ||
ARTICLE 2. | PREMISES | 2 | ||
ARTICLE 3. | TERM AND COMMENCEMENT | 2 | ||
ARTICLE 4. | CONSTRUCTION OF PREMISES | 4 | ||
ARTICLE 5. | BASE RENT | 4 | ||
ARTICLE 6. | RENT ESCALATION | 5 | ||
ARTICLE 7. | LATE PAYMENT | 9 | ||
ARTICLE 8. | USE OF PREMISES | 9 | ||
ARTICLE 9. | COMMON AREAS/PARKING | 10 | ||
ARTICLE 10. | ALTERATIONS | 10 | ||
ARTICLE 11. | MECHANIC'S LIENS | 11 | ||
ARTICLE 12. | CONDITION OF PREMISES | 11 | ||
ARTICLE 13. | UTILITIES AND SERVICES | 11 | ||
ARTICLE 14. | ASSIGNMENT AND SUBLETTING | 13 | ||
ARTICLE 15. | RIGHTS RESERVED BY LANDLORD | 13 | ||
ARTICLE 16. | REPAIRS | 14 | ||
ARTICLE 17. | INDEMNIFICATION AND INSURANCE | 15 | ||
ARTICLE 18. | LANDLORD'S LIABILITY | 16 | ||
ARTICLE 19. | COMPLIANCE WITH INSURANCE REQUIREMENTS | 17 | ||
ARTICLE 20. | FIRE OR OTHER CASUALTY | 17 | ||
ARTICLE 21. | SUBORDINATION | 18 | ||
ARTICLE 22. | CONDEMNATION | 18 | ||
ARTICLE 23. | ESTOPPEL CERTIFICATES | 19 | ||
ARTICLE 24. | DEFAULT | 19 | ||
ARTICLE 25. | PROVISIONS RELATED TO LANDLORD’S REMEDIES | 20 | ||
ARTICLE 26. | LANDLORD’S DEFAULT; RIGHT TO CURE | 22 | ||
ARTICLE 27. | WAIVER | 22 | ||
ARTICLE 28. | UTILITY DEREGULATION | 23 | ||
ARTICLE 29. | TELECOMMUNICATIONS | 23 | ||
ARTICLE 30. | SURRENDER | 24 |
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ARTICLE 31. | QUIET ENJOYMENT | 25 | ||
ARTICLE 32. | HOLDING OVER | 25 | ||
ARTICLE 33. | ENVIRONMENTAL COVENANTS, REPRESENTATIONS AND WARRANTIES | 25 | ||
ARTICLE 34. | TENANT’S COMPLIANCE WITH LAWS | 27 | ||
ARTICLE 35. | DISABILITIES ACT | 27 | ||
ARTICLE 36. | NOTICE | 27 | ||
ARTICLE 37. | BROKERS | 28 | ||
ARTICLE 38. | FORCE MAJEURE | 28 | ||
ARTICLE 39. | TRANSFER OF LANDLORD'S INTEREST | 28 | ||
ARTICLE 40. | SUCCESSORS | 29 | ||
ARTICLE 41. | GOVERNING LAW | 29 | ||
ARTICLE 42. | SEPARABILITY | 29 | ||
ARTICLE 43. | CAPTIONS | 29 | ||
ARTICLE 44. | GENDER | 29 | ||
ARTICLE 45. | EXECUTION; COUNTERPARTS | 29 | ||
ARTICLE 46. | ENTIRE AGREEMENT | 30 | ||
ARTICLE 47. | AUTHORITY | 30 | ||
ARTICLE 48. | SECURITY DEPOSIT | 30 | ||
ARTICLE 49. | OFAC CERTIFICATION | 31 |
EXHIBIT “A” DIAGRAM OF DEVELOPMENT | 33 | |
EXHIBIT “B” OUTLINE OF PREMISES | 34 | |
EXHIBIT “C” RULES AND REGULATIONS | 35 | |
EXHIBIT “D” INTENTIONALLY OMITTED | 36 | |
EXHIBIT “E” ESTOPPEL CERTIFICATE | 37 | |
EXHIBIT “F” SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT | 38 |
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OFFICE LEASE AGREEMENT
This Office Lease Agreement (the "Lease") is made this 31st day of August, 2022, by and between RJ EQUITIES LP, a Pennsylvania limited partnership ("Landlord") and COGNITION THERAPEUTICS, INC., a Delaware corporation (“Tenant”).
ARTICLE 1. BASIC TERMS
For the purposes of this Lease, the following terms shall have the meanings set forth below:
(a) Landlord: | RJ EQUITIES LP, a Pennsylvania limited partnership | |
(b) Tenant: | COGNITION THERAPEUTICS, INC., a Delaware corporation | |
(c) Premises: | Suite 230 located on the second floor of the commercial building (the "Building") situated at 2403 Sidney Street, Pittsburgh, PA 15203 (the "Development") and as outlined on the Diagram of Development attached hereto as Exhibit “A”. The Premises contains approximately 2,980 rentable square feet as depicted on the floor plan attached hereto as Exhibit “B”. | |
(d) Commencement Date: | October 1, 2022. | |
(e) Lease Term: | Three (3) years and nine (9) months. | |
(f) Termination Date: | June 30, 2026. | |
(g) Extension Term: | Intentionally omitted. | |
(h) Base Rent: |
Period | Monthly | Annual | |
10/1/2022 - 6/30/2023 | $2,755.67 | $33,068.04 | |
7/1/2023 - 6/30/2026 | $4,470.00 | $53,640.00 |
(i) Base Year for Real Estate Taxes: | 2023. | |
(j) Base Year for Operating Costs: | 2023. | |
(k) Approximate rentable area of the Premises: | 2,980 sq. ft. |
(l) Approximate rentable area of the Building: | 221,000 sq. ft. | |
(m) Tenant's Proportionate Share: | 1.34%. | |
(n) Security Deposit: | N/A. | |
(o) Permitted Uses: | Office uses. | |
(p) Notification Addresses: |
Landlord: | RJ Equities LP | |
2403 Sidney Street, Suite 200 | ||
Pittsburgh, PA 15203 | ||
Attn: Ronald J. Tarquinio |
Tenant: | Cognition Therapeutics, Inc. | |
2403 Sidney Street, Suite 261 | ||
Pittsburgh, PA 15203 | ||
Attn: President |
ARTICLE 2. PREMISES
(a) Office Space. Landlord, for and in consideration of the Rent (as defined below) to be paid and the covenants and agreements to be performed by Tenant, as hereinafter set forth, does hereby lease, demise and let unto Tenant the Premises, together with a non-exclusive license (in common with others), to use the common areas of the Building and the Development. Landlord reserves unto itself, however, the use of the roof, exterior walls and the area above and beneath the Premises, together with the right to install, maintain, use, repair and replace exterior windows and doors, pipes, ducts, conduits, wires and structural elements leading through the Premises in locations and in such a manner which shall not materially or adversely interfere with Tenant's use or occupancy thereof.
(b) Current Lease. Reference is made to that certain Office Lease Agreement dated December 20, 2019, between Landlord and Tenant (as amended from time to time, the “Current Lease”) for Suite 242 in the Building, which Current Lease has a stated Termination Date (as defined in the Current Lease) of June 30, 2023. Landlord and Tenant hereby acknowledge and agree that: (i) the Termination Date of the Current Lease is hereby modified to be the Commencement Date of this Lease (to the extent the same occurs hereunder – if this Lease is terminated prior to the Commencement Date, the Current Lease shall continue unmodified), and (ii) except as expressly modified by this Lease, all other terms and provisions of the Current Lease shall remain in full force and effect.
ARTICLE 3. TERM AND COMMENCEMENT
(a) Term and Confirmation. The term of this Lease shall commence on the Commencement Date set forth in Article 1(d) and end on the Termination Date set forth in Article 1(f), unless extended or sooner terminated as provided herein, subject to adjustment as provided below and the other provisions hereof. If the Commencement Date is postponed as provided below, the Termination Date set forth in Article 1 shall be adjusted accordingly. Tenant shall execute a confirmation of the Commencement Date and other factual matters in such form as Landlord may reasonably request within ten (10) days after requested by Landlord following the Commencement Date; any failure to respond within such time shall be deemed an acceptance of the matters as set forth in Landlord’s confirmation. If Tenant disagrees with Landlord’s adjustment of the Commencement Date, Tenant shall pay Rent and perform all other obligations commencing on the date as determined by Landlord, subject to refund or credit when the matter is resolved.
(b) Commencement Delays. The Commencement Date, Rent and Tenant’s other obligations shall be postponed to the extent Landlord fails to deliver possession of the Premises in the condition required under Article 4 for any reason, including holding over by prior occupants. If Landlord so fails for a ninety (90) day initial grace period, Tenant shall have the right to terminate this Lease by notice within ten (10) days. Any such delay in the Commencement Date shall not subject Landlord to liability for loss or damage resulting therefrom, and Tenant’s sole recourse with respect thereto shall be the postponement of Rent or termination of this Lease in accordance with the preceding sentence.
ARTICLE 4. CONSTRUCTION OF PREMISES
Landlord shall, prior to the Commencement Date, cause: (i) the interior walls of the Premises to be painted with Building standard paint, and (ii) the installation of Building standard carpet in the Premises.
ARTICLE 5. BASE RENT
(a) Base Rent. Tenant shall pay to Landlord Base Rent, payable in advance without demand on the first day of each calendar month throughout the Term; provided, that Tenant shall pay Base Rent for the first full calendar month for which Base Rent shall be due (and any initial partial month) when Tenant executes and delivers this Lease.
(b) Additional Rent. Whenever under the terms of this Lease any sum of money is required to be paid by Tenant to Landlord in addition to the Base Rent herein reserved, and said additional amount so to be paid is not designated as "additional rent", then said amount shall nevertheless, at the option of Landlord, be deemed "additional rent" and collectible as such, but nothing herein contained shall be deemed to suspend or delay the payment of any sum at the time the same becomes due and payable hereunder, or limit any other remedy of Landlord. Nonpayment of additional rent beyond the expiration of applicable notice and/or cure periods shall constitute a default under this Lease to the same extent, and shall entitle the Landlord to the same remedies, as nonpayment of Base Rent. Where no time limit for payment is otherwise stated in the specific Lease provision applicable thereto, any such obligation shall be due and payable within fifteen (15) days following Tenant's receipt of a written statement showing in reasonable detail the basis for the amount claimed. Base Rent and additional rent are sometimes hereinafter referred to as “Rent”.
(c) Payments. All payments of Rent shall be paid when due without any deduction, recoupment, set-off or counterclaim (except as otherwise set forth in this Lease) at the principal office of the Landlord or at such other place as Landlord may from time to time direct. No delay by Landlord in providing a statement for Rent shall be deemed a default by Landlord or a waiver of Landlord’s right to require payment of Tenant’s obligations for any Rent due under the terms of this Lease.
ARTICLE 6. RENT ESCALATION
(a) Real Estate Tax Increases. Commencing on January 1, 2024, and thereafter through the term of this Lease, Tenant shall pay to Landlord, as additional rent, Tenant's Proportionate Share of the amount by which Real Estate Taxes incurred by Landlord during any calendar year following the Base Year for Real Estate Taxes shall exceed the Real Estate Taxes incurred by Landlord during such Base Year.
“Real Estate Taxes” shall be deemed to mean the aggregate amount of taxes and assessments levied, assessed or imposed upon the Development in which the Premises are located. For purposes hereof, Real Estate Taxes shall include, without limitation, real estate taxes, sewer rents, water rents, assessments (special or otherwise), transit taxes, any tax or excise on rentals or any other tax (however described) on account of rental received for use and occupancy of all or any part of the Premises, whether such taxes are imposed by the United States of America, the Commonwealth of Pennsylvania, the county in which the Premises is located or any local governmental municipality, authority or agency, or any other political subdivision of any of the foregoing. Real Estate Taxes shall also include all reasonable costs and expenses (including, without limitation, legal fees and court costs) incurred in connection with the protest or the reduction of any of the aforesaid taxes and or assessments, up to an amount equal to the reduction of any of the aforesaid taxes resulting from such protest. If at any time during the term hereof, a tax or excise on rents or any other tax, however described, is levied or assessed by any governmental authority on account of the rents hereunder or the interest of Landlord or Landlord's beneficiaries under this Lease, then such additional tax shall be included in Real Estate Taxes. Further, any tax assessed or levied by any governmental authority in lieu of the foregoing Real Estate Taxes shall also be included. For the purpose of determining Real Estate Taxes for any given calendar year, the amount to be paid for such calendar year shall be (a) with respect to assessments, the amount of the installments (and any interest) due and payable during such calendar year and (b) with respect to all other Real Estate Taxes, the amount due and payable during such calendar year, but only to the extent properly allocable to such calendar year. Notwithstanding anything in this Lease to the contrary, “Real Estate Taxes” shall not include (i) any capital stock, net income, profit tax, succession, transfer, franchise, gift, estate or inheritance tax, (ii) any transfer tax or recording charge resulting from a transfer of the Development or the Building or any interest in the Development or the Building or (iii) any penalties, interest or fines incurred by Landlord due to nonpayment or late payment of taxes.
(b) Operating Cost Increases. Commencing on January 1, 2024, and thereafter through the term of this Lease, Tenant shall pay to Landlord, as additional rent, Tenant's Proportionate Share of the amount by which Operating Costs incurred by Landlord during any calendar year following the Base Year for Operating Costs shall exceed the Operating Costs incurred by Landlord during such Base Year.
“Operating Costs” shall be deemed to mean all costs and expenses of any kind or nature incurred by Landlord in any calendar year in operating, policing, protecting, lighting, heating, air conditioning, insuring, repairing and maintaining the Building, other structures and improvements and the land constituting or supporting the Development, all in accordance with accepted principles of sound management of similar properties, and shall include (without limitation) all costs and expenses of operation, replacement, replacement and maintenance, including by way of illustration and not limitation: personal property taxes and any tax in addition to or in lieu thereof, assessed against Landlord or to be collected by Landlord; utilities; supplies; materials; tools; insurance (including, but not limited to, commercial general liability, casualty, business interruption, rent loss insurance and flood and earthquake insurance); licenses, permits and inspection fees; cost of services of independent contractors (including property management fees); any tax, assessment, cost or fee incurred by Landlord in connection with the Development from any neighborhood improvement district or similar program or initiative; cost of compensation (including employment taxes and fringe benefits) of all persons who perform regular and recurring duties connected with day-to-day operation, maintenance and repair of the Development, its equipment and the component interior and exterior common areas, ceilings, floors, walks, stairs, stairwells, elevators, loading docks, trash compactor, malls and landscaped areas including janitorial, gardening, security, parking, operating engineer, painting, plumbing, electrical, carpentry, heating, ventilation, air conditioning, window washing, signage and advertising; rental expense or a reasonable allowance for depreciation of personal property used in such maintenance, operation and repair of the Development; those variable costs, expenses and disbursements which Landlord reasonably determines Landlord would have incurred had the Development been 100% occupied at all times during such calendar year; and amortization of Permitted Capital Expenditures (as hereinafter defined).
Notwithstanding anything in this Lease to the contrary, “Operating Costs” shall not include the following: costs to benefit, or relating to, a specific tenant, such as legal and other related expenses associated with the negotiation or enforcement of leases, and any penalties or damages from such lawsuits; costs associated with the financing or refinancing of debt or selling of the Building, the Development or any interest therein, such as points, broker's fees and attorney's fees; executive salaries and compensation of employees of Landlord above the grade of regional property manager; repairs and/or replacements which are covered by insurance claim or condemnation proceeds; leasing commissions, legal fees, tenant allowances or fit outs (including permit, license and inspection fees), advertising costs, space planning costs and promotional material; costs incurred by Landlord in connection with the original construction of the Building or the correction of latent defects in construction of the Building; depreciation and amortization (except for amortization of Permitted Capital Expenditures); costs paid to subsidiaries or affiliates of Landlord, to the extent that the costs exceed the reasonable costs that would have been paid had the services, supplies or materials been provided by unaffiliated parties on a reasonable basis; interest on debt or amortization payments on any mortgage or deeds of trust or any other borrowings and any ground rent; ground rents or rentals payable by Landlord pursuant to any over-lease or any compensation paid to clerks, attendants or other persons in commercial concessions operated by Landlord; costs incurred in managing or operating any “pay for” parking facilities within the Development; expenses resulting from the gross negligence or willful misconduct of Landlord or its agents, employees or contractors; any fines or fees for Landlord’s failure to comply with governmental, quasi-governmental, or regulatory agencies’ rules and regulations, or any costs or expenses incurred by Landlord due to violation by Landlord, or Landlord’s agents, contractors or employees, of either the payment terms and conditions of any lease or, service contract or other agreement covering the Development or Landlord’s obligations as owner of the Development; costs for sculpture, decorations, painting or other objects of art in excess of amounts typically spent for such items in office buildings of comparable quality in the competitive area of the Building; costs of any political, charitable or civic contribution or donations; Capital Items, except for Permitted Capital Expenditures; costs that are properly chargeable to particular tenants in the Development, including, without limitation, costs and expenses for providing heating and air conditioning service outside of normal business hours and damages to the Development or any part thereof caused by the act or neglect of another tenant; costs relating to utilities or other services to tenant spaces for which Tenant pays for such utilities or other services directly; costs properly attributable (applying generally accepted accounting principles) to other calendar years; costs paid by Landlord if and to the extent such costs are incurred by Landlord for any work or service furnished to any other tenant in the Development (other than Tenant) to a materially greater extent and in a materially more favorable manner than furnished generally to the remaining tenants in the Project (including Tenant); costs incurred with respect to preparation of income tax returns; and costs incurred in cleaning up any environment hazard or condition in violation of any environmental law. “Permitted Capital Expenditures” means capital expenditures and capital repairs and replacements (“Capital Items”), provided such Capital Items (x) are necessitated by a change in law or regulation occurring after the Commencement Date; or (y) are reasonably intended to have cost-saving benefits over the Term of the Lease. The foregoing provision is for definitional purposes only and shall not be construed to impose any obligation upon Landlord to incur such expenses. No item of Operating Cost shall be included more than once in any given time period and no item of expense charged to Tenant as an Operating Cost shall be charged to Tenant as Real Estate Taxes or any other type of chargeable expense or cost. The property management fees incurred by Landlord shall only be chargeable to Tenant to the extent such property management fees do not exceed the property management fees incurred by other buildings of similar size and quality and located within the geographic area in which the Development is located.
(c) Method of Payment. Within sixty (60) days after the end of each calendar year (including the last calendar year of the term of this Lease), Landlord shall furnish Tenant a written statement showing in reasonable detail Landlord's Real Estate Taxes and Operating Costs for the Base Year and the preceding calendar year and showing Tenant's Proportionate Share of the amount of any increase in such Real Estate Taxes and/or Operating Costs over the amount thereof for the respective Base Year. Coincidentally with the monthly rent payment due following Tenant's receipt of such statement, Tenant shall pay to Landlord an amount equal to the sum of (1) Tenant's Proportionate Share of the increase in Real Estate Taxes and Operating Costs for the preceding calendar year over the amount thereof for the applicable Base Year; and (2) one-twelfth (1/12th) of such increases for the current calendar year multiplied by the number of rent payments (including the current one) then elapsed in such calendar year. Thereafter such one-twelfth (1/12th) amount shall be paid monthly with the Base Rent until subsequently adjusted in accordance with the terms of this Article.
(d) Tenant’s Proportionate Share. “Tenant’s Proportionate Share” of Taxes and Operating Costs shall be the percentages set forth in Article 1, but if the rentable area of the Premises or Building shall change, Tenant’s Proportionate Share shall thereupon become the rentable area of the Premises divided by the rentable area of the Building, subject at all times to adjustment as provided in this Article. Tenant acknowledges that the “rentable area of the Premises” under this Lease includes the usable area, without deduction for columns or projections, multiplied by a load or conversion factor, to reflect a share of certain areas, which may include lobbies, corridors, mechanical, utility, janitorial, boiler and service rooms and closets, restrooms, and other public, common and service areas. Except as provided expressly to the contrary herein, the “rentable area of the Building” shall include all rentable area of all space leased or available for lease at the Building, which Landlord may reasonably re-determine from time to time, to reflect re-configurations, additions or modifications to the Building.
(e) Tax Refunds, Protest Costs, and Expense Adjustments For Prior Years. Landlord shall each year: (i) credit against Real Estate Taxes any refunds received during such year, (ii) include in Real Estate Taxes any additional amount paid during such year, involving an adjustment to Real Estate Taxes for a prior year, due to error by the taxing authority, supplemental assessment, or other reason, (iii) include, in either Real Estate Taxes or Operating Costs, any fees for attorneys, consultants and experts, and other costs paid during such year in attempting to protest, appeal or otherwise seek to reduce or minimize Real Estate Taxes, by the terms of this Article, (iv) credit against Operating Costs the cost of any item previously included in Operating Costs, to the extent that Landlord receives reimbursement from insurance proceeds or a third party during such year (excluding tenant payments for Real Estate Taxes and Operating Expenses), and (v) make any other appropriate changes to reflect adjustments to Real Estate Taxes or Operating Expenses for prior years.
(f) Payments After Lease Term Ends. Tenant’s obligations to pay Tenant’s Proportionate Share of Real Estate Taxes and Operating Costs (or any other amounts) accruing during, or relating to, the period prior to expiration or earlier termination of this Lease shall survive the expiration or termination of this Lease for a period of two (2) years. Tenant shall pay the full amount of such estimate and any additional amount due after the actual amounts are determined, in each case within thirty (30) days after Landlord sends a statement therefore. If the actual amount is less than the amount Tenant pays as an estimate, Landlord shall refund the difference within thirty (30) days after such determination is made.
(g) Audit Rights. In the event of any dispute as to the amount of Tenant’s Proportionate Share of Operating Costs and Real Property Taxes, Tenant may, by prior written notice (“Audit Notice”) given within ninety (90) days following receipt of a Landlord’s reconciliation statement (“Audit Period”), audit Landlord’s accounting records with respect to Operating Expenses and Real Property Taxes relative to the year to which such statement relates. The audit shall be conducted by Tenant, or an accounting firm engaged by Tenant and reasonably satisfactory to Landlord (billing hourly and not on a contingency fee basis) (“Third Party Auditor”), and shall be conducted at the office of Landlord at which its records are kept or, at Landlord’s election, the office of Landlord’s property manager (if any). The audit shall be conducted at reasonable times during normal business hours. In no event will Landlord or its property manager be required to (i) photocopy any accounting records or other items or contracts, (ii) create any ledgers or schedules not already in existence, (iii) incur any costs or expenses relative to such inspection, or (iv) perform any other tasks other than making available such accounting records as aforesaid. Neither Tenant nor its auditor may leave the office of Landlord with originals of any materials supplied by Landlord. Tenant must pay Tenant’s Proportionate Share of Operating Costs and Real Property Taxes when due pursuant to the terms of this Lease and may not withhold payment of Operating Costs, Real Property Taxes or any other Rent pending results of the audit or during a dispute regarding Operating Costs and Real Property Taxes. The audit must be completed within ninety (90) days of the date of Tenant’s Audit Notice and the results of such audit shall be delivered to Landlord within forty-five (45) days of the date of Tenant’s Audit Notice. If Tenant does not substantially comply with any of the aforementioned time frames, then the Landlord’s statement will be conclusively binding on Tenant. If such audit or review correctly reveals that Landlord has overcharged Tenant, then within thirty (30) days after the results of such audit are made available to Landlord, the amount of such overcharge shall be deducted from the installments of Tenant’s Share of Operating Costs and Real Property Taxes next becoming due. If the audit reveals that Tenant was undercharged, then within thirty (30) days after the results of the audit are made available to Tenant, Tenant agrees to reimburse Landlord the amount of such undercharge. Tenant agrees to keep the results of the audit confidential and will cause its agents, employees and contractors to keep such results confidential. To that end, Landlord may require Tenant and its auditor to execute a commercially reasonable confidentiality agreement provided by Landlord.
ARTICLE 7. LATE PAYMENT
A late charge of five (5%) percent shall be due and payable forthwith on the amount of Base Rent and additional rent not received by Landlord from Tenant on or before the tenth (10th) day after such payment was due. In addition, Tenant shall pay interest at the Lease Interest Rate (as defined below) on any sum which is not paid when due, interest to run from the due date until such sum is paid. The “Lease Interest Rate” means four (4) percentage points per annum above the prime rate per annum announced from time to time by PNC Bank, N.A, or its successors.
ARTICLE 8. USE OF PREMISES
Tenant shall occupy and use the Premises only for the Permitted Uses set forth in Article 1. Tenant shall not occupy or use the Premises for any other purpose or business without the prior written consent of Landlord. Landlord has promulgated reasonable Rules and Regulations (“Rules and Regulations”), which are attached hereto, made part hereof and marked as Exhibit “C”. Tenant acknowledges receipt of and shall observe and comply with such Rules and Regulations. Tenant further acknowledges that Landlord, in Landlord’s reasonable discretion, may from time to time adopt, amend, establish, modify, proscribe or restate such rules and regulations with regard to the operation of the Premises, the Building, and common areas of the Development; provided that such rules and regulations are generally applicable to all tenants, do not materially increase the financial burdens of Tenant and do not materially adversely affect Tenant’s rights under this Lease. In the event of any conflict between the provisions of such rules and regulations and this Lease, the provisions of this Lease shall control.
ARTICLE 9. COMMON AREAS/PARKING
All parking areas, driveways, alleys, public corridors and fire escapes, and other areas, facilities and improvements as may be approved by Landlord from time to time for the general use, in common, of Tenant and other tenants, their employees, agents, invitees and licensees, shall at all times be subject to the exclusive control and management of Landlord, and Landlord shall have the right from time to time to establish, modify and enforce reasonable rules and regulations with respect to all such areas, facilities and improvements.
Landlord reserves the right to designate certain parking areas for non-exclusive permitted parking for tenant’s employees, for general visitor parking, and for other designated uses. Tenant shall be allocated fourteen (14) non-exclusive permitted parking spaces for the use of Tenant's employees, the location of such parking spaces to be designated by Landlord from time to time according to the Landlord's parking policies and procedures. Landlord agrees to enforce its parking regulations for the mutual benefit of Landlord and tenants of the Development. Except for claims resulting from Landlord’s intentional or grossly negligent acts, Landlord shall not be responsible or liable for damage or loss sustained to motor vehicles (including any contents) parked in the Development.
ARTICLE 10. ALTERATIONS
(a) Tenant shall not make any alterations, improvements or additions to the Premises or attach any fixtures or equipment thereto, without the Landlord's prior written approval, not to be unreasonably withheld. All alterations, improvements or additions made to the Premises or the attachment of any fixtures or equipment thereto shall be performed at Tenant's sole cost and expense. Tenant may affix pictures and shelving to the walls without Landlord's consent.
(b) All alterations, improvements or additions to the Premises made by Tenant shall be deemed to have been attached to the Premises and to have become the property of Landlord upon such attachment, and upon expiration of this Lease or renewal term thereof, Tenant shall not remove any of such alterations, improvements or additions; provided, however, that Landlord may designate by written notice to Tenant at the time Tenant requests consent those alterations and additions which shall be removed by Tenant at the expiration or termination of this Lease, and Tenant shall properly remove the same and repair any damage to the Premises caused by such removal. Notwithstanding anything in this Lease to the contrary, all furniture, trade fixtures and equipment installed by or for Tenant may be removed by Tenant at any time.
(c) In performing such alterations, improvements or additions, or in the removal thereof, Tenant shall use due care to cause as little damage or injury as possible to the Premises and the Building and shall repair all damage or injury that may occur to the Premises or the Building as a result thereof.
(d) Tenant agrees in doing any such work in or about the Premises to engage only such labor as will not conflict with or cause strikes or other labor disturbances among the Development service employees of Landlord. Any contractors employed by Tenant shall be subject to Landlord's prior written approval, not to be unreasonably withheld. All such contractors shall be required to carry worker's compensation insurance, commercial general liability insurance and property damage insurance in amounts, form and content, and with companies reasonably satisfactory to Landlord.
(e) Prior to the commencement by Tenant of any work as set forth in this Article, Tenant shall obtain, at Tenant's sole cost and expense, all necessary permits, authorizations and licenses required by the various governmental authorities having jurisdiction over the Premises.
ARTICLE 11. MECHANIC'S LIENS
If any mechanics' or other lien shall be filed against the Premises or the Development purporting to be for labor or material furnished or to be furnished at the request of Tenant, then Tenant shall at its expense cause such lien to be discharged by payment, bond or otherwise within thirty (30) days after notice of filing thereof. As an alternative to causing the lien to be discharged of record, Tenant shall have the right to contest the validity of any lien or claim if Tenant shall first have posted a bond or other security reasonably satisfactory to Landlord (such as an undertaking with Landlord's title company to insure that, upon final determination of the validity of such lien or claim, Tenant shall immediately pay any judgment rendered against Tenant). If Tenant shall fail to take such action within such thirty (30) day period, Landlord may cause such lien to be discharged by payment, bond or otherwise, without investigation as to the validity thereof or as to any offsets or defenses thereto and Tenant shall, upon demand, reimburse Landlord for all amounts paid and costs incurred including reasonable attorney's fees, in having such lien discharged of record. Tenant shall indemnify and hold Landlord harmless from and against any and all claims, costs, damages, liabilities and expenses (including reasonable attorney's fees) which may be brought or imposed against or incurred by Landlord by reason of any such lien or its discharge.
ARTICLE 12. CONDITION OF PREMISES
Tenant acknowledges and agrees that, except as expressly set forth in this Lease, there have been no representations or warranties made by or on behalf of Landlord with respect to the Building, Premises or the Development or with respect to the suitability of any of them for the conduct of Tenant's business. The taking of possession of the Premises by Tenant shall conclusively establish that the Premises were at such time in satisfactory condition, order and repair, subject to latent defects which a reasonable inspection of the Premises would not disclose.
ARTICLE 13. UTILITIES AND SERVICES
(a) Utilities: Separately metered electric and gas service shall be made available to the Premises. Tenant shall pay for the cost of such utility services directly to the utility provider or to the Landlord, as the case may be.
(b) Building Services: Landlord shall provide the following to the Premises, the Building or the Development, as applicable:
1) Janitorial service four (4) times per week, for office space portions of the Premises only, see Exhibit "D," Cleaning Specifications;
2) Water and sewage for the Permitted Use;
3) Replacement standard light globes and/or standard fluorescent tubes and ballasts in the standard ceiling lighting fixtures;
4) HVAC, including maintenance of HVAC equipment and systems;
5) Passenger and freight elevator service and maintenance and repair;
6) Hot and cold water for drinking, lavatory and toilet purposes at those points of supply provided for nonexclusive general use of tenants of the Building, and points of supply in the Premises installed by or with Landlord’s consent for the exclusive use of Tenant;
7) Maintenance and repair of interior common areas of the Building, including the public restrooms in the Building; and
8) Maintenance and repair of exterior common areas of the Development, including but not limited to cleaning of outside exterior windows and doors, snow removal and landscaping.
(c) Landlord does not warrant that the utilities or services provided for in this Article shall be free from slow-down, interruption or stoppage pursuant to voluntary agreement by and between Landlord and governmental bodies and regulatory agencies, or caused by the maintenance, repair, substitution, renewal, replacement or improvements of any of the equipment involved in the furnishing of any such utilities or services or caused by strikes, lockouts, labor controversies, fuel shortages, accidents, acts of God or the elements or any other cause beyond the reasonable control of Landlord; and specifically, no such slow-down, interruption or stoppage of any of such services shall be construed as an eviction, actual or constructive, of Tenant, nor shall same cause any abatement of Base Rent or additional rent payable hereunder or in any manner or for any purpose relieve Tenant from any of Tenant's obligations hereunder, unless same shall make a material portion of the Premises untenantable for a period of three (3) consecutive business days at which point Base Rent shall be abated until such time as the Premises are no longer untenantable, and in no event shall Landlord be liable for damages to persons or property or be in default hereunder as a result of such interruption or stoppage of service. Should said disruption of service or utilities cause significant interference with Tenant’s business for a period of sixty (60) days, Tenant shall have the right to terminate this Lease by written notice to Landlord. Landlord shall provide Tenant with reasonable advance notice of any anticipated interruptions in utility or Building services, and Landlord shall use reasonable efforts to minimize disruption of Tenant’s use and occupancy in connection therewith.
ARTICLE 14. ASSIGNMENT AND SUBLETTING
Tenant shall not assign this Lease or sublet the Premises, (whether by operation of law or voluntary agreement) in whole or in part, without the Landlord's prior written consent, not to be unreasonably withheld. In case of any assignment or subletting, Tenant shall remain primarily liable on this Lease and shall not be released from the performance of any of the terms, covenants and conditions hereof.
Notwithstanding the foregoing, Tenant may assign this Lease, or sublet the Premises or any portion thereof to an affiliate controlling, controlled by or under common control with Tenant, without Landlord consent, but with notice thereof to Landlord. Tenant may sublet all or a portion of the Premises without prior consent to third parties and entities related to Tenant either through affiliated or commercial relationships for office use. Any license, assignment, subleasing or other occupancy agreement shall be subject to all terms, covenants and conditions of this Lease and no license, assignment, subleasing or other occupancy agreement shall relieve Tenant of any liability hereunder. Upon Landlord' s request, Tenant shall provide Landlord with copies of all reasonable documentation related to any license, assignment, sublease, or other occupancy agreement and Tenant shall require any permitted licensee, assignee, sublicensee, or other occupant to obtain and maintain commercially reasonable insurance naming Landlord as additional insured. Tenant shall provide copies evidencing such insurance to Landlord upon Landlord's request.
ARTICLE 15. RIGHTS RESERVED BY LANDLORD
Except to the extent expressly limited herein, Landlord reserves full rights to control the Development, the Building and the Premises (which rights may be exercised without subjecting Landlord to claims for constructive eviction, abatement of Rent, damages or other claims of any kind), including more particularly, but without limitation, the following rights for Landlord, its employees or agents; provided however, Landlord shall use commercially reasonable efforts to exercise such rights in a manner that will first attempt to minimize interference with Tenant’s use and occupancy of the Premises:
(a) Access to Premises. To enter the Premises in order to inspect, supply cleaning service or other services to be provided Tenant hereunder, show the Premises to current and prospective lenders, insurers, purchasers, tenants, brokers and governmental authorities, and perform any work or take any other actions reserved to Landlord under this Lease or applicable laws. However, Landlord shall: (i) provide reasonable advance written or oral notice to Tenant’s on-site manager or other appropriate person (except in emergencies), (ii) take reasonable steps to minimize any significant disruption to Tenant’s business, and following completion of any work, return Tenant’s leasehold improvements, fixtures, property and equipment to the original locations and condition to the fullest extent reasonably possible, and (iii) take reasonable steps to avoid materially changing the configuration or reducing the square footage of the Premises, unless required by laws or other causes beyond Landlord’s reasonable control (and in the event of any permanent reduction, the Rent and other rights and obligations of the parties based on the square footage of the Premises shall be proportionately reduced). Tenant shall not place partitions, furniture or other obstructions in the Premises which may prevent or impair Landlord’s access to the systems and equipment for the Building or the systems and equipment for the Premises. If Tenant requests that any such access occur before or after Landlord’s regular business hours and Landlord approves, Tenant shall pay all overtime and other additional costs in connection therewith.
(b) Changes to the Development. To: (i) paint and decorate, (ii) perform repairs or maintenance, and (iii) make replacements, restorations, renovations, alterations, additions and improvements, structural or otherwise in and to the Development or any part thereof, including any adjacent building, structure, facility, land, street or alley, or change the uses thereof (including changes, reductions or additions of corridors, entrances, doors, lobbies, parking facilities and other areas, structural support columns and shear walls, utility lines, pipes, duct work, cables, installations, docks, walks, elevators, stairs, solar tint windows or film, planters, sculptures, displays, and other amenities and features therein, and changes relating to the connection with or entrance into or use of the Building or any other adjoining or adjacent building or buildings, now existing or hereafter constructed). In connection with such matters, Landlord may among other things erect scaffolding, barricades and other structures, open ceilings, close entry ways, restrooms, elevators, stairways, corridors, parking and other areas and facilities, and take such other actions as Landlord deems appropriate.
ARTICLE 16. REPAIRS
(a) Subject to the provisions of Article 6 hereof, Landlord shall perform all maintenance and make all repairs or replacement necessary to maintain the structural, plumbing, HVAC and electrical systems (including replacement of light bulbs, ballasts and fixtures), exterior doors and windows, roof, exterior walls, demising walls and floor (but excluding interior ceiling, wall and floor finishes), common areas and utility lines and connections servicing the Premises, the Building or the Development in good order and condition. Landlord shall commence such repairs as promptly as the circumstances reasonably permit and thereafter shall diligently pursue the same to completion with reasonable promptness. Notwithstanding anything contained in this Lease to the contrary, Tenant shall be responsible, at its sole cost and expense, for any maintenance, repairs and replacements made by the Landlord which are necessitated by the negligent acts, misuse or willful misconduct of Tenant, its agents, contractors, employees or invitees.
(b) Except as the Landlord is obligated for repairs as provided hereinabove, Tenant shall make at Tenant's sole cost and expense, all repairs necessary to maintain the Premises and shall keep the Premises and the fixtures therein in neat, clean, safe and orderly condition. Without limiting the generality of the foregoing, any maintenance, repairs or replacements of all lab equipment contained in the lab space portion of the Premises, including without limitation all water treatment systems and vacuum equipment, desired by Tenant shall be the responsibility of Tenant. If the Tenant refuses or neglects to make such repairs, or fails to diligently prosecute the same to completion, after written notice from Landlord of the need therefore, Landlord may make such repairs at the expense of Tenant and such expense, along with a fifteen (15%) percent service charge, shall be collectible as additional rent.
(c) Landlord shall not be liable by reason of any injury to or interference with Tenant's business arising from the making of any repairs in accordance with this Article 16 in or to the Premises or the Building and Development or to any appurtenances or equipment therein; provided that Landlord shall interfere as little as reasonably practicable with the conduct of Tenant's business in the performance of the foregoing. There shall be no abatement of Rent because of such repairs, except as provided in Article 20 hereof.
ARTICLE 17. INDEMNIFICATION AND INSURANCE
(a) Indemnification.
(i) Tenant shall indemnify, hold harmless and defend Landlord from and against any and all costs, expenses (including reasonable counsel fees), liabilities, losses, damages, suits, actions, fines, penalties, claims or demands of any kind and asserted by or on behalf of any person or governmental authority, arising out of or in any way connected with, and Landlord shall not be liable to Tenant on account of, (i) any failure by Tenant to perform any of the agreements, terms, covenants or conditions of this Lease required to be performed by Tenant, (ii) any failure by Tenant to comply with any statutes, ordinances, regulations or orders of any governmental authority applicable to Tenant’s occupancy and use of the Premises, or (iii) any accident, death or personal injury, or damage to or loss or theft of property, which shall occur in the Premises, except to the extent caused by the negligence or willful misconduct of Landlord, its agents, employees or contractors.
(ii) Landlord shall indemnify, hold harmless and defend Tenant from and against any and all costs, expenses (including reasonable counsel fees), liabilities, losses, damages, suits, actions, fines, penalties, claims or demands of any kind and asserted by or on behalf of any person or governmental authority, arising out of or in any way connected with, (i) any failure by Landlord to perform any of the agreements, terms, covenants or conditions of this Lease required to be performed by Landlord, or (ii) the negligence or willful misconduct of Landlord or its agents, employees or contractors.
(b) Required Insurance. Tenant shall maintain at its expense during the term with respect to the Premises and Tenant’s use thereof and of the Building:
(i) Worker’s compensation insurance in the amounts required by statute, and Employer Liability Insurance in at least the following amounts: (a) Bodily Injury by Accident - $500,000 per accident, (b) Bodily Injury by Disease - $500,000 per employee and (c) Aggregate Limit - $1,000,000 per policy year.
(ii) Property Damage Insurance for the protection of Tenant and Landlord, as their interest may appear, covering all risks of physical loss to Tenant’s alterations or improvements, personal property, business records, fixtures and equipment in amounts not less than the full insurable replacement cost of such property and full insurable value of such other interests of Tenant, such policies to be in form reasonably satisfactory to Landlord.
(iii) Commercial general liability insurance in form reasonably satisfactory to Landlord with limits of at least the following amounts: (a) death or bodily injury - $2,000,000, (b) property damage or destruction (including loss of use thereof) - $2,000,000 per policy year. Such policy shall include endorsements: (1) for contractual liability covering Tenant’s indemnity obligations under this Lease, and (2) for adding Landlord, Landlord’s mortgagee, the management company for the Development, and other parties designated by Landlord, as additional insureds.
(c) Certificates, Subrogation and Other Matters. Tenant shall provide Landlord with certificates evidencing the coverage required hereunder prior to the Commencement Date, or Tenant’s entry to the Premises for construction of improvements or any other purpose (whichever first occurs). Such certificates shall state that such insurance coverage may not be changed, canceled or non-renewed without at least thirty (30) days’ prior written notice to Landlord. Tenant shall provide renewal certificates to Landlord at least ten (10) days prior to expiration of such policies. Tenant’s insurance policies shall be primary to all policies of Landlord and any other additional insureds (whose policies shall be deemed excess and non-contributory). All insurance required hereunder shall be provided by responsible insurers licensed in the Commonwealth of Pennsylvania, and shall have a general policy holder’s rating of at least A and a financial rating of at least X in the then current edition of Best’s Insurance Reports. The parties mutually hereby waive all rights and claims against each other for all losses covered by their respective insurance policies, and waive all rights of subrogation for their respective insurers. The parties agree that their respective insurance policies are now, or shall be, endorsed such that said waiver of subrogation shall not affect the right of the insured to recover thereunder. Landlord disclaims any representations as to whether the foregoing coverages will be adequate to protect Tenant.
(d) Landlord Insurance. At all times during the Lease Term, Landlord agrees to maintain in force and effect (i) all-risk fire and extended coverage insurance on the Building, and (ii) commercial general liability insurance with limits and deductibles consistent with those maintained by owners of similarly situated buildings in the vicinity of the Building.
ARTICLE 18. LANDLORD'S LIABILITY
Except for claims arising from the negligent acts or willful misconduct of Landlord or its agents, employees or contractors, Tenant waives all claims against Landlord and Landlord’s partners, members, agents and employees for injury or death to persons, damage to property or any other interest of Tenant sustained by Tenant or a party claiming by or through Tenant resulting from: (a) any defect in or failure of structural, plumbing, sprinkling, electrical, heating or air conditioning systems or equipment, or any other systems and equipment of the Premises or the Building or from the drains, pipes, plumbing or sewer; (b) broken glass; (c) any acts or omissions of the other tenants or occupants of the Building or of nearby buildings; (d) any acts or omissions of other persons; (e) damage or loss sustained to motor vehicles (including any contents) parked at or operating within the Development, from any cause; and (f) theft, Act of God, public enemy, injunction, riot, strike, insurrection, war, court order, or any order of any governmental authorities having jurisdiction over the Premises.
ARTICLE 19. COMPLIANCE WITH INSURANCE REQUIREMENTS
Tenant agrees that Tenant will not do or suffer to be done, any act, matter or thing, objectionable to the fire insurance companies whereby the fire insurance or any other insurance now in force or hereafter to be placed on the Premises or any part thereof, or on the Building of which the Premises may be a part, shall become void or suspended, or whereby the same shall be rated as a more hazardous risk than at the date when Tenant receives possession hereunder. In case of a breach of this covenant, in addition to all other remedies of Landlord hereunder, Tenant agrees to pay to Landlord as additional rent, any and all increases in premiums on insurance carried by Landlord on the Premises or any part thereof, or on the Building of which the Premises may be a part, caused in any way by the occupancy of Tenant. Notwithstanding the foregoing, Landlord acknowledges that the Permitted Use shall not constitute a breach of this Article 19.
ARTICLE 20. FIRE OR OTHER CASUALTY
(a) If the Building and/or Premises are damaged by fire or any other cause to such extent that the same cannot be restored, as reasonably estimated by Landlord, within one hundred twenty (120) days after the date of such damage or destruction, then Landlord shall, no later than the sixtieth (60th) day following the damage, give Tenant notice of Landlord’s election either to (a) restore the Building and Premises or (b) terminate this Lease. In the event Landlord elects to terminate this Lease, the Lease shall terminate on the earlier of the date of such notice or the date upon which Tenant surrenders possession of the Premises. In such event, the Rent and other charges due hereunder shall be apportioned as of the date of such casualty, and any Rent paid for any period beyond said date shall be repaid to Tenant. If the time of restoration as estimated by Landlord shall be less than one hundred twenty (120) days, or if Landlord does not elect to terminate this Lease, as hereinabove provided, Landlord shall restore the Building and the Premises, and Tenant shall have not right to terminate this Lease except as herein provided. Tenant shall, in such event, restore fixtures and improvements owned by Tenant to the original condition. Notwithstanding the foregoing, however, if the time of restoration as reasonably estimated by Landlord exceeds one hundred twenty (120) days, Tenant shall have the right to terminate this Lease upon written notice given to Landlord within thirty (30) days after the date of Landlord’s notice of the estimated restoration period. Landlord shall deliver notice of the estimated restoration period within sixty (60) days after the date of the casualty.
(b) In any such case in which use of the Premises is affected by any damage thereto, there shall be an abatement or an equitable reduction in Rent, depending on the period for which, and the extent to which, the Premises is not reasonably usable for the purposes for which it is leased hereunder. If the damage results from the fault of Tenant, or Tenant's agents, servants, visitors or licensees, Tenant shall not be entitled to any abatement or reduction of Rent up to the amount of the deductible paid by Landlord.
ARTICLE 21. SUBORDINATION
This Lease shall be subject and subordinate to the lien of any mortgage, or renewals, modifications, consolidations, replacements or extensions thereof, which now or hereafter may affect the Premises. Tenant shall, at Landlord's request, execute such agreements and other instruments as Landlord or any mortgagee of the Premises reasonably shall deem necessary or desirable to subordinate this Lease to the lien of any present or future mortgage, mortgages or construction loans against the Premises. The subordination of this Lease shall be subject to any current or future mortgage holder(s) agreement not to disturb Tenant's occupancy so long as Tenant is not then in default of this Lease. Tenant specifically approves and, upon Landlord's request, agrees to execute an Estoppel Certificate and a Subordination, Nondisturbance and Attornment Agreement substantially in the forms attached hereto as Exhibits “E” and “F”, respectively.
ARTICLE 22. CONDEMNATION
(a) In the event the Premises, or any part thereof, shall be taken or condemned permanently or temporarily for any public or quasi-public use or purpose by any competent authority in appropriation proceedings or by any right of eminent domain, the entire compensation award therefore, including leasehold, reversion and fee, shall belong to the Landlord without any deduction therefrom for any present or future estate of Tenant. Tenant shall, however, be entitled to claim, prove and receive in such condemnation proceedings such award as may be allowed for fixtures and other equipment installed by it, and for moving expenses, but only if such award shall be in addition to the award to Landlord.
(b) If the entire Building shall be so taken by virtue of eminent domain, this Lease shall terminate on the date when title vests pursuant to such taking, and the Rent and other charges hereunder shall be apportioned as of said date, and any Rent paid for any period beyond said date shall be repaid to Tenant.
(c) If more than twenty percent (20%) of the floor area comprising the Premises shall be so taken, or if a portion of the Building or Development is taken which materially interferes with Tenant’s use of the Premises, either party shall have the right to cancel and terminate this Lease as of the date of such taking, upon giving notice to the other party within thirty (30) days after notice to Tenant from Landlord or the condemning authority that such Premises are to be appropriated or taken. In the event that this Lease is not terminated as herein provided, this Lease shall continue, with an equitable and proportionate adjustment, effective on the date of taking, in Rent and other charges due hereunder based upon the reduction in floor area.
ARTICLE 23. ESTOPPEL CERTIFICATES
Tenant shall, at any time and from time to time, upon thirty (30) days written request by Landlord, execute, acknowledge and deliver to Landlord a statement in writing duly executed by Tenant (i) certifying that this Lease is in full force and effect without modification or amendment (or, if there have been any modifications or amendments, that this Lease is in full force and effect as modified and amended and setting forth in full all modifications and amendments), (ii) certifying the dates to which Base Rent and additional rent have been paid, and (iii) either certifying that to the knowledge of Tenant no default exists under this Lease or specifying each such default, and (iv) certifying such other matters as Landlord and/or any lender may reasonably request; it being the intention and agreement of Landlord and Tenant that any such statement by Tenant may be relied upon by a prospective purchaser or a prospective mortgagee of the Building, or current mortgagee of the Building, or by others, in any matter affecting the Premises.
ARTICLE 24. DEFAULT
The occurrence of any of the following events shall constitute a default by Tenant under this Lease:
(a) Failure of Tenant to take possession of the Premises within thirty (30) days following the Commencement Date;
(b) A failure by Tenant to pay any installment of Base Rent hereunder within seven (7) days after the due date (provided, Tenant shall be afforded one 5-day notice and cure period per 12-month period) or a failure to pay any such other sum herein required to be paid by Tenant within thirty (30) days after written notice thereof;
(c) An abandonment of the Premises by Tenant (provided, the foregoing shall not include temporary vacation or customary work from home arrangements);
(d) An assignment of this Lease or subletting of the Premises in violation of this Lease;
(e) A failure by Tenant to pay, when due, any installment of Rent hereunder on two (2) or more occasions within any period of twelve (12) consecutive months;
(f) The failure by Tenant to maintain insurance as required by the provisions of Article 17 hereof;
(g) A failure by Tenant to observe and perform any other material provision or covenant of this Lease to be observed or performed by Tenant, where such failure continues for thirty (30) days after written notice thereof from Landlord to Tenant;
(h) The filing of a petition by or against Tenant for adjudication as a bankrupt or insolvent or for reorganization or for the appointment pursuant to any local, state or federal bankruptcy or insolvency law of a receiver or trustee of Tenant's property; or an assignment by Tenant for the benefit of creditors; or the taking possession of the property of Tenant by any local, state or federal governmental officer or agency or court-appointed official for the dissolution or liquidation of Tenant or for the operating, either temporary or permanently, of Tenant's business, provided, however, that if any such action is commenced against Tenant the same shall not constitute a default if Tenant causes the same to be dismissed within sixty (60) days after the filing of same; or
(i) A default or breach by Tenant beyond the expiration of applicable notice and/or cure periods under any other lease with Landlord in connection with the Building.
ARTICLE 25. PROVISIONS RELATED TO LANDLORD’S REMEDIES
(a) Remedies. Upon the occurrence of any event of default set forth above and the expiration of any applicable notice and grace period, Landlord shall have the rights and remedies hereinafter set forth to the extent permitted by law, which shall be distinct, separate and cumulative with and in addition to any other right or remedy allowed under law or any other provision of this Lease:
(1) Landlord may terminate this Lease and Tenant’s right of possession, reenter and repossess the Premises by detainer suit, summary proceedings or other lawful means, and recover from Tenant: (i) any unpaid Rent as of the termination date; (ii) the amount by which: (a) any unpaid Rent which would have accrued after the termination date during the balance of the term exceeds (b) the reasonable rental value of the Premises under a lease substantially similar to this Lease, taking into account among other things the condition of the Premises, market conditions and the period of time the Premises may reasonably remain vacant before Landlord is able to re-lease the same to a suitable replacement tenant, and Costs of Reletting (as defined in Paragraph (g) below) that Landlord may incur in order to enter such replacement lease, (iii) any other amounts necessary to compensate Landlord for all damages proximately caused by Tenant’s failure to perform its obligations under this Lease, but excluding consequential, indirect or special damages. For purposes of computing the amount of rent herein that would have accrued after the termination date, Tenant’s obligations for Real Estate Taxes and Operating Costs shall be projected based upon the average rate of increase in such items from the Commencement Date through the termination date (or if such period shall be less than three years, then based on Landlord’s reasonable estimates). The amounts computed in accordance with the foregoing subclauses (a) and (b) shall both be discounted in accordance with accepted financial practice at the rate of four (4%) percent per annum to the then present value.
(2) Landlord may terminate Tenant’s right of possession, reenter and repossess the Premises by detainer suit, summary proceedings or other lawful means, without terminating this Lease, and recover from Tenant: (i) any unpaid Rent as of the date possession is terminated, (ii) any unpaid rent which thereafter accrues during the term from the date possession is terminated through the time of judgment (or which may have accrued from the time of any earlier judgment obtained by Landlord), less any consideration received from replacement tenants as further described and applied pursuant to Paragraph (g) below, and (iii) any other amounts necessary to compensate Landlord for all damages proximately caused by Tenant’s failure to perform its obligations under this Lease, including all Costs of Reletting, but excluding consequential, indirect or special damages. Tenant shall pay any such amounts to Landlord as the same accrue or after the same have accrued from time to time upon demand. At any time after terminating Tenant’s right to possession as provided herein, Landlord may terminate this Lease as provided in clause (1) above by notice to Tenant, and Landlord may pursue such other remedies as may be available to Landlord under this Lease or applicable law.
(b) Reletting. If this Lease or Tenant’s right to possession is terminated or Tenant abandons the Premises, Landlord may: (i) enter and secure the Premises, change the locks, install barricades, remove any improvements, fixtures or other property of Tenant therein, perform any decorating, remodeling, repairs, alterations, improvements or additions and take such other actions as Landlord shall determine in Landlord’s sole discretion to prevent damage or deterioration to the Premises or prepare the same for reletting, and (ii) relet all or any portion of the Premises (separately or as part of a larger space), for any rent, use or period of time (which may extend beyond the term hereof), and upon any other terms as Landlord shall determine in Landlord’s sole discretion. The consideration received from such reletting shall be applied pursuant to the terms of Paragraph (g) hereof, and if such consideration, as so applied, is not sufficient to cover all Rent and damages to which Landlord may be entitled hereunder, Tenant shall pay any deficiency to Landlord as the same accrues or after the same has accrued from time to time upon demand, subject to the other provisions hereof.
(c) Specific Performance. Landlord shall at all times have the right without prior demand or notice except as required by applicable law to: (i) seek any declaratory, injunctive or other equitable relief, and specifically enforce this Lease or restrain or enjoin a violation of any provision hereof, and Tenant hereby waives any right to require that Landlord post a bond or other security in connection therewith, and (ii) sue for and collect any unpaid Rent which has accrued.
(d) Returned Checks. If Landlord receives two (2) or more checks from Tenant which are returned by Tenant’s bank for insufficient funds, Landlord may require that all checks thereafter be bank certified or cashier’s checks (without limiting Landlord’s other remedies). All bank service charges resulting from any returned checks shall be borne by Tenant.
(e) Landlord’s Cure of Tenant Defaults. If Tenant fails to perform any obligation under this Lease beyond the applicable notice and cure periods set forth herein (except that no notice shall be required in emergencies), Landlord shall have the right (but not the duty), to perform such obligation on behalf and for the account of Tenant. In such event, Tenant shall reimburse Landlord upon demand, as additional rent, for all expenses reasonably incurred by Landlord in performing such obligation together with an amount equal to fifteen (15%) percent thereof for Landlord’s overhead, and interest thereon at the Lease Interest Rate from the date of demand. Landlord’s performance of Tenant’s obligations hereunder shall not be deemed a waiver or release of Tenant therefrom.
(f) Intentionally Omitted.
(g) Other Matters. No re-entry or repossession, repairs, changes, alterations and additions, reletting, or any other action or omission by Landlord shall be construed as an election by Landlord to terminate this Lease or Tenant’s right to possession, nor shall the same operate to release Tenant in whole or in part from any of Tenant’s obligations hereunder, unless express notice of such intention is sent by Landlord to Tenant. Landlord may bring suits for amounts owed by Tenant hereunder or any portions thereof, as the same accrue or after the same have accrued, and no suit or recovery of any portion due hereunder shall be deemed a waiver of Landlord’s right to collect all amounts to which Landlord is entitled hereunder, nor shall the same serve as any defense to any subsequent suit brought for any amount not therefor reduced to judgment. Landlord may pursue one or more remedies against Tenant and need not make an election of remedies except as required by applicable law. All rent and other consideration paid by any replacement tenants shall be applied at Landlord’s option: (i) first, to the Costs of Reletting, (ii) second, to the payment of all costs of enforcing this Lease against Tenant or any guarantor, (iii) third, to the payment of all interest and service charges accruing hereunder, (iv) fourth, to the payment of Rent theretofore accrued, and (v) with the residue, if any, to be held by Landlord and applied to the payment of Rent and other obligations of Tenant as the same become due (and with any remaining residue to be retained by Landlord). “Costs of Reletting” shall include without limitation, all costs and expenses incurred by Landlord for any repairs or other matters described in Paragraph (b) above, brokerage commissions, advertising costs, attorneys’ fees, any economic incentives given to enter leases with replacement tenants, and costs of collecting rent from replacement tenants. Landlord shall be under no obligation to observe or perform any provision of this Lease on its part to be observed or performed which accrues while Tenant is in default hereunder. The times set forth herein for the curing of defaults by Tenant are of the essence of this Lease.
ARTICLE 26. LANDLORD’S DEFAULT; RIGHT TO CURE
(a) If Landlord shall fail to perform any obligation under this Lease required to be performed by Landlord, Landlord shall not be deemed to be in default hereunder nor subject to any claims for damages of any kind, unless such failure shall have continued for a period of thirty (30) days after written notice thereof by Tenant (provided, if the nature of Landlord’s failure is such that more time is reasonably required in order to cure, Landlord shall not be in default if Landlord commences to cure within such thirty (30) day period and thereafter diligently seeks to cure such failure to completion).
(b) Upon the occurrence of any event of default by Landlord after the expiration of any applicable cure and grace period, Tenant shall have all rights and remedies to the extent permitted by law or in equity, which be distinct, separate and cumulative to the extent permitted by law.
ARTICLE 27. WAIVER
The failure or delay on the part of Landlord or Tenant to enforce or exercise at any time any of the provisions, rights or remedies in the Lease shall in no way be construed to be a waiver thereof, nor in any way to affect the validity of this Lease or any part hereof, or the right of the Landlord or Tenant to thereafter enforce each and every such provision, right or remedy. No waiver of any breach of this Lease shall be held to be a waiver of any other or subsequent breach. The receipt by Landlord of lesser amount than the Rent due at a time when the rent is in default under this Lease shall not be construed as a waiver of such default. The receipt by Landlord of a lesser amount than the Rent due shall not be construed to be other than a payment on account of the Rent then due, nor shall any statement on Tenant's check or any letter accompanying Tenant's check be deemed an accord and satisfaction and Landlord may accept such payment without prejudice to Landlord's right to recover the balance of the rent due or to pursue any other remedies provided in this Lease. No act or thing done by Landlord or Landlord's agents or employees during the term of this Lease shall be deemed an acceptance of a surrender of the Premises, and no agreement to accept such a surrender shall be valid unless in writing and signed by Landlord.
ARTICLE 28. UTILITY DEREGULATION
Landlord has advised Tenant that various utility companies (each to be referred to herein as a “Current Service Provider”) are the utility companies selected by Landlord to provide service for the Development. Notwithstanding the foregoing, if permitted by law, Landlord shall have the right at any time and from time to time during the term of this Lease to either contract for service from a different company or companies providing service (each such company shall hereinafter be referred to as an “Alternate Service Provider”) or continue to contract for service from the Current Service Provider.
Tenant shall cooperate with Landlord, the Current Service Providers, and any Alternate Service Provider as reasonably necessary, and shall allow Landlord, the Current Service Providers, and any Alternate Service Provider reasonable access to the Building’s lines, feeders, risers, wiring, and other machinery within the Premises.
Unless caused by the willful misconduct or negligence of Landlord, its agents or employees, Landlord shall in no way be liable or responsible for any loss, damage, or expense that Tenant may sustain or incur by reason of any failure, interference, disruption, or defect in the supply of utility services furnished to the Premises, or of any change in the quality or character of the utility services supplied by the Current Service Providers or any Alternate Service Provider, and no such change, failure, defect, unavailability, or unsuitability shall constitute an actual or constructive eviction, in whole or in part, or entitle Tenant to any abatement or diminution of rent, or relieve Tenant from any of its obligations under this Lease.
ARTICLE 29. TELECOMMUNICATIONS
(a) Telephone Lines. Subject to Landlord’s continuing right of supervision and approval (not to be unreasonably withheld), and the other provisions hereof, Landlord shall: (i) install telephone lines (“Lines”) connecting the Premises to Landlord’s terminal block on the floor or floors on which the Premises are located, or (ii) use such Lines as may currently exist and already connect the Premises to such terminal block. Landlord’s predecessor or independent contractor has heretofore connected such terminal block through riser system Lines to Landlord’s main distribution frame (“MDF”) for the Property. Landlord disclaims any representations, warranties or understandings concerning the capacity, design or suitability of Landlord’s riser Lines, MDF or related equipment. If there is, or will be, more than one tenant on any floor, at any time, Landlord may allocate, and periodically reallocate, connections to the terminal block based on the proportion of square feet each tenant occupies on such floor, or the type of business operations or requirements of such tenants, in Landlord’s reasonable discretion. Landlord may arrange for an independent contractor to review Tenant’s request for approval hereunder, monitor or supervise Tenant’s installation, connection and disconnection of Lines, and provide other such services, or Landlord may provide the same.
(b) Installation. Landlord shall install Tenant’s Lines and make connections and disconnection at the terminal blocks as described above, and Landlord shall use an experienced and qualified contractor.
(c) Limitation of Liability. Unless due solely to Landlord’s intentional misconduct or negligent acts, Landlord shall have no liability for damages arising, and Landlord does not warrant that the Tenant’s use of the Lines will be free, from the following (collectively called “Line Problems”): (i) any eavesdropping, wire-tapping or theft of long distance access codes by unauthorized parties, (ii) any failure of the Lines to satisfy Tenant’s requirements, or (iii) any capacitance, attenuation, cross-talk or other problems with the Lines, any misdesignation of the Lines in the MDF room or wire closets, or any shortages, failures, variations, interruptions, disconnections, loss or damage caused by or in connection with the installation, maintenance, replacement, use or removal of any other Lines or equipment at the Development by or for other tenants at the Development, by any failure of the environmental conditions at or the power supply for the Development to conform to any requirements of the Lines or any other problems associated with any Lines or by any other cause. Unless due solely to Landlord’s willful misconduct or negligent acts, under no circumstances shall any Line Problems be deemed an actual or constructive eviction of Tenant, render Landlord liable to Tenant for abatement of any rent or other charges under the Lease, or relieve Tenant from performance of Tenant’s obligations under the Lease. Landlord in no event shall be liable for damages by reason of loss of profits, business interruption or other consequential damage arising from any Line Problems.
ARTICLE 30. SURRENDER
The Lease shall terminate and Tenant shall deliver up and surrender possession of the Premises on the last day of the term hereof, and Tenant waives the right to any notice of termination or notice to quit and Tenant hereby waives all right to any such notice as may be provided under any laws now or hereafter in effect in Pennsylvania, including but not limited to the Landlord and Tenant Act of 1951, as amended. Tenant covenants that upon the expiration or sooner termination of this Lease Tenant shall deliver up and surrender possession of the Premises in the same condition in which Tenant has agreed to keep the same during the continuance of this Lease and in accordance with the terms hereof, ordinary wear and tear and damage from casualty or condemnation excepted.
ARTICLE 31. QUIET ENJOYMENT
Landlord covenants and agrees that Tenant, upon paying the Rent herein provided for and observing and keeping the covenants, agreements and conditions on its part to be kept, shall lawfully and quietly hold, occupy and enjoy the Premises during the Lease without hindrance or interruption by Landlord or anyone claiming by, through or under Landlord.
ARTICLE 32. HOLDING OVER
Unless Landlord expressly agrees otherwise in writing, Tenant shall pay Landlord 150% of the amount of Rent then applicable prorated on a per diem basis for each day Tenant shall fail to vacate or surrender possession of the Premises or any part thereof after expiration or earlier termination of this Lease as required under Article 30, together with all damages sustained by Landlord on account thereof. Tenant shall pay such amounts on demand, and, in the absence of demand, monthly in advance. The foregoing provisions, and Landlord’s acceptance of any such amounts, shall not serve as permission for Tenant to hold-over, nor serve to extend the term (although Tenant shall remain a tenant at sufferance bound to comply with all provisions of this Lease until Tenant properly vacates the Premises.
ARTICLE 33. ENVIRONMENTAL COVENANTS, REPRESENTATIONS AND WARRANTIES
(a) Tenant shall comply with all laws, regulations, ordinances and other governmental standards applicable to Tenant's use of the Premises with respect to hazardous waste, hazardous substances and any and all other environmental matters. Furthermore, Tenant shall procure and maintain all licenses and permits required by such applicable laws, ordinances or regulations. Tenant covenants and agrees that it shall not release, emit, or discharge at or from the Premises any hazardous or toxic substances consisting of any hazardous or toxic chemical, waste, byproduct, pollutants, contamination, compound, product or substance, including, without limitation, asbestos, polychlorinated byphenyls, petroleum (including crude oil or any fraction thereof), and any material the exposure to, or manufacture, possession, presence, use, generation, storage, transportation, treatment, release, disposal, abatement, cleanup, removal, remediation or handling of which, is prohibited, controlled or regulated by federal, state, regional, county, local, governmental, public or private statute, law, regulation, ordinance, order, consent decree, judgment, permit, license, code, covenant, deed restrictions, common law, treaty, convention or other requirement, pertaining to protection of the environmental, health or safety of persons, natural resources, conservation, wildlife, waste management, any hazardous material activity, and pollution (including, without limitation, regulation of releases and disposals to air, land, water and ground water). These requirements include, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended by the Superfund Amendments and Reauthorization Act of 1986, 42 U.S.C. 9601 et seq., Solid Waste Disposal Act, as amended by the Resource Conservation and Recovery Act of 1976 and Solid and Hazardous Waste Amendments of 1984, 42 U.S.C. 6901 et seq., Federal Water Pollution Control Act, as amended by the Clean Water Act of 1977, 33 U.S.C. 1251, et seq., Clean Air Act of 1966, as amended, 42 U.S.C. 7401 et seq., Toxic Substances Control Act of 1976, 15 U.S.C. 2601 et seq., Occupational Safety and Health Act of 1970, as amended, 29 U.S.C. 651 et seq., Emergency Planning and Community Right-to-Know Act of 1986, 42 U.S.C. 11001 et seq., National Environmental Policy Act of 1975, 42 U.S.C. 300(f) et seq., and any similar or implementing Pennsylvania laws, and all amendments, rules, regulations, guidance documents and publications promulgated thereunder.
(b) In the event Tenant receives any notice of the happening of: (1) any event arising from Tenant’s use or occupancy of the Premises involving an emission, spill, release or discharge at or from the Premises into or upon (i) the air; (ii) soils (whether on the Premises or neighboring property) or any improvements located thereon; (iii) surface water or ground water; (iv) the sewer system servicing the Premises, except as allowed under current law, regulation or permit, of any regulated quantities of toxic or hazardous substances or wastes (intended hereby and hereafter to include any and all such materials listed in any federal, state or local law, code and ordinances and all rules and regulations promulgated thereunder, as hazardous) (any of which is hereinafter referred to as "Hazardous Discharge"); or (2) any complaint, order, directive, claim, citation or notice by any governmental authority or any other person or entity arising from Tenant’s use or occupancy of the Premises with respect to (i) air emissions; (ii) spills, releases or discharges to soils or any improvements located thereon, surface water, ground water or the sewer, septic system or waste treatment, storage or disposal system servicing the Premises; (iii) solid or liquid waste disposal; (iv) the use, generation, storage, transportation or disposal of toxic or hazardous substances or wastes; or (v) any other environmental, health or safety matter relating to any of Tenant's activity upon the Premises, including any improvements located thereon or neighboring property (any of which is hereinafter referred to as an "Environmental Complaint"), then Tenant shall give immediate notice of same to Landlord, detailing all relevant facts and circumstances. Tenant shall, upon receipt of notice of a Hazardous Discharge or Environmental Complaint with respect to the Premises or Tenant’s use thereof, and at its sole cost and expense, promptly and completely take all actions necessary to remove, resolve or minimize the impact of such Hazardous Discharge or Environmental Complaint with respect to the Premises or Tenant’s use thereof, and restore the affected property to its prior condition.
Without limitation on the foregoing, and in the event Tenant fails to take the actions set forth herein (to the extent Tenant is obligated to do so), Landlord shall have the right, but not the obligation, to enter onto the Premises and take any actions as it deems necessary or advisable to clean up, remove, resolve or minimize the impact or otherwise deal with any Hazardous Discharge or Environmental Complaint upon Landlord's receipt of any notice from any person or entity asserting the happening of a Hazardous Discharge or Environmental Complaint on or from or pertaining to the Premises and arising from Tenant’s use or occupancy of the Premises. All reasonable costs and expenses incurred by Landlord in the exercise of any such rights shall be deemed to be additional rent hereunder and shall be immediately payable by Tenant to Landlord upon demand.
(c) Tenant, its successors and assigns, shall forever indemnify, defend and hold harmless Landlord, its partners, members, directors, officers, employees and agents, and successors and assigns from and against all damages, punitive damages, liabilities, losses, demands, claims, cost recovery actions, lawsuit, administrative proceedings, orders, response costs, compliance costs, investigation expenses, consultant fees, attorneys' fees and litigation expenses, arising from Tenant's use of the Premises, including (1) possession, use and storage of any hazardous material at the Premises; (2) the operation of any applicable environmental law against the Tenant, Landlord or the Premises, based on Tenant's activities during the term of this Lease; or (3) the violation at the Premises or by the Tenant of any applicable environmental law. Tenant and its successors or assigns shall pay all costs and expenses incurred by Landlord, its successors and assigns, to enforce the provisions of this indemnification, including, without limitation, reasonable attorneys' fees and litigation expenses. This indemnification shall survive the termination of this Lease.
(d) As between Landlord and Tenant only, Landlord shall be responsible for (i) the remediation of any hazardous materials or substances located on the Development, the Building, or any part thereof (including the Premises), existing as of the Commencement Date (except to the extent caused by Tenant or its agents, employees or contractors), (ii) any violations of environmental laws existing as of the Commencement Date (except to the extent caused by Tenant or its agents, employees or contractors), (iii) the remediation of any hazardous materials or substances located on the Development, the Building, or any part thereof (including the Premises), existing as of the Commencement Date and, after the Commencement Date, to the extent caused by Landlord or its agents, employees or contractors, or other tenants of the Building (i.e. to pursue Landlord’s enforcement rights against such other tenants), or (iv) any violations of environmental laws arising on or after the Commencement Date to the extent caused by Landlord or its agents, employees or contractors or other tenants of the Building (i.e. to pursue Landlord’s enforcement rights against such other tenants).
(e) Landlord represents and warrants to Tenant, to the best of its knowledge, as of the Commencement Date, it has received no written notice from any applicable governmental authority regarding the existence of hazardous materials on or about the Premises or the Development.
ARTICLE 34. TENANT’S COMPLIANCE WITH LAWS
Tenant shall comply with all governmental laws, ordinances and regulations applicable to Tenant's occupancy and use of the Premises.
ARTICLE 35. DISABILITIES ACT
Tenant shall comply, at Tenant’s sole cost and expense, with the Americans with Disabilities Act of 1990 and similar state and local laws and ordinances, as well as all regulations issued thereunder, but only if the need for compliance is caused in whole or material part by reason of the specific nature of Tenant’s business operations in the Premises or specific accommodation to Tenant’s employees. Except as set forth in the preceding sentence, Landlord shall cause the Premises and common areas of the Development to comply, at Landlord’s sole cost, or at another tenant’s sole cost, or as an Operating Cost subject to pass-through hereunder, with the Americans with Disabilities Act of 1990 and similar state and local laws and ordinances, as well as all regulations issued thereunder. Tenant shall promptly advise Landlord in writing, and provide Landlord with copies of any notice received by Tenant alleging violation of any such law, regulation or ordinance relating to the Premises or the Building or any use thereof or activity therein, or any governmental or regulatory action or investigation instituted or threatened regarding noncompliance with any such law, regulation or ordinance.
ARTICLE 36. NOTICE
Wherever in this Lease it shall be required or permitted that notice or demand be given or served by either party to this Lease to or on the other party, such notice or demand shall be deemed to have been duly given or served if in writing and either personally served or forwarded by Federal Express or comparable delivery service or by registered or certified mail, charges prepaid, and addressed as set forth in Article 1 to the applicable Notification Addresses.
Each such mailed notice shall be deemed to have been given to or served upon the party to which addressed (i) on the date of delivery if personally served, (ii) one business day after the date the same is deposited with the express service, or (iii) three business days after the date the same is deposited with the postal service, properly addressed in the manner above provided. Either party hereto may change the address to which such notices shall be delivered or mailed by giving written notice of such change to the other party hereto, as herein provided.
ARTICLE 37. BROKERS
Each party represents and warrants to the other that TARQUINCoRE, LLC has acted as the only broker or agent in connection with the finding and negotiation of this Lease. Landlord shall be responsible for payment of commissions or fees due such brokers in accordance with the terms of Landlord's written listing agreement with such agent. Each party agrees to indemnify and hold harmless the other from and against any claims, suits, liabilities and expenses incurred by or assessed by reason of any undisclosed brokerage or agency arrangement.
ARTICLE 38. FORCE MAJEURE
Neither party shall be required to perform any term, condition or covenant of this Lease as long as such performance is delayed or prevented by force majeure, which shall mean Acts of God, strikes, lockouts, material or labor restrictions imposed by governmental authority, civil riot, floods and other causes not reasonably within the control of such party and which, by the exercise of due diligence, such party is unable, wholly or in part, to prevent or overcome; provided, however, that such party shall be required to commence and thereafter diligently prosecute performance of completion to the extent reasonably permitted under the circumstances. Notwithstanding anything herein to the contrary, the foregoing shall not excuse either party from the payment of any monies due pursuant to the terms of this Lease.
ARTICLE 39. TRANSFER OF LANDLORD'S INTEREST
Landlord's obligations hereunder shall be binding upon Landlord only for the period of time that Landlord is in ownership of the Building; and, upon termination of that ownership, Tenant, except as to any obligations which have then matured or relate to an event occurring prior to the transfer, any breach occurring prior to the transfer, or any tort or fraud committed prior to the transfer, shall look solely to Landlord's successor in interest in the Building for the satisfaction of each and every obligation of Landlord hereunder. Tenant agrees to attorn to any transferee of Landlord.
ARTICLE 40. SUCCESSORS
The respective rights and obligations provided in this Lease shall bind and shall inure to the benefit of the parties hereto and their respective successors and assigns, provided, however, that no rights shall inure to the benefit of any successors of Tenant whenever, by the express terms of this Lease, Landlord's written consent for the transfer to such successor is required under Article 14 hereof, unless Landlord shall have granted such consent.
ARTICLE 41. GOVERNING LAW
This Lease shall be construed, governed and enforced in accordance with the laws of the Commonwealth of Pennsylvania and the exclusive venue for any action shall be in the Court of Common Pleas of Allegheny County, Pennsylvania.
ARTICLE 42. SEPARABILITY
If any provisions of this Lease shall be held to be invalid, void or unenforceable, the remaining provisions hereof shall in no way be affected or impaired and such remaining provisions shall remain in full force and effect.
ARTICLE 43. CAPTIONS
Any headings preceding the text of the several paragraphs and subparagraphs hereof are inserted solely for convenience of reference and shall not constitute a part of this Lease, nor shall they affect its meaning, construction or effect.
ARTICLE 44. GENDER
As used in this Lease, the word "person" shall mean and include, where appropriate, any individual, corporation, partnership or other entity; the plural shall be substituted for the singular, and the singular for the plural, where appropriate; and words of any gender shall mean to include any other gender.
ARTICLE 45. EXECUTION; COUNTERPARTS
This Lease shall become effective when it has been signed by a duly authorized officer or representative of each of the parties and delivered to the other party. This Lease may be executed in any number of counterparts, each of which when taken together shall be deemed to be one and the same instrument. The parties acknowledge and agree that notwithstanding any law or presumption to the contrary, the exchange of copies of this Lease and signature pages by electronic transmission shall constitute effective execution and delivery of this Lease for all purposes, and signatures of the parties hereto transmitted electronically shall be deemed to be their original signature for all purposes.
ARTICLE 46. ENTIRE AGREEMENT
This Lease, including the Exhibits hereto, contains all the agreements, conditions, understandings, representations and warranties made between the parties hereto with respect to the subject matter hereof, and may not be modified orally or in any manner other than by an agreement in writing signed by both parties hereto or their respective successors in interest.
ARTICLE 47. AUTHORITY
If Tenant is a corporation, association, partnership or similar legal entity, the Tenant represents and warrants that the individual signing this Lease is duly authorized to execute and deliver this Lease on behalf of such entity in accordance with the duly adopted authorizing instruments of such entity which have been adopted or approved in accordance with all legal requirements and the internal bylaws, agreements, or other organizing documents of the entity, and that this Lease is binding upon such entity in accordance with its terms.
If Landlord is a corporation, association, partnership or similar legal entity, The Landlord represents and warrants that the individual signing this Lease is duly authorized to execute and deliver this Lease on behalf of such entity in accordance with the duly adopted authorizing instruments of such entity which have been adopted or approved in accordance with all legal requirements and the internal bylaws, agreements, or other organizing documents of the entity, and that this Lease is binding upon such entity in accordance with its terms.
ARTICLE 48. SECURITY DEPOSIT
Upon execution of this Lease, Tenant shall deposit with Landlord the Security Deposit in the amount set forth in Article 1. The Security Deposit shall be held by Landlord as security for the full and faithful performance by Tenant of all of the terms, covenants and provisions of this Lease during the term hereof. In no event shall Landlord be obligated to pay, or Tenant is entitled to receive, any interest or other earnings on the security deposit. Landlord shall not be obligated to hold the Security Deposit in trust or in a separate account but may freely commingle the security deposit with Landlord’s other funds.
In the event Tenant fails to keep and perform any of the terms, covenants or provisions of this Lease, then Landlord, at Landlord’s option, may appropriate and apply the Security Deposit, or so much thereof as may be necessary to pay any Rent or other sums due hereunder for which Tenant shall be in default of payment. Tenant, upon notice from Landlord, immediately shall remit to Landlord an amount sufficient to restore this Security Deposit to the amount required to be maintained in accordance with this Article. Upon Tenant’s full and complete performance and compliance with all of the terms, covenants and provisions of this Lease during the lease term, upon the expiration of the term and Tenant’s proper surrender of the Premises, the Security Deposit shall be returned to Tenant.
In the event of a sale of the Building, Landlord may deliver the Security Deposit to the purchaser, and upon such delivery, Landlord shall be discharged from any further liability with respect to the Security Deposit.
ARTICLE 49. OFAC CERTIFICATION
Tenant certifies that: (i) it is not acting, directly or indirectly, for or on behalf of any person, group, entity, or nation named by any Executive Order or the United States Treasury Department as a terrorist, “Specially Designated National and Blocked Person,” or other banned or blocked person, entity, nation, or transaction pursuant to any law, order, rule, or regulation that is enforced or administered by the Office of Foreign Assets Control; and (ii) it is not engaged in this transaction, directly or indirectly on behalf of, or instigating or facilitating this transaction, directly or indirectly on behalf of, any such person, group, entity, or nation.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties, intending to be legally bound, have executed this Lease as of the day and year first written above.
ATTEST: | COGNITION THERAPEUTICS, INC. |
By: | /s/ Lisa Ricciardi | ||
Name: Lisa Ricciardi | |||
Title: Chief Executive Officer |
ATTEST: | RJ EQUITIES LP |
By: RD Equities, LLC, its General Partner |
By: | /s/ Ronald J. Tarquinio | ||
Name: Ronald J. Tarquinio | |||
Title: Member |
Exhibit "A"
Diagram of Development
Exhibit "B"
Outline of Premises
Exhibit "C"
Rules and Regulations
GENERAL:
1. | OBSTRUCTIONS: |
The streets, driveways, parking lots, sidewalks, entrances, passages and other common areas provided by Landlord shall not be obstructed by Tenant, its employees, agents, representatives, vendors and guests or used for any other purpose than ingress and egress.
2. | BATHROOMS: |
The bathrooms, toilet rooms and other plumbing apparatus shall not be used for any other purposes other than those for which they are constructed.
3. | GENERAL PROHIBITIONS: |
· | No cooking, grilling, smoking, gas or other type of flame in the common areas; | |
· | No animals or birds are permitted anywhere on the premises; | |
· | No use of the premises as sleeping rooms; | |
· | No loitering or congregating in the entrances or hallways; | |
· | No making improper loud noises or disturbances of any kind; | |
· | Doing anything to unreasonably disturb or disrupt other tenants in the complex; | |
· | Doing anything to change, damage or destroy the landscaping around the premises; |
4. | SMOKING: |
The complex’s buildings are maintained as smoke free environments. This means no smoking in the building. Smoking is permitted outside of the buildings where several smoking boxes are provided in four designated areas for cigarette butts. Please use the smoking boxes for your butts, not the grounds or parking areas.
5. | DOORS: |
Exterior doors are not to be held open. Holding or propping these doors open for 30 seconds or more will sound off an alarm and automatically notify police.
PARKING:
To insure that adequate parking spaces are available for our tenants, a specific number of parking passes are provided to each tenant for a specific parking zone. The passes are to be placed on the rear view mirror of each vehicle and can be transferred from one vehicle to another. The parking lots are patrolled daily. Vehicles that lack a parking pass or are parked in the wrong zone will be considered in violation of the parking regulations. Violations are handled as follows:
First Violation: A yellow sticker will be placed under the windshield wiper;
Second Violation: An adhesive yellow sticker will be placed on the windshield;
Third Violation: The police will be called and the car will be towed, at the owner’s expense.
These rules and regulations are subject to change from time to time at the discretion of the Landlord.
Exhibit "D"
Cleaning Specifications
Daily Services (4 nights/week) will consist of the following:
1. | Perform all high dusting where required. | |
2. | Empty waste receptacles ensuring to remove waste to building designated location. | |
3. | Replace liners in receptacles as required. | |
4. | Spot clean all door glass, doors, door frames and light switches. | |
5. | Damp wipe all window sills, ledges and countertops. | |
6. | Wash all tabletops and chair seating using a food service degreaser. | |
7. | Clean and scour sinks in kitchen. | |
8. | Spot clean the exterior of all appliances. | |
9. | Dust mop and damp mop hard surface floors. | |
10. | Vacuum carpeting traffic lanes and other soiled areas. | |
11. | Vacuum all carpeting, ensuring to maintain corners, edges and under desks by moving light furniture. (Weekly) | |
12. | Damp wipe rosewood baseboards. (Monthly) | |
13. | Damp wipe rubber baseboards. (Quarterly) | |
14. | Spot clean carpeting as required. |
Exhibit "E"
ESTOPPEL CERTIFICATE
TENANT ESTOPPEL
__________ __, 202__
________________________
________________________
________________________
Ladies and Gentlemen:
The undersigned certifies to ___________________________ (together with its successors and assigns, the “Bank”) and the Landlord (as defined below) as of the date hereof as follows:
1. It is the tenant under a certain Office Lease Agreement dated ______________________ (the “Lease”) with RJ Equities, LP, a Pennsylvania limited partnership, as landlord (together with its successors and assigns, “Landlord”), and the undersigned, as tenant (“Tenant”), for premises located at and known as _______________________________________________________ (the “Leased Premises”).
2. The Lease is in full force and effect. There are no amendments, modifications or supplements to the Lease except the following (if none, indicate “None”): .
3. The Lease does not contain any provisions regarding options to purchase and/or lease additional space, rights of first refusal to purchase and/or lease additional space or any similar provisions regarding acquisition of ownership interests or additional leases space in the building. If such provisions are contained in the Lease please specify: .
4. The term of the Lease commenced on __________________ and terminates on _____________________. Tenant has taken possession of the Leased Premises.
5. The monthly base rent payments currently payable pursuant to the Lease are in the amount of $______________________. Rent has been paid through _________________________. In addition to the monthly base rent payments, the following amounts are also payable on a monthly basis for the following purposes, all of which have been paid through _________________________ (if none, indicate “None”): .
6. All improvements, if any, required to be made by Landlord under the Lease have been completed and accepted by Tenant. Landlord has not agreed to grant Tenant any free rent or rent rebate or to make any contribution to tenant improvements.
7. No advance rent has been paid, and to Tenant’s knowledge, Tenant has no unsatisfied claims against Landlord, no uncured default exists under the Lease, and no event has occurred that but for the giving of notice would constitute a default.
8. No prepayment of more than one month’s rent shall be made without the Bank’s written consent and approval.
9. Tenant has all licenses and permits which Tenant must have to operate its business from the Leased Premises, and all are current and have not been revoked. Since taking possession of the Leased Premises, Tenant has not received any notice that the Leased Premises or Tenant’s use of the Leased Premises violates any applicable law, regulation, ordinance or directive of any governmental authority or agency or insurance company.
10. The amount of the security deposit is $0.00.
The undersigned individual hereby certifies that he or she is duly authorized to sign, acknowledge and deliver this letter on behalf of Tenant. The statements herein contained may be relied upon by the Bank and the Landlord and their respective successors and assigns.
Very truly yours, | |
(Print Name of Tenant) |
By: |
Title: |
EXHIBIT “F”
SUBORDINATION, NON-DISTURBANCE AND ATTORNMENT AGREEMENT
SUBORDINATION, NON-DISTURBANCE
AND ATTORNMENT AGREEMENT
This Subordination, Non-Disturbance and Attornment Agreement (this “Agreement”) is made as of the _____ day of __________, 20__, among ___________________________ (the “Lender”), ___________________________, R.J. Equities LP (the “Landlord” or “Borrower”), a Pennsylvania limited partnership having a place of business at 2403 Sidney Street, Suite 200, Pittsburgh, PA 15203, and _________________________ (the “Tenant”), having a place of business at ________________.
Introductory Provisions
A. Lender is relying on this Agreement as an inducement to Lender in making and maintaining a loan (the “Loan”) secured by, among other things, a Mortgage and Security Agreement dated as of ______________________ (the “Mortgage”) given by Borrower covering property commonly known as and numbered ________________________ (the “Property”). Lender is also the “Assignee” under an Assignment of Leases, Rents and Profits (the "Assignment") dated as of _________________ from Borrower with respect to the Property.
B. Tenant is the tenant under that certain lease (the “Lease”) dated ________, 20__, made with Landlord covering certain premises (the “Premises") at the Property as more particularly described in the Lease.
C. Lender requires, as a condition to the making and maintaining of the Loan, that the Mortgage be and remain superior to the Lease and that its rights under the Assignment be recognized.
D. Tenant requires as a condition to the Lease being subordinate to the Mortgage that its rights under the Lease be recognized.
E. Lender, Landlord, and Tenant desire to confirm their understanding with respect to the Mortgage and the Lease.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and agreements contained in this Agreement, and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, and with the understanding by Tenant that Lender shall rely hereon in making and maintaining the Loan, Lender, Landlord, and Tenant agree as follows:
1. | Subordination. The Lease and the rights of Tenant thereunder is subordinate and inferior to the Mortgage and any amendment, renewal, substitution, extension or replacement thereof and each advance made thereunder as though the Mortgage, and each such amendment, renewal, substitution, extension or replacement were executed and recorded, and the advance made, before the execution of the Lease. |
2. | Non-Disturbance. So long as Tenant is not in default (beyond any notice and/or cure period expressed in the Lease within which Tenant may cure such default) in the payment of rent or in the performance or observance of any of the terms, covenants or conditions of the Lease on Tenant’s part to be performed or observed: (a) Tenant’s occupancy of the Premises shall not be disturbed by Lender in the exercise of any of its rights under the Mortgage during the term of the Lease, or any extensions or renewals thereof made in accordance with the terms of the Lease, and (b) Lender will not join Tenant as a party defendant in any action or proceeding for the purpose of terminating Tenant’s interest and estate under the Lease because of any default under the Mortgage. |
3. | Attornment and Certificates. In the event Lender succeeds to the interest of Borrower as Landlord under the Lease, or if the Property or the Premises are sold pursuant to the power of sale under the Mortgage, Tenant shall attorn to Lender, or a purchaser upon any such foreclosure sale, and shall recognize Lender, or such purchaser, thereafter as the Landlord under the Lease. Such attornment shall be effective and self-operative without the execution of any further instrument. Tenant agrees, however, to execute and deliver at any time and from time to time, upon the request of any holder(s) of any of the indebtedness or other obligations secured by the Mortgage, or upon request of any such purchaser, (a) any instrument or certificate which, in the reasonable judgment of such holder(s), or such purchaser, may be necessary or appropriate in any such foreclosure proceeding or otherwise to evidence such attornment and (b) an instrument or certificate regarding the status of the Lease, consisting of statements, if true (and if not true, specifying in what respect): (i) that the Lease is in full force and effect, (ii) the date through which rentals have been paid, (iii) the duration and date of the commencement of the term of the Lease, (iv) the nature of any amendments or modifications to the Lease, (v) that to Tenant’s knowledge no default, or state of facts, which with the passage of time or notice, or both, would constitute a default, exists on the part of either party to the Lease, and (vi) the dates on which payments of additional rent, if any, are due under the Lease. |
4. | Limitations. If Lender exercises any of its rights under the Assignment or the Mortgage, or if Lender shall succeed to the interest of Landlord under the Lease in any manner, or if any purchaser acquires the Property, or the Premises, upon or after any foreclosure of the Mortgage, or any deed in lieu thereof, Lender or such purchaser, as the case may be, shall have the same remedies by entry, action or otherwise in the event of any default by Tenant (beyond any notice and/or cure period expressed in the Lease within which Tenant may cure such default) in the payment of rent or in the performance or observance of any of the terms, covenants and conditions of the Lease on Tenant’s part to be paid, performed or observed that Landlord had or would have had if Lender or such purchaser had not succeeded to the interest of the present Landlord. From and after any such attornment, Lender or such purchaser shall be bound to Tenant under all the terms, covenants and conditions of the Lease, and Tenant shall, from and after such attornment to Lender, or to such purchaser, have the same remedies against Lender, or such purchaser, for the breach of an agreement contained in the Lease that Tenant might have had under the Lease against Landlord, if Lender or such purchaser had not succeeded to the interest of Landlord; provided, however, that Lender or such purchaser shall only be bound during the period of its ownership, and that in the case of the exercise by Lender of its rights under the Mortgage, or the Assignment, or any combination thereof, or a foreclosure, or deed in lieu of foreclosure, all Tenant claims shall be satisfied only out of the interest, if any, of Lender, or such purchaser, in the Property, and Lender and such purchaser shall not be: (a) liable for any act or omission of any prior landlord (including Landlord); or (b) liable for or incur any obligation with respect to the construction of the Property or any improvements of the Premises or the Property; or (c) subject to any offsets or defenses which Tenant might have against any prior landlord (including Landlord), or (d) bound by any rent or additional rent which Tenant might have paid for more than the then current rental period to any prior landlord (including Landlord); or (e) bound by any amendment or modification of the Lease, or any consent to any assignment or sublease, made without Lender’s prior written consent; or (f) bound by or responsible for any security deposit not actually received by Lender; or (g) liable for any obligation with respect to any breach of warranties or representations of any nature under the Lease or otherwise, including without limitation, any warranties or representations respecting use, compliance with zoning, Landlord’s title, Landlord’s authority, habitability and/or fitness for any purpose, or possession; or (h) liable for consequential damages. |
5. | Rights Reserved. Nothing herein contained is intended, nor shall it be construed, to abridge or adversely affect any right or remedy of: (a) Landlord under the Lease, or any subsequent Landlord, against Tenant in the event of any default by Tenant (beyond any notice and/or cure period expressed in the Lease within which Tenant may cure such default) in the payment of rent or in the performance of observance of any of the terms, covenants or conditions of the Lease on Tenant’s part to be performed or observed; or (b) Tenant to pursue claims under the Lease against any prior landlord (including Landlord) in the event of any default by prior landlord whether or not such claim is barred against Lender or a subsequent purchaser. |
6. | Notice and Right to Cure. Tenant agrees to provide Lender with a copy of each notice of default given to Landlord under the Lease at the same time such notice of default is given to Landlord. In the event of any default by Landlord under the Lease, Tenant will take no action to terminate the Lease unless the default remains uncured for a period of sixty (60) days after written notice thereof shall have been given, postage prepaid, to Landlord at Landlord’s address, and to Lender at the address provided in Section 7 below; provided, however, that if any such default is such that it reasonably cannot be cured within such sixty (60) day period, such period shall be extended for such additional period of time as shall be reasonably necessary (including, without limitation, a reasonable period of time to obtain possession of the Property and to foreclose the Mortgage), if Lender gives Tenant written notice within such sixty (60) day period of Lender’s election to undertake the cure of the default and if curative action (including, without limitation, action to obtain possession and foreclosure) is instituted within thirty (30) days thereafter and is thereafter diligently pursued. Notwithstanding the foregoing, Lender shall have no obligation to cure any default under the Lease. |
7. | Notices. Any notice or communication required or permitted hereunder shall be in writing, and shall be given or delivered: (a) by United States mail, registered or certified, postage fully prepaid, return receipt requested, or (b) by recognized courier service or recognized overnight delivery service; and in any event addressed to the party for which it is intended at its address set forth below: |
To Lender: | ||
To Landlord: | RJ Equities LP | |
2403 Sidney Street, Suite 200 | ||
Pittsburgh, PA 15203 | ||
Attention: Ronald J. Tarquinio | ||
To Tenant: | ||
or such other address as such party may have previously specified by notice given or delivered in accordance with the foregoing. Any such notice shall be deemed to have been given and received on the date delivered or tendered for delivery during normal business hours as herein provided.
8. | No Oral Change. This Agreement may not be modified orally or in any manner other than by an agreement in writing signed by the parties hereto or their respective successors in interest. |
9. | Payment of Rent To Lender. Tenant acknowledges that it has notice that the Lease and the rent and all sums due thereunder have been assigned to Lender as part of the security for the obligations secured by the Mortgage. In the event Lender notifies Tenant of a default under the Loan and demands that Tenant pay its rent and all other sums due under the Lease to Lender, Tenant agrees that it will honor such demand and pay its rent and all other sums due under the Lease to Lender, or Lender’s designated agent, until otherwise notified in writing by Lender. Landlord unconditionally authorizes and directs Tenant to make rent payments directly to Lender following receipt of such notice without any obligation to further inquire as to whether or not any default exists under the Mortgage or the Assignment and that Landlord shall have no right or claim against Tenant for or by reason of any payments of rent or other charges made by Tenant to Lender following receipt of such notice. |
10. | No Amendment or Cancellation of Lease. So long as the Mortgage remains undischarged of record, Tenant shall not amend, modify, cancel or terminate the Lease, or consent to an amendment, modification, cancellation or termination of the Lease, or agree to subordinate the Lease to any other mortgage, without Lender’s prior written consent in each instance; provided however, the foregoing shall not be construed to require Lender’s consent for Tenant to exercise any right to terminate expressly granted in the Lease. |
11. | Options. With respect to any options for additional space provided to Tenant under the Lease, Lender agrees to recognize the same if Tenant is entitled thereto under the Lease after the date on which Lender succeeds as landlord under the Lease by virtue of foreclosure or deed in lieu of foreclosure or Lender takes possession of the Premises; provided, however, Lender shall not be responsible for any acts of any prior landlord (including Landlord) under the Lease, or the act of any tenant, subtenant or other party which prevents Lender from complying with the provisions hereof and Tenant shall have no right to cancel the Lease or to make any claims against Lender on account thereof. |
12. | Captions. Captions and headings of sections are not parts of this Agreement and shall not be deemed to affect the meaning or construction of any of the provisions of this Agreement. |
13. | Counterparts. This Agreement may be executed in several counterparts each of which when executed and delivered is an original, but all of which together shall constitute one instrument. |
14. | Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the state where the Property is located. |
15. | Parties Bound. The provisions of this Agreement shall be binding upon and inure to the benefit of Tenant, Lender and Landlord and their respective successors and assigns; provided, however, reference to successors and assigns of Tenant shall not constitute a consent by Landlord or Lender to an assignment or sublease by Tenant, but has reference only to those instances in which such consent is not required pursuant to the Lease or for which such consent has been given. |
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written.
ATTEST: | |||
By: | |||
Name: | |||
Title: | |||
ATTEST: | RJ EQUITIES LP | ||
By: | RD Equities, LLC, its General Partner | ||
By: | |||
Name: Ronald J. Tarquinio | |||
Title: Member | |||
ATTEST: | |||
LENDER: |
STATE OF __________ | ) |
) ss: | |
COUNTY OF ________ | ) |
The foregoing instrument was acknowledged before me this____day of_____________, 20_______, by______________, ___________, of_____________, a______, on behalf of the corporation.
Notary Public | |
My Commission Expires: |
STATE OF __________ | ) |
) ss: | |
COUNTY OF _________ | ) |
The foregoing instrument was acknowledged before me this____day of______________, 20_______, by_______________, ______________, of____________, a______ corporation, on behalf of the corporation.
Notary Public | |
My Commission Expires: |
STATE OF __________ | ) |
) ss: | |
COUNTY OF _________ | ) |
The foregoing instrument was acknowledged before me this____day of_______________, 20_______, by_____________, _____________, of_____________, a______ corporation, on behalf of the corporation.
Notary Public | |
My Commission Expires: |
Exhibit 23.1
Consent of Independent Registered Public Accounting Firm
We consent to the reference to our firm under the caption "Experts" in the Registration Statement (Form S-1) and related Prospectus of Cognition Therapeutics, Inc. for the registration of 5,586,592 shares of its common stock and to the incorporation by reference therein of our report dated March 30, 2022, with respect to the consolidated financial statements of Cognition Therapeutics, Inc. included in its Annual Report (Form 10-K) for the year ended December 31, 2021, filed with the Securities and Exchange Commission.
/S/ ERNST & YOUNG LLP | |
Philadelphia, Pennsylvania | |
November 7, 2022 |
Exhibit 107
CALCULATION OF REGISTRATION FEE
Security Type | Security Class Title | Fee Calculation Rule |
Maximum Aggregate Offering Price(1)(2) |
Fee Rate |
Amount of Registration Fee |
||||||||||
Equity | Common stock, $0.001 par value per share(3) | Rule 457 | (o) | $11,500,000 | .00011020 | $1,267.30 | |||||||||
Total Offering Amounts | $11,500,000 | $1,267.30 | |||||||||||||
Total Fees Previously Paid | |||||||||||||||
Total Fee Offsets | — | ||||||||||||||
Net Fee Due | $1,267.30 |
1) | Pursuant to Rule 416(a) under the Securities Act of 1933, as amended (the “Securities Act”), this Registration Statement shall also cover any additional shares of common stock that become issuable with respect to the shares being registered by reason of any stock dividend, stock split, recapitalization or any other similar transaction effected without receipt of consideration which results in an increase in the number of Cognition Therapeutics, Inc.’s (the “Registrant”) outstanding shares of common stock, par value $0.001 per share (the “Common Stock”). |
2) | Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(o) under the Securities Act. The registrant may increase or decrease the size of the offering prior to effectiveness. |
3) | Includes $1,500,000 of common stock issuable upon exercise of the underwriters’ overallotment option. |