As
filed with the U.S. Securities and Exchange Commission on March 27, 2023
Registration
Statement No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
S-1
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
| SIDUS
SPACE, INC. |
| (Exact
name of registrant as specified in its charter) |
| Delaware |
|
4812 |
|
46-0628183 |
(State
or other jurisdiction of
incorporation
or organization) |
|
(Primary
Standard Industrial
Classification
Code Number) |
|
(I.R.S.
Employer
Identification
Number) |
150
N. Sykes Creek Parkway, Suite 200
Merritt
Island, FL 32953
(321)
450-5633
(Address
and telephone number of registrant’s principal executive offices)
Carol
Craig
Chief
Executive Officer
Sidus
Space, Inc.
150
N. Sykes Creek Parkway, Suite 200
Merritt
Island, FL 32953
(321)
450-5633
(Name,
address, including zip code, and telephone number, including area code, of agent for service)
Copies
to:
Jeffrey
J. Fessler, Esq.
Sean
F. Reid, Esq.
Sheppard,
Mullin, Richter & Hampton LLP
30
Rockefeller Plaza
New
York, NY 10112-0015
Tel:
(212) 653-8700 |
|
Cavas
S. Pavri
Johnathan
Duncan
ArentFox
Schiff LLP
1717
K Street NW
Washington,
DC 20006
Tel:
(202) 857-6000
Fax:
(202) 857-6395 |
Approximate
date of commencement of proposed sale to the public:
As
soon as practicable after the effective date of
this registration statement.
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933 check the following box: ☒
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the same
offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large
accelerated filer ☐ |
|
Accelerated
filer ☐ |
|
Non-accelerated
filer ☒ |
|
Smaller
reporting company ☒ |
| |
|
|
|
|
|
Emerging
growth company ☒ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. ☐
The
registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the
registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective
in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date
as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
The
information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration
statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell nor does
it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
| PRELIMINARY
PROSPECTUS |
SUBJECT
TO COMPLETION |
DATED MARCH 27, 2023 |
Up to [*] shares of Class A Common Stock
Pre-Funded Warrants to Purchase up to [*] Shares
of Class A Common Stock
Warrants to Purchase [*] shares of
Class A Common Stock
Shares of Class A Common Stock underlying the
Pre-Funded Warrants and Warrants
Sidus
Space, Inc.
We are offering up to [*] shares of our Class
A common stock, together with warrants to purchase [*] shares of our Class A common stock (and the shares of Class A common stock that
are issuable from time to time upon exercise of the warrants). We are also offering to certain purchasers whose purchase of shares of
Class A common stock in this offering would otherwise result in the purchaser, together with its affiliates and certain related parties,
beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Class A common stock immediately
following the consummation of this offering, the opportunity to purchase, if any such purchaser so chooses, pre-funded warrants to purchase
shares of our Class A common stock, in lieu of shares of Class A common stock that would otherwise result in such purchaser’s beneficial
ownership exceeding 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Class A common stock. Each pre-funded warrant
will be exercisable for one share of our Class A common stock. The purchase price of each pre-funded warrant and accompanying warrant
will be equal to the price at which a share of Class A common stock and accompanying warrant are sold to the public in this offering,
minus $0.0001, and the exercise price of each pre-funded warrant will be $0.0001 per share. The pre-funded warrants will be immediately
exercisable and may be exercised at any time until all of the pre-funded warrants are exercised in full. This offering also relates to
the shares of Class A common stock issuable upon exercise of any pre-funded warrants sold in this offering. Each share of Class A common
stock and pre-funded warrant is being sold together with a warrant to purchase one share of our Class A common stock at an exercise price
of $ per share (representing 100% of the price at which a share of Class A common stock and accompanying warrant are sold to the public
in this offering). The warrants will be exercisable immediately and will expire five years from the date of issuance. For each pre-funded
warrant we sell, the number of shares of Class A common stock we are offering will be decreased on a one-for-one basis. Because we will
issue a warrant for each share of our Class A common stock and for each pre-funded warrant to purchase one share of our Class A common
stock sold in this offering, the number of warrants sold in this offering will not change as a result of a change in the mix of the shares
of our Class A common stock and pre-funded warrants sold. The shares of Class A common stock and pre-funded warrants, and the accompanying
warrants, can only be purchased together in this offering but will be issued separately and will be immediately separable upon issuance.
We
have two classes of common stock: Class A common stock and Class B common stock. The rights of the holders of Class A common stock and
Class B common stock are identical, except with respect to voting rights. Each share of Class A common stock is entitled to one vote.
Each share of Class B common stock is entitled to ten votes and is convertible at any time into one share of Class A common stock. The
holders of our outstanding Class B common stock will hold approximately [ ]% of the voting power of our outstanding
capital stock following this offering.
Our
Class A common stock is listed on The Nasdaq Capital Market under the symbol “SIDU”. On March 24, 2023, the closing
price as reported on The Nasdaq Capital Market was $0.62 per share.
The public offering price per share of Class
A common stock and accompanying warrant and any pre-funded warrant and accompanying warrant, as the case may be, will be
determined by us at the time of pricing, may be at a discount to the current market price, and the recent market price
used throughout this prospectus may not be indicative of the final offering price.
We
are an “emerging growth company” as that term is used in the Jumpstart Our Business Startups Act of 2012 and, as such, have
elected to comply with certain reduced public company reporting requirements.
Investing
in our Class A common stock involves risks. See “Risk Factors” beginning on page 5.
Neither the Securities
and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus
is truthful or complete. Any representation to the contrary is a criminal offense.
| | |
Per Share
and Accompanying
Warrant (2) | | |
Per
Pre-Funded
Warrant and
Accompanying Warrant (2) | | |
Total | |
| Price to the public | |
$ | | | |
$ | | | |
| | |
| Underwriting discounts and
commissions(1) | |
$ | | | |
$ | | | |
| | |
| Proceeds to us, before expenses | |
$ | | | |
$ | | | |
| | |
| (1) |
Underwriting
discounts and commissions do not include a non-accountable expense allowance equal to 1.0% of the public offering price payable to
the underwriters. The registration statement, of which this prospectus is a part, also registers for sale warrants to purchase [*]
shares of Class A common stock to be issued to the representatives of the underwriter in connection with this offering.
We have agreed to issue the warrants to the representatives of the underwriter as a portion of the underwriting compensation payable
to the underwriters in connection with this offering. See “Underwriting” for a description of compensation payable to
the underwriters. |
| (2) |
The public offering corresponds to a public offering
price per share of common stock (or pre-funded warrant) of $[_], and a public offering price per accompanying warrant of $0.001. |
We have granted the representatives
of the underwriter an option to purchase up to an additional [*] shares of Class A common stock, representing 15% of the aggregate
shares of Class A common stock and pre-funded warrants sold in this offering, and/or warrants to purchase up to [*] shares
of Class A common stock in lieu thereof, representing 15% of the aggregate number of accompanying warrants sold in this offering, in
any combination thereof, from us at the public offering price, less underwriting discounts and commissions, within 45 days from the
date of this prospectus to cover over-allotments, if any.
We anticipate that delivery of the securities against payment will be made on or about
, 2023.
| BOUSTEAD
SECURITIES, LLC |
EF
HUTTON |
| |
division
of Benchmark Investments, LLC |
The
date of this prospectus is , 2023
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
We
incorporate by reference important information into this prospectus. You may obtain the information incorporated by reference without
charge by following the instructions under “Where You Can Find More Information.” You should carefully read this prospectus
as well as additional information described under “Information Incorporated by Reference,” before deciding to invest in our
securities.
Neither
we nor the underwriters have authorized anyone to provide you with additional information or information different from that contained
or incorporated by reference in this prospectus filed with the Securities and Exchange Commission (the “SEC”). We take no
responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. The underwriters
are offering to sell, and seeking offers to buy, our securities only in jurisdictions where offers and sales are permitted. The information
contained in this prospectus, or any document incorporated by reference in this prospectus, is accurate only as of the date of those
respective documents, regardless of the time of delivery of this prospectus or any sale of our securities. Our business, financial condition,
results of operations and prospects may have changed since that date.
The
information incorporated by reference or provided in this prospectus contains estimates and other
statistical data made by independent parties and by us relating to market size and growth and other data about our industry. We obtained
the industry and market data in this prospectus from our own research as well as from industry and general publications, surveys and
studies conducted by third parties. This data involves a number of assumptions and limitations and contains projections and estimates
of the future performance of the industries in which we operate that are subject to a high degree of uncertainty, including those discussed
in “Risk Factors.” We caution you not to give undue weight to such projections, assumptions, and estimates. Further, industry
and general publications, studies and surveys generally state that they have been obtained from sources believed to be reliable, although
they do not guarantee the accuracy or completeness of such information. While we believe that these publications, studies, and surveys
are reliable, we have not independently verified the data contained in them. In addition, while we believe that the results and estimates
from our internal research are reliable, such results and estimates have not been verified by any independent source.
For
investors outside the United States (“U.S.”): We and the underwriters have not done anything that would permit this offering
or the possession or distribution of this prospectus in any jurisdiction where action for those purposes is required, other than in the
U.S. Persons outside the U.S. who come into possession of this prospectus must inform themselves about, and observe any restrictions
relating to, the offering of the securities and the distribution of this prospectus outside of the U.S.
INFORMATION
REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus contains forward-looking statements that involve risks and uncertainties. You should not place undue reliance on these forward-looking
statements. All statements other than statements of historical facts contained in this prospectus are forward-looking statements. The
forward-looking statements in this prospectus are only predictions. We have based these forward-looking statements largely on our current
expectations and projections about future events and financial trends that we believe may affect our business, financial condition, and
results of operations. In some cases, you can identify these forward-looking statements by terms such as “anticipate,” “believe,”
“continue,” “could,” “depends,” “estimate,” “expects,” “intend,”
“may,” “ongoing,” “plan,” “potential,” “predict,” “project,”
“should,” “will,” “would” or the negative of those terms or other similar expressions, although not
all forward-looking statements contain those words. We have based these forward-looking statements on our current expectations and projections
about future events and trends that we believe may affect our financial condition, results of operations, strategy, short- and long-term
business operations and objectives, and financial needs. These forward-looking statements include, but are not limited to, statements
concerning the following:
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our
projected financial position and estimated cash burn rate; |
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our
estimates regarding expenses, future revenues and capital requirements; |
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our
ability to continue as a going concern; |
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our
need to raise substantial additional capital to fund our operations; |
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our
ability to compete in the global space industry; |
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our
ability to obtain and maintain intellectual property protection for our current products and services; |
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our
ability to protect our intellectual property rights and the potential for us to incur substantial costs from lawsuits to enforce
or protect our intellectual property rights; |
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the
possibility that a third party may claim we have infringed, misappropriated or otherwise violated their intellectual property rights
and that we may incur substantial costs and be required to devote substantial time defending against these claims; |
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our
reliance on third-party suppliers and manufacturers; |
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the
success of competing products or services that are or become available; |
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our
ability to expand our organization to accommodate potential growth and our ability to retain and attract key personnel; and |
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the
potential for us to incur substantial costs resulting from lawsuits against us and the potential for these lawsuits to cause us to
limit our commercialization of our products and services. |
These
forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described in “Risk
Factors.” Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is
not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which
any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements
we may make. In light of these risks, uncertainties and assumptions, the forward-looking events and circumstances discussed in this prospectus
may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.
You
should not rely upon forward-looking statements as predictions of future events. Although we believe that the expectations reflected
in the forward-looking statements are reasonable, we cannot guarantee that the future results, levels of activity, performance or events
and circumstances reflected in the forward-looking statements will be achieved or occur. Moreover, except as required by law, neither
we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. We undertake no obligation
to update publicly any forward-looking statements for any reason after the date of this prospectus to conform these statements to actual
results or to changes in our expectations.
You
should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration
statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and
events and circumstances may be materially different from what we expect.
PROSPECTUS
SUMMARY
The
following summary highlights selected information contained elsewhere in this prospectus and is qualified in its entirety by the more
detailed information and financial statements included elsewhere in this prospectus. It does not contain all the information that may
be important to you and your investment decision. You should carefully read this entire prospectus, including the matters set forth under
“Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations,”
and our financial statements and related notes included elsewhere in this prospectus. In this prospectus, unless context requires otherwise,
references to “we,” “us,” “our,” “Sidus Space” “Sidus,” or “the Company”
refer to Sidus Space, Inc.
Company
Overview
Founded
in 2012, we are a vertically integrated provider of Space-as-a-Service solutions including end-to-end satellite support. The company
combines mission critical hardware manufacturing; multi-disciplinary engineering services; satellite design, manufacture, launch planning,
mission operations and in-orbit support; and space-based data collection with a vision to enable space flight heritage status for new
technologies and deliver data and predictive analytics to both domestic and global customers. We have over ten (10) years of commercial,
military and government manufacturing experience combined with space qualification experience, existing customers and pipeline, and International
Space Station (ISS) heritage hardware.
In
addition, we are building a multi-mission satellite constellation using our hybrid 3D printed multipurpose satellite to provide continuous,
near real-time Earth Observation and Internet-of-Things (IOT) data for the global space economy. We have designed and are manufacturing
LizzieSat (LS) for our low earth orbit (“LEO”) satellite constellation operating in diverse orbits (28°-98° inclination,
300-650km altitude) as approved by the International Telecommunication Union (ITU) in February 2021. LS is expected to begin operations
in 2023. Initial launches are planned via NASA CRS2 program agreement and launch service rideshare contracts. Each LS is 100kg with 35kg
dedicated to payloads including remote sensing instruments. Payloads (Sidus or customer owned) can collect data over multiple Earth based
locations, record it onboard, and downlink via ground passes to Sidus Mission Control Center (MCC) in Merritt Island, FL.
Leveraging
our existing manufacturing operations, flight hardware manufacturing experience and commercial off the shelf subsystem hardware, we believe
we can deliver customer sensors to orbit in months, rather than years. In addition, we intend on delivering high-impact data for insights
on aviation, maritime, weather, space services, earth intelligence and observation, financial technology (Fintech) and the Internet of
Things. While our business has historically been centered on the design and manufacture of space hardware, our expansion into manufacture
of spacecraft as well as on-orbit constellation management services and space data applications has led us to innovating in the area
of space data applications. We continue to patent our products including our satellites, external platforms and other innovations. Sidus
offerings include a broad area of market sub-segments, such as:
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● |
Mission
Critical Hardware Manufacturing |
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● |
Multi-Disciplinary
Engineering Services |
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● |
Satellite
Design, Production, Launch Planning, Mission Operations, and In-Orbit Support |
| |
● |
On-Orbit
Testing of Space Ecosystem Technologies and Hardware |
| |
● |
Data
and Analytics Derived from Satellite Missions |
Each
of these areas and initiatives addresses a critical component of our cradle-to-grave solution and value proposition for the space economy
as a Space-as-a-Service company. The majority of our revenues to date have been from our space
related hardware manufacturing, however, 2022 revenue to date includes revenue related to our multi-mission constellation and our hybrid
3D printed LizzieSat satellite.
We are
on track to grow our space and defense hardware operations, with a goal of expanding to two and a half shifts with an increased customer
base in the future. With current customers in space, marine, and defense industries, our contract revenue is growing, and we are in active
discussions with numerous potential customers, including government agencies, large defense contractors and private companies, to add
to our contracted revenue. In the past decade, we have fabricated ground and flight products for the NASA SLS Rocket and Mobile Launcher
as well as other commercial space and satellite companies. Customers supported include Boeing, Lockheed Martin, Northrop Grumman, Dynetics/Leidos,
Blue Origin, United Launch Alliance, Collins Aerospace, L3Harris, OneWeb and Space Systems Loral/Maxar. Various products have been manufactured
including fluid, hydraulic and pneumatic systems, electrical control systems, cable harnesses, hardware lifting frames, umbilical plates,
purge and hazardous gas disconnects, frangible bolts, reef cutters, wave guides, customized platforms, and other precision machined and
electrical component parts for all types of Rockets, Ground, Flight and Satellite systems. In June 2022, the NASA xEVAS, 12-year, $3.5
Billion multiple award contract was awarded to Collins Aerospace and Axiom Space. We are a member of the Collins Aerospace team and expect
to support this contract upon execution of task orders issued by NASA and contracts with independent commercial entities. The Exploration
Extravehicular Activity Services, or xEVAS Program is expected to include the design, development, production, hardware processing, and
sustainment of an integrated Extravehicular Activity (EVA) capability that includes a new Spacesuit and ancillary hardware, such as Vehicle
Interface Equipment and EVA tools. This EVA capability is to be provided as a service for the NASA International Space Station (ISS),
Artemis Program (Gateway and Human Landing System), and Commercial Space missions.
We
support a broad range of international and domestic government and commercial companies with its hardware manufacturing including the
Department of State, the Department of Defense, NASA, Collins Aerospace, Lockheed Martin, Teledyne Marine, Bechtel, and L3Harris in areas
that include launch vehicles, satellite hardware, and autonomous underwater vehicles. Planned services that benefit not only current
customers but additional customers such as Mission Helios include providing the ability for customers to demonstrate that a technology
(hardware or software) performs successfully in the harsh environment of space and delivering space-based data that can provide critical
insight for agriculture, commodities tracking, disaster assessment, illegal trafficking monitoring,
energy, mining, oil and gas, fire monitoring, classification of vegetation, soil moisture, carbon mass, Maritime AIS, Aviation ADS, weather
monitoring, and space services. We plan to own and operate one of the industry’s leading U.S. based low earth orbit (“LEO”)
small satellite (“smallsat” or “smallsats”) constellations. Our operating strategy is to continue to enhance
the capabilities of our satellite constellation, to increase our international and domestic partnerships and to expand our analytics
offerings in order to increase the value we deliver to our customers. Our two operating assets—our satellite constellation and
hardware manufacturing capability—are mutually reinforcing and are a result of years of heritage and innovation.
Our
strategy is to capitalize on the rapid growth and deployment of millions of low-cost GPS enabled terrestrial, IoT, and space-based sensors
to provide data to global customers in near real-time. As we are now entering a new commercial space age, the number of commercial sensors
on orbit has expanded from a handful of large expensive commercial satellites just a few years ago to now hundreds and in the near future
thousands of sensors that will ultimately change the way we see and understand our world. Our mission is to enable our existing and future
customers to prove out new technologies for the space ecosystem rapidly and at low cost and also have access to space-based data on-demand
for any problem set or business need. We believe we can deliver this at a lower cost than legacy providers due to our vertically integrated
cost-efficiencies, capital efficient constellation design, and improved pricing models with improved data accessibility. We believe the
combination of the proven flight heritage and years of industry experience of a traditional space company with the disruptive innovation
of a new space startup such as our 3D printing of spacecraft and focus on intellectual property makes us very well positioned in the
global space economy.
Corporate
Information
We
were formed as a limited liability company under the name Craig Technologies Aerospace Solutions, LLC on April 17, 2012. On April 15,
2021, we converted into a Delaware corporation and changed our name to Sidus Space, Inc. on August 13, 2021. Our principal executive
offices are located at 150 N. Sykes Creek Parkway, Suite 200, Merritt Island, FL 32953 and our telephone number is (321) 613-5620. Our
website address is www.sidusspace.com. The information contained on our website is not incorporated by reference into this prospectus,
and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or
in deciding whether to purchase our Class A common stock.
Implications
of Being an Emerging Growth Company
As
a company with less than $1.235 billion in revenues during our last fiscal year, we qualify as an emerging growth company as defined
in the Jumpstart Our Business Startups Act (“JOBS Act”) enacted in 2012. As an emerging growth company, we expect to take
advantage of reduced reporting requirements that are otherwise applicable to public companies. These provisions include, but are not
limited to:
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● |
being
permitted to present only two years of audited financial statements, in addition to any required unaudited interim financial statements,
with correspondingly reduced “Management’s Discussion and Analysis of Financial Condition and Results of Operations”
disclosure in this prospectus; |
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● |
not
being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, as amended (“Sarbanes-Oxley
Act”); |
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reduced
disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements; and
|
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exemptions
from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute
payments not previously approved. |
We
may use these provisions until the last day of our fiscal year following the fifth anniversary of the completion of our initial public
offering. However, if certain events occur prior to the end of such five-year period, including if we become a “large accelerated
filer,” our annual gross revenues exceed $1.235 billion or we issue more than $1.0 billion of non-convertible debt in any three-year
period, we will cease to be an emerging growth company prior to the end of such five-year period.
The
JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised
accounting standards. As an emerging growth company, we intend to take advantage of an extended transition period for complying with
new or revised accounting standards as permitted by The JOBS Act.
To
the extent that we continue to qualify as a “smaller reporting company,” as such term is defined in Rule 12b-2 under the
Securities Exchange Act of 1934, after we cease to qualify as an emerging growth company, certain of the exemptions available to us as
an emerging growth company may continue to be available to us as a smaller reporting company, including: (i) not being required to comply
with the auditor attestation requirements of Section 404(b) of the Sarbanes Oxley Act; (ii) scaled executive compensation disclosures;
and (iii) the requirement to provide only two years of audited financial statements, instead of three years.
THE
OFFERING
| Class
A common stock offered by us |
|
[*]
shares (or [*] shares if the underwriters’ option to purchase additional shares is exercised in full), based on the sale of
our common stock at an assumed combined public offering price of $[ ] per share of Class A common stock and accompanying
warrant, which is the last reported sale price of our Class A common stock on March [*], 2023, and no sale of any pre-funded
warrants. |
| |
|
|
| Pre-funded
warrants offered by us |
|
We
are also offering to certain purchasers whose purchase of shares of Class A common stock in this offering would otherwise
result in the purchaser, together with its affiliates and certain related parties, beneficially owning more than 4.99% (or, at the
election of the purchaser, 9.99%) of our outstanding Class A common stock immediately following the consummation of this offering,
the opportunity to purchase, if such purchasers so choose, pre-funded warrants to purchase shares of Class A
common stock, in lieu of shares of Class A common stock that would otherwise result in any such purchaser’s
beneficial ownership exceeding 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding Class A common stock. Each
pre-funded warrant will be exercisable for one share of our Class A common stock. The purchase price of each pre-funded warrant
and accompanying warrant will equal the price at which the share of Class A common stock and accompanying warrant are
being sold to the public in this offering, minus $0.0001, and the exercise price of each pre-funded warrant will be $0.0001 per share.
The pre-funded warrants will be exercisable immediately and may be exercised at any time until all of the pre-funded warrants are
exercised in full. This offering also relates to the shares of Class A common stock issuable upon exercise of any pre-funded warrants
sold in this offering. For each pre-funded warrant we sell, the number of shares of Class A common stock we are offering
will be decreased on a one-for-one basis. Because we will issue a warrant for each share of our Class A common stock and for each
pre-funded warrant to purchase one share of our Class A common stock sold in this offering, the number of warrants sold in this offering
will not change as a result of a change in the mix of the shares of our Class A common stock and pre-funded warrants sold. |
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|
|
| Warrants
offered by us |
|
Warrants
to purchase an aggregate of [*] shares of our Class A common stock (or [*] shares if the underwriters’ option to purchase additional
warrants is exercised in full), based on the sale of our Class A common stock at an assumed combined public offering price of $[
] per share of Class A common stock and accompanying warrant, which is the last reported sale price of our common stock on The Nasdaq
Capital Market on March [*], 2023. Each share of our Class A common stock and each pre-funded warrant to purchase one share
of our Class A common stock is being sold together with a warrant to purchase one share of our common stock. Each warrant will have
an exercise price of $ per share (representing 100% of the price at which a share of Class A common stock and accompanying warrant
are sold to the public in this offering), will be immediately exercisable and will expire on the fifth anniversary of the original
issuance date. Each Warrant is exercisable for one share of common stock, subject to adjustment in the event of stock dividends,
stock splits, stock combinations, reclassifications, reorganizations or similar events affecting our common stock. On or after the
thirty (30) day anniversary of the date of this prospectus, a holder of the Warrants may also provide notice and elect an “alternative
cashless exercise” pursuant to which they would receive an aggregate number of shares equal to the product of (x) the aggregate
number of shares of the Company’s common stock that would be issuable upon a cash exercise and (y) 0.50. The shares of Class
A common stock and pre-funded warrants, and the accompanying warrants, as the case may be, can only be purchased together in this
offering but will be issued separately and will be immediately separable upon issuance. This prospectus also relates to the offering
of the shares of common stock issuable upon exercise of the warrants. |
| Class
A common stock outstanding immediately prior to this offering(1) |
|
25,272,736
shares |
| |
|
|
| Class
A common stock outstanding immediately after this offering(1) |
|
[*]
shares (assuming no exercise of the over-allotment option and no exercise of the warrants and pre-funded warrants issued in connection
with this offering). |
| |
|
|
| Option
to purchase additional securities |
|
We
have granted the underwriters an option, exercisable within 30 days after the closing of
this offering, to acquire up to an additional [*] shares of Class A common stock and/or additional
[*] warrants to purchase up to shares of Class A common stock from us, based on the sale
of our Class A common stock at an assumed combined public offering price of $[ ] per share
of Class A common stock, which is the last reported sale price of our common stock on the
Nasdaq Capital Market on March [*], 2023, in any combination thereof, at the public
offering price per share and public offering price per warrant, respectively, less underwriting
discounts and commissions on the same terms as set forth in this prospectus.
Because
the warrants will not be listed on a national securities exchange or other nationally recognized trading market, the underwriters
will be unable to satisfy any overallotment of shares and warrants without exercising the underwriters’ overallotment option
with respect to the warrants. As a result, the underwriters will exercise their overallotment option for all of the warrants which
are over-allotted, if any, at the time of the initial offering of the shares and the warrants. However, because our common stock
is publicly traded, the underwriters may satisfy some or all of the overallotment of shares of our common stock, if any, by purchasing
shares in the open market and will have no obligation to exercise the overallotment option with respect to our common stock. |
| |
|
|
| Use
of proceeds |
|
We
estimate that the net proceeds from this offering will be approximately $[ ] million or approximately $[ ]
million if the underwriters exercise their option to purchase additional securities in full, at an assumed public offering price
of $[ ] per share and accompanying warrant, which was the closing price of our Class A common stock on The Nasdaq Capital
Market on March [*], 2023, after deducting the underwriting discounts and commissions and estimated offering expenses payable
by us. We intend to use the net proceeds from this offering for (i) sales and marketing, (ii) operational costs, (iii) product development,
(iv) manufacturing expansion and (v) working capital and other general corporate purposes. We may also use a portion of the net proceeds
to in-license, acquire or invest in complementary businesses or products, however, we have no current commitments or obligations
to do so. See “Use of Proceeds” for a more complete description of the intended use of proceeds from this offering. |
| |
|
|
| Risk
factors |
|
See
“Risk Factors” on page 5 and other information included in this prospectus for a discussion of factors to consider carefully
before deciding to invest in shares of our Class A Common Stock. |
| |
|
|
| Nasdaq
Capital Market symbol |
|
Shares
of our Class A Common Stock are listed on The Nasdaq Capital Market under the symbol “SIDU.” There is no established
trading market for the warrants, and we do not expect a trading market to develop. We do not intend to list the warrants on any securities
exchange or other trading market. Without a trading market, the liquidity of the warrants will be extremely limited. |
(1) The
number of shares of Class A common stock and Class B common stock that will be outstanding after this offering is based on 25,272,736
shares of Class A common stock and 10,000,000 shares of Class B common stock outstanding as of March 15, 2023, and excludes:
| |
● |
10,000,000
shares of Class A common stock issuable upon conversion of our Class B Common Stock; |
| |
|
|
| |
● |
950,000
shares of Class A common stock reserved for
future issuance under our 2021 Omnibus Equity Incentive Plan. |
RISK
FACTORS
An investment in our securities involves a high degree
of risk. This prospectus contains a discussion of the risks applicable to an investment in our securities. Prior to making a decision
about investing in our securities, you should carefully consider the specific factors discussed within this prospectus. The risks
and uncertainties we have described are not the only ones we face. Additional risks and uncertainties not presently known to us or
that we currently deem immaterial may also affect our operations. The occurrence of any of these known or unknown
risks might cause you to lose all or part of your investment in the offered securities.
Risks
Related to this Offering and Our Class A Common Stock
Our stock price may be volatile,
and purchasers of our Class A common stock could incur substantial losses.
The stock market in general has experienced significant
price and volume fluctuations that have often been unrelated or disproportionate to operating performance of individual companies, particularly
following a public offering of a company with a small public float. There is the potential for rapid and substantial price volatility
of our Class A common stock following this offering. These broad market factors may seriously harm the market price of our Class A common
stock, regardless of our actual or expected operating performance and financial condition or prospects, which may make it difficult for
investors to assess the rapidly changing value of our Class A common stock.
We
are currently listed on The Nasdaq Capital Market. If we are unable to maintain listing of our securities on Nasdaq or any stock exchange,
our stock price could be adversely affected and the liquidity of our stock and our ability to obtain financing could be impaired and
it may be more difficult for our stockholders to sell their securities.
Although
our Class A Common Stock is currently listed on The Nasdaq Capital Market, we may not be able to continue to meet the exchange’s
minimum listing requirements or those of any other national exchange. If we are unable to maintain listing on Nasdaq or if a liquid market
for our Class A Common Stock does not develop or is sustained, our Class A Common Stock may remain thinly traded.
The
listing rules of Nasdaq require listing issuers to comply with certain standards in order to remain listed on its exchange. If, for any
reason, we should fail to maintain compliance with these listing standards and Nasdaq should delist our securities from trading on its
exchange and we are unable to obtain listing on another national securities exchange, a reduction in some or all of the following may
occur, each of which could have a material adverse effect on our stockholders:
| |
● |
the
liquidity of our Class A Common Stock; |
| |
● |
the
market price of our Class A Common Stock; |
| |
|
|
| |
● |
our
ability to obtain financing for the continuation of our operations; |
| |
|
|
| |
● |
the
number of institutional and general investors that will consider investing in our Class A Common Stock; |
| |
● |
the
number of investors in general that will consider investing in our Class A Common Stock; |
| |
|
|
| |
● |
the
number of market makers in our Class A Common Stock; |
| |
|
|
| |
● |
the
availability of information concerning the trading prices and volume of our Class A Common Stock; and |
| |
|
|
| |
● |
the
number of broker-dealers willing to execute trades in shares of our Class A Common Stock. |
The
dual-class structure of our common stock as contained in our amended and restated certificate of incorporation, as amended, has the effect
of concentrating voting control with those stockholders who held our Class B Common Stock prior to our initial public offering. This
ownership will limit or preclude your ability to influence corporate matters, including the election of directors, amendments of our
organizational documents, and any merger, consolidation, sale of all or substantially all of our assets, or other major corporate transactions
requiring stockholder approval, and that may adversely affect the trading price of our Class A Common Stock.
Our
Class B Common Stock has ten votes per share, and our Class A Common Stock, which is the stock that we sold in our initial public offering,
has one vote per share. CTC holds all of the issued and outstanding shares of our Class B Common Stock, representing approximately 79.8%
of the voting power of our outstanding capital stock as of March 15, 2023. In addition, because of the ten-to-one voting
ratio between our Class B and Class A Common Stock, the holder of our Class B Common Stock could continue to control a majority of the
combined voting power of our common stock and therefore control all matters submitted to our stockholders for approval until converted
by our Class B Common stockholder. This concentrated control may limit or preclude your ability to influence corporate matters for the
foreseeable future, including the election of directors, amendments of our organizational documents and any merger, consolidation, sale
of all or substantially all of our assets or other major corporate transactions requiring stockholder approval. In addition, this concentrated
control may prevent or discourage unsolicited acquisition proposals or offers for our capital stock that you may feel are in your best
interest as one of our stockholders. As a result, such concentrated control may adversely affect the market price of our Class A Common
Stock.
Future
transfers by holders of Class B Common Stock will generally result in those shares converting to Class A Common Stock, subject to limited
exceptions as specified in our amended and restated certificate of incorporation, such as transfers to family members and certain transfers
effected for estate planning purposes. The conversion of Class B Common Stock to Class A Common Stock will have the effect, over time,
of increasing the relative voting power of those holders of Class B Common Stock who retain their shares in the long term. As a result,
it is possible that one or more of the persons or entities holding our Class B Common Stock could gain significant voting control as
other holders of Class B Common Stock sell or otherwise convert their shares into Class A Common Stock.
We
cannot predict the effect our dual-class structure may have on the market price of our Class A Common Stock.
We
cannot predict whether our dual-class structure will result in a lower or more volatile market price of our Class A Common Stock, adverse
publicity or other adverse consequences. For example, certain index providers have announced and implemented restrictions on including
companies with multiple-class share structures in certain of their indices. In July 2017, FTSE Russell announced that it would require
new constituents of its indices to have greater than 5% of the company’s voting rights in the hands of public stockholders, and
S&P Dow Jones announced that it would no longer admit companies with multiple-class share structures to certain of its indices. Affected
indices include the Russell 2000 and the S&P 500, S&P MidCap 400 and S&P SmallCap 600, which together make up the S&P
Composite 1500. Also in 2017, MSCI, a leading stock index provider, opened public consultations on its treatment of no-vote and multi-class
structures and temporarily barred new multi-class listings from certain of its indices; however, in October 2018, MSCI announced its
decision to include equity securities “with unequal voting structures” in its indices and to launch a new index that specifically
includes voting rights in its eligibility criteria. Under such announced and implemented policies, the dual-class structure of our common
stock would make us ineligible for inclusion in certain indices and, as a result, mutual funds, exchange-traded funds and other investment
vehicles that attempt to passively track those indices would not invest in our Class A Common Stock. These policies are relatively new
and it is unclear what effect, if any, they will have on the valuations of publicly-traded companies excluded from such indices, but
it is possible that they may adversely affect valuations, as compared to similar companies that are included. Due to the dual-class structure
of our common stock, we will likely be excluded from certain indices and we cannot assure you that other stock indices will not take
similar actions. Given the sustained flow of investment funds into passive strategies that seek to track certain indices, exclusion from
certain stock indices would likely preclude investment by many of these funds and could make our Class A Common Stock less attractive
to other investors. As a result, the market price of our Class A Common Stock could be adversely affected.
Our
principal stockholders will continue to have significant influence over the election of our board of directors and approval of any significant
corporate actions, including any sale of the company.
Our
founders, executive officers, directors, and other principal stockholders, in the aggregate, beneficially own a majority of our outstanding
stock. These stockholders currently have, and likely will continue to have, significant influence with respect to the election of our
board of directors and approval or disapproval of all significant corporate actions. The concentrated voting power of these stockholders
could have the effect of delaying or preventing an acquisition of the company or another significant corporate transaction.
We
have broad discretion in the use of the net proceeds from this offering and may not use them effectively.
Our
management will have broad discretion in the application of the net proceeds from this offering, including for any of the currently intended
purposes described in the section entitled “Use of Proceeds.” Because of the number and variability of factors that will
determine our use of the net proceeds from this offering, their ultimate use may vary substantially from their currently intended use.
Our management may not apply our cash from this offering in ways that ultimately increase the value of any investment in our securities
or enhance stockholder value. The failure by our management to apply these funds effectively could harm our business. Pending their use,
we may invest the net proceeds from this offering in short-term, investment-grade, interest-bearing securities. These investments may
not yield a favorable return to our stockholders. If we do not invest or apply our cash in ways that enhance stockholder value, we may
fail to achieve expected financial results, which may result in a decline in the price of our shares of Class A common stock, and, therefore,
may negatively impact our ability to raise capital, invest in or expand our business, acquire additional products or licenses, commercialize
our product, or continue our operations.
We
could be subject to securities class action litigation.
In
the past, securities class action litigation has often been brought against companies following a decline in the market price of their
securities. This risk is especially relevant for us because biotechnology companies have experienced significant share price volatility
in recent years. If we face such litigation, it could result in substantial costs and a diversion of management’s attention and
resources, which could harm our business.
If
securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, the market
price for the shares and trading volume could decline.
The
trading market for our Class A Common Stock will depend in part on the research and reports that securities or industry analysts publish
about us or our business. If research analysts do not establish and maintain adequate research coverage or if one or more of the analysts
who covers us downgrades our Class A Common Stock or publishes inaccurate or unfavorable research about our business, the market price
for our Class A Common Stock would likely decline. If one or more of these analysts cease coverage of our company or fail to publish
reports on us regularly, we could lose visibility in the financial markets, which, in turn, could cause the market price or trading volume
for our common stock to decline.
We
do not expect to pay dividends in the foreseeable future, and you must rely on price appreciation of your shares of Class A Common Stock
for return on your investment.
We
have paid no cash dividends on any class of our stock to date, and we do not anticipate paying cash dividends in the near term. For the
foreseeable future, we intend to retain any earnings to finance the development and expansion of our business, and we do not anticipate
paying any cash dividends on our stock. Accordingly, investors must be prepared to rely on sales of their shares after price appreciation
to earn an investment return, which may never occur. Investors seeking cash dividends should not purchase our shares. Any determination
to pay dividends in the future will be made at the discretion of our board of directors and will depend on our results of operations,
financial condition, contractual restrictions, restrictions imposed by applicable law and other factors our board deems relevant.
As
the public offering price is substantially higher than our net tangible book value per share, you will experience immediate and substantial
dilution.
If
you purchase Class A common stock in this offering, you will pay more for your shares of Class A common stock than the amount paid by
our existing stockholders for their shares on a per share basis. As a result, you will experience immediate and substantial dilution
in net tangible book value per share in relation to the price that you paid for your shares. We expect the dilution as a result of the
offering to be $[ ] per share to new investors purchasing our shares of Class A common stock in this offering. In addition,
you will experience further dilution to the extent that our shares are issued upon the exercise of any warrants or exercise of stock
options under any stock incentive plans. See “Dilution” for a more complete description of how the value of your investment
in our shares will be diluted upon completion of this offering.
Future sales of substantial amounts of our
Class A common stock or securities convertible into or exchangeable or exercisable for shares of Class A common stock, either by us or
by our existing stockholders, or the possibility that such sales could occur, could adversely affect the market price of our Class A
common stock.
Future sales in the public market of shares of
our Class A common stock or securities convertible into or exchangeable or exercisable for shares of Class A common stock, shares held
by our existing stockholders or shares issued upon exercise of our outstanding stock options or warrants, or the perception by the market
that these sales could occur, could lower the market price of our Class A common stock or make it difficult for us to raise additional
capital.
There is no public market for the pre-funded
warrants or warrants being offered in this offering.
There is no established public trading market
for the pre-funded warrants or warrants being offered in this offering, and we do not expect a market to develop. In addition, we do
not intend to apply to list the pre-funded warrants or warrants on any securities exchange or nationally recognized trading system, including
The Nasdaq Capital Market. Without an active market, the liquidity of the pre-funded warrants and warrants will be limited.
Holders of pre-funded warrants and warrants
purchased in this offering will have no rights as common stockholders until such holders exercise such warrants and acquire our Class
A common stock.
Until holders of pre-funded warrants or warrants acquire shares of our Class A common stock
upon exercise of such warrants, holders of pre-funded warrants or warrants will have no rights with respect to the shares of our Class
A common stock underlying such warrants. Upon exercise of the pre-funded warrants or warrants, the holders will be entitled to exercise
the rights of a Class A common stockholder only as to matters for which the record date occurs after the exercise date.
We
will incur increased costs as a public company, and our management will be required to devote substantial time to new compliance initiatives
and corporate governance practices.
As
a public company, and particularly after we no longer qualify as an emerging growth company, we will incur significant legal, accounting,
and other expenses that we did not incur previously. The Sarbanes-Oxley Act of 2002 (“SOX”), the Dodd-Frank Wall Street Reform
and Consumer Protection Act, the listing requirements of Nasdaq, and other applicable securities rules and regulations impose various
requirements on U.S. reporting public companies, including the establishment and maintenance of effective disclosure and financial controls
and corporate governance practices. Our management and other personnel will need to devote a substantial amount of time to these compliance
initiatives. Moreover, these rules and regulations will increase our legal and financial compliance costs and will make some activities
more time-consuming and costly. For example, we expect that these rules and regulations may make it more expensive for us to obtain director
and officer liability insurance, which in turn could make it more difficult for us to attract and retain qualified senior management
personnel or members for our board of directors. In addition, these rules and regulations are often subject to varying interpretations,
and, as a result, their application in practice may evolve over time as new guidance is provided by regulatory and governing bodies.
This could result in continuing uncertainty regarding compliance matters and higher costs necessitated by ongoing revisions to disclosure
and governance practices. Pursuant to Section 404 of SOX (“Section 404”), we will be required to furnish a report by our
senior management on our internal control over financial reporting.
While
we remain an emerging growth company, we will not be required to include an attestation report on internal control over financial reporting
issued by our independent registered public accounting firm. To prepare for eventual compliance with Section 404, once we no longer qualify
as an emerging growth company, we will be engaged in a process to document and evaluate our internal control over financial reporting,
which is both costly and challenging. In this regard, we will need to continue to dedicate internal resources, potentially engage outside
consultants and adopt a detailed work plan to assess and document the adequacy of internal control over financial reporting, continue
steps to improve control processes as appropriate, validate through testing that controls are functioning as documented and implement
a continuous reporting and improvement process for internal control over financial reporting. Despite our efforts, there is a risk that
we will not be able to conclude, within the prescribed timeframe or at all, that our internal control over financial reporting is effective
as required by Section 404.
We are an “emerging
growth company,” and the reduced reporting requirements applicable to emerging growth companies may make our common stock less
attractive to investors.
We
are an “emerging growth company,” as defined in the Jumpstart Our Business Startups Act (“the JOBS Act”). For
as long as we continue to be an emerging growth company, we may take advantage of exemptions from various reporting requirements that
are applicable to other public companies that are not emerging growth companies, including exemption from compliance with the auditor
attestation requirements of Section 404, reduced disclosure obligations regarding executive compensation and exemptions from the requirements
of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously
approved. We will remain an emerging growth company until the earlier of (1) the last day of the fiscal year (a) following the fifth
anniversary of the closing of our initial public offering, (b) in which we have total annual gross revenue of at least $1.235 billion
or (c) in which we are deemed to be a large accelerated filer, which means the market value of our common stock held by non-affiliates
exceeds $700 million as of the end of our prior second fiscal quarter, and (2) the date on which we have issued more than $1.0 billion
in non-convertible debt during the prior three-year period.
In
addition, under the JOBS Act, emerging growth companies may delay adopting new or revised accounting standards until such time as those
standards apply to private companies. We may elect not to avail ourselves of this exemption from new or revised accounting standards
and, therefore, may be subject to the same new or revised accounting standards as other public companies that are not emerging growth
companies.
We
cannot predict if investors will find our common stock less attractive because we may rely on these exemptions. If some investors find
our common stock less attractive as a result, there may be a less active trading market for our common stock and our share price may
be more volatile.
Anti-takeover
provisions contained in our certificate of incorporation and bylaws as well as provisions of Delaware law, could impair a takeover attempt.
Our
certificate of incorporation, bylaws and Delaware law contain provisions which could have the effect of rendering more difficult, delaying
or preventing an acquisition deemed undesirable by our board of directors. Our corporate governance documents include provisions:
| |
● |
authorizing
“blank check” preferred stock, which could be issued by our board of directors without stockholder approval and may contain
voting, liquidation, dividend, and other rights superior to our common stock; |
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|
|
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● |
limiting
the liability of, and providing indemnification to, our directors and officers; |
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|
|
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● |
limiting
the ability of our stockholders to call and bring business before special meetings; |
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|
|
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● |
requiring
advance notice of stockholder proposals for business to be conducted at meetings of our stockholders and for nominations of candidates
for election to our board of directors; |
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|
|
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● |
controlling
the procedures for the conduct and scheduling of board of directors and stockholder meetings; and |
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|
|
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● |
providing
our board of directors with the express power to postpone previously scheduled annual meetings and to cancel previously scheduled
special meetings. |
These
provisions, alone or together, could delay or prevent hostile takeovers and changes in control or changes in our management.
As
a Delaware corporation, we are also subject to provisions of Delaware law, including Section 203 of the Delaware General Corporation
law, which prevents some stockholders holding more than 15% of our outstanding common stock from engaging in certain business combinations
without approval of the holders of substantially all of our outstanding common stock.
Any
provision of our certificate of incorporation, bylaws or Delaware law that has the effect of delaying or deterring a change in control
could limit the opportunity for our stockholders to receive a premium for their shares of our Class A common stock and could also affect
the price that some investors are willing to pay for our Class A common stock.
Our
amended and restated certificate of incorporation, as amended, designates the Court of Chancery of the State of Delaware as the sole
and exclusive forum for certain types of actions and proceedings that may be initiated by our stockholders, which could limit our stockholders’
ability to obtain a favorable judicial forum for disputes with us or our directors, officers, or other employees.
Our
certificate of incorporation requires that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery
of the State of Delaware will, to the fullest extent permitted by law, be the sole and exclusive forum for each of the following:
| |
● |
any
derivative action or proceeding brought on our behalf; |
| |
|
|
| |
● |
any
action asserting a claim for breach of any fiduciary duty owed by any director, officer, or other employee of ours to the Company
or our stockholders, creditors or other constituents; |
| |
|
|
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● |
any
action asserting a claim against us or any director or officer of ours arising pursuant to, or a claim against us or any of our directors
or officers, with respect to the interpretation or application of any provision of, the DGCL, our certificate of incorporation or
bylaws; or |
| |
|
|
| |
● |
any
action asserting a claim governed by the internal affairs doctrine; |
provided,
that, if and only if the Court of Chancery of the State of Delaware dismisses any of the foregoing actions for lack of subject matter
jurisdiction, any such action or actions may be brought in another state court sitting in the State of Delaware.
The
exclusive forum provision is limited to the extent permitted by law, and it will not apply to claims arising under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), the Securities Act of 1933, as amended (the “Securities Act”),
or for any other federal securities laws which provide for exclusive federal jurisdiction.
Our
Amended and Restated Certificate of Incorporation, as amended, provides that unless we consent in writing to the selection of an alternative
forum, the federal district courts of the United States of America will be the exclusive forum for the resolution of any complaint asserting
a cause of action arising under the Securities Act or the Securities Exchange Act of 1934, as amended. Any person or entity purchasing
or otherwise acquiring any interest in shares of our capital stock are deemed to have notice of and consented to this provision.
Furthermore,
Section 22 of the Securities Act creates concurrent jurisdiction for federal and state courts over all such Securities Act actions. Accordingly,
both state and federal courts have jurisdiction to entertain such claims. To prevent having to litigate claims in multiple jurisdictions
and the threat of inconsistent or contrary rulings by different courts, among other considerations, our second amended and restated certificate
of incorporation provides that the federal district courts of the United States of America will be the exclusive forum for resolving
any complaint asserting a cause of action arising under the Securities Act. While the Delaware courts have determined that such choice
of forum provisions are facially valid, a stockholder may nevertheless seek to bring such a claim arising under the Securities Act against
us, our directors, officers, or other employees in a venue other than in the federal district courts of the United States of America.
In such instance, we would expect to vigorously assert the validity and enforceability of the exclusive forum provisions of our second
amended and restated certificate of incorporation.
Although
we believe this provision benefits us by providing increased consistency in the application of Delaware law in the types of lawsuits
to which it applies, this provision may limit or discourage a stockholder’s ability to bring a claim in a judicial forum that it
finds favorable for disputes with us or our directors, officers, or other employees, which may discourage such lawsuits against us and
our directors, officers and other employees. Alternatively, if a court were to find the choice of forum provision contained in our certificate
of incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action
in other jurisdictions, which could adversely affect our business and financial condition.
We
note that there is uncertainty as to whether a court would enforce the provision and that investors cannot waive compliance with the
federal securities laws and the rules and regulations thereunder. Although we believe this provision benefits us by providing increased
consistency in the application of Delaware law in the types of lawsuits to which it applies, the provision may have the effect of discouraging
lawsuits against our directors and officers.
USE
OF PROCEEDS
We estimate that the net proceeds from our issuance
and sale of shares of our Class A common stock in this offering will be approximately $[ ] million, or approximately $[ ]
million if the underwriters exercise their option to purchase additional securities in full, based on an assumed public offering price
of $[ ] per share and accompanying warrant, which was the closing price of our Class A common stock on The Nasdaq Capital
Market on March [*], 2023, after deducting estimated underwriting discounts and commissions and estimated offering
expenses payable by us.
The foregoing discussion assumes no sale of pre-funded
warrants, which if sold, would reduce the number of shares of common stock that we are offering on a one-for-one basis.
We
intend to use the net proceeds from this offering for (i) sales and marketing, (ii) operational costs, (iii) product development, (iv)
manufacturing expansion and (v) working capital and other general corporate purposes. We may also use a portion of the net proceeds to
in-license, acquire or invest in complementary businesses or products, however, we have no current commitments or obligations to do so.
A
$0.50 increase or decrease in the assumed public offering price of $[ ] per share would increase or decrease the net
proceeds from this offering by approximately $[ ] million, assuming that the number of shares offered by us, as set
forth on the cover page of this prospectus, remains the same and after deducting the estimated underwriting discounts and commissions.
An
increase (decrease) of 500,000 shares in the number of shares offered by us, as set forth on the cover page of this prospectus, would
increase (decrease) the net proceeds from this offering by approximately $[ ], assuming no change in the assumed public
offering price per share and after deducting estimated underwriting discounts and commissions.
This
expected use of the net proceeds from this offering and our existing cash represents our intentions based upon our current plans, financial
condition and business conditions. Predicting the cost necessary to develop product candidates can be difficult and the amounts and timing
of our actual expenditures may vary significantly depending on numerous factors, including the progress of our development and commercialization
efforts, any collaborations that we may enter into with third parties for our product candidates and any unforeseen cash needs. As a
result, our management will retain broad discretion over the allocation of the net proceeds from this offering and our existing cash.
In
the ordinary course of our business, we expect to from time to time evaluate the acquisition of, investment in or in-license of complementary
products, technologies or businesses, and we could use a portion of the net proceeds from this offering for such activities. We currently
do not have any agreements, arrangements, or commitments with respect to any potential acquisition, investment or license.
Pending
our use of the net proceeds from this offering, we intend to invest the net proceeds in a variety of capital preservation investments,
including short-term, investment-grade, interest-bearing instruments, and government securities.
DILUTION
If
you invest in our securities, your ownership interest will be diluted to the extent of the difference between public offering
price per share of our Class A common stock and the as adjusted net tangible book value per share of our Class A common stock immediately
after this offering.
As
of February 28, 2023, 2022 we had a historical net tangible book value of $6,801,687, or $0.27 per share of Class
A common stock, based on 25,272,736 shares of Class A common stock outstanding at February 28, 2023. Our historical net
tangible book value per share is the amount of our total tangible assets less our total liabilities at February 28, 2023, divided
by the number of shares of Class A common stock outstanding at February 28, 2023.
After
giving effect to the sale of shares of Class A common stock and accompanying warrants in this offering at an assumed public offering
price of $[ ] per share, which was the closing price of our Class A common stock on The Nasdaq Capital Market on March [*],
2023 and after deducting the estimated underwriting discounts and commissions and estimated offering expenses payable by us, excluding
the proceeds, if any, from the exercise of the warrants issued in this offering, and assuming no sale of pre-funded warrants in this
offering, our as adjusted net tangible book value at February 28, 2023 would have been $[ ] million, or $[ ]
per share of common stock. This represents an immediate decrease in as adjusted net tangible book value of $[( )] per share to existing
stockholders and immediate dilution of $[ ] per share to new investors purchasing shares of Class A common stock in this offering.
The
following table illustrates this dilution on a per share basis:
| Assumed
combined public offering price per share and accompanying warrant |
|
|
|
|
|
$ |
|
|
| Net
tangible book value per share as of February 28, 2023 |
|
$ |
0.27 |
|
|
|
|
|
| Decrease in net tangible
book value per share attributable to new investors in this offering |
|
|
|
) |
|
|
|
|
| |
|
|
|
|
|
|
|
|
| As adjusted net tangible book value per share immediately
after this offering |
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
| Dilution per share to
new investors in this offering |
|
|
|
|
|
$ |
|
|
A $0.50 increase (decrease) in the assumed public
offering price of $[ ] per share and accompanying warrant, which was the closing price of our Class A common stock on The
Nasdaq Capital Market on March [*], 2023, would increase (decrease) our as adjusted net tangible book value after this offering
by $[ ] per share and the dilution to new investors purchasing Class A common stock in this offering by $[ ] per
share, assuming that the number of shares offered by us, as set forth on the cover page of this prospectus, remains the same and after
deducting estimated underwriting discounts and commissions. An increase (decrease) of 500,000 shares in the number of shares offered
by us, as set forth on the cover page of this prospectus, would increase our as adjusted net tangible book value after this offering
by $[ ] per share and decrease the dilution to new investors purchasing Class A common stock in this offering
by $[ ] per share, assuming no change in the assumed public offering price per share and after deducting estimated underwriting
discounts and commissions.
To
the extent that stock options or warrants are exercised, new stock options are issued under our equity incentive plan, or we issue additional
common stock in the future, there will be further dilution to investors participating in this offering. In addition, we may choose to
raise additional capital because of market conditions or strategic considerations, even if we believe that we have sufficient funds for
our current or future operating plans. If we raise additional capital through the sale of equity or convertible debt securities, the
issuance of these securities could result in further dilution to our stockholders.
DESCRIPTION
OF SECURITIES WE ARE OFFERING
Common
Stock
The
description of our Class A common stock under the section “Description of Capital Stock” in this prospectus is incorporated
herein by reference.
Warrants
General
The
following is a brief summary of certain terms and conditions of the warrants being offered by us. The following description is subject
in all respects to the provisions contained in the form of warrant, the form of which will be filed as an exhibit to the registration
statement of which this prospectus forms a part.
Duration
and Exercise Price
The
warrants offered hereby will have an exercise price of $ per share.
The warrants will be immediately exercisable and may be exercised at any time on or after the initial exercise date and on or before
the five-year anniversary of the date of issuance. The exercise prices and numbers of shares of Class A common stock issuable upon exercise
are subject to appropriate adjustment in the event of stock dividends, stock splits, reorganizations or similar events affecting our
Class A common stock. Warrants will be issued in certificated form only.
Exercisability
The
warrants will be exercisable, at the option of each holder, in whole or in part, by delivering to us a duly executed exercise notice
accompanied by payment in full for the number of shares of our Class A common stock purchased upon such exercise (except in the case
of a cashless exercise as discussed below). A holder (together with its affiliates) may not exercise any portion of such holder’s
warrants to the extent that the holder would own more than 4.99% (or 9.99%, at the holder’s election) of our outstanding Class
A common stock immediately after exercise, except that upon notice from the holder to us, the holder may decrease or increase the limitation
of ownership of outstanding stock after exercising the holder’s warrants up to 9.99% of the number of shares of our Class A common
stock outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the
terms of the warrants, provided that any increase in such limitation shall not be effective until 61 days following notice to us.
Cashless
Exercise
If,
at the time a holder exercises its warrants, a registration statement registering the issuance of the shares of Class A common stock
underlying the warrants under the Securities Act, is not then effective or available for the issuance of such shares, then in lieu of
making the cash payment otherwise contemplated to be made to us upon such exercise in payment of the aggregate exercise price, the holder
may elect instead to receive upon such exercise (either in whole or in part) the net number of shares of Class A common stock determined
according to a formula set forth in the warrant.
Alternative
Cashless Exercise
On
or after the thirty (30) day anniversary of the date of the underwriting agreement, a holder of common warrants may also provide notice
and elect an “alternative cashless exercise” pursuant to which they would receive an aggregate number of shares equal to
the product of (x) the aggregate number of shares of common stock that would be issuable upon a cash exercise and (y) 0.50.
Transferability
A
warrant may be transferred at the option of the holder upon surrender of the warrant to us together with the appropriate instruments
of transfer.
Fractional
Shares
No
fractional shares of Class A common stock will be issued upon the exercise of the warrants. Rather, the number of shares of Class A common
stock to be issued will, at our election, either be rounded up to the nearest whole number or we will pay a cash adjustment in respect
of such final fraction in an amount equal to such fraction multiplied by the exercise price.
Trading
Market
There
is no established trading market for any of the warrants, and we do not expect a market to develop. We do not intend to apply for a listing
for any of the warrants on any securities exchange or other nationally recognized trading system. Without an active trading market, the
liquidity of the warrants will be limited.
Rights
as a Shareholder
Except
as otherwise provided in the warrants or by virtue of the holders’ ownership of shares of our Class A common stock, the holders
of warrants do not have the rights or privileges of holders of our Class A common stock, including any voting rights, until such warrant
holders exercise their warrants.
Fundamental
Transaction
In
the event of a fundamental transaction, as described in the warrants and generally including any reorganization, recapitalization or
reclassification of our common stock, the sale, transfer or other disposition of all or substantially all of our properties or assets,
our consolidation or merger with or into another person, the acquisition of more than 50% of our outstanding common stock, or any person
or group becoming the beneficial owner of 50% of the voting power represented by our outstanding common stock, the holders of the warrants
will be entitled to receive upon exercise of the warrants the kind and amount of securities, cash or other property that the holders
would have received had they exercised the warrants immediately prior to such fundamental transaction. In the event of a Change of Control
(as defined in each common warrant) approved by our Board of Directors, the holders of the common warrants have the right to require
us or a successor entity to redeem the common warrants for cash in the amount of the Black-Scholes Value (as defined in each common warrant)
of the unexercised portion of the common warrants on the date of the consummation of the Change of Control. In the event of a Change
of Control which is not approved by our Board of Directors, the holders of the common warrants have the right to require us or a successor
entity to redeem the common warrants for the consideration paid in the Change of Control in the amount of the Black-Scholes Value of
the unexercised portion of the common warrants on the date of the consummation of the Change of Control.
Waivers
and Amendments
No
term of the warrants may be amended or waived without the written consent of the holder of such warrant.
Pre-Funded
Warrants
The
following summary of certain terms and provisions of the pre-funded warrants that are being offered hereby is not complete and is subject
to, and qualified in its entirety by, the provisions of the pre-funded warrant, the form of which is filed as an exhibit to the registration
statement of which this prospectus forms a part. Prospective investors should carefully review the terms and provisions of the form of
pre-funded warrant for a complete description of the terms and conditions of the pre-funded warrants.
Duration
and Exercise Price
Each
pre-funded warrant offered hereby will have an initial exercise price per share equal to $0.0001. The pre-funded warrants will
be immediately exercisable and may be exercised at any time until the pre-funded warrants are exercised in full. The exercise price and
number of shares of Class A common stock issuable upon exercise is subject to appropriate adjustment in the event of stock dividends,
stock splits, reorganizations or similar events affecting our Class A common stock and the exercise price.
Exercisability
Each
pre-funded warrant may be exercised, in cash or by a cashless exercise at the election of the holder at any time following the date of
issuance and from time to time thereafter until the pre-funded warrants are exercised in full. The pre-funded warrants will be exercisable
in whole or in part by delivering to the Company a completed instruction form for exercise and complying with the requirements for exercise
set forth in the pre-funded warrant. Payment of the exercise price may be made in cash or pursuant to a cashless exercise, in which case
the holder would receive upon such exercise the net number of shares of Class A common stock determined according to the formula set
forth in the pre-funded warrant.
Cashless
Exercise
At
the time a holder exercises its pre-funded warrants, in lieu of making the cash payment otherwise contemplated to be made to us upon
such exercise in payment of the aggregate exercise price, the holder may elect instead to receive upon such exercise (either in whole
or in part) the net number of shares of common stock determined according to a formula set forth in the pre-funded warrants.
Exercise
Limitation
In
general, a holder will not have the right to exercise any portion of a pre-funded warrant if the holder (together with its Attribution
Parties (as defined in the pre-funded warrant)) would beneficially own in excess of 4.99% or 9.99%, at the election of the holder, of
the number of shares of our Class A common stock outstanding immediately after giving effect to the exercise, as such percentage ownership
is determined in accordance with the terms of the pre-funded warrant. However, any holder may increase or decrease such percentage to
any other percentage not in excess of 9.99% upon notice to us, provided, that any increase in this limitation will not be effective until
61 days after such notice from the holder to us and such increase or decrease will apply only to the holder providing such notice.
Transferability
Subject
to applicable laws, a pre-funded warrant may be transferred at the option of the holder upon surrender of the pre-funded warrant to us
together with the appropriate instruments of transfer.
Fractional
Shares
No
fractional shares of Class A common stock will be issued upon the exercise of the pre-funded warrants. Rather, the number of shares of
Class A common stock to be issued will, at our election, either be rounded up to the nearest whole number or we will pay a cash adjustment
in respect of such final fraction in an amount equal to such fraction multiplied by the exercise price.
Trading
Market
There
is no trading market available for the pre-funded warrants on any securities exchange or nationally recognized trading system.
Right
as a Stockholder
Except
as otherwise provided in the pre-funded warrants or by virtue of such holder’s ownership of shares of our Class A common stock,
the holders of the pre-funded warrants do not have the rights or privileges of holders of our Class A common stock, including any voting
rights, until they exercise their pre-funded warrants.
UNDERWRITING
We
have entered into an underwriting agreement with Boustead Securities, LLC and EF Hutton, division of Benchmark Investments, LLC (the
“Representatives”) as the representatives of the underwriters named below, with respect to the offering of shares of our
Class A common stock and warrants. Subject to the terms and conditions of an underwriting agreement between us and the Representatives,
we have agreed to sell to the underwriters, and the underwriters have agreed to purchase, at the public offering price less the underwriting
discounts set forth on the cover page of this prospectus, the number of shares of Class A common stock and warrants listed next
to its name in the following table::
| |
|
Number
of
Shares and Accompanying Warrants |
| Boustead Securities, LLC |
|
|
| EF Hutton, division of Benchmark Investments, LLC |
|
|
| Total |
|
|
The
underwriters are committed to purchase all of the securities offered by us other than those covered by the over-allotment option described
below, if it purchases any securities. The obligations of the underwriters may be terminated upon the occurrence of certain events specified
in the underwriting agreement. Furthermore, pursuant to the underwriting agreement, the underwriters’ obligations are subject to
customary conditions, representations and warranties contained in the underwriting agreement, such as receipt by the underwriters of
officers’ certificates and legal opinions.
We
have agreed to indemnify the underwriters against specified liabilities, including liabilities under the Securities Act, and to contribute
to payments the underwriters may be required to make in respect thereof.
The
underwriters are offering the above securities, subject to prior sale, when, as and if issued to and accepted by it, subject to approval
of legal matters by its counsel and other conditions specified in the underwriting agreement. The underwriters reserve the right to withdraw,
cancel or modify offers to the public and to reject orders in whole or in part.
Over-Allotment
Option
We have granted the representatives
of the underwriter an option to purchase up to an additional [*] shares of Class A common stock, representing 15%
of the aggregate shares of Class A common stock and pre-funded warrants sold in this offering, and/or warrants to purchase up
to [*] shares of Class A common stock in lieu thereof, representing 15% of the aggregate number of accompanying warrants sold in this
offering, in any combination thereof, from us at the public offering price, less underwriting discounts and commissions,
within 45 days from the date of this prospectus to cover over-allotments, if any.
Discounts
The Representative has advised that the underwriters
propose to offer the shares of Class A common stock (and pre-funded warrants) and accompanying warrants directly to the
public at the public offering price per share and accompanying warrant set forth on the cover page of this prospectus. After the
offering to the public, the offering prices and other selling terms may be changed by the underwriters without changing the proceeds
we will receive from the underwriters. Any shares and accompanying warrants sold by the underwriters to securities dealers will
be sold at the public offering price less a concession not in excess of $ per share.
The
following table summarizes the public offering price, underwriting commissions, and proceeds before expenses to us.
| | |
| | |
| | |
Total | |
| | |
Per share and accompanying warrant | | |
Per
Pre-Funded
Warrant
and accompanying warrant | | |
Without Over- Allotment Option | | |
With Over- Allotment Option | |
| Public offering price | |
$ | | | |
$ | | | |
$ | | | |
$ | | |
| Underwriting discounts and commissions (7.0%) | |
$ | | | |
$ | | | |
$ | | | |
$ | | |
| Proceeds, before expenses, to us | |
$ | | | |
$ | | | |
$ | | | |
$ | | |
| (1) |
We
have agreed to pay a non-accountable expense allowance to the Representative equal to 1% of the gross proceeds received in this
offering which is not included in the underwriting discounts and commission. |
We
have agreed to reimburse the Representatives for all expenses relating to the offering, including, without limitation, (a) all fees,
expenses and disbursements relating to background checks of our officers, directors and entities in an amount not to exceed $7,500 in
the aggregate, (b)the costs, not to exceed $3,000, associated with bound volumes of the public offering materials as well as commemorative
mementos and lucite tombstones in such quantities as the Representative may reasonably request; (c) the fees and expenses of the underwriters’
legal counsel not to exceed $85,000; (d) the $29,500 cost associated with the use of Ipreo’s book building, prospectus tracking
and compliance software for the offering; (e) $10,000 for data services and communications expenses; (f) up to $5,000 of the Representative’s
actual accountable “road show” expenses; and (g) up to $30,000 of the Representative’s market making and trading, and
clearing firm settlement expenses for the offering.
We
expect that the total expenses of the offering payable by us, excluding underwriting discount and commissions, will be approximately
$ .
Discretionary
Accounts
The
underwriters do not intend to confirm sales of the securities offered hereby to any accounts over which it has discretionary authority.
Representative’s
Warrants
We
have agreed to issue a warrant to the Representatives to purchase a number of shares of Class A common stock equal to 3% of the
total number of shares of Class A common stock and pre-funded warrants sold in this offering at an exercise price equal to 125% of the
public offering price of the shares sold in this offering. This warrant will be exercisable upon issuance, will have a cashless exercise
provision and will terminate on the fifth anniversary of the commencement date of sales in this offering. The warrant also provides for
customary anti-dilution provisions and demand and “piggyback” registration rights with respect to the registration of the
shares of Class A common stock underlying the warrants. The sole demand registration right provided will not be greater than five years
from the commencement of sales of the securities issued in this offering in compliance with FINRA Rule 5110(g)(8)(C). The piggyback registration
rights provided will not be greater than seven years from the commencement of sales of the securities issued in this offering in compliance
with FINRA Rule 5110(g)(8)(D). This prospectus also relates to the offering of the Representatives’ warrant and the shares
of common stock issuable upon exercise of the Representatives’ warrant.
The
Representatives’ warrant and the underlying shares are deemed to be compensation by FINRA, and therefore will be subject
to a lock-up pursuant to FINRA Rule 5110(e)(1). In accordance with FINRA Rule 5110(e)(1), neither the Representative’s warrant
nor any of our shares of Class A common stock issued upon exercise of the Representatives’ warrant may be sold, transferred,
assigned, pledged or hypothecated, or be the subject of any hedging, short sale, derivative, put or call transaction that would result
in the effective economic disposition of such securities by any person, for a period of 180 days immediately following the commencement
of sales of this offering subject to certain exceptions permitted by FINRA Rule 5110(e)(2).
Lock-Up
Agreements
We
will not, without the prior written consent of the Representatives, from the date of execution of the Underwriting Agreement and
continuing for a period of 3 months from such date (the “Lock-Up Period”), (a) offer, pledge, sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of our capital stock or any securities convertible into or exercisable
or exchangeable for shares of our capital stock; (b) file or caused to be filed any registration statement with the Commission relating
to the offering of any shares of our capital stock or any securities convertible into or exercisable or exchangeable for shares of our
capital stock; (c) complete any offering of our debt securities, other than entering into a line of credit with a traditional bank or
(d) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership
of our capital stock, whether any such transaction described in clause (a), (b), (c) or (d) above is to be settled by delivery of shares
of our capital stock or such other securities, in cash or otherwise.
Our executive
officers and directors have agreed pursuant to “lock-up” agreements not to, without the prior written consent of the Representatives,
directly or indirectly, offer to sell, sell, pledge or otherwise transfer or dispose of any of shares of (or enter into any transaction
or device that is designed to, or could be expected to, result in the transfer or disposition by any person at any time in the future
of) our common stock, enter into any swap or other derivatives transaction that transfers to another, in whole or in part, any of the
economic benefits or risks of ownership of shares of our common stock, make any demand for or exercise any right or cause to be filed
a registration statement, including any amendments thereto, with respect to the registration of any shares of common stock or securities
convertible into or exercisable or exchangeable for shares of common stock or any other of our securities or publicly disclose the intention
to do any of the foregoing, subject to customary exceptions, for a period of six months from the date of this prospectus. The Representatives
may, in their sole discretion and at any time or from time to time before the termination of the lock-up period release all
or any portion of the securities subject to lock-up agreements; provided, however, that, subject to limited exceptions, at least three
business days before the release or waiver or any lock-up agreement, the Representatives must notify us of the impending release
or waiver and we will be required to announce the impending release or waiver through a major news service at least two business days
before the release or waiver.
Indemnification
We
have agreed to indemnify the underwriters against certain liabilities, including liabilities under the Securities Act, and to contribute
to payments that the underwriters may be required to make for these liabilities.
Price
Stabilization, Short Positions, and Penalty Bids
In connection with this offering, each underwriter
may engage in transactions that stabilize, maintain or otherwise affect the price of our securities. Specifically, such underwriter may
over-allot in connection with this offering by selling more Class A common stock and accompanying warrants than are set forth
on the cover page of this prospectus. This creates a short position in our securities for such underwriter’s own accounts. The
short position in our Class A common stock may be either a covered short position or a naked short position. In a covered short
position, the number of shares of Class A common stock over-allotted by such underwriter is not greater than the number of shares
of Class A common stock that it may purchase in the over-allotment option. In a naked short position, the number of shares of
Class A common stock involved is greater than the number of shares of Class A common stock in the over-allotment option. To
close out a short position, such underwriter may elect to exercise all or part of the over-allotment option. Such underwriter may also
elect to stabilize the price of our shares of Class A common stock or reduce any short position by bidding for, and purchasing,
shares of Class A common stock in the open market.
The
underwriters may also impose a penalty bid. This occurs when a particular underwriter or dealer repays selling concessions allowed to
it for distributing a security in this offering because the underwriter repurchases that security in stabilizing or short covering transactions.
Finally, each underwriter may bid for, and purchase,
shares of Class A common stock in market-making transactions, including “passive” market-making transactions as described
below.
These activities may stabilize or maintain the market
price of our shares of Class A common stock at a price that is higher than the price that might otherwise exist in the absence
of these activities. The underwriters are not required to engage in these activities and may discontinue any of these activities at any
time without notice. These transactions may be affected on Nasdaq, in the over-the-counter market, or otherwise.
In connection with this offering, the underwriters
and selling group members, if any, or their affiliates may engage in passive market-making transactions in our Class A common
stock immediately prior to the commencement of sales in this offering, in accordance with Rule 103 of Regulation M under the Exchange
Act. Rule 103 generally provides that:
| |
● |
a
passive market maker may not affect transactions or display bids for our securities in excess of the highest independent bid price
by persons who are not passive market makers; |
| |
|
|
| |
● |
net
purchases by a passive market maker on each day are generally limited to 30% of the passive market maker’s average daily trading
volume in our common stock during a specified two-month prior period or 200 shares, whichever is greater, and must be discontinued
when that limit is reached; and |
| |
|
|
| |
● |
passive
market-making bids must be identified as such. |
Electronic
Distribution
This
prospectus in electronic format may be made available on websites or through other online services maintained by the underwriters, or
by their affiliates. Other than this prospectus in electronic format, the information on the underwriters’ websites and any information
contained in any other websites maintained by an underwriter is not part of this prospectus or the registration statement of which this
prospectus forms a part, has not been approved and/or endorsed by us or the underwriters in their capacity as underwriter, and should
not be relied upon by investors.
Other
than the prospectus in electronic or printed format, the information on the underwriters’ website and any information contained
in any other website maintained by an underwriter is not part of the prospectus or the registration statement of which this prospectus
forms a part, has not been approved and/or endorsed by us or the underwriters in their capacity as underwriters and should not be relied
upon by investors.
Certain
Relationships
The
Representative and its affiliates have engaged in, and may in the future engage in, investment banking and other commercial dealings
in the ordinary course of business with us or our affiliates. The Representative has received, or may in the future receive, customary
fees and commissions for these transactions.
Offer
Restrictions Outside of the United States
Other
than in the United States, no action has been taken that would permit a public offering of our common stock in any jurisdiction where
action for the purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor
may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be
distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and
regulations of that country or jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about
and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute
an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an
offer or a solicitation is unlawful.
Australia
This
prospectus is not a disclosure document under Chapter 6D of the Australian Corporations Act, has not been lodged with the Australian
Securities and Investments Commission and does not purport to include the information required of a disclosure document under Chapter
6D of the Australian Corporations Act. Accordingly, (i) the offer of the securities under this prospectus is only made to persons to
whom it is lawful to offer the securities without disclosure under Chapter 6D of the Australian Corporations Act under one or more exemptions
set out in section 708 of the Australian Corporations Act, (ii) this prospectus is made available in Australia only to those persons
as set forth in clause (i) above, and (iii) the offeree must be sent a notice stating in substance that by accepting this offer, the
offeree represents that the offeree is such a person as set forth in clause (i) above, and, unless permitted under the Australian Corporations
Act, agrees not to sell or offer for sale within Australia any of the securities sold to the offeree within 12 months after its transfer
to the offeree under this prospectus.
Canada
The
shares of common stock may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are accredited investors,
as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the Securities Act (Ontario), and are permitted
clients, as defined in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. Any resale
of the securities must be made in accordance with an exemption from, or in a transaction not subject to, the prospectus requirements
of applicable securities laws.
Securities
legislation in certain provinces or territories of Canada may provide a purchaser with remedies for rescission or damages if this prospectus
(including any amendment thereto) contains a misrepresentation, provided that the remedies for rescission or damages are exercised by
the purchaser within the time limit prescribed by the securities legislation of the purchaser’s province or territory. The purchaser
should refer to any applicable provisions of the securities legislation of the purchaser’s province or territory for particulars
of these rights or consult with a legal advisor.
China
The
information in this document does not constitute a public offer of the securities, whether by way of sale or subscription, in the People’s
Republic of China (excluding, for purposes of this paragraph, Hong Kong Special Administrative Region, Macau Special Administrative Region
and Taiwan). The securities may not be offered or sold directly or indirectly in the PRC to legal or natural persons other than directly
to “qualified domestic institutional investors.”
European
Economic Area—Belgium, Germany, Luxembourg and Netherlands
The
information in this document has been prepared on the basis that all offers of securities will be made pursuant to an exemption under
the Directive 2003/71/EC (“Prospectus Directive”), as implemented in Member States of the European Economic Area (each, a
“Relevant Member State”), from the requirement to produce a prospectus for offers of securities. An offer to the public of
securities has not been made, and may not be made, in a Relevant Member State except pursuant to one of the following exemptions under
the Prospectus Directive as implemented in that Relevant Member State:
| ● | to
legal entities that are authorized or regulated to operate in the financial markets or, if
not so authorized or regulated, whose corporate purpose is solely to invest in securities; |
| ● | to
any legal entity that has two or more of (i) an average of at least 250 employees during
its last fiscal year; (ii) a total balance sheet of more than €43,000,000 (as shown
on its last annual unconsolidated or consolidated financial statements) and (iii) an annual
net turnover of more than €50,000,000 (as shown on its last annual unconsolidated or
consolidated financial statements); |
| ● | to
fewer than 100 natural or legal persons (other than qualified investors within the meaning
of Article 2(1)(e) of the Prospectus Directive) subject to obtaining the prior consent of
the Company or any underwriter for any such offer; or |
| ● | in
any other circumstances falling within Article 3(2) of the Prospectus Directive, provided
that no such offer of securities shall result in a requirement for the publication by the
Company of a prospectus pursuant to Article 3 of the Prospectus Directive. |
France
This
document is not being distributed in the context of a public offering of financial securitie (offre au public de titres financiers) in
France within the meaning of Article L.411-1 of the French Monetary and Financial Code (Code Monétaire et Financier) and Articles
211-1 et seq. of the General Regulation of the French Autorité de marchés financiers (“AMF”). The securities
have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in France.
This
document and any other offering material relating to the securities have not been, and will not be, submitted to the AMF for approval
in France and, accordingly, may not be distributed or caused to distributed, directly or indirectly, to the public in France.
Such
offers, sales and distributions have been and shall only be made in France to (i) qualified investors (investisseurs qualifiés)
acting for their own account, as defined in and in accordance with Articles L.411-2-II-2° and D.411-1 to D.411-3, D.744-1, D.754-1
;and D.764-1 of the French Monetary and Financial Code and any implementing regulation and/or (ii) a restricted number of non-qualified
investors (cercle restreint d’investisseurs) acting for their own account, as defined in and in accordance with Articles L.411-2-II-2°
and D.411-4, D.744-1, D.754-1; and D.764-1 of the French Monetary and Financial Code and any implementing regulation.
Pursuant
to Article 211-3 of the General Regulation of the AMF, investors in France are informed that the securities cannot be distributed (directly
or indirectly) to the public by the investors otherwise than in accordance with Articles L.411-1, L.411-2, L.412-1 and L.621-8 to L.621-8-3
of the French Monetary and Financial Code.
Hong
Kong
Neither
the information in this document nor any other document relating to the offer has been delivered for registration to the Registrar of
Companies in Hong Kong, and its contents have not been reviewed or approved by any regulatory authority in Hong Kong, nor have we been
authorized by the Securities and Futures Commission in Hong Kong. This document does not constitute an offer or invitation to the public
in Hong Kong to acquire securities. Accordingly, unless permitted by the securities laws of Hong Kong, no person may issue or have in
its possession for the purpose of issue, this document or any advertisement, invitation or document relating to the securities, whether
in Hong Kong or elsewhere, which is directed at, or the contents of which are likely to be accessed or read by, the public in Hong Kong
other than in relation to securities which are intended to be disposed of only to persons outside Hong Kong or only to “professional
investors” (as such term is defined in the Securities and Futures Ordinance (Cap. 571 of the Laws of Hong Kong) (“SFO”)
and the subsidiary legislation made thereunder) or in circumstances which do not result in this document being a “prospectus”
as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance of Hong Kong (Cap. 32 of the Laws of Hong Kong) (the
“CO”) or which do not constitute an offer or an invitation to the public for the purposes of the SFO or the CO. The offer
of the securities is personal to the person to whom this document has been delivered by or on behalf of our company, and a subscription
for securities will only be accepted from such person. No person to whom a copy of this document is issued may issue, circulate or distribute
this document in Hong Kong or make or give a copy of this document to any other person. You are advised to exercise caution in relation
to the offer. If you are in any doubt about any of the contents of this document, you should obtain independent professional advice.
No document may be distributed, published or reproduced (in whole or in part), disclosed by or to any other person in Hong Kong or to
any person to whom the offer of sale of the securities would be a breach of the CO or SFO.
Ireland
The
information in this document does not constitute a prospectus under any Irish laws or regulations and this document has not been filed
with or approved by any Irish regulatory authority as the information has not been prepared in the context of a public offering of securities
in Ireland within the meaning of the Irish Prospectus (Directive 2003/71/EC) Regulations 2005 (the “Prospectus Regulations”).
The securities have not been offered or sold, and will not be offered, sold or delivered directly or indirectly in Ireland by way of
a public offering, except to (i) qualified investors as defined in Regulation 2(l) of the Prospectus Regulations and (ii) fewer than
100 natural or legal persons who are not qualified investors.
Israel
The
securities offered by this prospectus have not been approved or disapproved by the Israeli Securities Authority (the ISA), nor have such
securities been registered for sale in Israel. The shares may not be offered or sold, directly or indirectly, to the public in Israel,
absent the publication of a prospectus. The ISA has not issued permits, approvals or licenses in connection with the offering or publishing
the prospectus; nor has it authenticated the details included herein, confirmed their reliability or completeness, or rendered an opinion
as to the quality of the securities being offered. Any resale in Israel, directly or indirectly, to the public of the securities offered
by this prospectus is subject to restrictions on transferability and must be effected only in compliance with the Israeli securities
laws and regulations.
Italy
The
offering of the securities in the Republic of Italy has not been authorized by the Italian Securities and Exchange Commission (Commissione
Nazionale per le Società e la Borsa, or “CONSOB”) pursuant to the Italian securities legislation and, accordingly,
no offering material relating to the securities may be distributed in Italy and such securities may not be offered or sold in Italy in
a public offer within the meaning of Article 1.1(t) of Legislative Decree No. 58 of 24 February 1998 (“Decree No. 58”), other
than:
| ● | to
Italian qualified investors, as defined in Article 100 of Decree no.58 by reference to Article
34-ter of CONSOB Regulation no. 11971 of 14 May 1999 (“Regulation no. 1197l”)
as amended (“Qualified Investors”); and |
| ● | in
other circumstances that are exempt from the rules on public offer pursuant to Article 100
of Decree No. 58 and Article 34-ter of Regulation No. 11971 as amended. |
| ● | Any
offer, sale or delivery of the securities or distribution of any offer document relating
to the securities in Italy (excluding placements where a Qualified Investor solicits an offer
from the issuer) under the paragraphs above must be: |
| ● | made
by investment firms, banks or financial intermediaries permitted to conduct such activities
in Italy in accordance with Legislative Decree No. 385 of 1 September 1993 (as amended),
Decree No. 58, CONSOB Regulation No. 16190 of 29 October 2007 and any other applicable laws;
and |
| ● | in
compliance with all relevant Italian securities, tax and exchange controls and any other
applicable laws. |
Any
subsequent distribution of the securities in Italy must be made in compliance with the public offer and prospectus requirement rules
provided under Decree No. 58 and the Regulation No. 11971 as amended, unless an exception from those rules applies. Failure to comply
with such rules may result in the sale of such securities being declared null and void and in the liability of the entity transferring
the securities for any damages suffered by the investors.
Japan
The
securities have not been and will not be registered under Article 4, paragraph 1 of the Financial Instruments and Exchange Law of Japan
(Law No. 25 of 1948), as amended (the “FIEL”) pursuant to an exemption from the registration requirements applicable to a
private placement of securities to Qualified Institutional Investors (as defined in and in accordance with Article 2, paragraph 3 of
the FIEL and the regulations promulgated thereunder). Accordingly, the securities may not be offered or sold, directly or indirectly,
in Japan or to, or for the benefit of, any resident of Japan other than Qualified Institutional Investors. Any Qualified Institutional
Investor who acquires securities may not resell them to any person in Japan that is not a Qualified Institutional Investor, and acquisition
by any such person of securities is conditional upon the execution of an agreement to that effect.
Portugal
This
document is not being distributed in the context of a public offer of financial securities (oferta pública de valores mobiliários)
in Portugal, within the meaning of Article 109 of the Portuguese Securities Code (Código dos Valores Mobiliários). The
securities have not been offered or sold and will not be offered or sold, directly or indirectly, to the public in Portugal. This document
and any other offering material relating to the securities have not been, and will not be, submitted to the Portuguese Securities Market
Commission (Comissăo do Mercado de Valores Mobiliários) for approval in Portugal and, accordingly, may not be distributed
or caused to distributed, directly or indirectly, to the public in Portugal, other than under circumstances that are deemed not to qualify
as a public offer under the Portuguese Securities Code. Such offers, sales and distributions of securities in Portugal are limited to
persons who are “qualified investors” (as defined in the Portuguese Securities Code). Only such investors may receive this
document and they may not distribute it or the information contained in it to any other person.
Sweden
This
document has not been, and will not be, registered with or approved by Finansinspektionen (the Swedish Financial Supervisory Authority).
Accordingly, this document may not be made available, nor may the securities be offered for sale in Sweden, other than under circumstances
that are deemed not to require a prospectus under the Swedish Financial Instruments Trading Act (1991:980) (Sw. lag (1991:980) om handel
med finansiella instrument). Any offering of securities in Sweden is limited to persons who are “qualified investors” (as
defined in the Financial Instruments Trading Act). Only such investors may receive this document and they may not distribute it or the
information contained in it to any other person.
Switzerland
The
securities may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange (“SIX”) or on any
other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regard to the disclosure standards
for issuance prospectuses under art. 652a or art. 1156 of the Swiss Code of Obligations or the disclosure standards for listing prospectuses
under art. 27 ff. of the SIX Listing Rules or the listing rules of any other stock exchange or regulated trading facility in Switzerland.
Neither this document nor any other offering material relating to the securities may be publicly distributed or otherwise made publicly
available in Switzerland.
Neither
this document nor any other offering material relating to the securities have been or will be filed with or approved by any Swiss regulatory
authority. In particular, this document will not be filed with, and the offer of securities will not be supervised by, the Swiss Financial
Market Supervisory Authority (FINMA).
This
document is personal to the recipient only and not for general circulation in Switzerland.
United
Arab Emirates
Neither
this document nor the securities have been approved, disapproved or passed on in any way by the Central Bank of the United Arab Emirates
or any other governmental authority in the United Arab Emirates, nor have we received authorization or licensing from the Central Bank
of the United Arab Emirates or any other governmental authority in the United Arab Emirates to market or sell the securities within the
United Arab Emirates. This document does not constitute and may not be used for the purpose of an offer or invitation. No services relating
to the securities, including the receipt of applications and/or the allotment or redemption of such shares, may be rendered within the
United Arab Emirates by us.
United
Kingdom
Neither
the information in this document nor any other document relating to the offer has been delivered for approval to the Financial Services
Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Services and Markets Act 2000, as
amended (“FSMA”) has been published or is intended to be published in respect of the securities. This document is issued
on a confidential basis to “qualified investors” (within the meaning of section 86(7) of FSMA) in the United Kingdom, and
the securities may not be offered or sold in the United Kingdom by means of this document, any accompanying letter or any other document,
except in circumstances which do not require the publication of a prospectus pursuant to section 86(1) FSMA. This document should not
be distributed, published or reproduced, in whole or in part, nor may its contents be disclosed by recipients to any other person in
the United Kingdom.
Any
invitation or inducement to engage in investment activity (within the meaning of section 21 of FSMA) received in connection with the
issue or sale of the securities has only been communicated or caused to be communicated and will only be communicated or caused to be
communicated in the United Kingdom in circumstances in which section 21(1) of FSMA does not apply to the Company.
In
the United Kingdom, this document is being distributed only to, and is directed at, persons (i) who have professional experience in matters
relating to investments falling within Article 19(5) (investment professionals) of the Financial Services and Markets Act 2000 (Financial
Promotions) Order 2005 (“FPO”), (ii) who fall within the categories of persons referred to in Article 49(2)(a) to (d) (high
net worth companies, unincorporated associations, etc.) of the FPO or (iii) to whom it may otherwise be lawfully communicated (together
“relevant persons”). The investments to which this document relates are available only to, and any invitation, offer or agreement
to purchase will be engaged in only with, relevant persons. Any person who is not a relevant person should not act or rely on this document
or any of its contents.
Pursuant
to section 3A.3 of National Instrument 33-105 Underwriting Conflicts, or NI 33-105, the underwriters are not required to comply with
the disclosure requirements of NI 33-105 regarding underwriter conflicts of interest in connection with this offering.
LEGAL
MATTERS
The
validity of the issuance of the shares of Class A common stock (or pre-funded warrants) and accompanying warrants offered
by us in this offering will be passed upon for us by Sheppard, Mullin, Richter & Hampton LLP, New York, New York. ArentFox Schiff
LLP, Washington, DC, has acted as counsel for the underwriters in connection with certain legal matters related to this offering.
EXPERTS
The financial statements of Sidus
Space, Inc. as of December 31, 2022 and 2021 and for each of the years then ended incorporated by reference in this Registration
Statement, of which this prospectus forms a part, have been so included in reliance on the report of BF Borgers CPA PC, an independent
registered public accounting firm, appearing elsewhere herein, given on the authority of said firm as experts in auditing and accounting.
WHERE
YOU CAN FIND MORE INFORMATION
This prospectus is part of
a registration statement we filed with the SEC. This prospectus does not contain all of the information set forth in
the registration statement and the exhibits to the registration statement. For further information with respect to us and
the securities we are offering under this prospectus, we refer you to the registration statement and the exhibits and schedules
filed as a part of the registration statement. You should rely only on the information contained in this prospectus or
incorporated by reference into this prospectus. We have not authorized anyone else to provide you with different information.
We are not making an offer of these securities in any jurisdiction where the offer is not permitted. You should assume that the information
contained in this prospectus, or any document incorporated by reference in this prospectus, is accurate only as of the date of those
respective documents, regardless of the time of delivery of this prospectus or any sale of our securities.
We file annual, quarterly
and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the public from
commercial document retrieval services and over the Internet at the SEC’s website at http://www.sec.gov.
We maintain a website at www.sonnetbio.com. You
may access our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports
filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC free of charge at our website as soon as reasonably
practicable after such material is electronically filed with, or furnished to, the SEC. The information contained in, or that can be
accessed through, our website is not incorporated by reference into, and is not part of, this prospectus.
INCORPORATION OF DOCUMENTS BY REFERENCE
This prospectus is part of
the registration statement but the registration statement includes and incorporates by reference additional information and exhibits.
The SEC permits us to “incorporate by reference” the information contained in documents we file with the SEC, which means
that we can disclose important information to you by referring you to those documents rather than by including them in this prospectus.
Information that is incorporated by reference is considered to be part of this prospectus and you should read it with the same care that
you read this prospectus. Information that we file later with the SEC will automatically update and supersede the information that is
either contained, or incorporated by reference, in this prospectus, and will be considered to be a part of this prospectus from the date
those documents are filed. We have filed with the SEC, and incorporate by reference in this prospectus:
| ● | Annual
Report on Form 10-K for the year ended December 31, 2022 filed with the SEC on March 15,
2023; |
| ● | Current
Report on Form 8-K, filed with the SEC on March 17, 2023; and |
| ● | The
description of our Class A common stock contained in our Registration Statement on Form 8-A12b
filed with the SEC on December 10, 2021, and any amendments or reports filed updating such
description. |
Notwithstanding the statements
in the preceding paragraphs, no document, report or exhibit (or portion of any of the foregoing) or any other information that we have
“furnished” to the SEC pursuant to the Securities Exchange Act of 1934, as amended shall be incorporated by reference into
this prospectus.
We will furnish without charge
to you, on written or oral request, a copy of any or all of the documents incorporated by reference in this prospectus, including exhibits
to these documents. You should direct any requests for documents to:
Sidus Space, Inc.
150 N. Sykes Creek Parkway, Suite 200
Merritt Island, FL 32963
Phone: (321) 613-5620
You also may access these
filings on our website at http://www.sidusspace.com. We do not incorporate the information on our website into this prospectus or any
supplement to this prospectus and you should not consider any information on, or that can be accessed through, our website as part of
this prospectus or any supplement to this prospectus (other than those filings with the SEC that we specifically incorporate by reference
into this prospectus or any supplement to this prospectus).
Any statement contained in
a document incorporated or deemed to be incorporated by reference in this prospectus will be deemed modified, superseded or replaced
for purposes of this prospectus to the extent that a statement contained in this prospectus modifies, supersedes or replaces such statement.
Any statement contained herein or in any document incorporated or deemed to be incorporated by reference shall be deemed to be modified
or superseded for purposes of the registration statement of which this prospectus forms a part to the extent that a statement contained
in any other subsequently filed document which also is or is deemed to be incorporated by reference modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed to constitute a part of the registration statement of which this prospectus
forms a part, except as so modified or superseded.
Up to [*] shares of Class A Common Stock
Pre-Funded Warrants to Purchase
up to [*] shares of Class A Common Stock
Warrants to Purchase up to
[*] shares of Class A Common Stock
Sidus
Space, Inc.
PRELIMINARY
PROSPECTUS
BOUSTEAD
SECURITIES, LLC
EF Hutton
division of Benchmark Investments, LLC
,
2023
PART II—INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution
The following table sets forth all expenses, other
than the underwriting discounts and commissions, payable by the registrant in connection with the sale of the securities being registered.
All the amounts shown are estimates except the SEC registration fee and the FINRA filing fee.
| | |
Amount to be paid | |
| SEC registration fee | |
$ | 1,975 | |
| FINRA filing fee | |
$ | 3,088 | |
| Accounting fees and expenses | |
$ | 50,000 | |
| Legal fees and expenses | |
$ | 125,000 | |
| Printing and engraving expenses | |
$ | 5,000 | |
| Miscellaneous | |
$ | 14,937 | |
| | |
| | |
| Total | |
$ | 200,000
| |
Item 14. Indemnification of Directors and Officers
Section 102 of the General Corporation Law of the
State of Delaware (the “DGCL”) permits a corporation to eliminate the personal liability of directors of a corporation to
the corporation or its stockholders for monetary damages for a breach of fiduciary duty as a director, except where the director breached
his duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated a law, authorized the payment
of a dividend or approved a stock repurchase in violation of Delaware corporate law or obtained an improper personal benefit. Our Amended
and Restated Certificate of Incorporation, as amended, provides that no director of the Company shall be personally liable to it or its
stockholders for monetary damages for any breach of fiduciary duty as a director, notwithstanding any provision of law imposing such liability,
except to the extent that the DGCL prohibits the elimination or limitation of liability of directors for breaches of fiduciary duty.
Section 145 of the DGCL provides that a corporation
has the power to indemnify a director, officer, employee, or agent of the corporation, or a person serving at the request of the corporation
for another corporation, partnership, joint venture, trust or other enterprise in related capacities against expenses (including attorneys’
fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with an action, suit
or proceeding to which he was or is a party or is threatened to be made a party to any threatened, ending or completed action, suit or
proceeding by reason of such position, if such person acted in good faith and in a manner he reasonably believed to be in or not opposed
to the best interests of the corporation, and, in any criminal action or proceeding, had no reasonable cause to believe his conduct was
unlawful, except that, in the case of actions brought by or in the right of the corporation, no indemnification shall be made with respect
to any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or other adjudicating court determines that, despite the adjudication of liability but in view of all
of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery
or such other court shall deem proper.
Our Amended and Restated Certificate of Incorporation,
as amended, and Amended and Restated Bylaws provide indemnification for our directors and officers to the fullest extent permitted by
the DGCL. We will indemnify each person who was or is a party or threatened to be made a party to any threatened, pending or completed
action, suit or proceeding (other than an action by or in the right of us) by reason of the fact that he or she is or was, or has agreed
to become, a director or officer, or is or was serving, or has agreed to serve, at our request as a director, officer, partner, employee
or trustee of, or in a similar capacity with, another corporation, partnership, joint venture, trust or other enterprise (all such persons
being referred to as an “Indemnitee”), or by reason of any action alleged to have been taken or omitted in such capacity,
against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred
in connection with such action, suit or proceeding and any appeal therefrom, if such Indemnitee acted in good faith and in a manner he
or she reasonably believed to be in, or not opposed to, our best interests, and, with respect to any criminal action or proceeding, he
or she had no reasonable cause to believe his or her conduct was unlawful. Our Amended and Restated Certificate of Incorporation, as amended,
and Amended and Restated Bylaws will provide that we will indemnify any Indemnitee who was or is a party to an action or suit by or in
the right of us to procure a judgment in our favor by reason of the fact that the Indemnitee is or was, or has agreed to become, a director
or officer, or is or was serving, or has agreed to serve, at our request as a director, officer, partner, employee or trustee of, or in
a similar capacity with, another corporation, partnership, joint venture, trust or other enterprise, or by reason of any action alleged
to have been taken or omitted in such capacity, against all expenses (including attorneys’ fees) and, to the extent permitted by
law, amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding, and any appeal therefrom,
if the Indemnitee acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, our best interests, except
that no indemnification shall be made with respect to any claim, issue or matter as to which such person shall have been adjudged to be
liable to us, unless a court determines that, despite such adjudication but in view of all of the circumstances, he or she is entitled
to indemnification of such expenses. Notwithstanding the foregoing, to the extent that any Indemnitee has been successful, on the merits
or otherwise, he or she will be indemnified by us against all expenses (including attorneys’ fees) actually and reasonably incurred
in connection therewith. Expenses must be advanced to an Indemnitee under certain circumstances.
We have entered into separate indemnification agreements
with each of our directors and executive officers. Each indemnification agreement provide, among other things, for indemnification to
the fullest extent permitted by law and our Amended and Restated Certificate of Incorporation, as amended, and Amended and Restated Bylaws
against any and all expenses, judgments, fines, penalties and amounts paid in settlement of any claim. The indemnification agreements
provide for the advancement or payment of all expenses to the indemnitee and for the reimbursement to us if it is found that such indemnitee
is not entitled to such indemnification under applicable law and our Amended and Restated Certificate of Incorporation, as amended, and
Amended and Restated Bylaws.
We also have a general liability insurance policy
that covers certain liabilities of directors and officers of our corporation arising out of claims based on acts or omissions in their
capacities as directors or officers.
Item 15. Recent Sales of Unregistered Securities
During August and September 2021, we sold 3,000,000
shares of Class A common stock to various investors for gross proceeds of $3,000,000. We deemed the offer, sale and issuance of such securities
to be exempt from registration under the Securities Act in reliance on Section 4(2) of the Securities Act, including Regulation D and
Rule 506 promulgated thereunder, relative to transactions by an issuer not involving a public offering.
On September 22, 2021, we issued 200,000 shares of
restricted Class A Common Stock to 2 employees. The shares vested immediately upon the grant date. We deemed the offer, sale and issuance
of such securities to be exempt from registration under the Securities Act in reliance on Section 4(2) of the Securities Act, including
Regulation D and Rule 506 promulgated thereunder, relative to transactions by an issuer not involving a public offering.
On August 10, 2022, we issued an aggregate of 90,367
shares of common stock to B. Riley Principal Capital II as consideration for its commitment to purchase shares of our common stock in
one or more purchases that we may, in our sole discretion, direct them to make, from time to time after the date of this prospectus, pursuant
to the Purchase Agreement. The shares of common stock were issued under Section 4(a)(2) of the Securities Act and Rule 506(b) of Regulation
D, in a transaction by an issuer not involving a public offering. B. Riley Principal Capital II has represented that it is an accredited
investor for purposes of Rule 501 of Regulation D and that it is not acquiring such shares with a view to, or for offer or sale in connection
with, any distribution thereof in violation of the Securities Act or any applicable state security laws. The investor also represented
that it had been afforded the opportunity to ask questions and receive answers from us and has sought advice as it considered necessary
to make an informed investment decision.
Item 16. Exhibits and Financial Statement Schedules
EXHIBIT INDEX
| Exhibit
No. |
|
Title
of Document |
| 1.1 |
|
Form of Underwriting Agreement |
| 3.1 |
|
Amended
and Restated Certificate of Incorporation, as amended (incorporated by reference to Exhibit 3.1 to Amendment No. 1 to Form S-1 filed
with the SEC on December 3, 2021) |
| 3.2 |
|
Certificate
of Amendment of Amended and Restated Certificate of Incorporation dated August 24, 2021 (incorporated by reference to Exhibit 3.2
to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 3.3 |
|
Certificate
of Amendment of Amended and Restated Certificate of Incorporation dated December 16, 2021(incorporated by reference to Exhibit 3.3
to Form 10-K filed with the SEC on April 5, 2022) |
| 3.4 |
|
Amended
and Restated Bylaws (incorporated by reference to Exhibit 3.4 to Form 10-K filed with the SEC on April 5, 2022) |
| 4.1 |
|
Form of Representative’s Warrant (incorporated by reference to Exhibit 4.1 to Registration Statement on Form S-1 fled with the SEC on January 13, 2023) |
| 4.2 |
|
Form of Warrant |
| 4.3 |
|
Form of Pre-Funded Warrant |
| 4.4 |
|
Form of Representative’s Warrant |
| 5.1 |
|
Opinion of Sheppard, Mullin, Richter & Hampton LLP |
| 10.1 |
|
Sidus
Space, Inc. 2021 Omnibus Equity Incentive Plan (incorporated by reference to Exhibit 10.1 to Form 10-K filed with the SEC on April
5, 2022) |
| 10.2 |
|
Revenue
Loan and Security Agreement dated December 1, 2021 by and among Sidus Space, Inc., Carol Craig and Decathlon Alpha IV, L.P. (incorporated
by reference to Exhibit 10.2 to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 10.3 |
|
Loan
Assignment and Assumption Agreement dated December 1, 2021 by and between Decathlon Alpha IV, L.P., Craig Technical Consulting, Inc.
and Sidus Space, Inc. (incorporated by reference to Exhibit 10.3 to Amendment No. 1 to Form S-1 filed with the SEC on December 3,
2021) |
| 10.4 |
|
Loan
Agreement dated May 1, 2021 by and between Sidus Space, Inc. and Craig Technical Consulting, Inc. (incorporated by reference to Exhibit
10.4 to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 10.5 |
|
Form
of Indemnification Agreement for Directors and Officers (incorporated by reference to Exhibit 10.5 to Amendment No. 1 to Form S-1
filed with the SEC on December 3, 2021) |
| 10.6 |
|
Lease
Agreement dated as of November 29, 2016 between 400 W. Central LLC and Craig Technologies Properties, LLC (assigned to Sidus Space,
Inc.) (incorporated by reference to Exhibit 10.6 to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 10.7 |
|
Lease
Agreement dated as of May 21, 2021 between 400 W. Central LLC and Sidus Space, Inc. (incorporated by reference to Exhibit 10.7 to
Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021). |
| 10.8 |
|
Commercial
Sublease Agreement dated August 1, 2021 by and between Sykes Creek Limited Partnership, Craig Technical Consulting, Inc. and Sidus
Space, Inc. (incorporated by reference to Exhibit 10.8 to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 10.9# |
|
NASA
Contract Award dated November 5, 2018 (incorporated by reference to Exhibit 10.9 to Amendment No. 1 to Form S-1 filed with the SEC
on December 3, 2021) |
| 10.10 |
|
Employment
Agreement between Sidus Space, Inc. and Carol Craig dated December 16, 2021 (incorporated by reference to Exhibit 10.10 to Form 10-K
filed with the SEC on April 5, 2022) |
| 10.11 |
|
Consulting
Agreement between Sidus Space, Inc. and EverAsia Financial Group, Inc. dated August 21, 2021 (incorporated by reference to Exhibit
10.11 to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 10.12 |
|
Common
Stock Purchase Agreement, dated as of August 10, 2022, by and between Sidus Space, Inc. and B. Riley Principal Capital II, LLC (incorporated
by reference to Exhibit 10.1 to the Current Report on Form 8-K filed on August 11, 2022) |
| 10.13 |
|
Registration
Rights Agreement, dated as of August 10, 2022, by and between Sidus Space, Inc. and B. Riley Principal Capital II, LLC (incorporated
by reference to Exhibit 10.2 to the Current Report on Form 8-K filed on August 11, 2022) |
| 10.14 |
|
Debt
Forgiveness Agreement (incorporated by reference to Exhibit 10.1 to Form 8-K filed with the SEC on June 9, 2022) |
| 21.1 |
|
List
of Subsidiaries (incorporated by reference to Exhibit 21.1 to Amendment No. 1 to Form S-1 filed with the SEC on December 3, 2021) |
| 23.1 |
|
Consent of BF Borgers CPA PC. |
| 23.2 |
|
Consent of Sheppard, Mullin, Richter & Hampton LLP (included in Exhibit 5.1) |
| 24 |
|
Power of Attorney (included on signature page hereto). |
| 107 |
|
Filing Fee Table |
# Pursuant to Item 601(b)(10) of Regulation S-K, certain
confidential portions of this exhibit were omitted by means of marking such portions with an asterisk because the identified confidential
portions (i) are not material and (ii) would be competitively harmful if publicly disclosed.
Item 17. Undertakings
The undersigned registrant hereby undertakes:
| |
(1) |
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: |
| |
(i) |
To include any prospectus required by section 10(a)(3) of the Securities Act of 1933; |
| |
(ii) |
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement. |
| |
(iii) |
To include any material information with respect to
the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration
statement;
provided, however,
that paragraphs (i), (ii) and (iii) do not apply if the registration statement is on Form S-1 and
the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished
to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the
registration statement; |
| |
(2) |
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. |
| |
(3) |
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. |
| |
(4) |
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser: each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use; and |
| |
(5) |
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities: the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser: |
| |
(i) |
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424; |
| |
(ii) |
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant; |
| |
(iii) |
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and |
| |
(iv) |
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
| |
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. |
SIGNATURES
Pursuant to the requirements of the Securities Act
of 1933, as amended, the registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Merritt Island, State of Florida, on the 27th day of March 2023.
| |
SIDUS SPACE, INC. |
| |
|
| |
By: |
/s/ Carol Craig |
| |
|
Carol Craig |
| |
|
Chief Executive Officer and Chairwoman |
KNOW ALL
MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Carol Craig, his or her true and lawful
attorney-in-fact and agent with full power of substitution and re-substitution, for him or her and in his or her name, place and stead,
in any and all capacities to sign any or all amendments (including, without limitation, post-effective amendments) to this Registration
Statement, any related Registration Statement filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended, and any or
all pre- or post-effective amendments thereto, and to file the same, with all exhibits thereto, and all other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said attorney-in-fact and agent, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in and about the premises, as fully for all intents and purposes
as he or she might or could do in person, hereby ratifying and confirming that said attorney-in-fact and agent, or any substitute or
substitutes for him, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933,
as amended, the following persons in the capacities and on the dates indicated have signed this Registration Statement below.
Pursuant to the requirements of the Securities Act
of 1933, as amended, this Registration Statement on Form S-1 has been signed by the following persons in the capacities and on the dates
indicated below.
| Signature |
|
Title |
|
Date |
| |
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|
|
|
| /s/ Carol Craig |
|
Chief Executive Officer (Principal Executive Officer) and Chairwoman |
|
March 27, 2023 |
| Carol Craig |
|
|
|
|
| |
|
|
|
|
| /s/
Teresa Burchfield |
|
Chief Financial Officer |
|
March 27, 2023 |
| Teresa Burchfield |
|
(Principal Financial and Accounting Officer) |
|
|
| |
|
|
|
|
| /s/
Jamie Adams |
|
Chief Technology Officer and Director |
|
March 27, 2023 |
| Jamie Adams |
|
|
|
|
| |
|
|
|
|
| /s/
Dana Kilborne |
|
Director |
|
March 27, 2023 |
| Dana Kilborne |
|
|
|
|
| |
|
|
|
|
| /s/
Cole Oliver |
|
Director |
|
March 27, 2023 |
| Cole Oliver |
|
|
|
|
| |
|
|
|
|
| /s/
Miguel Valero |
|
Director |
|
March 27, 2023 |
| Miguel Valero |
|
|
|
|
Exhibit
1.1
UNDERWRITING
AGREEMENT
[●],
2023
Boustead
Securities, LLC
6
Venture, Suite 265
Irvine,
CA 92618
EF
Hutton, division of Benchmark Investments, LLC
590
Madison Avenue, 39th Floor
New
York, NY 10022
As
Representatives of the several Underwriters
named on Schedule 1 attached hereto
Ladies
and Gentlemen:
The
undersigned, Sidus Space, Inc., a Delaware corporation (the “Company”), hereby confirms its agreement (this “Agreement”)
with Boustead Securities, LLC and EF Hutton, division of Benchmark Investments, LLC (hereinafter referred to as “you” (including
its correlatives) or the “Representatives”) and with the other underwriters named on Schedule 1 hereto for
which the Representatives are acting as representative (the Representatives and such other underwriters being collectively called the
“Underwriters” or, individually, an “Underwriter”) as follows:
1. Purchase
and Sale of Shares and Warrants.
1.1 Firm
Shares and Firm Warrants.
1.1.1. Nature
and Purchase of Firm Shares and Firm Warrants.
(i) On
the basis of the representations and warranties herein contained, but subject to the terms and conditions herein set forth, the Company
agrees to sell to the Underwriters an aggregate of [●] units (each a “Unit,” and collectively, the “Units”),
each comprised of one share (the “Firm Shares”) of Company common stock, par value $0.001 per share (the “Common
Stock”), and (ii) a warrant to purchase one share of Common Stock at an exercise price of $[●] per share (the “Firm
Warrants” and, collectively with the Firm Shares, the “Firm Securities”.
(ii) The
Underwriters, severally and not jointly, agree to purchase from the Company the number of Units set forth opposite their respective names
on Schedule 1 attached hereto and made a part hereof. The combined purchase price for one Unit shall be $[●] (93% of the
public offering price per Unit of $[●]) which shall be allocated as $[●] per Firm Share (the “Share Purchase Price”)
and $0.00093 per Firm Warrant (the “Warrant Purchase Price”). The Units are to be offered initially to the public
at the offering price set forth on the cover page of the Prospectus (as defined in Section 2(a)(B) hereof) (the “Purchase Price”).
The Firm Share and the Firm Warrants will be separated immediately upon issuance.
(iii) To
the extent that the purchase of Firm Shares would cause the beneficial ownership of a purchaser in the Offering, together with its affiliates
and certain related parties, to exceed 4.99% of the shares of Common Stock, the Company agrees to issue the Underwriters, for delivery
to such purchasers, at the election of the purchasers, a number shares of Pre-Funded Warrants (the “Pre-Funded Warrants”),
which are initially convertible on a 1-for-1 basis into shares of Common Stock, at an exercise price of $0.001 in lieu of the Firm Shares.
The Common Stock issuable upon exercise of the Pre-Funded Warrants and the Warrants are hereinafter referred to as the “Warrant
Shares”.
1.1.2. Payment
and Delivery.
(i) Delivery
and payment for the Firm Shares (or Pre-Funded Warrants) and Firm Warrants shall be made at 10:00 a.m., Eastern time, on the second (2nd)
Business Day following the effective date (the “Effective Date”) of the Registration Statement (as defined in Section
2.1.1 below) (or the third (3rd) Business Day following the Effective Date if the Registration Statement is declared effective
after 4:01 p.m., Eastern time) or at such earlier time as shall be agreed upon by the Representatives and the Company, at the offices
of ArentFox Schiff LLP at 1717 K Street, NW, Washington, DC 20006 (“Representatives’ Counsel”), or at such other
place (or remotely by facsimile or other electronic transmission) as shall be agreed upon by the Representatives and the Company. The
hour and date of delivery and payment for the Firm Shares (or Pre-Funded Warrants) and Firm Warrants is called the “Closing
Date.”
(ii) Payment
for the Firm Shares (or Pre-Funded Warrants) and Firm Warrants shall be made on the Closing Date by wire transfer in Federal (same day)
funds, payable to the order of the Company upon delivery of the certificates (in form and substance satisfactory to the Underwriters)
representing the Firm Shares (or Pre-Funded Warrants) and Firm Warrants (or through the facilities of the Depository Trust Company (“DTC”))
for the account of the Underwriters. The Firm Shares (or Pre-Funded Warrants) and Firm Warrants shall be registered in such name or names
and in such authorized denominations as the Representatives may request in writing prior to the Closing Date. The Company shall not be
obligated to sell or deliver the Firm Shares (or Pre-Funded Warrants) and Firm Warrants except upon tender of payment by the Representatives
for all of the Firm Shares (or Pre-Funded Warrants) and Firm Warrants. The term “Business Day” means any day other
than a Saturday, a Sunday or a legal holiday or a day on which banking institutions are authorized or obligated by law to close in New
York, New York.
1.2. Over-allotment
Option.
1.2.1. Option
Securities. For the purposes of covering any over-allotments in connection with the distribution and sale of the Units, the Company
hereby grants to the Representatives an option (the “Over-allotment Option”) to purchase, in the aggregate, (a) up
to [●] additional shares of Common Stock (15% of the Firm Shares) at a purchase price per share of $[●] (93% of the public
offering price allocated to each Firm Share) (the “Option Shares” and together with the Firm Shares, the “Shares”),
and/or (b) [●] warrants to purchase an aggregate of [●] shares of Common Stock (15% of the Firm Warrants) at a purchase price
of $0.00093 per warrant (93% of the public offering price allocated to each set of Firm Warrants) (the “Option Warrants”
and together with the Firm Warrants and Pre-Funded Warrants, if any, the “Warrants”), which may be purchased in any
combination of Option Shares and/or the Option Warrants. The Option Shares and the Option Warrants are referred to as the “Option
Securities”). The Firm Securities and the Option Securities are collectively referred to as the “Public Securities.”
The offering and sale of the Public Securities is herein referred to as the “Offering.”
1.2.2. Exercise
of Option. The Over-allotment Option granted pursuant to Section 1.2.1 hereof may be exercised by the Representatives as to
all (at any time) or any part (from time to time) of the Option Securities within forty-five (45) days after the Effective Date. The
Representatives shall not be under any obligation to purchase any of the Option Securities prior to the exercise of the Over-allotment
Option. The Over-allotment Option granted hereby may be exercised by the giving of written notice to the Company from the Representatives,
setting forth the number of the Option Shares and/or Option Warrants to be purchased and the date and time for delivery of and payment
for the Option Shares and/or Option Warrants (the “Option Closing Date”), which shall not be later than five (5) full
Business Days after the date of the notice or such other time as shall be agreed upon by the Company and the Representatives, at the
offices of Representatives’ Counsel or at such other place (including remotely by facsimile or other electronic transmission) as
shall be agreed upon by the Company and the Representatives. If such delivery and payment for the Option Shares and/or Option Warrants
does not occur on the Closing Date, the Option Closing Date will be as set forth in the notice. Upon exercise of the Over-allotment Option
with respect to all or any portion of the Option Securities subject to the terms and conditions set forth herein, (i) the Company shall
become obligated to sell to the Underwriters the number of the Option Securities specified in such notice and (ii) each of the Underwriters,
acting severally and not jointly, shall purchase that portion of the total number of the Option Securities then being purchased as set
forth in Schedule 1 opposite the name of such Underwriter.
1.2.3. Payment
and Delivery. Payment for the Option Shares and/or Option Warrants shall be made on the Option Closing Date by wire transfer in U.S.
dollars (same day) funds, payable to the order of the Company upon delivery to you of certificates (in form and substance satisfactory
to the Representatives) representing the Option Shares and/or Option Warrants (or through the facilities of DTC or via DWAC transfer)
for the account of the Representatives. The Option Shares and/or Option Warrants shall be registered in such name or names and in such
authorized denominations as the Representatives may request in writing prior to the Option Closing Date. The Company shall not be obligated
to sell or deliver the Option Shares and/or Option Warrants except upon tender of payment by the Representatives for applicable Option
Shares and/or Option Warrants.
1.3
Representatives’ Warrants.
1.3.1. Purchase
Warrants. The Company hereby agrees to issue and sell to the Representatives (and/or their designees) on the Closing Date (“Representatives’
Warrants”) five-year warrants for the purchase of a number of shares of Common Stock equal to 3.0% of the number of the Firm
Shares (or Pre-Funded Warrants) and Option Shares issued in the Offering, pursuant to a warrant in the form attached hereto as Exhibit
A, at an initial exercise price of $[●] (or 125% of the public offering price per Firm Share). The Representatives’
Warrants and the Common Stock issuable upon exercise thereof are hereinafter referred to together as the “Representatives’
Securities.” The Representatives understand and agree that there are significant restrictions pursuant to FINRA Rule 5110 against
transferring the Representatives’ Warrants and the underlying Shares during the one hundred eighty (180) days after the Effective
Date and by its acceptance thereof shall agree that it will not sell, transfer, assign, pledge or hypothecate the Representatives’
Warrants, or any portion thereof, or be the subject of any hedging, short sale, derivative, put or call transaction that would result
in the effective economic disposition of such securities for a period of one hundred eighty (180) days following the Effective Date to
anyone other than (i) an Underwriter or a selected dealer in connection with the Offering, or (ii) an officer, partner, registered person
or affiliate of the Representatives or of any such Underwriter or selected dealer; and only if any such transferee agrees to the foregoing
lock-up restrictions.
1.3.2. Delivery.
Delivery of the Representatives’ Warrants shall be made on the Closing Date and shall be issued in the name or names and in such
authorized denominations as the Representatives may request.
2. Representations
and Warranties of the Company. The Company represents and warrants to the Underwriters as of the Applicable Time (as defined below),
as of the Closing Date and as of the Option Closing Date, if any, as follows:
2.1. Filing
of Registration Statement.
2.1.1. Pursuant
to the Securities Act. The Company has filed with the U.S. Securities and Exchange Commission (the “Commission”)
a registration statement, and an amendment or amendments thereto, on Form S-1 (File No. 333-[●]), including any related prospectus
or prospectuses, for the registration of the Public Securities and the Representatives’ Securities under the Securities Act of
1933, as amended (the “Securities Act”), which registration statement and amendment or amendments have been prepared
by the Company in all material respects in conformity with the requirements of the Securities Act and the rules and regulations of the
Commission under the Securities Act (the “Securities Act Regulations”) and will contain all material statements that
are required to be stated therein in accordance with the Securities Act and the Securities Act Regulations. Except as the context may
otherwise require, such registration statement, as amended, on file with the Commission at the time the registration statement became
effective (including the Preliminary Prospectus included in the registration statement, financial statements, schedules, exhibits and
all other documents filed as a part thereof and all information deemed to be a part thereof as of the Effective Date pursuant to paragraph
(b) of Rule 430A of the Securities Act Regulations (the “Rule 430A Information”)), is referred to herein as the “Registration
Statement.” If the Company files any registration statement pursuant to Rule 462(b) of the Securities Act Regulations, then
after such filing, the term “Registration Statement” shall include such registration statement filed pursuant to Rule
462(b). The Registration Statement has been declared effective by the Commission on the date hereof.
Each
prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted the Rule 430A Information
that was used after such effectiveness and prior to the execution and delivery of this Agreement, is herein called a “Preliminary
Prospectus.” The Preliminary Prospectus, subject to completion, dated [●], 2023, that was included in the Registration
Statement immediately prior to the Applicable Time is hereinafter called the “Pricing Prospectus.” The final prospectus
in the form first furnished to the Underwriters for use in the Offering is hereinafter called the “Prospectus.” Any
reference to the “most recent Preliminary Prospectus” shall be deemed to refer to the latest Preliminary Prospectus
included in the Registration Statement.
“Applicable
Time” means [●] p.m., Eastern time, on the date of this Agreement.
“Issuer
Free Writing Prospectus” means any “issuer free writing prospectus,” as defined in Rule 433 of the Securities Act
Regulations (“Rule 433”), including without limitation any “free writing prospectus” (as defined in Rule
405 of the Securities Act Regulations) relating to the Public Securities that is (i) required to be filed with the Commission by the
Company, (ii) a “road show that is a written communication” within the meaning of Rule 433(d)(8)(i), whether or not required
to be filed with the Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a
description of the Public Securities or of the Offering that does not reflect the final terms, in each case in the form filed or required
to be filed with the Commission or, if not required to be filed, in the form retained in the Company’s records pursuant to Rule
433(g).
“Issuer
General Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is intended for general distribution to
prospective investors (other than a “bona fide electronic road show,” as defined in Rule 433 (the “Bona Fide
Electronic Road Show”)), as evidenced by its being specified in Schedule 2-B hereto.
“Issuer
Limited Use Free Writing Prospectus” means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing
Prospectus.
“Pricing
Disclosure Package” means any Issuer General Use Free Writing Prospectus issued at or prior to the Applicable Time, the Pricing
Prospectus and the information included on Schedule 2-A hereto, all considered together.
2.1.2. Pursuant
to the Exchange Act. The registration of the Common Stock pursuant to Section 12(b) under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”) is effective. The Company has taken no action designed to, or likely to have the effect
of, terminating the registration of the Common Stock under the Exchange Act, nor has the Company received any notification that the Commission
is contemplating terminating such registration.
2.2. Share
Exchange Listing. The Shares and the shares of Common Stock underlying the Representatives’ Warrants and Warrants have
been approved for listing on the NASDAQ Capital Market (the “Exchange”), and the Company has taken no action designed
to, or likely to have the effect of, delisting of the Shares or the shares of Common Stock underlying the Representatives’ Warrants
and Warrants from the Exchange, nor has the Company received any written notification that the Exchange is contemplating terminating
such listing.
2.3. No
Stop Orders, etc. Neither the Commission nor, to the Company’s knowledge, any state regulatory authority has issued any
written order preventing or suspending the use of the Registration Statement, any Preliminary Prospectus or the Prospectus or has instituted
or, to the Company’s knowledge, threatened to institute, any proceedings with respect to such an order. The Company has complied
with each request (if any) from the Commission for additional information.
2.4. Disclosures
in Registration Statement.
2.4.1. Compliance
with Securities Act and 10b-5 Representation.
(i) Each
of the Registration Statement and any post-effective amendment thereto, at the time it became effective, complied in all material respects
with the requirements of the Securities Act and the Securities Act Regulations. Each Preliminary Prospectus, including the prospectus
filed as part of the Registration Statement as originally filed or as part of any amendment or supplement thereto, and the Prospectus,
at the time each was filed with the Commission, complied in all material respects with the requirements of the Securities Act and the
Securities Act Regulations. Each Preliminary Prospectus delivered to the Underwriters for use in connection with this Offering and the
Prospectus was or will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
(ii) Neither
the Registration Statement nor any amendment thereto, at its effective time, as of the Applicable Time, at the Closing Date or at any
Option Closing Date (if any), contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit
to state a material fact required to be stated therein or necessary to make the statements therein not misleading.
(iii) The
Pricing Disclosure Package, as of the Applicable Time, at the Closing Date or at any Option Closing Date (if any), did not, does not
and 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 under which they were made, not misleading; and each Issuer Limited Use Free Writing Prospectus
hereto does not conflict with the information contained in the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus
or the Prospectus, and each such Issuer Limited Use Free Writing Prospectus, as supplemented by and taken together with the Pricing Prospectus
as of the Applicable Time, did not include an untrue statement of a material fact or omit to state a material fact necessary in order
to make the statements therein, in light of the circumstances under which they were made, not misleading; provided, however,
that this representation and warranty shall not apply to statements made in reliance upon and in conformity with written information
furnished to the Company in writing with respect to the Underwriters by the Representatives expressly for use in the Registration Statement,
the Pricing Prospectus or the Prospectus or any amendment thereof or supplement thereto. The parties acknowledge and agree that such
information provided by or on behalf of any Underwriter consists solely of the information in the table set forth in the second paragraph
of the “Underwriting” section and the disclosure contained in the “Underwriting” subsections “- Discounts,”
“Representatives’ Warrants,” and “Price Stabilization, Short Positions and Penalty Bids” of the Prospectus
(the “Underwriters’ Information”).
(iv) Neither
the Prospectus nor any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time of any filing
with the Commission pursuant to Rule 424(b), at the Closing Date or at any Option Closing Date (if any), included, includes or will include
an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading; provided, however, that this representation
and warranty shall not apply to the Underwriters’ Information.
2.4.2. Disclosure
of Agreements. The agreements and documents described in the Registration Statement, the Pricing Disclosure Package and the Prospectus
conform in all material respects to the descriptions thereof contained therein and there are no agreements or other documents required
by the Securities Act and the Securities Act Regulations to be described in the Registration Statement, the Pricing Disclosure Package
and the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed.
Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound
or affected and (i) that is referred to in the Registration Statement, the Pricing Disclosure Package and the Prospectus, or (ii) is
material to the Company’s business, has been duly authorized and validly executed by the Company, is in full force and effect in
all material respects and is enforceable against the Company and, to the Company’s knowledge, the other parties thereto, in accordance
with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting
creditors’ rights generally, (y) as enforceability of any indemnification or contribution provision may be limited under the federal
and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be
subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. Except as disclosed
in the Registration Statement, the Pricing Disclosure Package or the Prospectus, none of such agreements or instruments has been assigned
by the Company, and neither the Company nor, to the Company’s knowledge, any other party is in default thereunder and, to the Company’s
knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder,
except for any default or event which would not reasonably be expected to result in a Material Adverse Change (as defined below). To
the Company’s knowledge, performance by the Company of the material provisions of such agreements or instruments will not result
in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic
or foreign, having jurisdiction over the Company or any of its assets or businesses (each, a “Governmental Entity”),
including, without limitation, those relating to environmental laws and regulations, except for any violation which would not reasonably
be expected to result in a Material Adverse Change (as defined below).
2.4.3. Prior
Securities Transactions. During the past three (3) years from the date of this Agreement, no securities of the Company have been
sold by the Company or by or on behalf of, or for the benefit of, any person or persons controlling, controlled by or under common control
with the Company, except as disclosed in the Registration Statement, the Pricing Disclosure Package and any Preliminary Prospectus.
2.4.4. Regulations.
The disclosures in the Registration Statement, the Pricing Disclosure Package and the Prospectus concerning the effects of federal, state,
local and all foreign regulation on the Offering and regulations applicable to the Company’s business as currently contemplated
are correct in all material respects and no other such regulations are required to be disclosed in the Registration Statement, the Pricing
Disclosure Package and the Prospectus which are not so disclosed
2.5. Changes
after Dates in Registration Statement.
2.5.1. No
Material Adverse Change. Since the respective dates as of which information is given in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, except as otherwise specifically stated therein: (i) there has been no material adverse change in the financial
position or results of operations of the Company or its Subsidiaries taken as a whole, nor, to the Company’s knowledge, any change
or development that, singularly or in the aggregate, would involve a material adverse change in or affecting the condition (financial
or otherwise), results of operations, business, or assets of the Company or its Subsidiaries taken as a whole (a “Material Adverse
Change”); (ii) there have been no material transactions entered into by the Company or its Subsidiaries, other than as contemplated
pursuant to this Agreement; and (iii) no officer or director of the Company has resigned from any position with the Company.
2.5.2. Recent
Securities Transactions, etc. Subsequent to the respective dates as of which information is given in the Registration Statement,
the Pricing Disclosure Package and the Prospectus, and except as may otherwise be indicated or contemplated herein or disclosed in the
Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has not: (i) issued any securities or incurred
any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution
on or in respect to its capital stock.
2.6. Independent
Accountants. To the knowledge of the Company, BF Borgers CPA PC (“Auditor”), whose report is filed with the
Commission as part of the Registration Statement, the Pricing Disclosure Package and the Prospectus, is an independent registered public
accounting firm as required by the Securities Act and the Securities Act Regulations and the Public Company Accounting Oversight Board.
The Auditor has not, during the periods covered by the financial statements included in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act.
2.7. Financial
Statements, etc. The financial statements, including the notes thereto and supporting schedules, if any, included in the Registration
Statement, the Pricing Disclosure Package and the Prospectus, fairly present in all material respects the financial position and the
results of operations of the Company at the dates and for the periods to which they apply; and such financial statements have been prepared
in conformity with U.S. generally accepted accounting principles (“GAAP”), consistently applied throughout the periods
involved (provided that unaudited interim financial statements are subject to year-end audit adjustments that are not expected to be
material in the aggregate and do not contain all footnotes required by GAAP); and any supporting schedules included in the Registration
Statement present fairly in all material respects the information required to be stated therein. Except as included therein, no historical
or pro forma financial statements are required to be included in the Registration Statement, the Pricing Disclosure Package or the Prospectus
under the Securities Act or the Securities Act Regulations. The pro forma and pro forma as adjusted financial information and the related
notes, if any, included in the Registration Statement, the Pricing Disclosure Package and the Prospectus have been properly compiled
and prepared in all material respects in accordance with the applicable requirements of the Securities Act and the Securities Act Regulations
and present fairly in all material respects the information shown therein, and the assumptions used in the preparation thereof are reasonable
and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. All disclosures
contained in the Registration Statement, the Pricing Disclosure Package or the Prospectus regarding “non-GAAP financial measures”
(as such term is defined by the rules and regulations of the Commission), if any, comply with Regulation G of the Exchange Act and Item
10 of Regulation S-K of the Securities Act, to the extent applicable. Each of the Registration Statement, the Pricing Disclosure Package
and the Prospectus discloses all material off-balance sheet transactions, arrangements, obligations (including contingent obligations),
and other relationships of the Company with unconsolidated entities or other persons that may have a material current or future effect
on the Company’s financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital
resources, or significant components of revenues or expenses. Except as disclosed in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, (a) neither the Company nor any of its subsidiaries listed in Exhibit 21.1 to the Registration Statement
(each, a “Subsidiary” and, collectively, the “Subsidiaries”), has incurred any material liabilities
or obligations, direct or contingent, or entered into any material transactions other than in the ordinary course of business, (b) the
Company has not declared or paid any dividends or made any distribution of any kind with respect to its Common Stock or preferred stock
(c) there has not been any change in the capital of the Company or any of its Subsidiaries, or, other than in the course of business,
any grants under any stock compensation plan, and (d) there has not been any Material Adverse Change in the Company’s long-term
or short-term debt. The Company represents that it has no direct or indirect subsidiaries other than those listed in Exhibit 21.1 to
the Registration Statement.
2.8. Authorized
Capital; Options, etc. The Company had, at the date or dates indicated in the Registration Statement, the Pricing Disclosure
Package and the Prospectus, the duly authorized, issued and outstanding capitalization as set forth therein. Based on the assumptions
stated in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company will have on the Closing Date the
adjusted capitalization set forth therein. Except as set forth in, or contemplated by, the Registration Statement, the Pricing Disclosure
Package and the Prospectus, on the Effective Date, as of the Applicable Time and on the Closing Date or at any Option Closing Date, there
will be no options, warrants, or other rights to purchase or otherwise acquire any authorized, but unissued Common Stock or any security
convertible or exercisable into Common Stock, or any contracts or commitments to issue or sell Common Stock or any such options, warrants,
rights or convertible securities.
2.9. Valid
Issuance of Securities, etc.
2.9.1. Outstanding
Securities. All issued and outstanding securities of the Company issued prior to the transactions contemplated by this Agreement
have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights of rescission
with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities were issued
in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company.
The Common Stock, preferred stock, and any other securities outstanding or to be outstanding upon consummation of the Offering conform
in all material respects to all statements relating thereto contained in the Registration Statement, the Pricing Disclosure Package and
the Prospectus. The offers and sales of the outstanding Common Stock were at all relevant times either registered under the Securities
Act and the applicable state securities or “blue sky” laws or, based in part on the representations and warranties of the
purchasers of such shares, exempt from such registration requirements.
2.9.2. Securities
Sold Pursuant to this Agreement. The Public Securities and Representatives’ Warrants have been duly authorized for issuance
and sale and, when issued and paid for, will be validly issued, fully paid and non-assessable; the holders thereof are not and will not
be subject to personal liability by reason of being such holders; the Public Securities and Representatives’ Warrants are not and
will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the
Company; and all corporate action required to be taken for the authorization, issuance and sale of the Public Securities and Representatives’
Warrants has been duly and validly taken; the Common Stock issuable upon exercise of the Representatives’ Warrants or the Warrants
have been duly authorized and reserved for issuance by all necessary corporate action on the part of the Company and when issued in accordance
with such Representatives’ Warrants and the Warrants, as the case may be, such Common Stock will be validly issued, fully paid
and non-assessable. The Public Securities and the Representatives’ Warrants conform in all material respects to all statements
with respect thereto contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
2.10. Registration
Rights of Third Parties. Except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus,
no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities of the Company
have the right to require the Company to register any such securities of the Company under the Securities Act or to include any such
securities in a registration statement to be filed by the Company.
2.11. Validity
and Binding Effect of Agreements. This Agreement, the Warrants and the Representatives’ Warrants have been duly and validly
authorized by the Company, and, when executed and delivered, will constitute, the valid and binding agreements of the Company, enforceable
against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited by bankruptcy, insolvency,
reorganization or similar laws affecting creditors’ rights generally; (ii) as enforceability of any indemnification or contribution
provision may be limited under the federal and state securities laws; and (iii) that the remedy of specific performance and injunctive
and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding
therefor may be brought.
2.12. No
Conflicts, etc. The execution, delivery and performance by the Company of this Agreement and all ancillary documents, the consummation
by the Company of the transactions herein and therein contemplated and the compliance by the Company with the terms hereof and thereof
do not and will not, with or without the giving of notice or the lapse of time or both: (i) result in a material breach of, or conflict
with any of the terms and provisions of, or constitute a material default under, or result in the creation, modification, termination
or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreement or
instrument to which the Company is a party; (ii) result in any violation of the provisions of the Company’s Certificate of Incorporation
(as the same may be amended or restated from time to time, the “Charter”) or the by-laws of the Company; or (iii)
violate any existing applicable law, rule, regulation, judgment, order or decree of any Governmental Entity as of the date hereof.
2.13. No
Defaults; Violations. No material default exists in the due performance and observance of any term, covenant or condition of
any material license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument
evidencing an obligation for borrowed money, or any other material agreement or instrument to which the Company is a party or by which
the Company may be bound or to which any of the properties or assets of the Company is subject. The Company is not (i) in violation of
any term or provision of its Charter or by-laws, or (ii) in violation of any franchise, license, permit, applicable law, rule, regulation,
judgment or decree of any Governmental Entity, except in the cases of clause (ii) for such violations which would not reasonably be expected
to cause a Material Adverse Change.
2.14. Corporate
Power; Licenses; Consents.
2.14.1. Conduct
of Business. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has
all requisite corporate power and authority, and has all necessary authorizations, approvals, orders, licenses, certificates and permits
of and from all governmental regulatory officials and bodies that it needs as of the date hereof to conduct its business purpose as described
in the Registration Statement, the Pricing Disclosure Package and the Prospectus, except for the absence of which would not reasonably
be expected to result in a Material Adverse Change.
2.14.2. Transactions
Contemplated Herein. The Company has all corporate power and authority to enter into this Agreement and to carry out the provisions
and conditions hereof, and all consents, authorizations, approvals and orders required in connection therewith have been obtained. No
consent, authorization or order of, and no filing with, any court, government agency, the Exchange or other body is required for the
valid issuance, sale and delivery of the Public Securities and the consummation of the transactions and agreements contemplated by this
Agreement and the delivery of the Warrants and the Representatives’ Warrants and as contemplated by the Registration Statement,
the Pricing Disclosure Package and the Prospectus, except with respect to applicable Securities Act Regulations, state securities laws
and the rules and regulations of the Financial Industry Regulatory Authority, Inc. (“FINRA”),.
2.15. D&O
Questionnaires. To the Company’s knowledge, all information contained in the questionnaires (the “Questionnaires”)
completed by each of the Company’s directors and officers immediately prior to the Offering (the “Insiders”)
as supplemented by all information concerning the Company’s directors, officers and principal shareholders as described in the
Registration Statement, the Pricing Disclosure Package and the Prospectus, as well as in the Lock-Up Agreement (as defined in Section
2.24 below), provided to the Underwriters, is true and correct in all material respects and the Company has not become aware of any
information which would cause the information disclosed in the Questionnaires to become materially inaccurate and incorrect.
2.16. Litigation;
Governmental Proceedings. 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 Registration Statement, the Pricing Disclosure Package and
the Prospectus which has not been disclosed.
2.17. Good
Standing. The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws
of the State of Delaware as of the date hereof, and is duly qualified to do business and is in good standing in each other jurisdiction
in which its ownership or lease of property or the conduct of business requires such qualification, except where the failure to qualify,
singularly or in the aggregate, would not have or reasonably be expected to result in a Material Adverse Change.
2.18. Insurance.
The Company carries or is entitled to the benefits of insurance, (including, without limitation, as to directors and officers insurance
coverage), with, to the Company’s knowledge, reputable insurers, in such amounts and covering such risks which the Company believes
are adequate, and all such insurance is in full force and effect. The Company has no reason to believe that it will not be able (i) to
renew its existing insurance coverage as and when such policies expire or (ii) to obtain comparable coverage from similar institutions
as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse
Change.
2.19. Transactions
Affecting Disclosure to FINRA.
2.19.1. Finder’s
Fees. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no claims,
payments, arrangements, agreements or understandings relating to the payment of a finder’s, consulting or origination fee by the
Company or any Insider with respect to the sale of the Public Securities hereunder or any other arrangements, agreements or understandings
of the Company or, to the Company’s knowledge, any of its shareholders that may affect the Underwriters’ compensation, as
determined by FINRA.
2.19.2. Payments
within Six (6) Months. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the
Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder’s fee,
consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who
raised or provided capital to the Company; (ii) any FINRA member; or (iii) any person or entity that has any direct or indirect affiliation
or association with any FINRA member, within the six (6) months immediately prior to the original filing of the Registration Statement,
other than the payment to the Underwriters as provided hereunder in connection with the Offering.
2.19.3. Use
of Proceeds. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member or its affiliates,
except as specifically authorized herein.
2.19.4. FINRA
Affiliation. To the Company’s knowledge, and except as may otherwise be disclosed in FINRA questionnaires provided to the Representatives’
Counsel, there is no (i) officer or director of the Company, (ii) beneficial owner of 5% or more of any class of the Company’s
securities or (iii) beneficial owner of the Company’s unregistered equity securities which were acquired during the 180-day period
immediately preceding the filing of the Registration Statement that is an affiliate or associated person of a FINRA member participating
in the Offering (as determined in accordance with the rules and regulations of FINRA).
2.19.5. Information.
To the Company’s knowledge, all information provided by the Company in its FINRA questionnaire to Representatives’ Counsel
specifically for use by Representatives’ Counsel in connection with its Public Offering System filings (and related disclosure)
with FINRA is true, correct and complete in all material respects.
2.20. Foreign
Corrupt Practices Act. None of the Company and its Subsidiaries or, to the Company’s knowledge, any director, officer,
agent, employee or affiliate of the Company and its Subsidiaries or any other person acting on behalf of the Company and its Subsidiaries,
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 Change or (iii) if not continued in the future,
might adversely affect the assets, business, operations or prospects of the Company. 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.
2.21. Compliance
with OFAC. None of the Company and its Subsidiaries or, to the Company’s knowledge, any director, officer, agent, employee
or affiliate of the Company and its Subsidiaries or any other person acting on behalf of the Company and its Subsidiaries, is currently
subject to 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 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 subject to any U.S. sanctions administered by OFAC.
2.22. Money
Laundering Laws. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with
applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations
or guidelines, issued, administered or enforced by any Governmental Entity (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 best knowledge of the Company, threatened.
2.23. Officers’
Certificate. Any certificate signed by any duly authorized officer of the Company and delivered to you or to Representatives’
Counsel shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.
2.24. Lock-Up
Agreements. The Company has caused each of its officers, directors and owners of the Company’s outstanding Common
Stock (or securities convertible or exercisable into Common Stock) (collectively, the “Lock-Up Parties”) to deliver
to the Representatives an executed Lock-Up Agreement, in a form substantially similar to that attached hereto as Exhibit B (the
“Lock-Up Agreement”), prior to the execution of this Agreement.
2.25. Subsidiaries.
All Subsidiaries of the Company are duly organized and in good standing under the laws of the place of organization or incorporation,
and each Subsidiary is in good standing in each jurisdiction in which its ownership or lease of property or the conduct of business requires
such qualification, except where the failure to qualify would not have a Material Adverse Change. The Company’s ownership and control
of each Subsidiary is as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
2.26. Related
Party Transactions. There are no business relationships or related party transactions involving the Company or any other person
required to be described in the Registration Statement, the Pricing Disclosure Package and the Prospectus that have not been described
as required by the Securities Act Regulations.
2.27. Board
of Directors. The Board of Directors of the Company is comprised of the persons set forth under the heading of the Pricing Prospectus
and the Prospectus captioned “Management.” The qualifications of the persons serving as board members and the overall composition
of the board comply with the Exchange Act, the Exchange Act Regulations, the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder
(the “Sarbanes-Oxley Act”) applicable to the Company and the listing rules of the Exchange. At least one member of
the Audit Committee of the Board of Directors of the Company qualifies as an “audit committee financial expert,” as such
term is defined under Regulation S-K and the listing rules of the Exchange. In addition, at least a majority of the persons serving on
the Board of Directors qualify as “independent,” as defined under the listing rules of the Exchange.
2.28. Sarbanes-Oxley
Compliance.
2.28.1. Disclosure
Controls. Except as disclosed in the Registration Statement, Pricing Disclosure Package and the Prospectus, the Company has developed
and currently maintains disclosure controls and procedures that will comply with Rule 13a-15 or 15d-15 under the Exchange Act Regulations,
and such controls and procedures are effective to ensure that all material information concerning the Company will be made known on a
timely basis to the individuals responsible for the preparation of the Company’s Exchange Act filings and other public disclosure
documents.
2.28.2. Compliance.
The Company is in material compliance with the provisions of the Sarbanes-Oxley Act applicable to it, and has implemented or will implement
such programs and has taken reasonable steps to ensure the Company’s future compliance (not later than the relevant statutory and
regulatory deadlines therefor) with all of the material provisions of the Sarbanes-Oxley Act.
2.29. Accounting
Controls. Except as disclosed in the Registration Statement, Pricing Disclosure Package and the Prospectus, the Company maintains
systems of “internal control over financial reporting” (as defined under Rules 13a-15 and 15d-15 under the Exchange Act Regulations)
that comply in all material respects with the requirements of the Exchange Act and have been designed by, or under the supervision of,
its respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with
GAAP, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management’s general or specific authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP and to maintain asset accountability; (iii) access to assets is permitted
only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared
with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as disclosed
in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company is not aware of any material weaknesses
in its internal control over financial reporting, and, if applicable, with respect to such remedial actions disclosed in the Registration
Statement, the Pricing Disclosure Package and the Prospectus, the Company represents that it has taken all remedial actions set forth
in such disclosure. The Company’s auditors and the Audit Committee of the Board of Directors of the Company have been advised of:
(i) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which
are known to the Company’s management and that have adversely affected or are reasonably likely to adversely affect the Company’
ability to record, process, summarize and report financial information; and (ii) any fraud known to the Company’s management, whether
or not material, that involves management or other employees who have a significant role in the Company’s internal controls over
financial reporting.
2.30. No
Investment Company Status. The Company is not and, after giving effect to the Offering and the application of the proceeds thereof
as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, will not be, required to register as an
“investment company,” as defined in the Investment Company Act of 1940, as amended.
2.31. No
Labor Disputes. No labor dispute with the employees of the Company or any of its Subsidiaries exists or, to the knowledge of
the Company, is imminent.
2.32. Intellectual
Property Rights. The Company and each of its Subsidiaries owns or possesses or has valid rights to use all patents, patent applications,
trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses, inventions, trade
secrets and similar rights (“Intellectual Property Rights”) necessary for the conduct of the business of the Company
and its Subsidiaries as currently carried on and as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus.
To the knowledge of the Company, no action or use by the Company or any of its Subsidiaries necessary for the conduct of its business
as currently carried on and as described in the Registration Statement and the Prospectus will involve or give rise to any infringement
of, or license or similar fees for, any Intellectual Property Rights of others. Neither the Company nor any of its Subsidiaries has received
any written notice alleging any such infringement, fee or conflict with asserted Intellectual Property Rights of others. Except as would
not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change (A) to the knowledge of the Company,
there is no infringement, misappropriation or violation by third parties of any of the Intellectual Property Rights owned by the Company;
(B) there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding or claim by others challenging the rights
of the Company in or to any such Intellectual Property Rights, and the Company is unaware of any facts which would form a reasonable
basis for any such claim, that would, individually or in the aggregate, together with any other claims in this Section 2.32, reasonably
be expected to result in a Material Adverse Change; (C) the Intellectual Property Rights owned by the Company and, to the knowledge of
the Company, the Intellectual Property Rights licensed to the Company have not been adjudged by a court of competent jurisdiction invalid
or unenforceable, in whole or in part, and there is no pending or, to the Company’s knowledge, threatened action, suit, proceeding
or claim by others challenging the validity or scope of any such Intellectual Property Rights, and the Company is unaware of any facts
which would form a reasonable basis for any such claim that would, individually or in the aggregate, together with any other claims in
this Section 2.32, reasonably be expected to result in a Material Adverse Change; (D) there is no pending or, to the Company’s
knowledge, threatened action, suit, proceeding or claim by others that the Company infringes, misappropriates or otherwise violates any
Intellectual Property Rights or other proprietary rights of others, the Company has not received any written notice of such claim and
the Company is unaware of any other facts which would form a reasonable basis for any such claim that would, individually or in the aggregate,
together with any other claims in this Section 2.32, reasonably be expected to result in a Material Adverse Change; and (E) to
the Company’s knowledge, no employee of the Company is in or has ever been in violation in any material respect of any term of
any employment contract, patent disclosure agreement, invention assignment agreement, non-competition agreement, non-solicitation agreement,
nondisclosure agreement or any restrictive covenant to or with a former employer where the basis of such violation relates to such employee’s
employment with the Company, or actions undertaken by the employee while employed with the Company and could reasonably be expected to
result, individually or in the aggregate, in a Material Adverse Change. To the Company’s knowledge, all material technical information
developed by and belonging to the Company which has not been patented has been kept confidential. The Company is not a party to or bound
by any options, licenses or agreements with respect to the Intellectual Property Rights of any other person or entity that are required
to be set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus and are not described therein. The Registration
Statement, the Pricing Disclosure Package and the Prospectus contain in all material respects the same description of the matters set
forth in the preceding sentence. None of the technology employed by the Company has been obtained or is being used by the Company in
violation of any contractual obligation binding on the Company or, to the Company’s knowledge, any of its officers, directors or
employees, or otherwise in violation of the rights of any persons.
2.33. Taxes.
Each of the Company and its Subsidiaries has filed all returns (as hereinafter defined) required to be filed with taxing authorities
prior to the date hereof or has duly obtained extensions of time for the filing thereof, except in any case in which the failure so to
file would not reasonably be expected to cause a Material Adverse Change. Each of the Company and its Subsidiaries has paid all taxes
(as hereinafter defined) shown as due on such returns that were filed and has paid all taxes imposed on or assessed against the Company
or such respective Subsidiary, except for any such taxes that are currently being contested in good faith or as would not reasonably
be expected to cause a Material Adverse Change. The provisions for taxes payable, if any, shown on the financial statements filed with
or as part of the Registration Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods
to and including the dates of such consolidated financial statements. Except as disclosed in writing to the Underwriters, (i) no issues
have been raised (and are currently pending) by any taxing authority in connection with any of the returns or taxes asserted as due from
the Company or its Subsidiaries, and (ii) no waivers of statutes of limitation with respect to the returns or collection of taxes have
been given by or requested from the Company or its Subsidiaries. The term “taxes” means all federal, state, local, foreign
and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service
use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or
other taxes, fees, assessments or charges of any kind whatever, together with any interest and any penalties, additions to tax or additional
amounts with respect thereto. The term “returns” means all returns, declarations, reports, statements and other documents
required to be filed in respect to taxes.
2.34. ERISA
Compliance. The Company is not subject to the Employee Retirement Income Security Act of 1974, as amended, or the regulations
and published interpretations thereunder.
2.35. Compliance
with Laws. Except as otherwise disclosed in the Registration Statement, Pricing Disclosure Package and Prospectus and as could
not, individually or in the aggregate, be expected to result in a Material Adverse Change, each of the Company and each Subsidiary, the
Company: (A) is and at all times has been in compliance with all statutes, rules, or regulations applicable to the services provided
by the Company (“Applicable Laws”), except as could not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Change; (B) has not received any warning letter, untitled letter or other correspondence or notice from any
other governmental authority alleging or asserting noncompliance with any Applicable Laws or any licenses, certificates, approvals, clearances,
authorizations, permits and supplements or amendments thereto required by any such Applicable Laws (“Authorizations”);
(C) possesses all material Authorizations and such material Authorizations are valid and in full force and effect and are not in material
violation of any term of any such Authorizations; (D) has not received written notice of any claim, action, suit, proceeding, hearing,
enforcement, investigation, arbitration or other action from any governmental authority or third party alleging that any product operation
or activity is in violation of any Applicable Laws or Authorizations and has no knowledge that any such governmental authority or third
party is considering any such claim, litigation, arbitration, action, suit, investigation or proceeding that if brought would result
in a Material Adverse Change; (E) has not received written notice that any Governmental Authority has taken, is taking or intends to
take action to limit, suspend, modify or revoke any Authorizations and has no knowledge that any such Governmental Authority is considering
such action ; (F) has filed, obtained, maintained or submitted all material reports, documents, forms, notices, applications, records,
claims, submissions and supplements or amendments as required by any Applicable Laws or Authorizations and that all such reports, documents,
forms, notices, applications, records, claims, submissions and supplements or amendments were complete and correct in all material respects
on the date filed (or were corrected or supplemented by a subsequent submission); and (G) has not, either voluntarily or involuntarily,
initiated, conducted, or issued or caused to be initiated, conducted or issued, any recall, market withdrawal or replacement, safety
alert, post-sale warning, or other notice or action relating to the alleged lack of safety of any product or any alleged product defect
or violation and, to the Company’s knowledge, no third party has initiated, conducted or intends to initiate any such notice or
action.
2.36. Ineligible
Issuer. At the time of filing the Registration Statement and any post-effective amendment thereto, at the time of effectiveness
of the Registration Statement and any amendment thereto, at the earliest time thereafter that the Company or another offering participant
made a bona fide offer (within the meaning of Rule 164(h)(2) of the Securities Act Regulations) of the Public Securities and at the date
hereof, the Company was not and is not an “ineligible issuer,” as defined in Rule 405, without taking account of any determination
by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an ineligible issuer.
2.37. Real
Property. Except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company and
its Subsidiaries have good and marketable title in fee simple to, or have valid rights to lease or otherwise use, all items of real or
personal property which are material to the business of the Company and its Subsidiaries taken as a whole, in each case free and clear
of all liens, encumbrances, security interests, claims and defects that do not, singly or in the aggregate, materially affect the value
of such property and do not interfere with the use made and proposed to be made of such property by the Company or its Subsidiaries;
and all of the leases and subleases material to the business of the Company and its Subsidiaries, considered as one enterprise, and under
which the Company or any of its Subsidiaries holds properties described in the Registration Statement, the Pricing Disclosure Package
and the Prospectus, are in full force and effect, and neither the Company nor any Subsidiary has received any written notice of any material
claim of any sort that has been asserted by anyone adverse to the rights of the Company or any Subsidiary under any of the leases or
subleases mentioned above, or affecting or questioning the rights of the Company or such Subsidiary to the continued possession of the
leased or subleased premises under any such lease or sublease, which would result in a Material Adverse Change.
2.38. Contracts
Affecting Capital. There are no transactions, arrangements or other relationships between and/or among the Company, any of its
affiliates (as such term is defined in Rule 405 of the Securities Act Regulations) and any unconsolidated entity, including, but not
limited to, any structured finance, special purpose or limited purpose entity that could reasonably be expected to materially affect
the Company’s or its Subsidiaries’ liquidity or the availability of or requirements for their capital resources required
to be described or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus which have
not been described or incorporated by reference as required.
2.39. Loans
to Directors or Officers. There are no outstanding loans, advances (except normal advances for business expenses in the ordinary
course of business) or guarantees or indebtedness by the Company or its Subsidiaries to or for the benefit of any of the officers or
directors of the Company, its Subsidiaries or any of their respective family members, except as disclosed in the Registration Statement,
the Pricing Disclosure Package and the Prospectus.
2.40. Industry
Data; Forward-looking statements. The statistical and market-related data included in each of the Registration Statement, the
Pricing Disclosure Package and the Prospectus are based on or derived from sources that the Company reasonably and in good faith believes
are reliable and accurate or represent the Company’s good faith estimates that are made on the basis of data derived from such
sources. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) contained
in the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
2.41. Testing-the-Waters
Communications. The Company has not (i) alone engaged in any Testing-the-Waters Communications and (ii) authorized anyone to
engage in Testing-the-Waters Communications. The Company confirms that the Representatives have been authorized to act on its behalf
in undertaking Testing-the-Waters Communications. The Company has not distributed any Written Testing-the-Waters Communications. “Written
Testing-the-Waters Communication” means any Testing-the-Waters Communication that is a written communication within the meaning
of Rule 405 under the Securities Act; “Testing-the-Waters Communication” means any oral or written communication with potential
investors undertaken in reliance on Section 5(d) of the Securities Act.
2.42. Intentionally
omitted.
2.43. Intentionally
omitted.
2.44. Margin
Securities. The Company owns no “margin securities” as that term is defined in Regulation U of the Board of Governors
of the Federal Reserve System (the “Federal Reserve Board”), and none of the proceeds of Offering will be used, directly
or indirectly, for the purpose of purchasing or carrying any margin security, for the purpose of reducing or retiring any indebtedness
which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the Common Stock
to be considered a “purpose credit” within the meanings of Regulation T, U or X of the Federal Reserve Board.
2.45. Dividends
and Distributions. Except as disclosed in the Pricing Disclosure Package, Registration Statement and the Prospectus, no Subsidiary
of the Company is currently prohibited or restricted, directly or indirectly, from paying any dividends to the Company, from making any
other distribution on such Subsidiary’s capital stock, from repaying to the Company any loans or advances to such Subsidiary from
the Company or from transferring any of such Subsidiary’s property or assets to the Company or any other Subsidiary of the Company.
2.46. Lending
Relationships. Except as disclosed in the Pricing Disclosure Package, Registration Statement and the Prospectus, the Company
(i) does not have any material lending or other relationship with any bank or lending affiliate of the Underwriters and (ii) does not
intend to use any of the proceeds from the sale of the Securities hereunder to repay any outstanding debt owed to any affiliate of the
Underwriters.
3. Covenants
of the Company. The Company covenants and agrees as follows:
3.1. Amendments
to Registration Statement. The Company shall deliver to the Representatives, prior to filing, any amendment or supplement to
the Registration Statement or Prospectus proposed to be filed after the Effective Date and not file any such amendment or supplement
to which the Representatives shall reasonably object in writing.
3.2. Federal
Securities Laws.
3.2.1. Compliance.
The Company, subject to Section 3.2.2, shall comply with the requirements of Rule 430A of the Securities Act Regulations, and
will notify the Representatives promptly, and confirm the notice in writing, (i) when any post-effective amendment to the Registration
Statement shall become effective or any amendment or supplement to the Prospectus shall have been filed; (ii) of the receipt of any comments
from the Commission; (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for additional information; (iv) of the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any Preliminary Prospectus
or the Prospectus, or of the suspension of the qualification of the Public Securities and the Representatives’ Warrants for offering
or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant
to Section 8(d) or 8(e) of the Securities Act concerning the Registration Statement and (v) if the Company becomes the subject of a proceeding
under Section 8A of the Securities Act in connection with the Offering of the Public Securities and Representatives’ Warrants.
The Company shall effect all filings required under Rule 424(b) of the Securities Act Regulations, in the manner and within the time
period required by Rule 424(b) (without reliance on Rule 424(b)(8)), and shall take such steps as it deems necessary to ascertain promptly
whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that
it was not, it will promptly file such prospectus. The Company shall use its reasonable best efforts to prevent the issuance of any stop
order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.
3.2.2. Continued
Compliance. The Company shall comply with the Securities Act, the Securities Act Regulations, the Exchange Act and the Exchange Act
Regulations so as to permit the completion of the distribution of the Public Securities as contemplated in this Agreement and in the
Registration Statement, the Pricing Disclosure Package and the Prospectus. If at any time when a prospectus relating to the Public Securities
is (or, but for the exception afforded by Rule 172 of the Securities Act Regulations (“Rule 172”), would be) required
by the Securities Act to be delivered in connection with sales of the Public Securities, any event shall occur or condition shall exist
as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to (i) amend the Registration
Statement in order that the Registration Statement will not include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein not misleading; (ii) amend or supplement the Pricing Disclosure
Package or the Prospectus in order that the Pricing Disclosure Package or the Prospectus, as the case may be, will not include any untrue
statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the
light of the circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or
supplement the Pricing Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the Securities
Act or the Securities Act Regulations, the Company will promptly (A) give the Representatives notice of such event; (B) prepare any amendment
or supplement as may be necessary to correct such statement or omission or to make the Registration Statement, the Pricing Disclosure
Package or the Prospectus comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish
the Representatives with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement;
provided that the Company shall not file or use any such amendment or supplement to which the Representatives or Representatives’
Counsel shall reasonably object. The Company will furnish to the Underwriters such number of copies of such amendment or supplement as
the Underwriters may reasonably request. The Company has given the Representatives notice of any filings made pursuant to the Exchange
Act or the Exchange Act Regulations within 48 hours prior to the Applicable Time. The Company shall give the Representatives notice of
its intention to make any such filing from the Applicable Time until the later of the Closing Date and the exercise in full or expiration
of the Over-allotment Option specified in Section 1.2 hereof and will furnish the Representatives with copies of the related document(s)
a reasonable amount of time prior to such proposed filing, as the case may be, and will not file or use any such document to which the
Representatives or counsel for the Underwriters shall reasonably object.
3.2.3. Exchange
Act Registration. Until three years after the date of this Agreement, the Company shall use its commercially reasonable efforts to
maintain the registration of the Common Stock under the Exchange Act.
3.2.4. Free
Writing Prospectuses. The Company agrees that, unless it obtains the prior consent of the Representatives, it shall not make any
offer relating to the Public Securities that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a
“free writing prospectus,” or a portion thereof, required to be filed by the Company with the Commission or retained by the
Company under Rule 433; provided that the Representatives shall be deemed to have consented to each Issuer General Use Free Writing
Prospectus set forth in Schedule 2-B. The Company represents that it has treated or agrees that it will treat each such free writing
prospectus consented to, or deemed consented to, by the Underwriters as an “issuer free writing prospectus,” as defined in
Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely
filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing
Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would
conflict with the information contained in the Registration Statement or included or would include an untrue statement of a material
fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances
existing at that subsequent time, not misleading, the Company will promptly notify the Underwriters and will promptly amend or supplement,
at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.
3.2.5. Testing-the-Waters
Communications. If at any time following the distribution of any Written Testing-the-Waters Communication there occurred or occurs
an event or development as a result of which such Written Testing-the-Waters Communication included or would include an untrue statement
of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light
of the circumstances existing at that subsequent time, not misleading, the Company shall promptly notify the Representatives and shall
promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such untrue statement
or omission.
3.3. Delivery
to the Underwriters of Registration Statements. The Company has delivered or made available or shall deliver or make available
to the Representatives and Representatives’ Counsel, without charge, signed copies of the Registration Statement as originally
filed and each amendment thereto (including exhibits filed therewith) and signed copies of all consents and certificates of experts,
and upon request will also deliver to the Underwriters, without charge, a conformed copy of the Registration Statement as originally
filed and each amendment thereto (without exhibits) for each of the Underwriters. The copies of the Registration Statement and each amendment
thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant
to EDGAR, except to the extent permitted by Regulation S-T.
3.4. Delivery
to the Underwriters of Prospectuses. The Company has delivered or made available or will deliver or make available to each Underwriter,
without charge, as many copies of each Preliminary Prospectus as such Underwriter reasonably requested, and the Company hereby consents
to the use of such copies for purposes permitted by the Securities Act. The Company will furnish to each Underwriter, without charge,
during the period when a prospectus relating to the Public Securities is (or, but for the exception afforded by Rule 172, would be) required
to be delivered under the Securities Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may
reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.
3.5. Effectiveness
and Events Requiring Notice to the Representatives. The Company shall use its commercially reasonable efforts to cause the Registration
Statement covering the issuance of the shares of Common Stock underlying the Warrants and the Representatives’ Warrants to remain
effective with a current prospectus for at least nine (9) months after the Applicable Time, and shall notify the Representatives immediately
and confirm the notice in writing: (i) of the cessation of the effectiveness of the Registration Statement and any amendment thereto;
(ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose;
(iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the shares underlying
the Warrants or the Representatives’ Warrants for offering or sale in any jurisdiction or of the initiation, or the threatening,
of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the
Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission;
and (vi) of the happening of any event during the period described in this Section 3.5 that, in the judgment of the Company, makes
any statement of a material fact made in the Registration Statement, the Pricing Disclosure Package or the Prospectus untrue or that
requires the making of any changes in (a) the Registration Statement in order to make the statements therein not misleading, or (b) in
the Pricing Disclosure Package or the Prospectus in order to make the statements therein, in light of the circumstances under which they
were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification
at any time, the Company shall make every reasonable effort to obtain promptly the lifting of such order.
3.6. Review
of Financial Statements. For a period of three (3) years after the date of this Agreement, the Company, at its expense, shall
cause its regularly engaged independent registered public accounting firm to review (but not audit) the Company’s financial statements
for each of the three fiscal quarters immediately preceding the announcement of any quarterly financial information.
3.7. Listing.
The Company shall use its commercially reasonable efforts to maintain the listing of the Common Stock and the shares of Common Stock
underlying the Warrants on the Exchange for at least three (3) years from the date of this Agreement.
3.8. Reserved.
3.9. Reports
to the Representatives.
3.9.1. Periodic
Reports, etc. For a period of three (3) years after the date of this Agreement, the Company shall furnish or make available to the
Representatives copies of such financial statements and other periodic and special reports as the Company from time to time furnishes
generally to holders of any class of its securities and also furnish or make available to the Representatives: (i) a copy of each periodic
report the Company shall be required to file with the Commission under the Exchange Act and the Exchange Act Regulations; (ii) a copy
of every press release and every news item and article with respect to the Company or its affairs which was released by the Company;
(iii) a copy of each Form 8-K prepared and filed by the Company; (iv) a copy of each registration statement filed by the Company under
the Securities Act; and (v) such additional documents and information with respect to the Company and the affairs of any future subsidiaries
of the Company as the Representatives may from time to time reasonably request; provided the Representatives shall sign, if requested
by the Company, a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representatives and Representatives’
Counsel in connection with the Representatives’ receipt of such information. Documents filed with the Commission pursuant to its
EDGAR system shall be deemed to have been delivered to the Representatives pursuant to this Section 3.9.1.
3.9.2. Transfer
Agent; Transfer Sheets. For a period of three (3) years after the date of this Agreement, the Company shall retain a transfer agent
and registrar acceptable to the Representatives (the “Transfer Agent”) and shall furnish to the Representatives at
the Company’s sole cost and expense such transfer sheets of the Company’s securities as the Representatives may reasonably
request, including the daily and monthly consolidated transfer sheets of the Transfer Agent and DTC. ClearTrust, LLC is acceptable to
the Representatives to act as Transfer Agent for the Common Stock.
3.9.3. Trading
Reports. For a period of six (6) months after the date hereof, during such time as the Shares are listed on the Exchange, the Company
shall provide to the Representatives, at the Company’s expense, such reports published by the Exchange relating to price trading
of the Shares, as the Representatives shall reasonably request.
3.10. Payment
of Expenses
3.10.1. General
Expenses Related to the Offering. The Company hereby agrees to pay on the Closing Date and the Option Closing Date, if any, to the
extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement,
including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Public Securities to
be sold in the Offering with the Commission; (b) all Public Filing System filing fees associated with the review of the Offering by FINRA;
(c) all fees, expenses and disbursements relating to the registration, qualification or exemption of the Public Securities under the
securities laws of such foreign jurisdictions as the Representatives may reasonably designate; (d) all fees, expenses and disbursements
relating to background checks of the Company’s officers and directors and other due diligence expenses in an amount not to exceed
$7,500 in the aggregate; (e) the costs associated with receiving commemorative mementos and lucite tombstones not to exceed $3,000; (f)
fees and expenses of the Representatives’ Counsel not to exceed $85,000; (g) the Underwriters’ due diligence expenses; (h)
the $29,500 cost associated with the Representative’s use of Ipreo’s book-building, prospectus tracking and compliance software
for the Offering; (i) $10,000 for data services and communications expenses; (j) up to $5,000 of the Representative’s actual accountable
“road show” expenses; and (k) up to $30,000 of the Representative’s market making and trading, and clearing firm settlement
expenses for the Offering. The Representatives may deduct from the net proceeds of the Offering payable to the Company on the Closing
Date or the Option Closing Date, if any, the expenses set forth herein to be paid by the Company to the Underwriters; provided,
however, that in the event that the Offering is terminated, the Company agrees to reimburse the Underwriters pursuant to Section
8.3 hereof.
3.10.2. Non-accountable
Expenses. The Company further agrees that, in addition to the expenses payable pursuant to Section 3.10.1, on the Closing
Date it shall pay to the Representatives, by deduction from the net proceeds of the Offering contemplated herein, a non-accountable expense
allowance equal to one percent (1.0%) of the gross proceeds received by the Company from the sale of the Firm Securities (or Pre-Funded
Warrants) or Option Securities.
3.11. Application
of Net Proceeds. The Company shall apply the net proceeds from the Offering received by it in a manner consistent with the application
thereof described under the caption “Use of Proceeds” in the Registration Statement, the Pricing Disclosure Package and the
Prospectus.
3.12. Delivery
of Earnings Statements to Security Holders. The Company will timely file such reports pursuant to the Exchange Act as are necessary
in order to make generally available to its security holders as soon as practicable, an earnings statement (which need not be certified
by independent registered public accounting firm unless required by the Securities Act or the Securities Act Regulations, but which shall
satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities Act) covering a period of at least twelve (12) consecutive
months beginning after the date of this Agreement.
3.13. Stabilization.
Neither the Company nor, to its knowledge, any of its employees, directors or shareholders has taken or shall take, directly or indirectly,
any action designed to or that has constituted or that might reasonably be expected to cause or result in, under Regulation M of the
Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale
of the Public Securities.
3.14. Internal
Controls. Except to the extent disclosed in the Registration Statement, Pricing Disclosure Package and Prospectus, the Company
shall maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed
in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary in order to permit
preparation of financial statements in accordance with GAAP and to maintain accountability for assets; (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 existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
3.15. Accountants.
As of the date of this Agreement, the Company has retained an independent registered public accounting firm reasonably acceptable to
the Representatives, and the Company shall continue to retain a nationally recognized independent registered public accounting firm for
a period of at least three (3) years after the date of this Agreement. The Representatives acknowledges that the Auditor is acceptable
to the Representatives.
3.16. FINRA.
For a period of ninety (90) days from the later of the Closing Date or the Option Closing Date, if any, the Company shall advise the
Representatives (who shall make an appropriate filing with FINRA) if it is or becomes aware that (i) any officer or director of the Company,
(ii) any beneficial owner of 5% or more of any class of the Company’s securities or (iii) any beneficial owner of the Company’s
unregistered equity securities which were acquired during the 180 days immediately preceding the filing of the original Registration
Statement is or becomes an affiliate or associated person of a FINRA member participating in the Offering (as determined in accordance
with the rules and regulations of FINRA).
3.17. No
Fiduciary Duties. The Company acknowledges and agrees that the Underwriters’ responsibility to the Company is solely contractual
in nature and that none of the Underwriters or their affiliates or any selling agent shall be deemed to be acting in a fiduciary capacity,
or otherwise owes any fiduciary duty to the Company or any of its affiliates in connection with the Offering and the other transactions
contemplated by this Agreement.
3.18. Company
Lock-Up. The Company, on behalf of itself and any successor entity, agrees that, without the prior written consent of the Representatives,
it will not, for a period of three (3) months after the date of this Agreement (the “Lock-Up Period”), (i) offer,
pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any option, right
or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of capital stock of the Company
or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company; (ii) file or cause to be
filed any registration statement with the Commission relating to the offering of any shares of capital stock of the Company or any securities
convertible into or exercisable or exchangeable for shares of capital stock of the Company (other than pursuant to a registration statement
on Form S-8 for employee benefit plans); or (iii) enter into any swap or other arrangement that transfers to another, in whole or in
part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause
(i), (ii) or (iii) above is to be settled by delivery of shares of capital stock of the Company or such other securities, in cash or
otherwise. The restrictions contained in this section shall not apply to (i) the Public Securities and the Representatives’ Warrants
and shares underlying the Warrants or the the Representatives’ Warrants to be sold hereunder; (ii) the issuance by the Company
of Common Stock upon the exercise of an outstanding option or warrant or the conversion of a security outstanding on the date hereof
or disclosed in the Registration Statement and the Pricing Disclosure Package; and (iii) the issuance of Common Stock pursuant to the
Company’s existing stock option or bonus plans as disclosed in the Registration Statement and the Pricing Disclosure Package. The
Company agrees not to accelerate the vesting of any option or warrant or the lapse of any repurchase right prior to the expiration of
the Lock-Up Period.
3.19. Release
of D&O Lock-up Period. If the Representatives, each in their sole discretion, unanimously agree to release or waive the restrictions
set forth in the Lock-Up Agreements described in Section 2.24 hereof for an officer or director of the Company and provides the
Company with notice of the impending release or waiver at least three (3) Business Days before the effective date of the release or waiver,
the Company agrees to announce the impending release or waiver by a press release through a major news service at least two (2) Business
Days before the effective date of the release or waiver.
3.20. Blue
Sky Qualifications. The Company shall use its best efforts, in cooperation with the Underwriters, if necessary, to qualify the
Public Securities for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign)
as the Representatives may designate and to maintain such qualifications in effect so long as required to complete the distribution of
the Public Securities; provided, however, that the Company shall not be obligated to file any general consent to service
of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or
to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.
3.21. Reporting
Requirements. The Company, during the period when a prospectus relating to the Public Securities is (or, but for the exception
afforded by Rule 172, would be) required to be delivered under the Securities Act, will file all documents required to be filed with
the Commission pursuant to the Exchange Act within the time periods required by the Exchange Act and Exchange Act Regulations. Additionally,
the Company shall report the use of proceeds from the issuance of the Public Securities as may be required under Rule 463 under the Securities
Act Regulations.
4. Conditions
of Underwriters’ Obligations. The obligations of the Underwriters to purchase and pay for the Public Securities, as provided
herein, shall be subject to (i) the continuing accuracy of the representations and warranties of the Company as of the date hereof and
as of the Closing Date and the Option Closing Date, if any; (ii) the accuracy of the statements of officers of the Company made pursuant
to the provisions hereof; (iii) the performance by the Company of its obligations hereunder; and (iv) the following conditions:
4.1. Regulatory
Matters.
4.1.1. Effectiveness
of Registration Statement; Rule 430A Information. The Registration Statement has become effective not later than 5:00 p.m., Eastern
time, on the date of this Agreement or such later date and time as shall be consented to in writing by you, and, at the Closing Date,
no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under
the Securities Act, no order preventing or suspending the use of any Preliminary Prospectus or the Prospectus has been issued and no
proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated by the Commission.
The Company has complied with each request (if any) from the Commission for additional information. The Prospectus containing the Rule
430A Information shall have been filed with the Commission in the manner and within the time frame required by Rule 424(b) (without reliance
on Rule 424(b)(8)) or a post-effective amendment providing such information shall have been filed with, and declared effective by, the
Commission in accordance with the requirements of Rule 430A.
4.1.2. FINRA
Clearance. On or before the date of this Agreement, the Representatives shall have received clearance from FINRA as to the amount
of compensation allowable or payable to the Underwriters as described in the Registration Statement.
4.1.3. Exchange
Market Clearance. On the Closing Date, the Firm Shares and Warrant Shares shall have been approved for listing on the Exchange, subject
only to official notice of issuance. On the first Option Closing Date (if any), the Option Shares shall have been approved for listing
on the Exchange, subject only to official notice of issuance.
4.2. Company
Counsel Matters.
4.2.1. Closing
Date Opinions of Counsels. On the Closing Date, the Representatives shall have received the favorable opinion of Sheppard, Mullin,
Richter & Hampton LLP, counsel for the Company, in form and substance reasonably satisfactory to Representatives’ Counsel addressed
to the Representatives and stating that such opinions may be relied upon by Representatives’ Counsel.
4.2.2. Option
Closing Date Opinion of Counsel. On the Option Closing Date, if any, the Representatives shall have received the favorable opinions
of Sheppard, Mullin, Richter & Hampton LLP, in form and substance reasonably satisfactory to the Representatives, confirming as of
the Option Closing Date, the statements made by such counsel in their opinions delivered on the Closing Date.
4.2.3. Reliance.
In rendering such opinions, such counsel may rely: (i) as to matters involving the application of laws other than the laws of the United
States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to the extent specified in such opinion,
if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to the Representatives) of other counsel reasonably
acceptable to the Representatives, familiar with the applicable laws; and (ii) as to matters of fact, to the extent they deem proper,
on certificates or other written statements of officers of the Company and officers of departments of various jurisdictions having custody
of documents respecting the corporate existence or good standing of the Company, provided that copies of any such statements or
certificates shall be delivered to Representatives’ Counsel if requested.
4.3. Comfort
Letters.
4.3.1. Cold
Comfort Letter. At the time this Agreement is executed you shall have received a cold comfort letter containing statements and information
of the type customarily included in accountants’ comfort letters with respect to the financial statements and certain financial
information contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus, addressed to the Representatives
and in form and substance satisfactory in all respects to you and to the Auditor, dated as of the date of this Agreement.
4.3.2. Bring-down
Comfort Letter. At each of the Closing Date and the Option Closing Date, if any, the Representatives shall have received from the
Auditor a letter, dated as of the Closing Date or the Option Closing Date, as applicable, to the effect that the Auditor reaffirms the
statements made in the letter furnished pursuant to Section 4.3.1, except that the specified date referred to shall be a date
not more than three (3) Business Days prior to the Closing Date or the Option Closing Date, as applicable.
4.4. Officers’
Certificates.
4.4.1. Officers’
Certificate. The Company shall have furnished to the Representatives a certificate, dated the Closing Date and any Option Closing
Date (if such date is other than the Closing Date), of its Chief Executive Officer, its President and its Chief Financial Officer stating
that (i) such officers have carefully examined the Registration Statement, the Pricing Disclosure Package, any Issuer Free Writing Prospectus
and the Prospectus and, in their opinion, the Registration Statement and each amendment thereto, as of the Applicable Time and as of
the Closing Date (or any Option Closing Date if such date is other than the Closing Date) did not include any untrue statement of a material
fact and did not omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading,
and the Pricing Disclosure Package, as of the Applicable Time and as of the Closing Date (or any Option Closing Date if such date is
other than the Closing Date), any Issuer Free Writing Prospectus as of its date and as of the Closing Date (or any Option Closing Date
if such date is other than the Closing Date), the Prospectus and each amendment or supplement thereto, as of the respective date thereof
and as of the Closing Date, did not include any untrue statement of a material fact and did not omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances in which they were made, not misleading, (ii) since the effective
date of the Registration Statement, no event has occurred which should have been set forth in a supplement or amendment to the Registration
Statement, the Pricing Disclosure Package or the Prospectus, (iii) to the best of their knowledge after reasonable investigation, as
of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), the representations and warranties of the
Company in this Agreement are true and correct in all material respects (except for those representations and warranties qualified as
to materiality, which shall be true and correct in all respects and except for those representations and warranties which refer to facts
existing at a specific date, which shall be true and correct as of such date) and the Company has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date (or any Option Closing Date if such
date is other than the Closing Date), and (iv) there has not been, subsequent to the date of the most recent audited financial statements
included or incorporated by reference in the Pricing Disclosure Package, a Material Adverse Change.
4.4.2. Secretary’s
Certificate. At the Closing Date and the Option Closing Date, if any, the Representatives shall have received a certificate of the
Company signed by the Secretary of the Company, dated the Closing Date, certifying: (i) that each of the Charter and Bylaws is true and
complete, has not been modified and is in full force and effect; (ii) that the resolutions of the Company’s Board of Directors
(and any pricing committee thereof) relating to the Offering are in full force and effect and have not been modified; and (iii) as to
the incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.
4.5. No
Material Changes. Prior to and on the Closing Date and each Option Closing Date, if any: (i) there shall have been no Material
Adverse Change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates
as of which such condition is set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus; (ii) no action,
suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Insider before or by any court
or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may reasonably
be expected to cause a Material Adverse Change, except as set forth in the Registration Statement, the Pricing Disclosure Package and
the Prospectus; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated
or threatened by the Commission; and (iv) the Registration Statement, the Pricing Disclosure Package and the Prospectus and any amendments
or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities
Act and the Securities Act Regulations and shall conform in all material respects to the requirements of the Securities Act and the Securities
Act Regulations, and neither the Registration Statement, the Pricing Disclosure Package nor the Prospectus nor any amendment or supplement
thereto shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they were made, not misleading.
4.6. Delivery
of Agreements.
4.6.1. Lock-Up
Agreements. On or before the date of this Agreement, the Company shall have delivered to the Representatives executed copies of the
Lock-Up Agreements.
4.6.2. Representatives’
Warrant. On the Closing date, the Company shall have delivered to the Representatives an executed copy of the Representatives’
Warrant.
4.7. Additional
Documents. At the Closing Date and at each Option Closing Date, if any, Representatives’ Counsel shall have been furnished
with such documents and opinions as they may require for the purpose of enabling Representatives’ Counsel to deliver an opinion
to the Underwriters, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Public Securities
and the Representatives’ Warrants as herein contemplated shall be satisfactory in form and substance to the Representatives and
Representatives’ Counsel.
5. Indemnification.
5.1. Indemnification
of the Underwriters.
5.1.1. General.
Subject to the conditions set forth below, the Company agrees to indemnify and hold harmless each Underwriter, its affiliates and each
of its and their respective directors, officers, members, employees, representatives, partners, shareholders, affiliates, counsel, and
agents and each person, if any, who controls any such Underwriter within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act (collectively the “Underwriter Indemnified Parties,” and each an “Underwriter Indemnified
Party”), against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all
legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened,
or any claim whatsoever, whether arising out of any action between any of the Underwriter Indemnified Parties and the Company or between
any of the Underwriter Indemnified Parties and any third party, or otherwise) to which they or any of them may become subject under the
Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries (a “Claim”),
arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained, or the omission or alleged
omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, in (A) the Registration Statement, the Pricing Disclosure Package, any Preliminary
Prospectus, the Prospectus, or in any Issuer Free Writing Prospectus or in any Written Testing-the-Waters Communication (as from time
to time each may be amended and supplemented); (B) any materials or information provided to investors by, or with the approval of, the
Company in connection with the marketing of the Offering, including any “road show” or investor presentations made to investors
by the Company (whether in person or electronically); or (C) any application or other document or written communication (in this Section
5, collectively called “application”) executed by the Company or based upon written information furnished by the Company
in any jurisdiction in order to qualify the Public Securities and Representatives’ Warrants under the securities laws thereof or
filed with the Commission, any state securities commission or agency, the Exchange or any other national securities exchange; unless,
with respect to each subsection (A) through (C), such statement or omission was made in reliance upon, and in conformity with, the Underwriters’
Information. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Registration Statement,
Pricing Disclosure Package or Prospectus, the indemnity agreement contained in this Section 5.1.1 shall not inure to the benefit
of any Underwriter Indemnified Party to the extent that any loss, liability, claim, damage or expense of such Underwriter Indemnified
Party results from the fact that a copy of the Prospectus was not given or sent to the person asserting any such loss, liability, claim
or damage at or prior to the written confirmation of sale of the Public Securities to such person as required by the Securities Act and
the Securities Act Regulations, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to
deliver the Prospectus was a result of non-compliance by the Company with its obligations under Section 3.3 hereof. The Company
also agrees that it will reimburse each Underwriter Indemnified Party for all reasonable fees and expenses (including but not limited
to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced
or threatened, or any claim whatsoever, whether arising out of any action between any of the Underwriter Indemnified Parties and the
Company or between any of the Underwriter Indemnified Parties and any third party, or otherwise) (collectively, the “Expenses”),
and further agrees wherever and whenever possible to advance payment of Expenses as they are incurred by an Underwriter Indemnified Party
in investigating, preparing, pursuing or defending any Claim.
5.1.2. Procedure.
If any action is brought against an Underwriter Indemnified Party in respect of which indemnity may be sought against the Company pursuant
to Section 5.1.1, such Underwriter Indemnified Party shall promptly notify the Company in writing of the institution of such action
and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the approval of such
Underwriter Indemnified Party (which approval shall not be unreasonably withheld)) and payment of actual expenses if an Underwriter Indemnified
Party requests that the Company do so. Such Underwriter Indemnified Party shall have the right to employ its or their own counsel in
any such case, and the fees and expenses of such counsel shall be at the expense of the Company and shall be advanced by the Company;
provided, however, that the Company shall not be obligated to bear the reasonable fees and expenses of more than one firm
of attorneys selected by the Underwriter Indemnified Party (in addition to local counsel). Notwithstanding anything to the contrary contained
herein, and provided that the Company has timely honored its obligations under Section 5, the Underwriter Indemnified Party shall
not enter into any settlement without the prior written consent (which shall not be unreasonably withheld) of the terms of any settlement
by the Company. The Company shall not be liable for any settlement of any action effected without its prior written consent (which shall
not be unreasonably delayed or withheld). In addition, the Company shall not, without the prior written consent of the Underwriters (which
consent shall not be unreasonably withheld), settle, compromise or consent to the entry of any judgment in or otherwise seek to terminate
any pending or threatened action in respect of which advancement, reimbursement, indemnification or contribution may be sought hereunder
(whether or not such Underwriter Indemnified Party is a party thereto) unless such settlement, compromise, consent or termination (i)
includes an unconditional release of each Underwriter Indemnified Party, acceptable to such Underwriter Indemnified Party, from all liabilities,
expenses and claims arising out of such action for which indemnification or contribution may be sought and (ii) does not include a statement
as to or an admission of fault, culpability or a failure to act, by or on behalf of any Underwriter Indemnified Party.
5.2. Indemnification
of the Company. Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company, its directors,
its officers who signed the Registration Statement and persons who control 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 foregoing indemnity
from the Company to the several Underwriters, as incurred, but only with respect to such losses, liabilities, claims, damages and expenses
(or actions in respect thereof) which arise out of or are based upon untrue statements or omissions, or alleged untrue statements or
omissions made in the Registration Statement, any Preliminary Prospectus, the Pricing Disclosure Package or Prospectus or any amendment
or supplement thereto or in any application, in reliance upon, and in conformity with, the Underwriters’ Information. In case any
action shall be brought against the Company or any other person so indemnified based on any Preliminary Prospectus, the Registration
Statement, the Pricing Disclosure Package or Prospectus or any amendment or supplement thereto or any application, and in respect of
which indemnity may be sought against any Underwriter, such Underwriter shall have the rights and duties given to the Company, and the
Company and each other person so indemnified shall have the rights and duties given to the several Underwriters by the provisions of
Section 5.1.2. The Company agrees promptly to notify the Representatives of the commencement of any litigation or proceedings
against the Company or any of its officers, directors or any person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act, in connection with the issuance and sale of the Public Securities or in connection
with the Registration Statement, the Pricing Disclosure Package, the Prospectus, or any Issuer Free Writing Prospectus or any Written
Testing-the-Waters Communication.
5.3. Contribution.
If the indemnification provided for in this Section 5 shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 5.1 or 5.2 in respect of any liabilities and Expenses referred to therein, then each indemnifying party
shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result
of such liabilities and Expenses, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company,
on the one hand, and each of the Underwriters, on the other hand, from the Offering, or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to
in clause (i) above but also the relative fault of the Company, on the one hand, and the Underwriters, on the other hand, in connection
with the matters as to which such liabilities or Expenses relate, as well as any other relevant equitable considerations. The relative
benefits received by the Company, on the one hand, and the Underwriters, on the other, with respect to such Offering shall be deemed
to be in the same proportion as the total net proceeds actually received by the Company from the Offering of the Public Securities purchased
under this Agreement (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions actually
received by the Underwriters in connection with the Offering, in each case as set forth in the table on the cover page of the Prospectus.
The relative fault of the Company, on the one hand, and the Underwriters, on the other, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, on the one hand, or the Underwriters, on the other, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such untrue statement, omission, act or failure to act; provided
that the parties hereto agree that the written information furnished to the Company through the Representatives by or on behalf of
any Underwriter for use in any Preliminary Prospectus, any Registration Statement or the Prospectus, or in any amendment or supplement
thereto, consists solely of the Underwriters’ Information. The Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this subsection (d) were determined by pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred
to above in this subsection (d). Notwithstanding the above, no person guilty of fraudulent misrepresentation within the meaning of Section
11(f) of the Securities Act shall be entitled to contribution from a party who was not guilty of such fraudulent misrepresentation.
5.4. Limitation.
The Company also agrees that no Underwriter Indemnified Party shall have any liability (whether direct or indirect, in contract or tort
or otherwise) to the Company for or in connection with advice or services rendered or to be rendered by any Underwriter Indemnified Party
pursuant to this Agreement, the transactions contemplated thereby or any Underwriter Indemnified Party’s actions or inactions in
connection with any such advice, services or transactions, except to the extent that a court of competent jurisdiction has made a finding
that liabilities (and related Expenses) of the Company have resulted from such Underwriter Indemnified Party’s fraud, bad faith,
gross negligence or willful misconduct in connection with any such advice, actions, inactions or services or such Underwriter Indemnified
Party’s breach of this Agreement or any obligations of confidentiality owed to the Company.
5.5. Survival
& Third-Party Beneficiaries. The advancement, reimbursement, indemnity and contribution obligations set forth in this Section
5 shall remain in full force and effect regardless of any termination of, or the completion of any Underwriter Indemnified Party’s
services under or in connection with, this Agreement. Each Underwriter Indemnified Party’s is an intended third-party beneficiary
of this Section 5, and has the right to enforce the provisions of Section 5 as if he/she/it was a party to this Agreement.
6. Default
by an Underwriter.
6.1. Default
Not Exceeding 10% of Firm Securities or Option Securities. If any Underwriter or Underwriters shall default in its or their obligations
to purchase the Firm Securities or the Option Securities , if the Over-allotment Option is exercised hereunder, and if the number of
the Firm Securities or Option Securities with respect to which such default relates does not exceed in the aggregate 10% of the number
of Firm Securities or Option Securities that all Underwriters have agreed to purchase hereunder, then such Firm Securities or Option
Securities to which the default relates shall be purchased by the non-defaulting Underwriters in proportion to their respective commitments
hereunder.
6.2. Default
Exceeding 10% of Firm Securities or Option Securities. In the event that the default addressed in Section 6.1 relates
to more than 10% of the Firm Securities or Option Securities, you may in your discretion arrange for yourself or for another party or
parties to purchase such Firm Securities or Option Securities to which such default relates on the terms contained herein. If, within
one (1) Business Day after such default relating to more than 10% of the Firm Securities or Option Securities, you do not arrange for
the purchase of such Firm Securities or Option Securities, then the Company shall be entitled to a further period of one (1) Business
Day within which to procure another party or parties satisfactory to you to purchase said Firm Securities or Option Securities on such
terms. In the event that neither you nor the Company arrange for the purchase of the Firm Securities or Option Securities to which a
default relates as provided in this Section 6, this Agreement will automatically be terminated by you or the Company without liability
on the part of the Company (except as provided in Sections 8.3 and 5 hereof) or the several Underwriters (except as provided
in Section 5 hereof); provided, however, that if such default occurs with respect to the Option Securities , this
Agreement will not terminate as to the Firm Securities ; and provided, further, that nothing herein shall relieve a defaulting
Underwriter of its liability, if any, to the other Underwriters and to the Company for damages occasioned by its default hereunder.
6.3. Postponement
of Closing Date. In the event that the Firm Securities or Option Securities to which the default relates are to be purchased
by the non-defaulting Underwriters, or are to be purchased by another party or parties as aforesaid, you or the Company shall have the
right to postpone the Closing Date or Option Closing Date for a reasonable period, but not in any event exceeding five (5) Business Days,
in order to effect whatever changes may thereby be made necessary in the Registration Statement, the Pricing Disclosure Package or the
Prospectus or in any other documents and arrangements, and the Company agrees to file promptly any amendment to the Registration Statement,
the Pricing Disclosure Package or the Prospectus that in the opinion of counsel for the Underwriter may thereby be made necessary. The
term “Underwriter” as used in this Agreement shall include any party substituted under this Section 6 with like effect
as if it had originally been a party to this Agreement with respect to such Firm Securities or Option Securities.
7. Intentionally
Omitted.
8. Effective
Date of this Agreement and Termination Thereof.
8.1. Effective
Date. This Agreement shall become effective when both the Company and the Representatives have executed the same and delivered
counterparts of such signatures to the other party.
8.2. Termination.
The Representatives shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any domestic or
international event or act or occurrence has materially disrupted, or in your opinion will in the immediate future materially disrupt,
general securities markets in the United States; or (ii) if trading on the New York Share Exchange or the Nasdaq Share Market LLC shall
have been suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices
for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction;
or (iii) if the United States shall have become involved in a new war or an increase in major hostilities; or (iv) if a banking moratorium
has been declared by a New York State or federal authority; or (v) if a moratorium on foreign exchange trading has been declared which
materially adversely impacts the United States securities markets; or (vi) if the Company shall have sustained a material loss by fire,
flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have
been insured, will, in your opinion, make it inadvisable to proceed with the delivery of the Firm Securities (or Pre-Funded Warrants)
or Option Securities; or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder;
or (viii) if the Representatives shall have become aware after the date hereof of such a Material Adverse Change, or such adverse material
change in general market conditions as in the Representatives’ judgment would make it impracticable to proceed with the offering,
sale and/or delivery of the Public Securities or to enforce contracts made by the Underwriters for the sale of the Public Securities.
8.3. Expenses.
Notwithstanding anything to the contrary in this Agreement, except in the case of a default by the Underwriters, pursuant to Section
6.2 above, in the event that this Agreement shall not be carried out for any reason whatsoever, within the time specified herein
or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Underwriters their actual and accountable
out-of-pocket expenses related to the transactions contemplated herein then due and payable up to the amounts set forth in Section
3.10.1 and upon demand the Company shall pay such amount thereof to the Representatives on behalf of the Underwriters; provided,
however, that such expense cap in no way limits or impairs the indemnification and contribution provisions of this Agreement.
Notwithstanding the foregoing, any advance received by the Representatives will be reimbursed to the Company to the extent not actually
incurred in compliance with FINRA Rule 5110(g)(4)(A).
8.4. Indemnification.
Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and
whether or not this Agreement is otherwise carried out, the provisions of Section 5 shall remain in full force and effect and
shall not be in any way affected by, such election or termination or failure to carry out the terms of this Agreement or any part hereof.
8.5. Representations,
Warranties, Agreements to Survive. All representations, warranties and agreements contained in this Agreement or in certificates
of officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation
made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or
directors or any person controlling the Company or (ii) delivery of and payment for the Public Securities.
9. Miscellaneous.
9.1. Notices.
All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed (registered
or certified mail, return receipt requested), emailed, personally delivered or sent by facsimile transmission and confirmed and shall
be deemed given when so delivered or faxed and confirmed or if mailed, two (2) days after such mailing.
If
to the Representatives:
Boustead
Securities, LLC
6
Venture, Suite 265
Irvine,
CA 92618
Attn: Keith Moore
Email:
keith@boustead1828.com
EF
Hutton, division of Benchmark Investments, LLC
590
Madison Avenue, 39th Floor
New
York, NY 10022
Attn:
Sam Fleischman
Email: sfleischman@efhuttongroup.com
With
a copy (which shall not constitute notice) to:
ArentFox
Schiff LLP
1717
K Street, NW
Washington,
DC 20006
Attention:
Cavas S. Pavri, Esq.
Fax
No: (202) 778-6460
If
to the Company:
Sidus
Space, Inc.
150
N. Sykes Creek Parkway, Suite 200
Merritt
Island, FL 32953
Attention:
Carol Craig, Chief Executive Officer
Email:
Carol.Craig@craigtechinc.com
With
a copy (which shall not constitute notice) to:
Sheppard,
Mullin, Richter & Hampton LLP
30
Rockefeller Plaza
New
York, NY 10112
Attention:
Jeffrey J. Fessler, Esq.
Fax
No: 917-438-6133
9.2. Headings.
The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this Agreement.
9.3. Amendment.
This Agreement may only be amended by a written instrument executed by each of the parties hereto.
9.4. Entire
Agreement. This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with
this Agreement) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and supersedes
all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof. Notwithstanding
anything to the contrary set forth herein, it is understood and agreed by the parties hereto that all other terms and conditions of that
certain engagement letter between the Company and Boustead Securities, LLC dated as of December 7, 2022 shall remain in full force and
effect.
9.5. Binding
Effect. This Agreement shall inure solely to the benefit of and shall be binding upon the Representatives, the Underwriters,
the Company and the controlling persons, directors and officers referred to in Section 5 hereof, and their respective successors,
legal representatives, heirs and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy
or claim under or in respect of or by virtue of this Agreement or any provisions herein contained. The term “successors and assigns”
shall not include a purchaser, in its capacity as such, of securities from any of the Underwriters.
9.6. Governing
Law; Consent to Jurisdiction; Trial by Jury. This Agreement shall be governed by and construed and enforced in accordance with
the laws of the State of California, without giving effect to conflict of laws principles thereof. The Company hereby agrees that any
action, proceeding or claim against it arising out of, or relating in any way to this Agreement shall be brought and enforced in the
Los Angeles, California, or in the United States District Court located in Los Angeles, California, and irrevocably submits to such jurisdiction,
which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent
an inconvenient forum. Any such process or summons to be served upon the Company may be served by transmitting a copy thereof by registered
or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 9.1 hereof.
Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim. The
Company agrees that the prevailing party(ies) in any such action shall be entitled to recover from the other party(ies) all of its reasonable
attorneys’ fees and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor.
The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its shareholders and affiliates) and each of
the Underwriters hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in
any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.
9.7. Execution
in Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate
counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement,
and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of the other
parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf transmission shall constitute valid and
sufficient delivery thereof.
9.8. Waiver,
etc. The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed
or construed to be a waiver of any such provision, nor to in any way effect the validity of this Agreement or any provision hereof or
the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach, non-compliance
or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument executed by
the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or
non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.
[Signature
Page Follows]
If
the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided
below for that purpose, whereupon this letter shall constitute a binding agreement between us.
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Very
truly yours, |
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Sidus
Space, Inc. |
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By: |
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Name: |
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Title: |
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Confirmed
as of the date first written above mentioned, on behalf of itself and as Representatives of the several Underwriters named on Schedule
1 hereto:
| Boustead
Securities, LLC |
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| By: |
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| Name: |
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| Title: |
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| EF
Hutton, division of Benchmark Investments, LLC |
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| By: |
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| Name: |
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| Title: |
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SCHEDULE
1
| Underwriter | |
Total Number of Firm
Securities to be Purchased | |
Number of Additional
Option Securities to be
Purchased if the Over-
Allotment Option is
Fully Exercised |
| Boustead Securities, LLC | |
[●] | |
[●] |
| EF Hutton, division of Benchmark Investments, LLC | |
[●] | |
[●] |
| TOTAL | |
[●] | |
[●] |
SCHEDULE
2-A
Pricing
Information
Number
of Firm Shares: [●]
Number
of Firm Warrants: [●] Warrants
Number
of Option Shares: [●]
Number
of Option Warrants: [●] Warrants
Public
Offering Price per one Firm Share and one Warrant: $[●]
Underwriting
Discount per one Firm Share and one Warrant: $[●] (7.0%)
Price
per Option Share: $[●]
Underwriting
Discount per Option Share: $[●]
Price
per Option Warrant: $0.001
Underwriting
Discount per Option Warrant: $0.00093 (7.0%)
Non-Accountable
Expense Allowance per one Firm Share or Option Share and one Warrant: $[●] (1.0%)
SCHEDULE
2-B
Issuer
General Use Free Writing Prospectuses
None
EXHIBIT
A
Form
of Representatives’ Warrant
EXHIBIT
B
Form
of Lock-Up Agreement
Exhibit
4.2
COMMON
WARRANT
SIDUS
SPACE, INC.
WARRANT
TO PURCHASE COMMON STOCK
Warrant
No.: [ ]
Number
of Shares of Common Stock: [ ]
Date
of Issuance: March [ ], 2023 (“Issuance Date”)
Sidus
Space, Inc., a company organized under the laws of Delaware (the “Company”), hereby certifies that, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, [ ], the registered holder hereof or its permitted assigns
(the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise Price
(as defined below) then in effect, at any time or times on or after March [ ], 2023 (the “Initial Exercisability Date”),
but not after 11:59 p.m., New York time, on the Expiration Date, (as defined below), [ ] fully paid non-assessable shares of Common Stock
(as defined below), subject to adjustment as provided herein (the “Warrant Shares”). Except as otherwise defined herein,
capitalized terms in this Warrant to Purchase Common Stock (including any Warrants to Purchase Common Stock issued in exchange, transfer
or replacement hereof, this “Warrant”), shall have the meanings set forth in Section 16. This Warrant is one of the
Warrants to Purchase Common Stock (the “Warrants”) issued pursuant to (i) that certain Underwriting Agreement, dated
as of March [ ], 2023 (the “Subscription Date”) by and between the Company and Boustead Securities, LLC and EF Hutton,
division of Benchmark Investments, LLC, as representatives of the several underwriters named therein, (ii) the Company’s Registration
Statement on Form S-1 (File number 333-[ ] under the Securities Act of 1933, as amended (the “Registration Statement”)
and (iii) the Company’s prospectus dated as of February 8, 2023.
1.
EXERCISE OF WARRANT.
(a)
Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in
Section 1(f)), this Warrant may be exercised by the Holder at any time or times on or after the Initial Exercisability Date, in whole
or in part, by delivery (whether via facsimile, electronic mail or otherwise) of a written notice, in the form attached hereto as Annex
A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant. Within one (1) Trading Day
following the delivery of the Exercise Notice, the Holder shall make payment to the Company of an amount equal to the Exercise Price
in effect on the date of such exercise multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the “Aggregate
Exercise Price”) in cash by wire transfer of immediately available funds or, if the provisions of Section 1(d) are applicable,
by notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section 1(d)). For clarification
purposes, any reference to a Cashless Exercise in this Warrant shall include, without limitation, an “alternative cashless exercise”
as contemplated in Section 1(d) below. The Holder shall not be required to deliver the original Warrant in order to effect an exercise
hereunder, nor shall any ink-original signature or medallion guarantee (or other type of guarantee or notarization) with respect to any
Exercise Notice be required. Execution and delivery of the Exercise Notice with respect to less than all of the Warrant Shares shall
have the same effect as cancellation of the original Warrant and issuance of a new Warrant evidencing the right to purchase the remaining
number of Warrant Shares and the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has
purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender
this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Exercise Notice is delivered
to the Company. On or before the first (1st) Trading Day following the date on which the Holder has delivered the applicable Exercise
Notice, the Company shall transmit by facsimile or electronic mail an acknowledgment of confirmation of receipt of the Exercise Notice,
in the form attached to the Exercise Notice, to the Holder and the Transfer Agent. So long as the Holder delivers the Aggregate Exercise
Price (or notice of a Cashless Exercise, if applicable) on or prior to the first (1st) Trading Day following the date on which the Exercise
Notice has been delivered to the Company, then on or prior to the earlier of (i) the second (2nd) Trading Day and (ii) the number of
Trading Days comprising the Standard Settlement Period, in each case following the date on which the Exercise Notice has been delivered
to the Company, or, if the Holder does not deliver the Aggregate Exercise Price (or notice of a Cashless Exercise, if applicable) on
or prior to the first (1st) Trading Day following the date on which the Exercise Notice has been delivered to the Company, then on or
prior to the first (1st) Trading Day following the date on which the Aggregate Exercise Price (or notice of a Cashless Exercise) is delivered
(such earlier date, or if later, the earliest day on which the Company is required to deliver Warrant Shares pursuant to this Section
1(a), the “Share Delivery Date”), the Company shall (X) provided that the Transfer Agent is participating in The Depository
Trust Company (“the DTC”) Fast Automated Securities Transfer Program (“FAST”), credit such aggregate number
of Warrant Shares to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account
with DTC through its Deposit / Withdrawal At Custodian system, or (Y) if the Transfer Agent is not participating in FAST, issue and dispatch
by overnight courier to the physical address or email address as specified in the Exercise Notice, a certificate or evidence of a credit
of book-entry shares, registered in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled
pursuant to such exercise. The Company shall be responsible for all fees and expenses of the Transfer Agent and all fees and expenses
with respect to the issuance of Warrant Shares via DTC, if any, including without limitation for same day processing. Upon delivery of
the Exercise Notice, the Holder shall be deemed for all corporate purposes to have become the holder of record and beneficial owner of
the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date such Warrant Shares are credited to
the Holder’s DTC account or the date of delivery of the certificates evidencing such Warrant Shares, as the case may be. If this
Warrant is physically delivered to the Company in connection with any exercise pursuant to this Section 1(a) and the number of Warrant
Shares represented by this Warrant submitted for exercise is greater than the number of Warrant Shares being acquired upon an exercise,
then the Company shall as soon as practicable and in no event later than three (3) Trading Days after any exercise and at its own expense,
issue and deliver to the Holder (or its designee) a new Warrant (in accordance with Section 7(d)) representing the right to purchase
the number of Warrant Shares issuable immediately prior to such exercise under this Warrant, less the number of Warrant Shares with respect
to which this Warrant is exercised. No fractional Warrant Shares are to be issued upon the exercise of this Warrant, but rather the number
of Warrant Shares to be issued shall be rounded down to the nearest whole number. The Company shall pay any and all transfer, stamp,
issuance and similar taxes, costs and expenses (including, without limitation, fees and expenses of the Transfer Agent) which may be
payable with respect to the issuance and delivery of Warrant Shares upon exercise of this Warrant. The Company’s obligations to
issue and deliver Warrant Shares in accordance with the terms and subject to the conditions hereof are absolute and unconditional, irrespective
of any action or inaction by the Holder to enforce the same, any waiver or consent with respect to any provision hereof, the recovery
of any judgment against any Person or any action to enforce the same, or any setoff, counterclaim, recoupment, limitation or termination;
provided, however, that the Company shall not be required to deliver Warrant Shares with respect to an exercise prior to the Holder’s
delivery of the Aggregate Exercise Price (or notice of a Cashless Exercise) with respect to such exercise.
(b)
Exercise Price. For purposes of this Warrant, “Exercise Price” means $[ ] per share, subject to adjustment
as provided herein.
(c)
Company’s Failure to Timely Deliver Securities. If either (I) the Company shall fail for any reason or for no reason to
issue to the Holder on or prior to the applicable Share Delivery Date, if (x) the Transfer Agent is not participating in FAST, a certificate
or evidence of a book-entry credit for the number of shares of Common Stock to which the Holder is entitled and register such Common
Stock on the Company’s share register or (y) the Transfer Agent is participating in FAST, to credit the Holder’s balance
account with DTC, for such number of shares of Common Stock to which the Holder is entitled upon the Holder’s exercise of this
Warrant or (II) a registration statement (which may be the Registration Statement) covering the issuance of the Warrant Shares that are
the subject of the Exercise Notice (the “Exercise Notice Warrant Shares”) is not available for the issuance of such
Exercise Notice Warrant Shares and (x) the Company fails to promptly, but in no event later than one (1) Business Day after such registration
statement becomes unavailable, to so notify the Holder and (y) the Company is unable to deliver the Exercise Notice Warrant Shares electronically
without any restrictive legend by crediting such aggregate number of Exercise Notice Warrant Shares to the Holder’s or its designee’s
balance account with DTC through its Deposit / Withdrawal At Custodian system (the event described in the immediately foregoing clause
(II) is hereinafter referred as a “Notice Failure” and together with the event described in clause (I) above, an “Exercise
Failure”), then, in addition to all other remedies available to the Holder, if on or prior to the applicable Share Delivery
Date either (I) if the Transfer Agent is not participating in FAST, the Company shall fail to issue and deliver a certificate or evidence
of a book-entry credit to the Holder and register such shares of Common Stock on the Company’s share register or, if the Transfer
Agent is participating in FAST, credit the Holder’s balance account with DTC for the number of shares of Common Stock to which
the Holder is entitled upon the Holder’s exercise hereunder or pursuant to the Company’s obligation pursuant to clause (ii)
below or (II) if a Notice Failure occurs, and if on or after such date the Holder is required by its broker to purchase (in an open market
transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction
of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “Buy-In”),
then the Company shall, within three (3) Trading Days after the Holder’s request, (A) pay in cash to the Holder the amount, if
any, by which (x) the Holder’s total purchase price (including brokerage commissions and other out-of-pocket expenses, if any)
for the shares of Common Stock so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the
Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving
rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent
number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to
the Holder the number of shares of Common Stock that would have been issued had the Company timely complied with its exercise and delivery
obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with
respect to an attempted exercise of shares of Common Stock with an aggregate sale price giving rise to such purchase obligation of $10,000,
under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide
the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence
of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder,
at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s
failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof. The Company’s
current transfer agent participates in FAST. In the event that the Company changes transfer agents while this Warrant is outstanding,
the Company shall select a transfer agent that participates in FAST. While this Warrant is outstanding, the Company shall cause its transfer
agent to participate in FAST with respect to this Warrant. In addition to the foregoing rights, (i) if the Company fails to deliver the
applicable number of Warrant Shares upon an exercise pursuant to Section 1 by the applicable Share Delivery Date, then the Holder shall
have the right to rescind such exercise in whole or in part and retain and/or have the Company return, as the case may be, any portion
of this Warrant that has not been exercised pursuant to such Exercise Notice; provided that the rescission of an exercise shall not affect
the Company’s obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section 1(c)
or otherwise, and (ii) if a registration statement (which may be the Registration Statement) covering the issuance of the Warrant Shares
that are subject to an Exercise Notice is not available for the issuance of such Exercise Notice Warrant Shares and the Holder has submitted
an Exercise Notice prior to receiving notice of the non-availability of such registration statement and the Company has not already delivered
the Warrant Shares underlying such Exercise Notice electronically without any restrictive legend by crediting such aggregate number of
Warrant Shares to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account
with DTC through its Deposit / Withdrawal At Custodian system, the Holder shall have the option, by delivery of notice to the Company,
to (x) rescind such Exercise Notice in whole or in part and retain or have returned, as the case may be, any portion of this Warrant
that has not been exercised pursuant to such Exercise Notice; provided that the rescission of an Exercise Notice shall not affect the
Company’s obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise,
and/or (y) switch some or all of such Exercise Notice from a cash exercise to a Cashless Exercise. In addition to the foregoing, if the
Company fails for any reason to deliver to the Holder the Warrant Shares subject to an Exercise Notice by the second Trading Day following
the Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of
Warrant Shares subject to such exercise (based on the Weighted Average Price of the Common Stock on the date of the applicable Exercise
Notice), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading Day after such liquidated damages begin to accrue)
for each Trading Day after the second Trading Day following such Share Delivery Date until such Warrant Shares are delivered or Holder
rescinds such exercise.
(d)
Cashless Exercise. Notwithstanding anything contained herein to the contrary, if a registration statement (which may be the Registration
Statement) covering the issuance of the Exercise Notice Warrant Shares is not available for the issuance of such Exercise Notice Warrant
Shares, the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu of making the cash payment otherwise
contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price, elect instead to receive upon such
exercise the “Net Number” of shares of Common Stock determined according to the following formula (a “Cashless Exercise”):
| Net
Number = (A x B) - (A x C) |
| B |
For
purposes of the foregoing formula:
| |
A
= the total number of shares with respect to which this Warrant is then being exercised. |
| |
B
= as applicable: (i) the Weighted Average Price of the Common Stock on the Trading Day immediately preceding the date of the applicable
Exercise Notice if such Exercise Notice is (1) both executed and delivered pursuant to Section 1(a) hereof on a day that is not a
Trading Day or (2) both executed and delivered pursuant to Section 1(a) hereof on a Trading Day prior to the opening of “regular
trading hours” (as defined in Rule 600(b)(68) of Regulation NMS promulgated under the federal securities laws) on such Trading
Day, (ii) at the option of the Holder, either (y) the Weighted Average Price on the Trading Day immediately preceding the date of
the applicable Exercise Notice or (z) the Bid Price of the Common Stock as of the time of the Holder’s execution of the applicable
Exercise Notice if such Exercise Notice is executed during “regular trading hours” on a Trading Day and is delivered
within two (2) hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading
Day) pursuant to Section 1(a) hereof or (iii) the Weighted Average Price of the Common Stock on the date of the applicable Exercise
Notice if the date of such Exercise Notice is a Trading Day and such Exercise Notice is both executed and delivered pursuant to Section
1(a) hereof after the close of “regular trading hours” on such Trading Day. |
| |
C
= the Exercise Price then in effect for the applicable Warrant Shares at the time of such exercise. |
If
Warrant Shares are issued in such a cashless exercise, the Company acknowledges and agrees that in accordance with Section 3(a)(9) of
the Securities Act of 1933, as amended, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised,
and the holding period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares. The Company agrees
not to take any position contrary to this Section 1(d). Without limiting the rights of a Holder to receive Warrant Shares on a “cashless
exercise,” and to receive the cash payments contemplated pursuant to Sections 1(c) and 4(b), in no event will the Company be required
to net cash settle a Warrant exercise.
Notwithstanding
anything to the contrary herein, the Holder may also effect an “alternative cashless exercise” on or after the earlier of
the thirty (30) day anniversary of the Subscription Date. In such event, the aggregate number of Warrant Shares issuable in such alternative
cashless exercise pursuant to any given Notice of Exercise electing to effect an alternative cashless exercise shall equal the product
of (x) the aggregate number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this
Warrant if such exercise were by means of a cash exercise rather than a cashless exercise and (y) 0.50.
(e)
Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the number of
Warrant Shares to be issued pursuant to the terms hereof, the Company shall promptly issue to the Holder the number of Warrant Shares
that are not disputed and resolve such dispute in accordance with Section 11.
(f)
Beneficial Ownership. Notwithstanding anything to the contrary contained herein, the Company shall not effect the exercise of
any portion of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to the terms and
conditions of this Warrant and any such exercise shall be null and void and treated as if never made, to the extent that after giving
effect to such exercise, the Holder together with the other Attribution Parties collectively would beneficially own in excess of 4.99%
(or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) (the “Maximum Percentage”) of the number
of shares of Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate
number of shares of Common Stock beneficially owned by the Holder and the other Attribution Parties shall include the number of shares
of Common Stock held by the Holder and all other Attribution Parties plus the number of shares of Common Stock issuable upon exercise
of this Warrant with respect to which the determination of such sentence is being made, but shall exclude the number of shares of Common
Stock which would be issuable upon (A) exercise of the remaining, unexercised portion of this Warrant beneficially owned by the Holder
or any of the other Attribution Parties and (B) exercise or conversion of the unexercised or unconverted portion of any other securities
of the Company (including, without limitation, any convertible notes or convertible preferred stock or warrants, including the other
Warrants) beneficially owned by the Holder or any other Attribution Party subject to a limitation on conversion or exercise analogous
to the limitation contained in this Section 1(f). For purposes of this Section 1(f), beneficial ownership shall be calculated in accordance
with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “1934 Act”). For purposes of this Warrant,
in determining the number of outstanding shares of Common Stock the Holder may acquire upon the exercise of this Warrant without exceeding
the Maximum Percentage, the Holder may rely on the number of outstanding shares of Common Stock as reflected in (x) the Company’s
most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q and Current Reports on Form 8-K or other public filing with the
Securities and Exchange Commission (the “SEC”), as the case may be, (y) a more recent public announcement by the Company
or (z) any other written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding (the
“Reported Outstanding Share Number”). If the Company receives an Exercise Notice from the Holder at a time when the
actual number of outstanding shares of Common Stock is less than the Reported Outstanding Share Number, the Company shall (i) notify
the Holder in writing of the number of shares of Common Stock then outstanding and, to the extent that such Exercise Notice would otherwise
cause the Holder’s beneficial ownership, as determined pursuant to this Section 1(f), to exceed the Maximum Percentage, the Holder
must notify the Company of a reduced number of Warrant Shares to be purchased pursuant to such Exercise Notice (the number of shares
by which such purchase is reduced, the “Reduction Shares”) and (ii) as soon as reasonably practicable, the Company
shall return to the Holder any exercise price paid by the Holder for the Reduction Shares. For any reason at any time, upon the written
or oral request of the Holder, the Company shall within one (1) Business Day confirm orally and in writing or by electronic mail to the
Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be
determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder and
any other Attribution Party since the date as of which the Reported Outstanding Share Number was reported. In the event that the issuance
of Common Stock to the Holder upon exercise of this Warrant results in the Holder and the other Attribution Parties being deemed to beneficially
own, in the aggregate, more than the Maximum Percentage of the number of outstanding shares of Common Stock (as determined under Section
13(d) of the 1934 Act), the number of shares so issued by which the Holder’s and the other Attribution Parties’ aggregate
beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”) shall be deemed null and void and shall
be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess Shares. As soon as reasonably
practicable after the issuance of the Excess Shares has been deemed null and void, the Company shall return to the Holder the exercise
price paid by the Holder for the Excess Shares. Upon delivery of a written notice to the Company, the Holder may from time to time increase
or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such notice; provided that (i) any
such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such notice is delivered to the
Company and (ii) any such increase or decrease will apply only to the Holder and the other Attribution Parties and not to any other holder
of Warrants that is not an Attribution Party of the Holder. For purposes of clarity, the shares of Common Stock issuable pursuant to
the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned by the Holder for any purpose
including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the 1934 Act. No prior inability to exercise this Warrant pursuant to
this paragraph shall have any effect on the applicability of the provisions of this paragraph with respect to any subsequent determination
of exercisability. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity
with the terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion of this paragraph which may be defective
or inconsistent with the intended beneficial ownership limitation contained in this Section 1(f) or to make changes or supplements necessary
or desirable to properly give effect to such limitation. The limitation contained in this paragraph may not be waived and shall apply
to a successor holder of this Warrant.
(g)
Required Reserve Amount. So long as this Warrant remains outstanding, the Company shall at all times keep reserved for issuance
under this Warrant a number of shares of Common Stock at least equal to 100% of the maximum number of shares of Common Stock as shall
be necessary to satisfy the Company’s obligation to issue shares of Common Stock under the Warrants then outstanding (without regard
to any limitations on exercise) (the “Required Reserve Amount”); provided that at no time shall the number
of shares of Common Stock reserved pursuant to this Section 1(g) be reduced other than in connection with any exercise of Warrants or
such other event covered by Section 2(c) below. The Required Reserve Amount (including, without limitation, each increase in the number
of shares so reserved) shall be allocated pro rata among the holders of the Warrants based on the number of shares of Common Stock issuable
upon exercise of Warrants held by each holder thereof on the Issuance Date (without regard to any limitations on exercise) (the “Authorized
Share Allocation”). In the event that a holder shall sell or otherwise transfer any of such holder’s Warrants, each transferee
shall be allocated a pro rata portion of such holder’s Authorized Share Allocation. Any shares of Common Stock reserved and allocated
to any Person which ceases to hold any Warrants shall be allocated to the remaining holders of Warrants, pro rata based on the number
of shares of Common Stock issuable upon exercise of the Warrants then held by such holders thereof (without regard to any limitations
on exercise).
(h)
Insufficient Authorized Shares. If at any time while this Warrant remains outstanding the Company does not have a sufficient number
of authorized and unreserved shares of Common Stock to satisfy its obligation to reserve for issuance the Required Reserve Amount (an
“Authorized Share Failure”), then the Company shall promptly take all action reasonably necessary to increase the
Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount
for this Warrant then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of
the occurrence of an Authorized Share Failure, but in no event later than ninety (90) days after the occurrence of such Authorized Share
Failure, the Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized shares of Common
Stock. In connection with such meeting, the Company shall provide each stockholder with a proxy statement and shall use its reasonable
best efforts to solicit its stockholders’ approval of such increase in authorized shares of Common Stock and to cause its board
of directors to recommend to the stockholders that they approve such proposal. Notwithstanding the foregoing, if at any such time of
an Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares of its issued and outstanding
shares of Common Stock to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation
by obtaining such consent and submitting for filing with the SEC an Information Statement on Schedule 14C.
2.
ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted
from time to time as follows:
(a)
Intentionally omitted.
(b)
Voluntary Adjustment By Company. Unless prohibited by the rules of the Principal Market, the Company may at any time during the
term of this Warrant reduce the then current Exercise Price to any amount and for any period of time deemed appropriate by the Board
of Directors of the Company.
(c)
Adjustment Upon Subdivision or Combination of Common Stock. If the Company at any time on or after the Subscription Date subdivides
(by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into
a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the
number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Subscription Date combines (by
combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller number of
shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant
Shares will be proportionately decreased. Any adjustment under this Section 2(c) shall become effective at the close of business on the
date the subdivision or combination becomes effective.
3.
RIGHTS UPON DISTRIBUTION OF ASSETS. In addition to any adjustments pursuant to Section 2 above, if, on or after the Subscription
Date and on or prior to the Expiration Date, the Company shall declare or make any dividend or other distribution of its assets (or rights
to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation,
any distribution of cash, stock or other securities, property, options, evidence of indebtedness or any other assets by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant, including without
limitation, the Maximum Percentage) immediately before the date on which a record is taken for such Distribution, or, if no such record
is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution
(provided, however, that to the extent that the Holder’s right to participate in any such Distribution would result in the Holder
and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate in such Distribution
to such extent (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of such Distribution (and
beneficial ownership) to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until
such time or times as its right thereto would not result in the Holder and the other Attribution Parties exceeding the Maximum Percentage,
at which time or times the Holder shall be granted such Distribution (and any Distributions declared or made on such initial Distribution
or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no such limitation).
4.
FUNDAMENTAL TRANSACTIONS. The Company shall not enter into or be party to a Fundamental Transaction unless the Successor Entity
assumes in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 4(b), including
agreements to deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant, including, without limitation, which is exercisable for a corresponding
number of shares of capital stock equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without
regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies
the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock
pursuant to such Fundamental Transaction and the value of such shares of capital stock, such adjustments to the number of shares of capital
stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation
of such Fundamental Transaction). Upon the consummation of each Fundamental Transaction, the Successor Entity shall succeed to, and be
substituted for the Company (so that from and after the date of the applicable Fundamental Transaction, the provisions of this Warrant
and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as
if such Successor Entity had been named as the Company herein. Upon consummation of each Fundamental Transaction, the Successor Entity
shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation
of the applicable Fundamental Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets or other property
(except such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the
exercise of this Warrant prior to the applicable Fundamental Transaction, such shares of common stock (or its equivalent) of the Successor
Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of the applicable Fundamental
Transaction had this Warrant been exercised immediately prior to the applicable Fundamental Transaction (without regard to any limitations
on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. Notwithstanding the foregoing, and without
limiting Section 1(f) hereof, the Holder may elect, at its sole option, by delivery of written notice to the Company to waive this Section
4(b) to permit the Fundamental Transaction without the assumption of this Warrant. In addition to and not in substitution for any other
rights hereunder, prior to the consummation of each Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled
to receive securities or other assets with respect to or in exchange for shares of Common Stock (a “Corporate Event”),
the Company shall make appropriate provision to insure that the Holder will thereafter have the right to receive upon an exercise of
this Warrant at any time after the consummation of the applicable Fundamental Transaction but prior to the Expiration Date, in lieu of
the shares of the Common Stock (or other securities, cash, assets or other property (except such items still issuable under Sections
3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the exercise of the Warrant prior to such Fundamental
Transaction, such shares of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or
subscription rights) (collectively, the “Corporate Event Consideration”) which the Holder would have been entitled
to receive upon the happening of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable
Fundamental Transaction (without regard to any limitations on the exercise of this Warrant). The provision made pursuant to the preceding
sentence shall be in a form and substance reasonably satisfactory to the Requisite Holders. The provisions of this Section 4(b) shall
apply similarly and equally to successive Fundamental Transactions and Corporate Events. Notwithstanding the foregoing, in the event
of a Change of Control (other than a Change of Control which was not approved by the Board of Directors, as to which this right shall
not apply), at the request of the Holder delivered before the 30th day after such Change of Control, the Company (or the Successor Entity)
shall purchase this Warrant from the Holder by paying to the Holder, within five (5) Business Days after such request (or, if later,
on the effective date of the Change of Control), an amount equal to the Black Scholes Value of the remaining unexercised portion of this
Warrant on the effective date of such Change of Control, payable in cash; provided, that if the applicable Change of Control was not
approved by the Company’s Board of Directors, the Black-Scholes Value of the remaining unexercised portion of this Warrant shall
be payable at the option of the Company in either (x) Common Stock, whereby the Company would be continually obligated to actively settle
shares of Common Stock in the event insufficient authorized shares of Common Stock were available (or corresponding Corporate Event Consideration,
as applicable) valued at the value of the consideration received by the shareholders in such Change of Control or (y) cash.
5.
NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation
or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issuance or
sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
and will at all times in good faith carry out all of the provisions of this Warrant and take all action as may be required to protect
the rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares
of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions
as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common
Stock upon the exercise of this Warrant, and (iii) shall, so long as any of the Warrants are outstanding, take all action necessary to
reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the exercise
of the Warrants, the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of the Warrants
then outstanding (without regard to any limitations on exercise).
6.
WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s
capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of capital stock of
the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person’s
capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent
to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or
otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of
the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained
in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant
or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.
Notwithstanding this Section 6, the Company shall provide the Holder with copies of the same notices and other information given to the
stockholders of the Company generally, contemporaneously with the giving thereof to the stockholders.
7.
REISSUANCE OF WARRANTS.
(a)
Transfer of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the
Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as
the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less
than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.
(b)
Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Warrant (as to which a written certification and the indemnification contemplated below shall
suffice as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company
in customary and reasonable form (but without the obligation to post a bond) and, in the case of mutilation, upon surrender and cancellation
of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the
right to purchase the Warrant Shares then underlying this Warrant.
(c)
Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office
of the Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion of
such Warrant Shares as is designated by the Holder at the time of such surrender.
(d)
Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such
new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right
to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or
Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other
new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii)
shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have
the same rights and conditions as this Warrant.
8.
NOTICES. Whenever notice is required to be given under this Warrant, including, without limitation, an Exercise Notice, unless
otherwise provided herein, such notice shall be given in writing, (i) if delivered (a) from within the domestic United States, by first-class
registered or certified airmail, or nationally recognized overnight express courier, postage prepaid, electronic mail or by facsimile
or (b) from outside the United States, by International Federal Express, electronic mail or facsimile, and (ii) will be deemed given
(A) if delivered by first-class registered or certified mail domestic, three (3) Business Days after so mailed, (B) if delivered by nationally
recognized overnight carrier, one (1) Business Day after so mailed, (C) if delivered by International Federal Express, two (2) Business
Days after so mailed and (D) at the time of transmission, if delivered by electronic mail to each of the email addresses specified in
this Section 8 prior to 5:00 p.m. (New York time) on a Trading Day, (E) the next Trading Day after the date of transmission, if delivered
by electronic mail to each of the email addresses specified in this Section 8 on a day that is not a Trading Day or later than 5:00 p.m.
(New York time) on any Trading Day and (F) if delivered by facsimile, upon electronic confirmation of delivery of such facsimile, and
will be delivered and addressed as follows:
(i)
if to the Company, to:
Sidus
Space, Inc.
150
N. Sykes Creek Parkway, Suite 200
Merritt
Island, FL 32953
Attention:
Carol Craig, Chief Executive Officer
Email:
carol.craig@sidusspace.com
(ii)
if to the Holder, at such address or other contact information delivered by the Holder to the Company or as is on the books and records
of the Company.
The
Company shall provide the Holder with prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail
a description of such action and the reason therefor. Without limiting the generality of the foregoing, the Company will give written
notice to the Holder (i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the
calculation of such adjustment and (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a
record (A) with respect to any dividend or distribution upon the shares of Common Stock, (B) with respect to any grants, issuances or
sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of shares
of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation; provided
in each case that such information shall be made known to the public prior to or in conjunction with such notice being provided to the
Holder. It is expressly understood and agreed that the time of exercise specified by the Holder in each Exercise Notice shall be definitive
and may not be disputed or challenged by the Company.
9.
AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended or waived and the Company
may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained
the written consent of the Holder. No waiver shall be effective unless it is in writing and signed by an authorized representative of
the waiving party.
10.
GOVERNING LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance with, and
all questions concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal
laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New
York. The Company hereby irrevocably submits to the exclusive jurisdiction of the courts of the State of New York and of the United States
of America sitting in The City and County of New York for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, 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. The Company 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
to the Company at the address set forth in Section 8(i) above or such other address as the Company subsequently delivers to the Holder
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. Nothing contained herein shall be deemed or
operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect
on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce
a judgment or other court ruling in favor of the Holder. If either party shall commence an action, suit or proceeding to enforce any
provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their
reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action
or proceeding. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.
11.
DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the
Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within
two (2) Business Days of receipt of the Exercise Notice or other event giving rise to such dispute, as the case may be, to the Holder.
If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares
within three (3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company
shall, within two (2) Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation
of the Warrant Shares to the Company’s independent, outside accountant. The Company shall cause at its expense the investment bank
or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results
no later than ten (10) Business Days from the time it receives the disputed determinations or calculations. Such investment bank’s
or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.
12.
REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF.
(a)
The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and any
other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing
herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy
at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach,
the Holder of this Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without
the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information
and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with the
terms and conditions of this Warrant (including, without limitation, compliance with Section 2 hereof). The issuance of shares and certificates
for shares as contemplated hereby upon the exercise of this Warrant shall be made without charge to the Holder or such shares for any
issuance tax or other costs in respect thereof, provided that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of any certificate in a name other than the Holder or its agent on its
behalf.
(b)
If (i) this Warrant is placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal
proceeding or the holder otherwise takes action to collect amounts due under this Warrant or to enforce the provisions of this Warrant
or (ii) there occurs any bankruptcy, reorganization, receivership of the company or other proceedings affecting company creditors’
rights and involving a claim under this Warrant, then the Company shall pay the costs incurred by the Holder for such collection, enforcement
or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, without limitation, attorneys’
fees and disbursements.
13.
TRANSFER. This Warrant and the Warrant Shares may be offered for sale, sold, transferred, pledged or assigned without the consent
of the Company.
14.
SEVERABILITY; CONSTRUCTION; HEADINGS. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid
or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall
be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such
provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues
to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature,
invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal
obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties
will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s). This Warrant shall be
deemed to be jointly drafted by the Company and the Holder and shall not be construed against any Person as the drafter hereof. The headings
of this Warrant are for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant.
15.
DISCLOSURE. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Warrant, unless the Company
has in good faith determined that the matters relating to such notice do not constitute material, non-public information relating to
the Company or its subsidiaries, the Company shall contemporaneously with any such receipt or delivery publicly disclose such material,
non-public information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material,
non-public information relating to the Company or its subsidiaries, the Company so shall indicate to such Holder contemporaneously with
delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters relating
to such notice do not constitute material, non-public information relating to the Company or its subsidiaries.
16.
CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a)
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled
by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a
Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of
directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
(b)
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including,
any funds, feeder funds or managed accounts, currently, or from time to time after the Subscription Date, directly or indirectly managed
or advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of
the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or
any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated
with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the 1934 Act. For clarity, the purpose of
the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.
(c)
“Bid Price” means, for any security as of the particular time of determination, the bid price for such security on
the Principal Market as reported by Bloomberg as of such time of determination, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the bid price of such security on the principal securities exchange or trading market where
such security is listed or traded as reported by Bloomberg as of such time of determination, or if the foregoing does not apply, the
bid price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg
as of such time of determination, or, if no bid price is reported for such security by Bloomberg as of such time of determination, the
average of the bid prices of any market makers for such security as reported in the OTC Link or “pink sheets” by OTC Markets
Group Inc. as of such time of determination. If the Bid Price cannot be calculated for a security as of the particular time of determination
on any of the foregoing bases, the Bid Price of such security as of such time of determination shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security,
then such dispute shall be resolved in accordance with the procedures in Section 11. All such determinations shall be appropriately adjusted
for any stock dividend, stock split, stock combination or other similar transaction during such period.
(d)
“Black Scholes Value” means the value of this Warrant based on the Black-Scholes Option Pricing Model obtained from
the “OV” function on Bloomberg determined as of the day immediately following the first public announcement of the applicable
Change of Control, or, if the Change of Control is not publicly announced, the date the Change of Control is consummated, for pricing
purposes and reflecting (i) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the remaining term
of this Warrant as of such date of request, (ii) an expected volatility equal to 100%, (iii) the underlying price per share used in such
calculation shall be the greater of (A) the sum of the price per share being offered in cash, if any, plus the per share value of any
non-cash consideration, if any, being offered in such Change of Control and (B) the greater of (x) the last Weighted Average Price immediately
prior to the public announcement of such Change of Control and (y) the last Weighted Average Price immediately prior to the consummation
of such Change of Control, (iv) a zero cost of borrow and (v) a 360 day annualization factor.
(e)
“Bloomberg” means Bloomberg Financial Markets.
(f)
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New
York are authorized or required by law to remain closed.
(g)
“Change of Control” means any Fundamental Transaction other than (i) any reorganization, recapitalization or reclassification
of the Common Stock in which holders of the Company’s voting power immediately prior to such reorganization, recapitalization or
reclassification continue after such reorganization, recapitalization or reclassification to hold publicly traded securities and, directly
or indirectly, are, in all material respects, the holders of the voting power of the surviving entity (or entities with the authority
or voting power to elect the members of the board of directors (or their equivalent if other than a corporation) of such entity or entities)
after such reorganization, recapitalization or reclassification, (ii) pursuant to a migratory merger effected solely for the purpose
of changing the jurisdiction of incorporation of the Company or (iii) a merger in connection with a bona fide acquisition by the Company
of any Person in which (x) the gross consideration paid, directly or indirectly, by the Company in such acquisition is not greater than
20% of the Company’s market capitalization as calculated on the date of the consummation of such merger and (y) such merger does
not contemplate a change to the identity of a majority of the board of directors of the Company. Notwithstanding anything herein to the
contrary, any transaction or series of transactions that, directly or indirectly, results in the Company or the Successor Entity not
having Common Stock or common stock, as applicable, registered under the Exchange Act and listed on an Eligible Market shall be deemed
a Change of Control.
(h)
“Closing Bid Price” means, for any security as of any date, the last closing bid price and last closing trade price,
respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price or the closing trade price, as the case may be, then the last bid price
or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Principal
Market is not the principal securities exchange or trading market for such security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange or trading market where such security is listed or traded as reported
by Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in the
over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last
trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively,
of any market makers for such security as reported in the OTC Link or “pink sheets” by OTC Markets Group Inc. If the Closing
Bid Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price of such security
on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable
to agree upon the fair market value of such security, then such dispute shall be resolved pursuant to Section 11. All such determinations
shall be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or other similar transaction
during the applicable calculation period.
(i)
“Common Stock” means (i) the Company’s Class A Common Stock, par value $0.0001 per share, and (ii) any capital
stock into which such Common Stock shall have been changed or any capital stock resulting from a reclassification of such Common Stock.
(j)
“Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into
or exercisable or exchangeable for shares of Common Stock.
(k)
“Eligible Market” means The Nasdaq Capital Market, the NYSE American LLC, The Nasdaq Global Select Market, The Nasdaq
Global Market or The New York Stock Exchange, Inc.
(l)
“Expiration Date” means the date sixty (60) months after the Initial Exercisability Date or, if such date falls on
a day other than a Business Day or on which trading does not take place on the Principal Market (a “Holiday”), the
next day that is not a Holiday.
(m)
“Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries,
Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the
surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation
S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject
to or have its shares of Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer
that is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject
Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock
such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or
exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding
shares of Common Stock, or (iv) consummate a stock purchase agreement or other business combination (including, without limitation, a
reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities,
individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common Stock, (y) at least 50% of the
outstanding shares of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or
Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business combination were not outstanding;
or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in
Rule 13d-3 under the 1934 Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or reclassify
its shares of Common Stock, (B) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise,
in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the
“beneficial owner” (as defined in Rule 13d-3 under the 1934 Act), directly or indirectly, whether through acquisition, purchase,
assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common Stock, merger, consolidation, business
combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification
or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding
shares of Common Stock, (y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding shares of Common
Stock not held by all such Subject Entities as of the Subscription Date calculated as if any shares of Common Stock held by all such
Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding
shares of Common Stock or other equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short
form merger or other transaction requiring other stockholders of the Company to surrender their Common Stock without approval of the
stockholders of the Company or (C) directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related
transactions, the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that
circumvents, the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than
in strict conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition
which may be defective or inconsistent with the intended treatment of such instrument or transaction.
(n)
“Group” means a “group” as that term is used in Section 13(d) of the 1934 Act and as defined in Rule 13d-5
thereunder.
(o)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.
(p)
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person, including
such entity whose common stock or equivalent equity security is quoted or listed on an Eligible Market (or, if so elected by the Holder,
any other market, exchange or quotation system), or, if there is more than one such Person or such entity, the Person or such entity
designated by the Holder or in the absence of such designation, such Person or entity with the largest public market capitalization as
of the date of consummation of the Fundamental Transaction.
(q)
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust,
an unincorporated organization, any other entity and a government or any department or agency thereof.
(r)
“Principal Market” means The Nasdaq Capital Market.
(s)
“Requisite Holders” means the holders of the Warrants representing a majority of the shares of Common Stock underlying
the Warrants then outstanding.
(t)
“Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, for the
Company’s primary trading market or quotation system with respect to the Common Stock that is in effect on the date of receipt
of an applicable Exercise Notice.
(u)
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(v)
“Successor Entity” means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity)
formed by, resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder,
the Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.
(w)
“Trading Day” means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market
is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the
Common Stock is then traded.
(x)
“Transaction Documents” means any agreement entered into by and between the Company and the Holder, as applicable.
(y)
“Transfer Agent” means Pacific Stock Transfer Company, the current transfer agent of the Company, with a mailing address
of 6725 Via Austi Pkwy, Suite 300, Las Vegas, Nevada 89119 and any successor transfer agent of the Company.
(z)
“Weighted Average Price” means, for any security as of any date, the dollar volume-weighted average price for such
security on the Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market
publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its “Volume at Price” function or,
if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other time as such market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as such market publicly announces
is the official close of trading), as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security
by Bloomberg for such hours, the average of the highest Closing Bid Price and the lowest closing ask price of any of the market makers
for such security as reported in the OTC Link or “pink sheets” by OTC Markets Group Inc. If the Weighted Average Price cannot
be calculated for a security on a particular date on any of the foregoing bases, the Weighted Average Price of such security on such
date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to
agree upon the fair market value of such security, then such dispute shall be resolved pursuant to Section 11 with the term “Weighted
Average Price” being substituted for the term “Exercise Price.” All such determinations shall be appropriately adjusted
for any stock dividend, stock split, stock combination, reclassification or other similar transaction during the applicable calculation
period.
[Signature
Page Follows]
IN
WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out
above.
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Sidus
Space, Inc. |
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By: |
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Name: |
Carol
Craig |
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Title: |
Chief
Executive Officer |
[Signature
Page to Warrant to Purchase Common Stock]
Annex
A
EXERCISE
NOTICE
TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
WARRANT
TO PURCHASE COMMON STOCK
SIDUS
SPACE, INC.
The
undersigned holder hereby exercises the right to purchase ______________ shares of Common Stock (“Warrant Shares”)
of Sidus Space, Inc, a company organized under the laws of Delaware (the “Company”), evidenced by the attached Warrant
to Purchase Common Stock (the “Warrant”). Capitalized terms used herein and not otherwise defined shall have the respective
meanings set forth in the Warrant.
1.
Form of Exercise Price. The holder intends that payment of the Exercise Price shall be made as:
______________
a “Cash Exercise” with respect to ______________ Warrant Shares; and/or
______________
a “Cashless Exercise” with respect to ______________ Warrant Shares.
2.
Payment of Exercise Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares
to be issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $ _________ to the Company in accordance
with the terms of the Warrant.
3.
Delivery of Warrant Shares. The Company shall deliver to the holder ______________ Warrant Shares in accordance with the terms of the
Warrant.
Date:
__________________
| Name
of Registered Holder |
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| By: |
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| Name: |
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| Title: |
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ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs Pacific Stock Transfer Company to issue the above indicated number
of shares of Common Stock on or prior to the applicable Share Delivery Date.
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Sidus
Space, Inc. |
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By: |
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Name: |
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Title: |
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Exhibit 4.3
FORM
OF PRE-FUNDED WARRANT
SIDUS
SPACE, INC.
PRE-FUNDED
WARRANT TO PURCHASE COMMON STOCK
Warrant
No.: [ ]
Number
of Shares of Common Stock: [ ]
Date
of Issuance: [ ] (“Issuance Date”)
Sidus
Space, Inc., a company organized under the laws of Delaware (the “Company”), hereby certifies that, for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, [ ], the registered holder hereof or its permitted assigns
(the “Holder”), is entitled, subject to the terms set forth below, to purchase from the Company, at the Exercise Price
(as defined below) then in effect, at any time or times on or after [ ] (the “Initial Exercisability Date”), until
exercised in full (the “Termination Date”), [ ] ([ ]) fully paid non-assessable shares of Common Stock (as defined
below), subject to adjustment as provided herein (the “Warrant Shares”). Except as otherwise defined herein, capitalized
terms in this Warrant to Purchase Common Stock (including any Pre-Funded Warrants to Purchase Common Stock issued in exchange, transfer
or replacement hereof, this “Warrant”), shall have the meanings set forth in Section 16. This Warrant is one of the
Pre-Funded Warrants to Purchase Common Stock (the “Warrants”) issued pursuant to (i) that certain Underwriting Agreement,
dated as of __________, 2023 (the “Subscription Date”) by and between the Company and Boustead Securities, LLC and
EF Hutton, division of Benchmark Investments, LLC, as representatives of the several underwriters named therein, (ii) the Company’s
Registration Statement on Form S-1 (File number 333-[ ]) (the “Registration Statement”) under the Securities Act of
1933, as amended (the “Securities Act”) and (iii) the Company’s prospectus dated as of _______, 2023.
1.
EXERCISE OF WARRANT.
(a)
Mechanics of Exercise. Subject to the terms and conditions hereof (including, without limitation, the limitations set forth in
Section 1(f)), this Warrant may be exercised by the Holder at any time or times on or after the Initial Exercisability Date, in whole
or in part, by delivery (whether via facsimile, electronic mail or otherwise) of a written notice, in the form attached hereto as Annex
A (the “Exercise Notice”), of the Holder’s election to exercise this Warrant. Within one (1) Trading Day
following the delivery of the Exercise Notice, the Holder shall make payment to the Company of an amount equal to the Exercise Price
in effect on the date of such exercise multiplied by the number of Warrant Shares as to which this Warrant is being exercised (the “Aggregate
Exercise Price”) in cash by wire transfer of immediately available funds or, if the provisions of Section 1(d) are applicable,
by notifying the Company that this Warrant is being exercised pursuant to a Cashless Exercise (as defined in Section 1(d)). The Holder
shall not be required to deliver the original Warrant in order to effect an exercise hereunder, nor shall any ink-original signature
or medallion guarantee (or other type of guarantee or notarization) with respect to any Exercise Notice be required. Execution and delivery
of the Exercise Notice with respect to less than all of the Warrant Shares shall have the same effect as cancellation of the original
Warrant and issuance of a new Warrant evidencing the right to purchase the remaining number of Warrant Shares and the Holder shall not
be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder
and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within
three (3) Trading Days of the date on which the final Exercise Notice is delivered to the Company. On or before the first (1st) Trading
Day following the date on which the Holder has delivered the applicable Exercise Notice, the Company shall transmit by facsimile or electronic
mail an acknowledgment of confirmation of receipt of the Exercise Notice, in the form attached to the Exercise Notice, to the Holder
and the Company’s transfer agent (the “Transfer Agent”). So long as the Holder delivers the Aggregate Exercise
Price (or notice of a Cashless Exercise, if applicable) on or prior to the first (1st) Trading Day following the date on which the Exercise
Notice has been delivered to the Company, then on or prior to the earlier of (i) the second (2nd) Trading Day and (ii) the number of
Trading Days comprising the Standard Settlement Period, in each case following the date on which the Exercise Notice has been delivered
to the Company, or, if the Holder does not deliver the Aggregate Exercise Price (or notice of a Cashless Exercise, if applicable) on
or prior to the first (1st) Trading Day following the date on which the Exercise Notice has been delivered to the Company, then on or
prior to the first (1st) Trading Day following the date on which the Aggregate Exercise Price (or notice of a Cashless Exercise) is delivered
(such earlier date, or if later, the earliest day on which the Company is required to deliver Warrant Shares pursuant to this Section
1(a), the “Share Delivery Date”), the Company shall (X) provided that the Transfer Agent is participating in The Depository
Trust Company (“DTC”) Fast Automated Securities Transfer Program, credit such aggregate number of Warrant Shares to
which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account with DTC through
its Deposit / Withdrawal At Custodian system, or (Y) if the Transfer Agent is not participating in the DTC Fast Automated Securities
Transfer Program (“FAST”), issue and dispatch by overnight courier to the physical address or email address as specified
in the Exercise Notice, a certificate or evidence of a credit of book-entry shares, registered in the name of the Holder or its designee,
for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise. The Company shall be responsible for all
fees and expenses of the Transfer Agent and all fees and expenses with respect to the issuance of Warrant Shares via DTC, if any, including
without limitation for same day processing. Upon delivery of the Exercise Notice, the Holder shall be deemed for all corporate purposes
to have become the holder of record and beneficial owner of the Warrant Shares with respect to which this Warrant has been exercised,
irrespective of the date such Warrant Shares are credited to the Holder’s DTC account or the date of delivery of the certificates
evidencing such Warrant Shares, as the case may be. If this Warrant is physically delivered to the Company in connection with any exercise
pursuant to this Section 1(a) and the number of Warrant Shares represented by this Warrant submitted for exercise is greater than the
number of Warrant Shares being acquired upon an exercise, then the Company shall as soon as practicable and in no event later than three
(3) Trading Days after any exercise and at its own expense, issue and deliver to the Holder (or its designee) a new Warrant (in accordance
with Section 7(d)) representing the right to purchase the number of Warrant Shares issuable immediately prior to such exercise under
this Warrant, less the number of Warrant Shares with respect to which this Warrant is exercised. No fractional Warrant Shares are to
be issued upon the exercise of this Warrant, but rather the number of Warrant Shares to be issued shall be rounded down to the nearest
whole number. The Company shall pay any and all transfer, stamp, issuance and similar taxes, costs and expenses (including, without limitation,
fees and expenses of the Transfer Agent) which may be payable with respect to the issuance and delivery of Warrant Shares upon exercise
of this Warrant. The Company’s obligations to issue and deliver Warrant Shares in accordance with the terms and subject to the
conditions hereof are absolute and unconditional, irrespective of any action or inaction by the Holder to enforce the same, any waiver
or consent with respect to any provision hereof, the recovery of any judgment against any Person or any action to enforce the same, or
any setoff, counterclaim, recoupment, limitation or termination; provided, however, that the Company shall not be required
to deliver Warrant Shares with respect to an exercise prior to the Holder’s delivery of the Aggregate Exercise Price (or notice
of a Cashless Exercise) with respect to such exercise.
(b)
Exercise Price. The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.0001 per Warrant Share,
was pre-funded to the Company on or prior to the Initial Exercisability Date and, consequently, no additional consideration (other than
the nominal exercise price of $0.0001 per Warrant Share) shall be required to be paid by the Holder to any Person to affect any exercise
of this Warrant. The Holder shall not be entitled to the return or refund of all, or any portion, of such pre-paid aggregate Exercise
Price under any circumstance or for any reason whatsoever, including in the event this Warrant shall not have been exercised prior to
the Termination Date. The exercise price per share of Common Stock under this Warrant shall be $0.0001, subject to adjustment hereunder
(the “Exercise Price”).
(c)
Company’s Failure to Timely Deliver Securities. If either (I) the Company shall fail for any reason or for no reason to
issue to the Holder on or prior to the applicable Share Delivery Date, if (x) the Transfer Agent is not participating in FAST, a certificate
or evidence of a book-entry credit for the number of shares of Common Stock to which the Holder is entitled and register such Common
Stock on the Company’s share register or (y) the Transfer Agent is participating in FAST, to credit the Holder’s balance
account with DTC, for such number of shares of Common Stock to which the Holder is entitled upon the Holder’s exercise of this
Warrant or (II) a registration statement (which may be the Registration Statement) covering the issuance or resale of the Warrant Shares
that are the subject of the Exercise Notice (the “Exercise Notice Warrant Shares”) is not available for the issuance
or resale, as applicable, of such Exercise Notice Warrant Shares and (x) the Company fails to promptly, but in no event later than one
(1) Business Day after such registration statement becomes unavailable, to so notify the Holder and (y) the Company is unable to deliver
the Exercise Notice Warrant Shares electronically without any restrictive legend by crediting such aggregate number of Exercise Notice
Warrant Shares to the Holder’s or its designee’s balance account with DTC through its Deposit / Withdrawal At Custodian system
(the event described in the immediately foregoing clause (II) is hereinafter referred as a “Notice Failure” and together
with the event described in clause (I) above, an “Exercise Failure”), then, in addition to all other remedies available
to the Holder, if on or prior to the applicable Share Delivery Date either (I) if the Transfer Agent is not participating in FAST, the
Company shall fail to issue and deliver a certificate or evidence of a book-entry credit to the Holder and register such shares of Common
Stock on the Company’s share register or, if the Transfer Agent is participating in FAST, credit the Holder’s balance account
with DTC for the number of shares of Common Stock to which the Holder is entitled upon the Holder’s exercise hereunder or pursuant
to the Company’s obligation pursuant to clause (ii) below or (II) if a Notice Failure occurs, and if on or after such date the
Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise
purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated
receiving upon such exercise (a “Buy-In”), then the Company shall, within three (3) Trading Days after the Holder’s
request, (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage
commissions and other out-of-pocket expenses, if any) for the shares of Common Stock so purchased exceeds (y) the amount obtained by
multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at
issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the
Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in
which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been
issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common
Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with
an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the
Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable
to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit
a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree
of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares of Common Stock
upon exercise of the Warrant as required pursuant to the terms hereof. The Company’s current transfer agent participates in FAST.
In the event that the Company changes transfer agents while this Warrant is outstanding, the Company shall select a transfer agent that
participates in FAST. While this Warrant is outstanding, the Company shall cause its transfer agent to participate in FAST with respect
to this Warrant. In addition to the foregoing rights, (i) if the Company fails to deliver the applicable number of Warrant Shares upon
an exercise pursuant to Section 1 by the applicable Share Delivery Date, then the Holder shall have the right to rescind such exercise
in whole or in part and retain and/or have the Company return, as the case may be, any portion of this Warrant that has not been exercised
pursuant to such Exercise Notice; provided that the rescission of an exercise shall not affect the Company’s obligation to make
any payments that have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise, and (ii) if a registration
statement (which may be the Registration Statement) covering the issuance or resale of the Warrant Shares that are subject to an Exercise
Notice is not available for the issuance or resale, as applicable, of such Exercise Notice Warrant Shares and the Holder has submitted
an Exercise Notice prior to receiving notice of the non-availability of such registration statement and the Company has not already delivered
the Warrant Shares underlying such Exercise Notice electronically without any restrictive legend by crediting such aggregate number of
Warrant Shares to which the Holder is entitled pursuant to such exercise to the Holder’s or its designee’s balance account
with DTC through its Deposit / Withdrawal At Custodian system, the Holder shall have the option, by delivery of notice to the Company,
to (x) rescind such Exercise Notice in whole or in part and retain or have returned, as the case may be, any portion of this Warrant
that has not been exercised pursuant to such Exercise Notice; provided that the rescission of an Exercise Notice shall not affect the
Company’s obligation to make any payments that have accrued prior to the date of such notice pursuant to this Section 1(c) or otherwise,
and/or (y) switch some or all of such Exercise Notice from a cash exercise to a Cashless Exercise. In addition to the foregoing, if the
Company fails for any reason to deliver to the Holder the Warrant Shares subject to an Exercise Notice by the second Trading Day following
the Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of
Warrant Shares subject to such exercise (based on the Weighted Average Price of the Common Stock on the date of the applicable Exercise
Notice), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading Day after such liquidated damages begin to accrue)
for each Trading Day after the second Trading Day following such Share Delivery Date until such Warrant Shares are delivered or Holder
rescinds such exercise.
(d)
Cashless Exercise. Notwithstanding anything contained herein to the contrary, if a registration statement (which may be the Registration
Statement) covering the issuance or resale of the Exercise Notice Warrant Shares is not available for the issuance or resale, as applicable,
of such Exercise Notice Warrant Shares, the Holder may, in its sole discretion, exercise this Warrant in whole or in part and, in lieu
of making the cash payment otherwise contemplated to be made to the Company upon such exercise in payment of the Aggregate Exercise Price,
elect instead to receive upon such exercise the “Net Number” of shares of Common Stock determined according to the following
formula (a “Cashless Exercise”):
| Net
Number = (A x B) - (A x C) |
| B |
For
purposes of the foregoing formula:
A=
the total number of shares with respect to which this Warrant is then being exercised.
B=
as applicable: (i) the Weighted Average Price of the Common Stock on the Trading Day immediately preceding the date of the applicable
Exercise Notice if such Exercise Notice is (1) both executed and delivered pursuant to Section 1(a) hereof on a day that is not a Trading
Day or (2) both executed and delivered pursuant to Section 1(a) hereof on a Trading Day prior to the opening of “regular trading
hours” (as defined in Rule 600(b)(68) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii)
at the option of the Holder, either (y) the Weighted Average Price on the Trading Day immediately preceding the date of the applicable
Exercise Notice or (z) the Bid Price of the Common Stock as of the time of the Holder’s execution of the applicable Exercise Notice
if such Exercise Notice is executed during “regular trading hours” on a Trading Day and is delivered within two (2) hours
thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section
1(a) hereof or (iii) the Weighted Average Price of the Common Stock on the date of the applicable Exercise Notice if the date of such
Exercise Notice is a Trading Day and such Exercise Notice is both executed and delivered pursuant to Section 1(a) hereof after the close
of “regular trading hours” on such Trading Day.
C=
$0.0001, as adjusted hereunder.
If
Warrant Shares are issued in such a cashless exercise, the Company acknowledges and agrees that in accordance with Section 3(a)(9) of
the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised, and the holding
period of the Warrants being exercised may be tacked on to the holding period of the Warrant Shares. The Company agrees not to take any
position contrary to this Section 1(d). Without limiting the rights of a Holder to receive Warrant Shares on a “cashless exercise,”
and to receive the cash payments contemplated pursuant to Sections 1(c) and 4(b), in no event will the Company be required to net cash
settle a Warrant exercise.
(e)
Disputes. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the number of
Warrant Shares to be issued pursuant to the terms hereof, the Company shall promptly issue to the Holder the number of Warrant Shares
that are not disputed and resolve such dispute in accordance with Section 11.
(f)
Beneficial Ownership. Notwithstanding anything to the contrary contained herein, the Company shall not effect the exercise of
any portion of this Warrant, and the Holder shall not have the right to exercise any portion of this Warrant, pursuant to the terms and
conditions of this Warrant and any such exercise shall be null and void and treated as if never made, to the extent that after giving
effect to such exercise, the Holder together with the other Attribution Parties collectively would beneficially own in excess of [4.99/9.99]%
(the “Maximum Percentage”) of the number of shares of Common Stock outstanding immediately after giving effect to
such exercise. For purposes of the foregoing sentence, the aggregate number of shares of Common Stock beneficially owned by the Holder
and the other Attribution Parties shall include the number of shares of Common Stock held by the Holder and all other Attribution Parties
plus the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence
is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (A) exercise of the remaining, unexercised
portion of this Warrant beneficially owned by the Holder or any of the other Attribution Parties and (B) exercise or conversion of the
unexercised or unconverted portion of any other securities of the Company (including, without limitation, any convertible notes or convertible
preferred stock or warrants, including the other Warrants) beneficially owned by the Holder or any other Attribution Party subject to
a limitation on conversion or exercise analogous to the limitation contained in this Section 1(f). For purposes of this Section 1(f),
beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). For purposes of this Warrant, in determining the number of outstanding shares of Common Stock the Holder may acquire
upon the exercise of this Warrant without exceeding the Maximum Percentage, the Holder may rely on the number of outstanding shares of
Common Stock as reflected in (x) the Company’s most recent Annual Report on Form 10-K, Quarterly Report on Form 10-Q and Current
Reports on Form 8-K or other public filing with the Securities and Exchange Commission (the “SEC”), as the case may
be, (y) a more recent public announcement by the Company or (z) any other written notice by the Company or the Transfer Agent setting
forth the number of shares of Common Stock outstanding (the “Reported Outstanding Share Number”). If the Company receives
an Exercise Notice from the Holder at a time when the actual number of outstanding shares of Common Stock is less than the Reported Outstanding
Share Number, the Company shall (i) notify the Holder in writing of the number of shares of Common Stock then outstanding and, to the
extent that such Exercise Notice would otherwise cause the Holder’s beneficial ownership, as determined pursuant to this Section
1(f), to exceed the Maximum Percentage, the Holder must notify the Company of a reduced number of Warrant Shares to be purchased pursuant
to such Exercise Notice (the number of shares by which such purchase is reduced, the “Reduction Shares”) and (ii)
as soon as reasonably practicable, the Company shall return to the Holder any exercise price paid by the Holder for the Reduction Shares.
For any reason at any time, upon the written or oral request of the Holder, the Company shall within one (1) Business Day confirm orally
and in writing or by electronic mail to the Holder the number of shares of Common Stock then outstanding. In any case, the number of
outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company,
including this Warrant, by the Holder and any other Attribution Party since the date as of which the Reported Outstanding Share Number
was reported. In the event that the issuance of Common Stock to the Holder upon exercise of this Warrant results in the Holder and the
other Attribution Parties being deemed to beneficially own, in the aggregate, more than the Maximum Percentage of the number of outstanding
shares of Common Stock (as determined under Section 13(d) of the Exchange Act), the number of shares so issued by which the Holder’s
and the other Attribution Parties’ aggregate beneficial ownership exceeds the Maximum Percentage (the “Excess Shares”)
shall be deemed null and void and shall be cancelled ab initio, and the Holder shall not have the power to vote or to transfer the Excess
Shares. As soon as reasonably practicable after the issuance of the Excess Shares has been deemed null and void, the Company shall return
to the Holder the exercise price paid by the Holder for the Excess Shares. Upon delivery of a written notice to the Company, the Holder
may from time to time increase or decrease the Maximum Percentage to any other percentage not in excess of 9.99% as specified in such
notice; provided that (i) any such increase in the Maximum Percentage will not be effective until the sixty-first (61st) day after such
notice is delivered to the Company and (ii) any such increase or decrease will apply only to the Holder and the other Attribution Parties
and not to any other holder of Warrants that is not an Attribution Party of the Holder. For purposes of clarity, the shares of Common
Stock issuable pursuant to the terms of this Warrant in excess of the Maximum Percentage shall not be deemed to be beneficially owned
by the Holder for any purpose including for purposes of Section 13(d) or Rule 16a-1(a)(1) of the Exchange Act. No prior inability to
exercise this Warrant pursuant to this paragraph shall have any effect on the applicability of the provisions of this paragraph with
respect to any subsequent determination of exercisability. The provisions of this paragraph shall be construed and implemented in a manner
otherwise than in strict conformity with the terms of this Section 1(f) to the extent necessary to correct this paragraph or any portion
of this paragraph which may be defective or inconsistent with the intended beneficial ownership limitation contained in this Section
1(f) or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitation contained in
this paragraph may not be waived and shall apply to a successor holder of this Warrant.
(g)
Required Reserve Amount. So long as this Warrant remains outstanding, the Company shall at all times keep reserved for issuance
under this Warrant a number of shares of Common Stock at least equal to 100% of the maximum number of shares of Common Stock as shall
be necessary to satisfy the Company’s obligation to issue shares of Common Stock under the Warrants then outstanding (without regard
to any limitations on exercise) (the “Required Reserve Amount”); provided that at no time shall the number
of shares of Common Stock reserved pursuant to this Section 1(g) be reduced other than in connection with any exercise of Warrants or
such other event covered by Section 2(c) below. The Required Reserve Amount (including, without limitation, each increase in the number
of shares so reserved) shall be allocated pro rata among the holders of the Warrants based on the number of shares of Common Stock issuable
upon exercise of Warrants held by each holder thereof on the Issuance Date (without regard to any limitations on exercise) (the “Authorized
Share Allocation”). In the event that a holder shall sell or otherwise transfer any of such holder’s Warrants, each transferee
shall be allocated a pro rata portion of such holder’s Authorized Share Allocation. Any shares of Common Stock reserved and allocated
to any Person which ceases to hold any Warrants shall be allocated to the remaining holders of Warrants, pro rata based on the number
of shares of Common Stock issuable upon exercise of the Warrants then held by such holders thereof (without regard to any limitations
on exercise).
(h)
Insufficient Authorized Shares. If at any time while this Warrant remains outstanding the Company does not have a sufficient number
of authorized and unreserved shares of Common Stock to satisfy its obligation to reserve for issuance the Required Reserve Amount (an
“Authorized Share Failure”), then the Company shall promptly take all action reasonably necessary to increase the
Company’s authorized shares of Common Stock to an amount sufficient to allow the Company to reserve the Required Reserve Amount
for this Warrant then outstanding. Without limiting the generality of the foregoing sentence, as soon as practicable after the date of
the occurrence of an Authorized Share Failure, but in no event later than ninety (90) days after the occurrence of such Authorized Share
Failure, the Company shall hold a meeting of its stockholders for the approval of an increase in the number of authorized shares of Common
Stock. In connection with such meeting, the Company shall provide each stockholder with a proxy statement and shall use its reasonable
best efforts to solicit its stockholders’ approval of such increase in authorized shares of Common Stock and to cause its board
of directors to recommend to the stockholders that they approve such proposal. Notwithstanding the foregoing, if at any such time of
an Authorized Share Failure, the Company is able to obtain the written consent of a majority of the shares of its issued and outstanding
shares of Common Stock to approve the increase in the number of authorized shares of Common Stock, the Company may satisfy this obligation
by obtaining such consent and submitting for filing with the SEC an Information Statement on Schedule 14C.
2.
ADJUSTMENT OF EXERCISE PRICE AND NUMBER OF WARRANT SHARES. The Exercise Price and the number of Warrant Shares shall be adjusted
from time to time as follows:
(a)
Intentionally omitted.
(b)
Intentionally omitted.
(c)
Adjustment Upon Subdivision or Combination of Common Stock. If the Company at any time on or after the Subscription Date subdivides
(by any stock split, stock dividend, recapitalization or otherwise) one or more classes of its outstanding shares of Common Stock into
a greater number of shares, the Exercise Price in effect immediately prior to such subdivision will be proportionately reduced and the
number of Warrant Shares will be proportionately increased. If the Company at any time on or after the Subscription Date combines (by
combination, reverse stock split or otherwise) one or more classes of its outstanding shares of Common Stock into a smaller number of
shares, the Exercise Price in effect immediately prior to such combination will be proportionately increased and the number of Warrant
Shares will be proportionately decreased. Any adjustment under this Section 2(c) shall become effective at the close of business on the
date the subdivision or combination becomes effective.
3.
RIGHTS UPON DISTRIBUTION OF ASSETS. In addition to any adjustments pursuant to Section 2 above, if, on or after the Subscription
Date and on or prior to the Termination Date, the Company shall declare or make any dividend or other distribution of its assets (or
rights to acquire its assets) to holders of shares of Common Stock, by way of return of capital or otherwise (including, without limitation,
any distribution of cash, stock or other securities, property, options, evidence of indebtedness or any other assets by way of a dividend,
spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “Distribution”),
at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution
to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable
upon complete exercise of this Warrant (without regard to any limitations or restrictions on exercise of this Warrant, including without
limitation, the Maximum Percentage) immediately before the date on which a record is taken for such Distribution, or, if no such record
is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution
(provided, however, that to the extent that the Holder’s right to participate in any such Distribution would result
in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate
in such Distribution to such extent (and shall not be entitled to beneficial ownership of such shares of Common Stock as a result of
such Distribution (and beneficial ownership) to such extent) and the portion of such Distribution shall be held in abeyance for the benefit
of the Holder until such time or times as its right thereto would not result in the Holder and the other Attribution Parties exceeding
the Maximum Percentage, at which time or times the Holder shall be granted such Distribution (and any Distributions declared or made
on such initial Distribution or on any subsequent Distribution held similarly in abeyance) to the same extent as if there had been no
such limitation).
4.
PURCHASE RIGHTS; FUNDAMENTAL TRANSACTIONS.
(a)
Purchase Rights. In addition to any adjustments pursuant to Section 2 above, if at any time on or after the Subscription Date
and on or prior to the Termination Date the Company grants, issues or sells any Options, Convertible Securities or rights to purchase
stock, warrants, securities or other property pro rata to the record holders of any class of Common Stock (the “Purchase Rights”),
then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the
Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant
(without regard to any limitations or restrictions on exercise of this Warrant, including without limitation, the Maximum Percentage)
immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record
is taken, the date as of which the record holders of Common Stock are to be determined for the grant, issuance or sale of such Purchase
Rights (provided, however, that to the extent that the Holder’s right to participate in any such Purchase Right would
result in the Holder and the other Attribution Parties exceeding the Maximum Percentage, then the Holder shall not be entitled to participate
in such Purchase Right to such extent (and shall not be entitled to beneficial ownership of such Common Stock as a result of such Purchase
Right (and beneficial ownership) to such extent) and such Purchase Right to such extent shall be held in abeyance for the benefit of
the Holder until such time or times as its right thereto would not result in the Holder and the other Attribution Parties exceeding the
Maximum Percentage, at which time or times the Holder shall be granted such right (and any Purchase Right granted, issued or sold on
such initial Purchase Right or on any subsequent Purchase Right to be held similarly in abeyance) to the same extent as if there had
been no such limitation).
(b)
Fundamental Transaction. The Company shall not enter into or be party to a Fundamental Transaction unless the Successor Entity
assumes in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 4(b), including
agreements to deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument
substantially similar in form and substance to this Warrant, including, without limitation, which is exercisable for a corresponding
number of shares of capital stock equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without
regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies
the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock
pursuant to such Fundamental Transaction and the value of such shares of capital stock, such adjustments to the number of shares of capital
stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation
of such Fundamental Transaction). Upon the consummation of each Fundamental Transaction, the Successor Entity shall succeed to, and be
substituted for the Company (so that from and after the date of the applicable Fundamental Transaction, the provisions of this Warrant
and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise
every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as
if such Successor Entity had been named as the Company herein. Upon consummation of each Fundamental Transaction, the Successor Entity
shall deliver to the Holder confirmation that there shall be issued upon exercise of this Warrant at any time after the consummation
of the applicable Fundamental Transaction, in lieu of the shares of Common Stock (or other securities, cash, assets or other property
(except such items still issuable under Sections 3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the
exercise of this Warrant prior to the applicable Fundamental Transaction, such shares of common stock (or its equivalent) of the Successor
Entity (including its Parent Entity) which the Holder would have been entitled to receive upon the happening of the applicable Fundamental
Transaction had this Warrant been exercised immediately prior to the applicable Fundamental Transaction (without regard to any limitations
on the exercise of this Warrant), as adjusted in accordance with the provisions of this Warrant. Notwithstanding the foregoing, and without
limiting Section 1(f) hereof, the Holder may elect, at its sole option, by delivery of written notice to the Company to waive this Section
4(b) to permit the Fundamental Transaction without the assumption of this Warrant. In addition to and not in substitution for any other
rights hereunder, prior to the consummation of each Fundamental Transaction pursuant to which holders of shares of Common Stock are entitled
to receive securities or other assets with respect to or in exchange for shares of Common Stock (a “Corporate Event”),
the Company shall make appropriate provision to insure that the Holder will thereafter have the right to receive upon an exercise of
this Warrant at any time after the consummation of the applicable Fundamental Transaction but prior to the Termination Date, in lieu
of the shares of the Common Stock (or other securities, cash, assets or other property (except such items still issuable under Sections
3 and 4(a) above, which shall continue to be receivable thereafter)) issuable upon the exercise of the Warrant prior to such Fundamental
Transaction, such shares of stock, securities, cash, assets or any other property whatsoever (including warrants or other purchase or
subscription rights) (collectively, the “Corporate Event Consideration”) which the Holder would have been entitled
to receive upon the happening of the applicable Fundamental Transaction had this Warrant been exercised immediately prior to the applicable
Fundamental Transaction (without regard to any limitations on the exercise of this Warrant). The provision made pursuant to the preceding
sentence shall be in a form and substance reasonably satisfactory to the Requisite Holders. The provisions of this Section 4(b) shall
apply similarly and equally to successive Fundamental Transactions and Corporate Events.
5.
NONCIRCUMVENTION. The Company hereby covenants and agrees that the Company will not, by amendment of its Certificate of Incorporation
or Bylaws, or through any reorganization, transfer of assets, consolidation, merger, scheme of arrangement, dissolution, issuance or
sale of securities, or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant,
and will at all times in good faith carry out all of the provisions of this Warrant and take all action as may be required to protect
the rights of the Holder. Without limiting the generality of the foregoing, the Company (i) shall not increase the par value of any shares
of Common Stock receivable upon the exercise of this Warrant above the Exercise Price then in effect, (ii) shall take all such actions
as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of Common
Stock upon the exercise of this Warrant, and (iii) shall, so long as any of the Warrants are outstanding, take all action necessary to
reserve and keep available out of its authorized and unissued shares of Common Stock, solely for the purpose of effecting the exercise
of the Warrants, the number of shares of Common Stock as shall from time to time be necessary to effect the exercise of the Warrants
then outstanding (without regard to any limitations on exercise).
6.
WARRANT HOLDER NOT DEEMED A STOCKHOLDER. Except as otherwise specifically provided herein, the Holder, solely in such Person’s
capacity as a holder of this Warrant, shall not be entitled to vote or receive dividends or be deemed the holder of capital stock of
the Company for any purpose, nor shall anything contained in this Warrant be construed to confer upon the Holder, solely in such Person’s
capacity as the Holder of this Warrant, any of the rights of a stockholder of the Company or any right to vote, give or withhold consent
to any corporate action (whether any reorganization, issue of stock, reclassification of stock, consolidation, merger, conveyance or
otherwise), receive notice of meetings, receive dividends or subscription rights, or otherwise, prior to the issuance to the Holder of
the Warrant Shares which such Person is then entitled to receive upon the due exercise of this Warrant. In addition, nothing contained
in this Warrant shall be construed as imposing any liabilities on the Holder to purchase any securities (upon exercise of this Warrant
or otherwise) or as a stockholder of the Company, whether such liabilities are asserted by the Company or by creditors of the Company.
Notwithstanding this Section 6, the Company shall provide the Holder with copies of the same notices and other information given to the
stockholders of the Company generally, contemporaneously with the giving thereof to the stockholders.
7.
REISSUANCE OF WARRANTS.
(a)
Transfer of Warrant. If this Warrant is to be transferred, the Holder shall surrender this Warrant to the Company, whereupon the
Company will forthwith issue and deliver upon the order of the Holder a new Warrant (in accordance with Section 7(d)), registered as
the Holder may request, representing the right to purchase the number of Warrant Shares being transferred by the Holder and, if less
than the total number of Warrant Shares then underlying this Warrant is being transferred, a new Warrant (in accordance with Section
7(d)) to the Holder representing the right to purchase the number of Warrant Shares not being transferred.
(b)
Lost, Stolen or Mutilated Warrant. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss,
theft, destruction or mutilation of this Warrant (as to which a written certification and the indemnification contemplated below shall
suffice as such evidence), and, in the case of loss, theft or destruction, of any indemnification undertaking by the Holder to the Company
in customary and reasonable form (but without the obligation to post a bond) and, in the case of mutilation, upon surrender and cancellation
of this Warrant, the Company shall execute and deliver to the Holder a new Warrant (in accordance with Section 7(d)) representing the
right to purchase the Warrant Shares then underlying this Warrant.
(c)
Exchangeable for Multiple Warrants. This Warrant is exchangeable, upon the surrender hereof by the Holder at the principal office
of the Company, for a new Warrant or Warrants (in accordance with Section 7(d)) representing in the aggregate the right to purchase the
number of Warrant Shares then underlying this Warrant, and each such new Warrant will represent the right to purchase such portion of
such Warrant Shares as is designated by the Holder at the time of such surrender.
(d)
Issuance of New Warrants. Whenever the Company is required to issue a new Warrant pursuant to the terms of this Warrant, such
new Warrant (i) shall be of like tenor with this Warrant, (ii) shall represent, as indicated on the face of such new Warrant, the right
to purchase the Warrant Shares then underlying this Warrant (or in the case of a new Warrant being issued pursuant to Section 7(a) or
Section 7(c), the Warrant Shares designated by the Holder which, when added to the number of shares of Common Stock underlying the other
new Warrants issued in connection with such issuance, does not exceed the number of Warrant Shares then underlying this Warrant), (iii)
shall have an issuance date, as indicated on the face of such new Warrant which is the same as the Issuance Date, and (iv) shall have
the same rights and conditions as this Warrant.
8.
NOTICES. Whenever notice is required to be given under this Warrant, including, without limitation, an Exercise Notice, unless
otherwise provided herein, such notice shall be given in writing, (i) if delivered (a) from within the domestic United States, by first-class
registered or certified airmail, or nationally recognized overnight express courier, postage prepaid, electronic mail or by facsimile
or (b) from outside the United States, by International Federal Express, electronic mail or facsimile, and (ii) will be deemed given
(A) if delivered by first-class registered or certified mail domestic, three (3) Business Days after so mailed, (B) if delivered by nationally
recognized overnight carrier, one (1) Business Day after so mailed, (C) if delivered by International Federal Express, two (2) Business
Days after so mailed and (D) at the time of transmission, if delivered by electronic mail to each of the email addresses specified in
this Section 8 prior to 5:00 p.m. (New York time) on a Trading Day, (E) the next Trading Day after the date of transmission, if delivered
by electronic mail to each of the email addresses specified in this Section 8 on a day that is not a Trading Day or later than 5:00 p.m.
(New York time) on any Trading Day and (F) if delivered by facsimile, upon electronic confirmation of delivery of such facsimile, and
will be delivered and addressed as follows:
(i)
if to the Company, to:
Sidus
Space, Inc.
150
N. Sykes Creek Parkway, Suite 200
Merritt
Island, FL 32953
Attention:
Carol Craig, Chief Executive Officer
Email:
carol.craig@sidusspace.com
(ii)
if to the Holder, at such address or other contact information delivered by the Holder to the Company or as is on the books and records
of the Company.
The
Company shall provide the Holder with prompt written notice of all actions taken pursuant to this Warrant, including in reasonable detail
a description of such action and the reason therefor. Without limiting the generality of the foregoing, the Company will give written
notice to the Holder (i) immediately upon any adjustment of the Exercise Price, setting forth in reasonable detail, and certifying, the
calculation of such adjustment and (ii) at least fifteen (15) days prior to the date on which the Company closes its books or takes a
record (A) with respect to any dividend or distribution upon the shares of Common Stock, (B) with respect to any grants, issuances or
sales of any Options, Convertible Securities or rights to purchase stock, warrants, securities or other property to holders of shares
of Common Stock or (C) for determining rights to vote with respect to any Fundamental Transaction, dissolution or liquidation; provided
in each case that such information shall be made known to the public prior to or in conjunction with such notice being provided to
the Holder. It is expressly understood and agreed that the time of exercise specified by the Holder in each Exercise Notice shall be
definitive and may not be disputed or challenged by the Company.
9.
AMENDMENT AND WAIVER. Except as otherwise provided herein, the provisions of this Warrant may be amended or waived and the Company
may take any action herein prohibited, or omit to perform any act herein required to be performed by it, only if the Company has obtained
the written consent of the Holder. No waiver shall be effective unless it is in writing and signed by an authorized representative of
the waiving party.
10.
GOVERNING LAW; JURISDICTION; JURY TRIAL. This Warrant shall be governed by and construed and enforced in accordance with, and
all questions concerning the construction, validity, interpretation and performance of this Warrant shall be governed by, the internal
laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New
York. The Company hereby irrevocably submits to the exclusive jurisdiction of the courts of the State of New York and of the United States
of America sitting in The City and County of New York for the adjudication of any dispute hereunder or in connection herewith or with
any transaction contemplated hereby or discussed herein, 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. The Company 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
to the Company at the address set forth in Section 8(i) above or such other address as the Company subsequently delivers to the Holder
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. Nothing contained herein shall be deemed or
operate to preclude the Holder from bringing suit or taking other legal action against the Company in any other jurisdiction to collect
on the Company’s obligations to the Holder, to realize on any collateral or any other security for such obligations, or to enforce
a judgment or other court ruling in favor of the Holder. If either party shall commence an action, suit or proceeding to enforce any
provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their
reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action
or proceeding. THE COMPANY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS WARRANT OR ANY TRANSACTION CONTEMPLATED HEREBY.
11.
DISPUTE RESOLUTION. In the case of a dispute as to the determination of the Exercise Price or the arithmetic calculation of the
Warrant Shares, the Company shall submit the disputed determinations or arithmetic calculations via facsimile or electronic mail within
two (2) Business Days of receipt of the Exercise Notice or other event giving rise to such dispute, as the case may be, to the Holder.
If the Holder and the Company are unable to agree upon such determination or calculation of the Exercise Price or the Warrant Shares
within three (3) Business Days of such disputed determination or arithmetic calculation being submitted to the Holder, then the Company
shall, within two (2) Business Days submit via facsimile or electronic mail (a) the disputed determination of the Exercise Price to an
independent, reputable investment bank selected by the Company and approved by the Holder or (b) the disputed arithmetic calculation
of the Warrant Shares to the Company’s independent, outside accountant. The Company shall cause at its expense the investment bank
or the accountant, as the case may be, to perform the determinations or calculations and notify the Company and the Holder of the results
no later than ten (10) Business Days from the time it receives the disputed determinations or calculations. Such investment bank’s
or accountant’s determination or calculation, as the case may be, shall be binding upon all parties absent demonstrable error.
12.
REMEDIES, OTHER OBLIGATIONS, BREACHES AND INJUNCTIVE RELIEF.
(a)
The remedies provided in this Warrant shall be cumulative and in addition to all other remedies available under this Warrant and any
other Transaction Documents, at law or in equity (including a decree of specific performance and/or other injunctive relief), and nothing
herein shall limit the right of the Holder to pursue actual damages for any failure by the Company to comply with the terms of this Warrant.
The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holder and that the remedy
at law for any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach,
the Holder of this Warrant shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without
the necessity of showing economic loss and without any bond or other security being required. The Company shall provide all information
and documentation to the Holder that is requested by the Holder to enable the Holder to confirm the Company’s compliance with the
terms and conditions of this Warrant (including, without limitation, compliance with Section 2 hereof). The issuance of shares and certificates
for shares as contemplated hereby upon the exercise of this Warrant shall be made without charge to the Holder or such shares for any
issuance tax or other costs in respect thereof, provided that the Company shall not be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of any certificate in a name other than the Holder or its agent on its
behalf.
(b)
If (i) this Warrant is placed in the hands of an attorney for collection or enforcement or is collected or enforced through any legal
proceeding or the holder otherwise takes action to collect amounts due under this Warrant or to enforce the provisions of this Warrant
or (ii) there occurs any bankruptcy, reorganization, receivership of the company or other proceedings affecting company creditors’
rights and involving a claim under this Warrant, then the Company shall pay the costs incurred by the Holder for such collection, enforcement
or action or in connection with such bankruptcy, reorganization, receivership or other proceeding, including, without limitation, attorneys’
fees and disbursements.
13.
TRANSFER. This Warrant and the Warrant Shares may be offered for sale, sold, transferred, pledged or assigned without the consent
of the Company.
14.
SEVERABILITY; CONSTRUCTION; HEADINGS. If any provision of this Warrant is prohibited by law or otherwise determined to be invalid
or unenforceable by a court of competent jurisdiction, the provision that would otherwise be prohibited, invalid or unenforceable shall
be deemed amended to apply to the broadest extent that it would be valid and enforceable, and the invalidity or unenforceability of such
provision shall not affect the validity of the remaining provisions of this Warrant so long as this Warrant as so modified continues
to express, without material change, the original intentions of the parties as to the subject matter hereof and the prohibited nature,
invalidity or unenforceability of the provision(s) in question does not substantially impair the respective expectations or reciprocal
obligations of the parties or the practical realization of the benefits that would otherwise be conferred upon the parties. The parties
will endeavor in good faith negotiations to replace the prohibited, invalid or unenforceable provision(s) with a valid provision(s),
the effect of which comes as close as possible to that of the prohibited, invalid or unenforceable provision(s). This Warrant shall be
deemed to be jointly drafted by the Company and the Holder and shall not be construed against any Person as the drafter hereof. The headings
of this Warrant are for convenience of reference and shall not form part of, or affect the interpretation of, this Warrant.
15.
DISCLOSURE. Upon receipt or delivery by the Company of any notice in accordance with the terms of this Warrant, unless the Company
has in good faith determined that the matters relating to such notice do not constitute material, non-public information relating to
the Company or its subsidiaries, the Company shall contemporaneously with any such receipt or delivery publicly disclose such material,
non-public information on a Current Report on Form 8-K or otherwise. In the event that the Company believes that a notice contains material,
non-public information relating to the Company or its subsidiaries, the Company so shall indicate to such Holder contemporaneously with
delivery of such notice, and in the absence of any such indication, the Holder shall be allowed to presume that all matters relating
to such notice do not constitute material, non-public information relating to the Company or its subsidiaries.
16.
CERTAIN DEFINITIONS. For purposes of this Warrant, the following terms shall have the following meanings:
(a)
“Affiliate” means, with respect to any Person, any other Person that directly or indirectly controls, is controlled
by, or is under common control with, such Person, it being understood for purposes of this definition that “control” of a
Person means the power directly or indirectly either to vote 10% or more of the stock having ordinary voting power for the election of
directors of such Person or direct or cause the direction of the management and policies of such Person whether by contract or otherwise.
(b)
“Attribution Parties” means, collectively, the following Persons and entities: (i) any investment vehicle, including,
any funds, feeder funds or managed accounts, currently, or from time to time after the Subscription Date, directly or indirectly managed
or advised by the Holder’s investment manager or any of its Affiliates or principals, (ii) any direct or indirect Affiliates of
the Holder or any of the foregoing, (iii) any Person acting or who could be deemed to be acting as a Group together with the Holder or
any of the foregoing and (iv) any other Persons whose beneficial ownership of the Company’s Common Stock would or could be aggregated
with the Holder’s and the other Attribution Parties for purposes of Section 13(d) of the Exchange Act. For clarity, the purpose
of the foregoing is to subject collectively the Holder and all other Attribution Parties to the Maximum Percentage.
(c)
“Bid Price” means, for any security as of the particular time of determination, the bid price for such security on
the Principal Market as reported by Bloomberg as of such time of determination, or, if the Principal Market is not the principal securities
exchange or trading market for such security, the bid price of such security on the principal securities exchange or trading market where
such security is listed or traded as reported by Bloomberg as of such time of determination, or if the foregoing does not apply, the
bid price of such security in the over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg
as of such time of determination, or, if no bid price is reported for such security by Bloomberg as of such time of determination, the
average of the bid prices of any market makers for such security as reported in the OTC Link or “pink sheets” by OTC Markets
Group Inc. as of such time of determination. If the Bid Price cannot be calculated for a security as of the particular time of determination
on any of the foregoing bases, the Bid Price of such security as of such time of determination shall be the fair market value as mutually
determined by the Company and the Holder. If the Company and the Holder are unable to agree upon the fair market value of such security,
then such dispute shall be resolved in accordance with the procedures in Section 11. All such determinations shall be appropriately adjusted
for any stock dividend, stock split, stock combination or other similar transaction during such period.
(d)
“Bloomberg” means Bloomberg Financial Markets.
(e)
“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New
York are authorized or required by law to remain closed.
(f)
“Closing Bid Price” means, for any security as of any date, the last closing bid price and last closing trade price,
respectively, for such security on the Principal Market, as reported by Bloomberg, or, if the Principal Market begins to operate on an
extended hours basis and does not designate the closing bid price or the closing trade price, as the case may be, then the last bid price
or the last trade price, respectively, of such security prior to 4:00:00 p.m., New York time, as reported by Bloomberg, or, if the Principal
Market is not the principal securities exchange or trading market for such security, the last closing bid price or last trade price,
respectively, of such security on the principal securities exchange or trading market where such security is listed or traded as reported
by Bloomberg, or if the foregoing do not apply, the last closing bid price or last trade price, respectively, of such security in the
over-the-counter market on the electronic bulletin board for such security as reported by Bloomberg, or, if no closing bid price or last
trade price, respectively, is reported for such security by Bloomberg, the average of the bid prices, or the ask prices, respectively,
of any market makers for such security as reported in the OTC Link or “pink sheets” by OTC Markets Group Inc. If the Closing
Bid Price cannot be calculated for a security on a particular date on any of the foregoing bases, the Closing Bid Price of such security
on such date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable
to agree upon the fair market value of such security, then such dispute shall be resolved pursuant to Section 11. All such determinations
shall be appropriately adjusted for any stock dividend, stock split, stock combination, reclassification or other similar transaction
during the applicable calculation period.
(g)
“Common Stock” means (i) the Company’s Class A Common Stock, par value $0.0001 per share, and (ii) any capital
stock into which such Common Stock shall have been changed or any capital stock resulting from a reclassification of such Common Stock.
(h)
“Convertible Securities” means any stock or securities (other than Options) directly or indirectly convertible into
or exercisable or exchangeable for shares of Common Stock.
(i)
“Eligible Market” means The Nasdaq Capital Market, the NYSE American LLC, The Nasdaq Global Select Market, The Nasdaq
Global Market or The New York Stock Exchange, Inc.
(j)
“Fundamental Transaction” means (A) that the Company shall, directly or indirectly, including through subsidiaries,
Affiliates or otherwise, in one or more related transactions, (i) consolidate or merge with or into (whether or not the Company is the
surviving corporation) another Subject Entity, or (ii) sell, assign, transfer, convey or otherwise dispose of all or substantially all
of the properties or assets of the Company or any of its “significant subsidiaries” (as defined in Rule 1-02 of Regulation
S-X) to one or more Subject Entities, or (iii) make, or allow one or more Subject Entities to make, or allow the Company to be subject
to or have its shares of Common Stock be subject to or party to one or more Subject Entities making, a purchase, tender or exchange offer
that is accepted by the holders of at least either (x) 50% of the outstanding shares of Common Stock, (y) 50% of the outstanding shares
of Common Stock calculated as if any shares of Common Stock held by all Subject Entities making or party to, or Affiliated with any Subject
Entities making or party to, such purchase, tender or exchange offer were not outstanding; or (z) such number of shares of Common Stock
such that all Subject Entities making or party to, or Affiliated with any Subject Entity making or party to, such purchase, tender or
exchange offer, become collectively the beneficial owners (as defined in Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding
shares of Common Stock, or (iv) consummate a stock purchase agreement or other business combination (including, without limitation, a
reorganization, recapitalization, spin-off or scheme of arrangement) with one or more Subject Entities whereby all such Subject Entities,
individually or in the aggregate, acquire, either (x) at least 50% of the outstanding shares of Common Stock, (y) at least 50% of the
outstanding shares of Common Stock calculated as if any shares of Common Stock held by all the Subject Entities making or party to, or
Affiliated with any Subject Entity making or party to, such stock purchase agreement or other business combination were not outstanding;
or (z) such number of shares of Common Stock such that the Subject Entities become collectively the beneficial owners (as defined in
Rule 13d-3 under the Exchange Act) of at least 50% of the outstanding shares of Common Stock, or (v) reorganize, recapitalize or reclassify
its shares of Common Stock, (B) that the Company shall, directly or indirectly, including through subsidiaries, Affiliates or otherwise,
in one or more related transactions, allow any Subject Entity individually or the Subject Entities in the aggregate to be or become the
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, whether through acquisition,
purchase, assignment, conveyance, tender, tender offer, exchange, reduction in outstanding shares of Common Stock, merger, consolidation,
business combination, reorganization, recapitalization, spin-off, scheme of arrangement, reorganization, recapitalization or reclassification
or otherwise in any manner whatsoever, of either (x) at least 50% of the aggregate ordinary voting power represented by issued and outstanding
shares of Common Stock, (y) at least 50% of the aggregate ordinary voting power represented by issued and outstanding shares of Common
Stock not held by all such Subject Entities as of the Subscription Date calculated as if any shares of Common Stock held by all such
Subject Entities were not outstanding, or (z) a percentage of the aggregate ordinary voting power represented by issued and outstanding
shares of Common Stock or other equity securities of the Company sufficient to allow such Subject Entities to effect a statutory short
form merger or other transaction requiring other stockholders of the Company to surrender their Common Stock without approval of the
stockholders of the Company or (C) directly or indirectly, including through subsidiaries, Affiliates or otherwise, in one or more related
transactions, the issuance of or the entering into any other instrument or transaction structured in a manner to circumvent, or that
circumvents, the intent of this definition in which case this definition shall be construed and implemented in a manner otherwise than
in strict conformity with the terms of this definition to the extent necessary to correct this definition or any portion of this definition
which may be defective or inconsistent with the intended treatment of such instrument or transaction.
(k)
“Group” means a “group” as that term is used in Section 13(d) of the Exchange Act and as defined in Rule
13d-5 thereunder.
(l)
“Options” means any rights, warrants or options to subscribe for or purchase shares of Common Stock or Convertible
Securities.
(m)
“Parent Entity” of a Person means an entity that, directly or indirectly, controls the applicable Person, including
such entity whose common stock or equivalent equity security is quoted or listed on an Eligible Market (or, if so elected by the Holder,
any other market, exchange or quotation system), or, if there is more than one such Person or such entity, the Person or such entity
designated by the Holder or in the absence of such designation, such Person or entity with the largest public market capitalization as
of the date of consummation of the Fundamental Transaction.
(n)
“Person” means an individual, a limited liability company, a partnership, a joint venture, a corporation, a trust,
an unincorporated organization, any other entity and a government or any department or agency thereof.
(o)
“Principal Market” means The Nasdaq Capital Market.
(p)
“Requisite Holders” means the holders of the Warrants representing a majority of the shares of Common Stock underlying
the Warrants then outstanding.
(q)
“Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, for the
Company’s primary trading market or quotation system with respect to the Common Stock that is in effect on the date of receipt
of an applicable Exercise Notice.
(r)
“Subject Entity” means any Person, Persons or Group or any Affiliate or associate of any such Person, Persons or Group.
(s)
“Successor Entity” means one or more Person or Persons (or, if so elected by the Holder, the Company or Parent Entity)
formed by, resulting from or surviving any Fundamental Transaction or one or more Person or Persons (or, if so elected by the Holder,
the Company or the Parent Entity) with which such Fundamental Transaction shall have been entered into.
(t)
“Trading Day” means any day on which the Common Stock is traded on the Principal Market, or, if the Principal Market
is not the principal trading market for the Common Stock, then on the principal securities exchange or securities market on which the
Common Stock is then traded.
(u)
“Transaction Documents” means any agreement entered into by and between the Company and the Holder, as applicable.
(v)
“Weighted Average Price” means, for any security as of any date, the dollar volume-weighted average price for such
security on the Principal Market during the period beginning at 9:30:01 a.m., New York time (or such other time as the Principal Market
publicly announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as the Principal Market
publicly announces is the official close of trading), as reported by Bloomberg through its “Volume at Price” function or,
if the foregoing does not apply, the dollar volume-weighted average price of such security in the over-the-counter market on the electronic
bulletin board for such security during the period beginning at 9:30:01 a.m., New York time (or such other time as such market publicly
announces is the official open of trading), and ending at 4:00:00 p.m., New York time (or such other time as such market publicly announces
is the official close of trading), as reported by Bloomberg, or, if no dollar volume-weighted average price is reported for such security
by Bloomberg for such hours, the average of the highest Closing Bid Price and the lowest closing ask price of any of the market makers
for such security as reported in the OTC Link or “pink sheets” by OTC Markets Group Inc. If the Weighted Average Price cannot
be calculated for a security on a particular date on any of the foregoing bases, the Weighted Average Price of such security on such
date shall be the fair market value as mutually determined by the Company and the Holder. If the Company and the Holder are unable to
agree upon the fair market value of such security, then such dispute shall be resolved pursuant to Section 11 with the term “Weighted
Average Price” being substituted for the term “Exercise Price.” All such determinations shall be appropriately adjusted
for any stock dividend, stock split, stock combination, reclassification or other similar transaction during the applicable calculation
period.
[Signature
Page Follows]
IN
WITNESS WHEREOF, the Company has caused this Warrant to Purchase Common Stock to be duly executed as of the Issuance Date set out
above.
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Sidus
Space, Inc. |
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By: |
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Name: |
Carol
Craig |
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Title: |
Chief
Executive Officer |
[Signature
Page to Pre-Funded Warrant]
Annex
A
EXERCISE
NOTICE
TO
BE EXECUTED BY THE REGISTERED HOLDER TO EXERCISE THIS
PRE-FUNDED
WARRANT TO PURCHASE COMMON STOCK
SIDUS
SPACE, INC.
The
undersigned holder hereby exercises the right to purchase _________________ shares of Common Stock (“Warrant Shares”)
of Sidus Space, Inc., a company organized under the laws of Delaware (the “Company”), evidenced by the attached Pre-Funded
Warrant to Purchase Common Stock (the “Warrant”). Capitalized terms used herein and not otherwise defined shall have
the respective meanings set forth in the Warrant.
1.
Form of Exercise Price. The holder intends that payment of the Exercise Price shall be made as:
____________
a “Cash Exercise” with respect to _________________ Warrant Shares; and/or
____________
a “Cashless Exercise” with respect to _______________ Warrant Shares.
2.
Payment of Exercise Price. In the event that the holder has elected a Cash Exercise with respect to some or all of the Warrant Shares
to be issued pursuant hereto, the holder shall pay the Aggregate Exercise Price in the sum of $___________________ to the Company in
accordance with the terms of the Warrant.
3.
Delivery of Warrant Shares. The Company shall deliver to the holder __________ Warrant Shares in accordance with the terms of the Warrant.
Date:
_______________ __, ______
Name
of Registered Holder
ACKNOWLEDGMENT
The
Company hereby acknowledges this Exercise Notice and hereby directs Pacific Stock Transfer Company to issue the above indicated number
of shares of Common Stock on or prior to the applicable Share Delivery Date.
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Sidus
Space, Inc. |
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By: |
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Name: |
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Title: |
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Exhibit
4.4
THE
REGISTERED HOLDER OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE WARRANT
EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR
HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE HUNDRED EIGHTY DAYS FOLLOWING MARCH [__], 2023 (THE “EFFECTIVE DATE”)
TO ANYONE OTHER THAN (I) BOUSTEAD SECURITIES, LLC, EF HUTTON, DIVISION OF BENCHMARK INVESTMENTS, LLC OR A SELECTED DEALER IN CONNECTION
WITH THE OFFERING FOR WHICH THIS PURCHASE WARRANT WAS ISSUED TO THE UNDERWRITER AS CONSIDERATION (THE “OFFERING”), OR (II)
AN OFFICER, PARTNER, REGISTERED PERSON OR AFFILIATE OF BOUSTEAD SECURITIES, LLC OR EF HUTTON, DIVISION OF BENCHMARK INVESTMENTS, LLC.
COMMON
STOCK PURCHASE WARRANT
For
the Purchase of [____] Shares of Common Stock
of
Sidus
Space, Inc.
1. Purchase
Warrant. THIS CERTIFIES THAT, in consideration of funds duly paid by or on behalf of [__] (“Holder”), as registered
owner of this Purchase Warrant, to Sidus Space, Inc., a Delaware corporation (the “Company”), Holder is entitled,
at any time or from time to time beginning March [__], 2023 (the “Commencement Date”), and at or before 5:00 p.m.,
Eastern time, March [__], 2028 (the “Expiration Date”), but not thereafter, to subscribe for, purchase and receive,
in whole or in part, up to [____]1 shares of Class A common stock of the Company, par value $0.0001 per share (the
“Shares”), subject to adjustment as provided in Section 6 hereof. If the Expiration Date is a day on which banking
institutions are authorized by law to close, then this Purchase Warrant may be exercised on the next succeeding day which is not such
a day in accordance with the terms herein. During the period ending on the Expiration Date, the Company agrees not to take any action
that would terminate this Purchase Warrant. This Purchase Warrant is initially exercisable at $[___]2 per Share;
provided, however, that upon the occurrence of any of the events specified in Section 6 hereof, the rights granted by this
Purchase Warrant, including the exercise price per Share and the number of Shares to be received upon such exercise, shall be adjusted
as therein specified. The term “Exercise Price” shall mean the initial exercise price or the adjusted exercise price,
depending on the context.
2. Exercise.
2.1 Exercise
Form. In order to exercise this Purchase Warrant, the exercise form attached hereto must be duly executed and completed and delivered
to the Company, together with this Purchase Warrant and payment of the Exercise Price for the Shares being purchased payable in cash
by wire transfer of immediately available funds to an account designated by the Company or by certified check or official bank check.
If the subscription rights represented hereby shall not be exercised at or before 5:00 p.m., Eastern time, on the Expiration Date, this
Purchase Warrant shall become and be void without further force or effect, and all rights represented hereby shall cease and expire.
Each exercise hereof shall be irrevocable.
2.2 Cashless
Exercise. In lieu of exercising this Purchase Warrant by payment of cash or check payable to the order of the Company pursuant to
Section 2.1 above, this Purchase Warrant may also be exercised, in whole or in part, at such time by means of a “cashless exercise”
in which the Holder shall be entitled to receive a number of Shares equal to the quotient obtained by dividing [(A-B) (X)] by (A), where:
(A)
= the FMV of one share of Common Stock;
1
Number equal to 3% of the total number of shares of Class A common stock and pre-funded warrants sold.
2
Amount equal to 125% of the public offering price of the shares sold in the offering.
(B)
= the Exercise Price of this Purchase Warrant, as adjusted hereunder; and
(X)
= the number of shares of Common Stock underlying the Purchase Warrant that would be issuable upon exercise of this Purchase Warrant
in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
If
Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities
Act, the Shares shall take on the registered characteristics of the Purchase Warrants being exercised. The Company agrees not to take
any position contrary to this Section 2.2.
Notwithstanding
anything herein to the contrary, on the Expiration Date, this Purchase Warrant shall be automatically exercised via cashless exercise
pursuant to this Section 2.2.
“Bid
Price” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock
is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date)
on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (“Bloomberg”)
(based on a trading day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading
Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable,
(c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported
in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions
of reporting prices), the “OTC Markets Group”, the most recent bid price per share of Common Stock so reported, or (d) in
all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by
the Holders of a majority in interest of the Purchase Warrants then outstanding and reasonably acceptable to the Company, the fees and
expenses of which shall be paid by the Company.
“FMV”
means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed
or quoted on a Trading Market, the value shall be deemed to be the highest intra-day or closing price on any trading day on such Trading
Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a trading day from 9:30 a.m. (New York
City time) to 4:02 p.m. (New York City time)) during the five trading days preceding the exercise, (b) if OTCQB or OTCQX is not a Trading
Market, the value shall be deemed to be the highest intra-day or closing price on any trading day on the OTCQB or OTCQX on which the
Common Stock is then quoted as reported by Bloomberg L.P. (based on a trading day from 9:30 a.m. (New York City time) to 4:02 p.m. (New
York City time)) during the five trading days preceding the exercise, as applicable, (c) if the Common Stock is not then listed or quoted
for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the Pink Sheets published by OTC Markets Group
(or a similar organization or agency succeeding to its functions of reporting prices), the value shall be deemed to be the highest intra-day
or closing price on any trading day on the Pink Sheets on which the Common Stock is then quoted as reported by OTC Markets Group (based
on a trading day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) during the five trading days preceding the exercise,
or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good
faith by the Holder and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“Trading
Market” means the NASDAQ Stock Market LLC, or any of the following other markets or exchanges on which the Common Stock is
listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Global Market, the Nasdaq Global Select Market or
the New York Stock Exchange (or any successors to any of the foregoing).
2.3 Legend. Each certificate for the securities purchased under this Purchase Warrant shall
bear a legend as follows unless such securities have been registered under the Securities Act of 1933, as amended (the “Act”):
“The
securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the “Act”),
or applicable state law. Neither the securities nor any interest therein may be offered for sale, sold or otherwise transferred except
pursuant to an effective registration statement under the Act, or pursuant to an exemption from registration under the Act and applicable
state law which, in the opinion of counsel to the Company, is available.”
3. Transfer.
3.1 General
Restrictions. The registered Holder of this Purchase Warrant agrees by his, her or its acceptance hereof, that such Holder will not:
(a) sell, transfer, assign, pledge or hypothecate this Purchase Warrant for a period of one hundred eighty (180) days following the Effective
Date to anyone other than: (i) Boustead Securities, LLC (“Boustead”), EF Hutton, division of Benchmark Investments,
LLC (“EFH”), or an underwriter, placement agent, or a selected dealer participating in the Offering, or (ii) an officer,
partner, registered person or affiliate of Boustead, EFH or of any such underwriter, placement agent or selected dealer, in each case
in accordance with FINRA Conduct Rule 5110(e)(1), or (b) cause this Purchase Warrant or the securities issuable hereunder to be the subject
of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of this Purchase
Warrant or the securities hereunder, except as provided for in FINRA Rule 5110(e)(2). After 180 days after the Effective Date, transfers
to others may be made subject to compliance with or exemptions from applicable securities laws. In order to make any permitted assignment,
the Holder must deliver to the Company the assignment form attached hereto duly executed and completed, together with the Purchase Warrant
and payment of all transfer taxes, if any, payable in connection therewith. The Company shall within five (5) Business Days transfer
this Purchase Warrant on the books of the Company and shall execute and deliver a new Purchase Warrant or Purchase Warrants of like tenor
to the appropriate assignee(s) expressly evidencing the right to purchase the aggregate number of Shares purchasable hereunder or such
portion of such number as shall be contemplated by any such assignment.
3.2 Restrictions Imposed by the Act. The securities evidenced by this Purchase Warrant shall
not be transferred unless and until: (i) if required by applicable law, the Company has received the opinion of counsel for the Company
that the securities may be transferred pursuant to an exemption from registration under the Act and applicable state securities laws,
or (ii) a registration statement or a post-effective amendment to the Registration Statement relating to the offer and sale of such securities
has been filed by the Company and declared effective by the U.S. Securities and Exchange Commission (the “Commission”)
and compliance with applicable state securities law has been established.
4. Piggyback
Registration Rights.
4.1 Grant
of Right. Whenever the Company proposes to register any shares of its common stock under the Act (other than (i) a registration effected
solely to implement an employee benefit plan or a transaction to which Rule 145 of the Act is applicable, or (ii) a registration statement
on Form S-4, S-8 or any successor form thereto or another form not available for registering the Shares issuable upon exercise of this
Purchase Warrant for sale to the public, whether for its own account or for the account of one or more stockholders of the Company (a
“Piggyback Registration”), the Company shall give prompt written notice (in any event no later than ten (10) Business
Days prior to the filing of such registration statement) to the Holder of the Company’s intention to effect such a registration
and, subject to the remaining provisions of this Section 4.1, shall include in such registration such number of Shares underlying this
Purchase Warrant (the “Registrable Securities”) that the Holders have (within ten (10) Business Days of the respective
Holder’s receipt of such notice) requested in writing (including such number) to be included within such registration. If a Piggyback
Registration is an underwritten offering and the managing underwriter advises the Company that it has determined in good faith that marketing
factors require a limit on the number of shares of common stock to be included in such registration, including all Shares issuable upon
exercise of this Purchase Warrant (if the Holder has elected to include such shares in such Piggyback Registration) and all other shares
of common stock proposed to be included in such underwritten offering, the Company shall include in such registration (i) first, the
number of shares of common stock that the Company proposes to sell and (ii) second, the number of shares of common stock, if any, requested
to be included therein by selling stockholders (including the Holder) allocated pro rata among all such persons on the basis of the number
of shares of common stock then owned by each such person. If any Piggyback Registration is initiated as a primary underwritten offering
on behalf of the Company, the Company shall select the investment banking firm or firms to act as the managing underwriter or underwriters
in connection with such offering. Notwithstanding anything to the contrary, the obligations of the Company pursuant to this Section 4.1
shall terminate on the earlier of (i) the third anniversary of the Effective Date and (ii) the date that Rule 144 would allow the Holder
to sell its Registrable Securities during any ninety (90) day period.
4.2 Indemnification.
The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement hereunder and
each person, if any, who controls such Holders within the meaning of Section 15 of the Act or Section 20 (a) of the Securities Exchange
Act of 1934, as amended (“Exchange Act”), against all loss, claim, damage, expense or liability (including all reasonable
attorneys’ fees and other out-of-pocket expenses reasonably incurred in investigating, preparing or defending against any claim
whatsoever) to which any of them may become subject under the Act, the Exchange Act or otherwise, arising from such registration statement
but only to the same extent and with the same effect as the provisions pursuant to which the Company has agreed to indemnify Boustead
and EFH contained in the Underwriting Agreement between Boustead, EFH and the Company, dated as of March [__], 2023. The Holder(s) of
the Registrable Securities to be sold pursuant to such registration statement, and their successors and assigns, shall severally, and
not jointly, indemnify the Company, against all loss, claim, damage, expense or liability (including all reasonable attorneys’
fees and other expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which they may
become subject under the Act, the Exchange Act or otherwise, arising from information furnished by or on behalf of such Holders, or their
successors or assigns, in writing, for specific inclusion in such registration statement to the same extent and with the same effect
as the provisions contained in the Underwriting Agreement pursuant to which Boustead and EFH has agreed to indemnify the Company.
4.3 Exercise of Purchase Warrants. Nothing contained in this Purchase Warrant shall be construed
as requiring the Holder(s) to exercise their Purchase Warrants prior to or after the initial filing of any registration statement or
the effectiveness thereof.
4.4 Documents Delivered to Holders. The Company shall deliver promptly to each Holder participating
in the offering requesting the correspondence and memoranda described below, copies of all correspondence between the Commission and
the Company, its counsel or auditors and all memoranda relating to discussions with the Commission or its staff with respect to the registration
statement and permit each Holder and underwriter to do such investigation, upon reasonable advance notice, with respect to information
contained in or omitted from the registration statement as it deems reasonably necessary to comply with applicable securities laws or
rules of FINRA. Such investigation shall include access to books, records and properties and opportunities to discuss the business of
the Company with its officers and independent auditors, all to such reasonable extent and at such reasonable times, during normal business
hours, as any such Holder shall reasonably request.
4.5
Underwriting Agreement. The Holders shall be parties to any underwriting agreement relating to a Piggyback Registration. Such
Holders shall not be required to make any representations or warranties to or agreements with the Company or the underwriters except
as they may relate to such Holders, their Shares and the amount and nature of their ownership thereof and their intended methods of distribution.
4.6 Documents to be Delivered by Holder(s). Each of the Holder(s) participating in any of
the foregoing offerings shall furnish to the Company a completed and executed questionnaire provided by the Company requesting information
customarily sought of selling security holders.
4.7
Damages. Should the Company fail to comply with such provisions, the Holder(s) shall, in addition to any other legal or other
relief available to the Holder(s), be entitled to obtain specific performance or other equitable (including injunctive) relief against
the threatened breach of such provisions or the continuation of any such breach, without the necessity of proving actual damages and
without the necessity of posting bond or other security.
5. New
Purchase Warrants to be Issued.
5.1 Partial
Exercise or Transfer. Subject to the restrictions in Section 3 hereof, this Purchase Warrant may be exercised or assigned in whole
or in part. In the event of the exercise or assignment hereof in part only, upon surrender of this Purchase Warrant for cancellation,
together with the duly executed exercise or assignment form and funds sufficient to pay any Exercise Price and/or transfer tax if exercised
pursuant to Section 2.1 hereto, the Company shall cause to be delivered to the Holder without charge a new Purchase Warrant of like tenor
to this Purchase Warrant in the name of the Holder evidencing the right of the Holder to purchase the number of Shares purchasable hereunder
as to which this Purchase Warrant has not been exercised or assigned.
5.2 Lost Certificate. Upon receipt by the Company of evidence satisfactory to it of the
loss, theft, destruction or mutilation of this Purchase Warrant and of reasonably satisfactory indemnification or the posting of a bond,
determined in the sole discretion of the Company, the Company shall execute and deliver a new Purchase Warrant of like tenor and date.
Any such new Purchase Warrant executed and delivered as a result of such loss, theft, mutilation or destruction shall constitute a substitute
contractual obligation on the part of the Company.
6. Adjustments.
6.1 Adjustments
to Exercise Price and Number of Securities. The Exercise Price and the number of Shares underlying the Purchase Warrant shall be
subject to adjustment from time to time as hereinafter set forth:
6.1.1 Share
Dividends; Split Ups. If, after the date hereof, and subject to the provisions of Section 6.3 below, the number of outstanding Shares
is increased by a stock dividend payable in Shares or by a split up of Shares or other similar event, then, on the effective day thereof,
the number of Shares purchasable hereunder shall be increased in proportion to such increase in outstanding Shares, and the Exercise
Price shall be proportionately decreased.
6.1.2
Aggregation of Shares. If, after the date hereof, and subject to the provisions of Section 6.3 below, the number of outstanding
Shares is decreased by a consolidation, combination or reclassification of Shares or other similar event, then, on the effective date
thereof, the number of Shares purchasable hereunder shall be decreased in proportion to such decrease in outstanding Shares, and the
Exercise Price shall be proportionately increased.
6.1.3 Replacement of Securities upon Reorganization, etc. In case of any reclassification
or reorganization of the outstanding Shares other than a change covered by Section 6.1.1 or 6.1.2 hereof or that solely affects the par
value of such Shares, or in the case of any share reconstruction or amalgamation or consolidation or merger of the Company with or into
another corporation (other than a consolidation or share reconstruction or amalgamation or merger in which the Company is the continuing
corporation and that does not result in any reclassification or reorganization of the outstanding Shares), or in the case of any sale
or conveyance to another corporation or entity of the property of the Company as an entirety or substantially as an entirety in connection
with which the Company is dissolved, the Holder of this Purchase Warrant shall have the right thereafter (until the expiration of the
right of exercise of this Purchase Warrant) to receive upon the exercise hereof, for the same aggregate Exercise Price payable hereunder
immediately prior to such event, the kind and amount of shares of stock or other securities or property (including cash) receivable upon
such reclassification, reorganization, share reconstruction or amalgamation, or consolidation, or upon a dissolution following any such
sale or transfer, by a Holder of the number of Shares of the Company obtainable upon exercise of this Purchase Warrant immediately prior
to such event; and if any reclassification also results in a change in Shares covered by Section 6.1.1 or 6.1.2, then such adjustment
shall be made pursuant to Sections 6.1.1, 6.1.2 and this Section 6.1.3. The provisions of this Section 6.1.3 shall similarly apply to
successive reclassifications, reorganizations, share reconstructions or amalgamations, or consolidations, sales or other transfers.
6.1.4
Changes in Form of Purchase Warrant. This form of Purchase Warrant need not be changed because of any change pursuant to this
Section 6.1, and Purchase Warrants issued after such change may state the same Exercise Price and the same number of Shares as are stated
in the Purchase Warrants initially issued pursuant to this Agreement. The acceptance by any Holder of the issuance of new Purchase Warrants
reflecting a required or permissive change shall not be deemed to waive any rights to an adjustment occurring after the Commencement
Date or the computation thereof.
6.2
Substitute Purchase Warrant. In case of any consolidation of the Company with, or share reconstruction or amalgamation or merger
of the Company with or into, another corporation (other than a consolidation or share reconstruction or amalgamation or merger which
does not result in any reclassification or change of the outstanding Shares), the corporation formed by such consolidation or share reconstruction
or amalgamation shall execute and deliver to the Holder a supplemental Purchase Warrant providing that the holder of each Purchase Warrant
then outstanding or to be outstanding shall have the right thereafter (until the stated expiration of such Purchase Warrant) to receive,
upon exercise of such Purchase Warrant, the kind and amount of shares of stock and other securities and property receivable upon such
consolidation or share reconstruction or amalgamation, by a holder of the number of Shares of the Company for which such Purchase Warrant
might have been exercised immediately prior to such consolidation, share reconstruction or amalgamation or merger, sale or transfer.
Such supplemental Purchase Warrant shall provide for adjustments which shall be identical to the adjustments provided for in this Section
6. The above provision of this Section shall similarly apply to successive consolidations or share reconstructions or amalgamations or
mergers.
6.3 Elimination of Fractional Interests. The Company shall not be required to issue certificates
representing fractions of Shares upon the exercise of the Purchase Warrant, nor shall it be required to issue scrip or pay cash in lieu
of any fractional interests, it being the intent of the parties that all fractional interests shall be eliminated by rounding any fraction
up or down, as the case may be, to the nearest whole number of Shares or other securities, properties or rights.
7. Reservation. The Company shall at all times reserve and keep available out of its authorized
Shares, solely for the purpose of issuance upon exercise of the Purchase Warrants, such number of Shares or other securities, properties
or rights as shall be issuable upon the exercise thereof. The Company covenants and agrees that, upon exercise of the Purchase Warrants
and payment of the Exercise Price therefor, in accordance with the terms hereby, all Shares and other securities issuable upon such exercise
shall be duly and validly issued, fully paid and non-assessable and not subject to preemptive rights of any shareholder.
8. Certain
Notice Requirements.
8.1 Holder’s
Right to Receive Notice. Nothing herein shall be construed as conferring upon the Holders the right to vote or consent or to receive
notice as a shareholder for the election of directors or any other matter, or as having any rights whatsoever as a shareholder of the
Company. If, however, at any time prior to the expiration of the Purchase Warrants and their exercise, any of the events described in
Section 8.2 shall occur, then, in one or more of said events, the Company shall deliver to each Holder a copy of each notice relating
to such events given to the other shareholders of the Company at the same time and in the same manner that such notice is given to the
shareholders.
8.2 Events Requiring Notice. The Company shall be required to give the notice described
in this Section 8 upon one or more of the following events: (i) if the Company shall take a record of the holders of its Shares for the
purpose of entitling them to receive a dividend or distribution payable otherwise than in cash, or a cash dividend or distribution payable
otherwise than out of retained earnings, as indicated by the accounting treatment of such dividend or distribution on the books of the
Company, or (ii) the Company shall offer to all the holders of its Shares any additional shares of capital stock of the Company or securities
convertible into or exchangeable for shares of capital stock of the Company, or any option, right or warrant to subscribe therefor.
8.3 Notice of Change in Exercise Price. The Company shall, promptly after an event requiring
a change in the Exercise Price pursuant to Section 6 hereof, send notice to the Holders of such event and change (“Price Notice”).
The Price Notice shall describe the event causing the change and the method of calculating same.
8.4
Transmittal of Notices. All notices, requests, consents and other communications under this Purchase Warrant shall be in writing
and shall be deemed to have been duly made when hand delivered, or mailed by express mail or private courier service: (i) if to the registered
Holder of the Purchase Warrant, to the address of such Holder as shown on the books of the Company, or (ii) if to the Company, to following
address or to such other address as the Company may designate by notice to the Holders:
If
to the Holder:
Boustead
Securities, LLC
6
Venture, Suite 265
Irvine,
CA 92618
Attention:
Chief Executive Officer
with
a copy (which shall not constitute notice) to:
ArentFox Schiff LLP
1717
K Street, NW
Washington,
DC 20006
Attention:
Cavas S. Pavri, Esq.
Fax
No: (202) 778-6460
If
to the Company:
Sidus
Space, Inc.
150
N. Sykes Creek Parkway, Suite 200
Merritt
Island, FL 32953
Fax
No: (321) 613-5630
With
a copy (which shall not constitute notice) to:
Sheppard,
Mullin, Richter & Hampton LLP
30
Rockefeller Plaza
New
York, NY 101120015
Attention:
Jeffrey J. Fessler, Esq.; Sean F. Reid, Esq.
Fax
No: (917) 438-6133
9. Miscellaneous.
9.1 Amendments.
The Company, Boustead and EFH may from time to time supplement or amend this Purchase Warrant without the approval of any of the Holders
in order to cure any ambiguity, to correct or supplement any provision contained herein that may be defective or inconsistent with any
other provisions herein, or to make any other provisions in regard to matters or questions arising hereunder that the Company, Boustead
and EFH may deem necessary or desirable and that the Company, Boustead and EFH deem shall not adversely affect the interest of the Holders.
All other modifications or amendments shall require the written consent of and be signed by (i) the Company and (ii) the Holder(s) of
Purchase Warrants then-exercisable for at least a majority of the Shares then-exercisable pursuant to all then-outstanding Purchase Warrants.
9.2
Headings. The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or
affect the meaning or interpretation of any of the terms or provisions of this Purchase Warrant.
9.3.
Entire Agreement. This Purchase Warrant (together with the other agreements and documents being delivered pursuant to or in connection
with this Purchase Warrant) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof, and supersedes
all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.
9.4
Binding Effect. This Purchase Warrant shall inure solely to the benefit of and shall be binding upon, the Holder and the Company
and their permitted assignees, respective successors, legal representative and assigns, and no other person shall have or be construed
to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Purchase Warrant or any provisions
herein contained.
9.5 Governing Law; Submission to Jurisdiction; Trial by Jury. This Purchase Warrant shall
be governed by and construed and enforced in accordance with the laws of the State of California, without giving effect to conflict of
laws principles thereof. The Company hereby agrees that any action, proceeding or claim against it arising out of, or relating in any
way to this Purchase Warrant shall be brought and enforced in the courts located in Los Angeles, California, or in the United States
District Court located in Los Angeles, California, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive.
The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Any process
or summons to be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt
requested, postage prepaid, addressed to it at the address set forth in Section 8 hereof. Such mailing shall be deemed personal service
and shall be legal and binding upon the Company in any action, proceeding or claim. The Company and the Holder agree that the prevailing
party(ies) in any such action shall be entitled to recover from the other party(ies) all of its reasonable attorneys’ fees and
expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor. The Company (on its behalf
and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) and the Holder hereby irrevocably waive,
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.
9.6 Waiver, etc. The failure of the Company or the Holder to at any time enforce any of
the provisions of this Purchase Warrant shall not be deemed or construed to be a waiver of any such provision, nor to in any way affect
the validity of this Purchase Warrant or any provision hereof or the right of the Company or any Holder to thereafter enforce each and
every provision of this Purchase Warrant. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this
Purchase Warrant shall be effective unless set forth in a written instrument executed by the party or parties against whom or which enforcement
of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver
of any other or subsequent breach, non-compliance or non-fulfillment.
9.7 Exchange Agreement. As a condition of the Holder’s receipt and acceptance of this
Purchase Warrant, Holder agrees that, at any time prior to the complete exercise of this Purchase Warrant by Holder, if the Company,
Boustead and EFH enter into an agreement (“Exchange Agreement”) pursuant to which they agree that all outstanding
Purchase Warrants will be exchanged for securities or cash or a combination of both, then Holder shall agree to such exchange and become
a party to the Exchange Agreement.
[Signature
Page Follows]
IN
WITNESS WHEREOF, the Company has caused this Purchase Warrant to be signed by its duly authorized officer as of the [___] day of March,
2023.
| Sidus
Space, Inc. |
|
| |
|
|
| |
|
|
| By: |
|
|
| Name: |
|
|
| Title: |
|
|
[Form
to be used to exercise Purchase Warrant]
Date:
__________, 20___
The
undersigned hereby elects irrevocably to exercise the Purchase Warrant for ______ shares of common stock, par value $0.0001 per share
(the “Shares”), of Sidus Space, Inc., a Delaware corporation (the “Company”), and hereby makes
payment of $____ (at the rate of $____ per Share) in payment of the Exercise Price pursuant thereto. Please issue the Shares as to which
this Purchase Warrant is exercised in accordance with the instructions given below and, if applicable, a new Purchase Warrant representing
the number of Shares for which this Purchase Warrant has not been exercised.
or
The
undersigned hereby elects irrevocably to convert its right to purchase ___ Shares of the Company under the Purchase Warrant for ______
Shares, as determined in accordance with the following formula:
dividing
[(A-B) (X)] by (A), where:
(A)
= the FMV;
(B)
= the Exercise Price of this Purchase Warrant, as adjusted hereunder; and
(X)
= the number of shares of Common Stock underlying the Purchase Warrant that would be issuable upon exercise of this Purchase Warrant
in accordance with the terms of this Purchase Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
The
undersigned agrees and acknowledges that the calculation set forth above is subject to confirmation by the Company.
Please
issue the Shares as to which this Purchase Warrant is exercised in accordance with the instructions given below and, if applicable, a
new Purchase Warrant representing the number of Shares for which this Purchase Warrant has not been converted.
Signature
__________________________
Signature
Guaranteed _________________
INSTRUCTIONS
FOR REGISTRATION OF SECURITIES
| Name: |
|
|
| |
(Print
in Block Letters) |
|
| |
|
|
| Address: |
|
|
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|
| |
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|
NOTICE:
The signature to this form must correspond with the name as written upon the face of the Purchase Warrant without alteration or enlargement
or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership
on a registered national securities exchange.
[Form
to be used to assign Purchase Warrant]
ASSIGNMENT
(To
be executed by the registered Holder to effect a transfer of the within Purchase Warrant):
FOR
VALUE RECEIVED, __________________ does hereby sell, assign and transfer unto the right to purchase shares of Common Stock, par value
$0.0001 per share, of Sidus Space, Inc., a Delaware corporation (the “Company”), evidenced by the Purchase Warrant
and does hereby authorize the Company to transfer such right on the books of the Company.
Dated:
__________, 20__
Signature
_____________________________
Signature
Guaranteed ____________________
NOTICE:
The signature to this form must correspond with the name as written upon the face of the within Purchase Warrant without alteration or
enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm
having membership on a registered national securities exchange.
Exhibit
5.1
 |
|
Sheppard,
Mullin, Richter & Hampton LLP
30
Rockefeller Plaza
New
York, New York 10112-0015
212.653.8700
main
212.653.8701
fax
www.sheppardmullin.com |
March
27, 2023
VIA
ELECTRONIC MAIL
Sidus
Space, Inc.
150
N. Sykes Creek Pkwy.
Suite
1200
Merritt
Island, FL 32953
| Re: |
Registration
Statement on Form S-1 |
Ladies
and Gentlemen:
We
are acting as counsel to Sidus Space, Inc. (the “Company”) in connection with its registration statement on Form S-1 (the
“Registration, Statement”) filed with the Securities and Exchange Commission (the “Commission”) under the Securities
Act of 1933, as amended (the “Act”), relating to the proposed public offering of (a) $17,250,000 of shares (the “Shares”)
of Class A common stock of the Company, par value $0.0001 per share (the “Common Stock”), including $2,250,000 of Shares
issuable upon exercise of an over-allotment option granted by the Company; (b) warrants to purchase shares of Common Stock; (c) to each
purchaser whose purchase of shares of Common Stock in such offering would otherwise result in the purchaser, together with its affiliates
and certain related parties, beneficially owning more than 4.99% (or, at the election of the holder, 9.99%) of the Company’s outstanding
Common Stock immediately following the consummation of such offering, the opportunity to purchase, if the purchaser so chooses, pre-funded
warrants (the “Pre-Funded Warrants”), in lieu of shares of Common Stock; and (iii) warrants to be issued by the Company to
the underwriters of the Company named in the Registration Statement to purchase up to 3% of the number of shares of Common Stock sold
in the offering (excluding shares of Common Stock sold to cover over-allotments, if any) (the “Underwriters’ Warrants”)
upon the closing of the public offering pursuant to which the Registration Statement relate. The Shares will be sold by the Company pursuant
to an underwriting agreement to be entered into by and between the Company and EF Hutton, division of Benchmark Securities, LLC and
Boustead Securities, LLC. as the representatives of the several underwriters to be named therein (the “Agreement”).
This opinion letter is furnished to you at your request to enable you to fulfill the requirements
of Item 601(b)(5) of Regulation S-K in connection with the Registration Statement.
In
connection with this opinion, we have reviewed and relied upon the following:
| |
● |
the
Registration Statement and the related prospectus included therein; |
| |
● |
the
form of Agreement; |
| |
● |
the
form of the Underwriters’ Warrants; |
| |
● |
The
Amended and Restated Certificate of Incorporation of the Company, as amended and in effect
on the date hereof; |
| |
● |
The
Bylaws of the Company in effect on the date hereof; |
| |
● |
the
resolutions of the Board of Directors of the Company authorizing/ratifying the execution and delivery of the Agreement, the issuance
and sale of the Shares, the issuance of the Underwriters’ Warrants, the preparation and filing of the Registration Statement,
and other actions with regard thereto; and |
| |
● |
such
other documents, records, certificates, memoranda and other instruments as we deem necessary as a basis for this opinion. |
In
our examination, we have assumed the genuineness of all signatures, including endorsements, the legal capacity and competency of all
natural persons, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents
submitted to us as facsimile, electronic, certified or photocopy, and the authenticity of the originals of such copies. As to any facts
relevant to the opinions stated herein that we did not independently establish or verify, we have relied upon statements and representations
of officers and other representatives of the Company and others and of public officials.
|
|
Sheppard,
Mullin, Richter & Hampton LLP
30
Rockefeller Plaza
New
York, New York 10112-0015
212.653.8700
main
212.653.8701
fax
www.sheppardmullin.com |
Based
upon, subject to and limited by the foregoing, we are of the opinion that:
| |
1. |
Following
(i) execution and delivery by the Company of the Agreement, (ii) effectiveness of the Registration Statement, (iii) issuance of the
Shares pursuant to the terms of the Agreement, and (iv) receipt by the Company of the consideration for the Shares specified in the
resolutions, the Shares will be duly authorized for issuance and, when issued, delivered and paid for in accordance with the terms
of the Agreement, will be validly issued, fully paid and non-assessable. |
| |
|
|
| |
2. |
The
Underwriters’ Warrants have been duly authorized by all requisite corporate action on the part of the Company under the DGCL
and, provided that the Underwriters’ Warrants have been duly executed and delivered by the Company and duly delivered to the
purchasers thereof against payment therefor, the Underwriters’ Warrants, when issued and sold as contemplated in the Registration
Statement will be valid and legally binding obligations of the Company, enforceable against the Company in accordance with their
terms, except as enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating
to or affecting creditors’ rights generally and by general equitable principles (regardless of whether such enforceability
is considered in a proceeding at law or in equity). |
| |
|
|
| |
3. |
The
shares of Common Stock issuable upon exercise of the Underwriters’ Warrants (the “Warrant Shares” and together
with the Underwriters’ Warrants, and the Shares, the “Securities”) have been duly authorized by all requisite corporate
action on the part of the Company under the DGCL and, when the Warrant Shares are delivered to and paid for in accordance with the
terms of the Underwriters’ Warrants and when evidence of the issuance thereof is duly recorded in the Company’s books
and records, the Warrant Shares will be validly issued, fully paid and non-assessable. |
We
also hereby consent to the reference to our firm under the caption “Legal Matters” in the prospectus which forms part of
the Registration Statement. In giving this consent, we do not admit that we are within the category of persons whose consent is required
under Section 7 of the Act, the rules and regulations of the Commission promulgated thereunder or Item 509 of Regulation S-K.
We
express no opinion as to matters governed by any laws other than the DGCL. No opinion is expressed herein with respect to the qualification
of the Securities under the securities or blue sky laws of any state or any foreign jurisdiction.
This
opinion letter is rendered as of the date first written above and we disclaim any obligation to advise you of facts, circumstances, events
or developments which hereafter may be brought to our attention and which may alter, affect or modify the opinion expressed herein. Our
opinion is expressly limited to the matters set forth above and we render no opinion, whether by implication or otherwise, as to any
other matters relating to the Company or the Securities, or any other agreements or transactions that may be related thereto or contemplated
thereby. We are expressing no opinion as to any obligations that parties other than the Company may have under or in respect of the Securities
or as to the effect that their performance of such obligations may have upon any of the matters referred to above. No opinion may be
implied or inferred beyond the opinion expressly stated above.
| Very
truly yours, |
|
| |
|
| /s/
Sheppard, Mullin, Richter & Hampton LLP |
|
| |
|
| SHEPPARD,
MULLIN, RICHTER & HAMPTON LLP |
|
Exhibit 23.1
CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
the Board of Directors of
Sidus
Space, Inc.
We
consent to the incorporation by reference in the Form S-1 Registration Statement of Sidus Space, Inc. (the “Company”) of
our report dated March 15, 2023 with respect to our audits of the consolidated balance sheets as of December 31, 2022 and 2021, and consolidated
statements of operations, stockholders’ deficit and cash flows for the years then ended appearing in the Annual Report on the Form
10-K of the Company for the year ended December 31, 2022.
We
also consent to the reference to us under the caption “Experts” in the Registration Statement.
/s/
BF Borgers CPA PC
Certified
Public Accountants
Lakewood,
Colorado
March
27, 2023
Exhibit
107
Calculation
of Filing Fee Tables
FORM
S-1
(Form
Type)
SIDUS
SPACE, INC.
(Exact
Name of Registrant as Specified in its Charter)
Table
1: Newly Registered Securities
| Title of each Class of Securities to be Registered | |
Amount
Registered | | |
Proposed
Maximum
Offering
Price Per
Share | | |
Maximum
Aggregate
Offering
Price(1)(2) | | |
Amount of
Registration
Fee(3) | |
| Class A Common Stock, $0.0001 par value | |
| - | | |
| - | | |
$ | 17,250,000 | | |
$ | 1,900.95 | |
| Pre-funded Warrants | |
| - | | |
| - | | |
| Included above | | |
| - | |
| Representative’s Warrants (4) | |
| - | | |
| - | | |
| - | | |
| - | |
| Class A Common Stock underlying Pre-funded Warrants | |
| - | | |
| - | | |
| Included above | | |
| - | |
| Class A Common Stock underlying Representative’s Warrants (5) | |
| | | |
| | | |
$ | 646,875 | | |
$ | 71.29 | |
| | |
| | | |
| | | |
| | | |
| | |
| Registration Fee Previously Paid | |
| | | |
| | | |
| | | |
| - | |
| Registration Fee Paid Herewith | |
| | | |
| | | |
| | | |
$ | 1,972.24 | |
| (1) |
The
registration fee for securities is based on an estimate of the Maximum Aggregate Offering Price of the securities, assuming the sale
of the maximum number of shares at the highest expected offering price, and such estimate is solely for the purpose of calculating
the registration fee pursuant to Rule 457(o). |
| |
|
| (2) |
Includes
shares of Class A common stock, that are issuable upon exercise of the underwriters’ over-allotment option to purchase additional
shares. |
| |
|
| (3) |
Calculated
pursuant to Rule 457(a) based on an estimate of the proposed maximum aggregate offering price. |
| |
|
| (4) |
No
registration fee required pursuant to Rule 457(g). |
| |
|
| (5) |
We
have agreed to issue to the representative of the underwriters warrants to purchase shares of common stock representing up to 3%
of the Class A common stock and pre-funded warrants issued in the offering. The representative’s warrants are exercisable at
a per share exercise price equal to 125% of the public offering price per share of the Class A common stock offered hereby. As estimated
solely for the purpose of calculating the registration fee pursuant to Rule 457(g) under the Securities Act, the proposed maximum
aggregate offering price of the representative’s warrants is $646,875, which is equal to 125% of $517,500 (3% of $17,250,000). |