As
filed with the Securities and Exchange Commission on May 31, 2024
Registration
No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE SECURITIES ACT OF 1933
AINOS,
INC.
(Exact
name of registrant as specified in its charter)
Texas |
|
75-1974352 |
(State
or other jurisdiction of
incorporation
or organization) |
|
(I.R.S.
Employer
Identification
Number) |
8880
Rio San Diego Drive, Ste. 800
San
Diego, CA 92108
(858)
869-2986
(Address,
including zip code, and telephone number, including area code, of registrant’s principal executive offices)
CT
Corporation System
1999
Bryan St., Suite 900 Dallas, TX 75201-3136
(214)
979-1172
(Address,
including zip code, and telephone number, including area code, of agent for service)
Copies
to:
Joseph
M. Lucosky, Esq.
Steven
A. Lipstein, Esq.
Lucosky
Brookman LLP
101
Wood Avenue South, 5th Floor
Woodbridge,
NJ 08830
(732)
395-4400
APPROXIMATE
DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time to time after the effective date of this registration statement.
If
the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please check
the following box. ☐
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, 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 registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become effective
on filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ☐
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register additional
securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer”
and “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
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 pursuant 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 Commission, acting pursuant to said Section 8(a), may determine.
EXPLANATORY
NOTE
This
registration statement contains two prospectuses:
● |
a
base prospectus which covers the offering, issuance and sale by us of up to $200,000,000 of our common stock, preferred stock, warrants,
units, and rights; and |
|
|
● |
a
sales agreement prospectus covering the offering, issuance and sale by us of up to a maximum aggregate offering price of $1,353,197
of our common stock that may be issued and sold under an At The Market Offering Agreement we have entered into with H.C. Wainwright
& Co., LLC as sales agent. |
The
base prospectus immediately follows this explanatory note. The specific terms of the securities offered pursuant to the base prospectus
are specified in the sales agreement prospectus immediately following the base prospectus.
The
information in this 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.
Subject
to Completion, dated May 31, 2024.
PROSPECTUS
$200,000,000
Common
Stock
Preferred
Stock
Debt
Securities
Warrants
Rights
Units
We
may offer and sell up to $200 million in the aggregate of the securities identified above from time to time in one or more offerings.
This prospectus provides you with a general description of the securities.
Each
time we offer and sell securities, we will provide a supplement to this prospectus that contains specific information about the offering
and the amounts, prices and terms of the securities. The supplement may also add, update or change information contained in this prospectus
with respect to that offering. You should carefully read this prospectus and the applicable prospectus supplement before you invest in
any of our securities.
We
may offer and sell the securities described in this prospectus and any prospectus supplement to or through one or more underwriters,
dealers and agents, or directly to purchasers, or through a combination of these methods. If any underwriters, dealers or agents are
involved in the sale of any of the securities, their names and any applicable purchase price, fee, commission or discount arrangement
between or among them will be set forth, or will be calculable from the information set forth, in the applicable prospectus supplement.
See “About this Prospectus” and “Plan of Distribution” for more information. No securities may
be sold without delivery of this prospectus and the applicable prospectus supplement describing the method and terms of the offering
of such securities.
INVESTING
IN OUR SECURITIES INVOLVES RISKS. SEE THE “RISK FACTORS” ON PAGE 11 OF THIS PROSPECTUS AND ANY SIMILAR
SECTION CONTAINED IN THE APPLICABLE PROSPECTUS SUPPLEMENT CONCERNING FACTORS YOU SHOULD CONSIDER BEFORE INVESTING IN OUR SECURITIES.
Our
common stock and public warrants are listed on the Nasdaq Capital Market under the symbols “AIMD” and “AIMDW,”
respectively. On May 23, 2024, the last reported sale price of our common stock on the Nasdaq Capital Market was $1.26
per share.
The
aggregate market value of our outstanding common stock held by non-affiliates is $4,059,591, based on 6,503,118 shares
of outstanding common stock, of which 3,221,898 are held by affiliates, and a per share price of $1.26 based on the closing
sale price of our common stock on May 23, 2024. Pursuant to General Instruction I.B.6 of Form S-3, in no event will we sell our
common stock in a public primary offering with a value exceeding more than one-third of our public float in any 12-month period so long
as our public float remains below $75,000,000. We have not offered any securities pursuant to General Instruction I.B.6. of Form S-3
during the prior 12 calendar month period that ends on and includes the date of this prospectus.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed
upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.
The
date of this prospectus is , 2024.
TABLE
OF CONTENTS
SPECIAL
NOTICE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus contains forward-looking statements that involve risks and uncertainties, principally in the sections entitled “Risk
Factors.” All statements other than statements of historical fact contained in this prospectus, including statements regarding
future events, our future financial performance, business strategy and plans and objectives of management for future operations, are
forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,”
“believes,” “can,” “continue,” “could,” “estimates,” “expects,”
“intends,” “may,” “plans,” “potential,” “predicts,” “should,”
or “will” or the negative of these terms or other comparable terminology. Although we do not make forward looking statements
unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. These statements are only predictions
and involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Risk Factors” or
elsewhere in this prospectus, which may cause our or our industry’s actual results, levels of activity, performance or achievements
expressed or implied by these forward-looking statements.
Forward-looking
statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the
times at, or by which, that performance or those results will be achieved. Forward-looking statements are based on information available
at the time they are made and/or management’s good faith belief as of that time with respect to future events, and are subject
to risks and uncertainties that could cause actual performance or results to differ materially from what is expressed in or suggested
by the forward-looking statements.
Forward-looking
statements speak only as of the date they are made. You should not put undue reliance on any forward-looking statements. We assume no
obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting
forward-looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking
statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the U.S. Securities and Exchange Commission, or the SEC, using a “shelf”
registration process. By using a shelf registration statement, we may sell securities from time to time and in one or more offerings
up to a total dollar amount of $50 million as described in this prospectus. Each time that we offer and sell securities, we will provide
a prospectus supplement to this prospectus that contains specific information about the securities being offered and sold and the specific
terms of that offering. The prospectus supplement may also add, update or change information contained in this prospectus with respect
to that offering. If there is any inconsistency between the information in this prospectus and the applicable prospectus supplement,
you should rely on the prospectus supplement. Before purchasing any securities, you should carefully read both this prospectus and the
applicable prospectus supplement, together with the additional information described under the heading “Where You Can Find More
Information; Incorporation by Reference.”
We
have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent
information, you should not rely on it. We will not make an offer to sell these securities in any jurisdiction where the offer or sale
is not permitted. You should assume that the information appearing in this prospectus and the applicable prospectus supplement to this
prospectus is accurate as of the date on its respective cover, and that any information incorporated by reference is accurate only as
of the date of the document incorporated by reference, unless we indicate otherwise. Our business, financial condition, results of operations
and prospects may have changed since those dates.
When
we refer to “we,” “our,” “us,” “our Company” and the “Company” in this prospectus,
we mean Ainos, Inc., a Texas corporation, unless otherwise specified. When we refer to “you,” we mean the holders of the
applicable series of securities.
WHERE
YOU CAN FIND MORE INFORMATION; INCORPORATION BY REFERENCE
Available
Information
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the securities being offered by
this prospectus. This prospectus, which constitutes part of the registration statement, does not contain all of the information in the
registration statement and its exhibits. For further information with respect to us and our securities offered by this prospectus, we
refer you to the registration statement and its exhibits. Statements contained in this prospectus as to the contents of any contract
or any other document referred to are not necessarily complete, and in each instance, we refer you to the copy of the contract or other
document filed as an exhibit to the registration statement. Each of these statements is qualified in all respects by this reference.
You can read our SEC filings, including the registration statement, over the internet at the SEC’s website at www.sec.gov.
We
are subject to the information reporting requirements of the Exchange Act, and we file reports, proxy statements and other information
with the SEC. These reports, proxy statements and other information will be available for review at the SEC’s website at www.sec.gov.
Incorporation
by Reference
The
SEC’s rules allow us to “incorporate by reference” information into this prospectus, which means that we can disclose
important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference
is deemed to be part of this prospectus, and subsequent information that we file with the SEC will automatically update and supersede
that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained in this prospectus modifies or replaces that statement.
We
incorporate by reference our documents listed below and any future filings made by us with the SEC under Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act” in this prospectus, between
the date of this prospectus and the termination of the offering of the securities described in this prospectus. We are not, however,
incorporating by reference any documents or portions thereof, whether specifically listed below or filed in the future, that are not
deemed “filed” with the SEC, including any information furnished pursuant to Items 2.02 or 7.01 of Form 8-K or related exhibits
furnished pursuant to Item 9.01 of Form 8-K.
This
prospectus and any accompanying prospectus supplement incorporate by reference the documents set forth below that have previously been
filed with the SEC:
|
● |
Our
Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 8, 2024; |
|
● |
Our
Quarterly Report on Form 10-Q for the period ended March 31, 2024, filed with the SEC on May 13, 2024; and |
|
● |
Our
Current Reports on Form 8-K filed with the SEC on January 2, 2024, January 12, 2024, January 25, 2024, March 15, 2024, March 19, 2024, and May 6, 2024. |
All
reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination
of this offering, including all such documents we may file with the SEC after the date of the initial registration statement and prior
to the effectiveness of the registration statement, but excluding any information furnished to, rather than filed with, the SEC, will
also be incorporated by reference into this prospectus and deemed to be part of this prospectus from the date of the filing of such reports
and documents.
You
may request a free copy of any of the documents incorporated by reference in this prospectus (other than exhibits, unless they are specifically
incorporated by reference in the documents) by writing or telephoning us at the following address:
Ainos,
Inc.
Attn:
Chief Financial Officer
8880
Rio San Diego Drive, Ste. 800
San
Diego, CA 92108
(858)
869-2986
Exhibits
to the filings will not be sent, however, unless those exhibits have specifically been incorporated by reference in this prospectus and
any accompanying prospectus supplement.
The
incorporated reports and other documents may also be accessed on website at www.ainos.com. The information on our website, however, is
not, and should not be deemed to be, a part of this prospectus.
THE
COMPANY
Overview
Ainos,
Inc. (the “Company”), incorporated in the State of Texas in 1984, is a diversified healthcare company focused on the development
of novel point-of-care testing (the “POCT”), therapeutics based on very low-dose interferon alpha (the “VELDONA”),
and synthetic RNA-driven preventative medicine. Our product pipeline includes commercial-stage VELDONA Pet cytoprotein supplements, clinical-stage
VELDONA human therapeutics and telehealth-friendly POCTs powered by the AI Nose technology platform.
We
have historically been involved in the research and development of therapeutics based on VELDONA. Building on our research and
development on VELDONA since inception, we are focused on commercializing a suite of VELDONA-based product candidates.
In
2021 and 2022, we acquired certain types of intellectual property from controlling shareholder, Ainos Inc., a Cayman Island corporation
(“Ainos KY”), to expand our product portfolio into POCTs aimed to provide connected, rapid, and convenient testing
for a broad range of health conditions. Pivoting from the sales of COVID-19 POCT, we aim to commercialize POCTs that detect volatile
organic compounds (the “VOC”) emitted by the body, powered by our AI Nose technology platform. Our lead VOC POCT candidate,
Ainos Flora, aims to test female vaginal health and certain common sexually transmitted infections (the “STIs”) quickly and
easily.
We
believe the following attributes differentiate us from other diversified life science companies:
|
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Intuitive,
telehealth-friendly point-of-care testing; |
|
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AI-powered
VOC testing platform; |
|
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decades
of proprietary low-dose oral interferon clinical research; |
|
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capital-efficient
business model; |
|
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outsourced
manufacturing; and |
|
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global
distribution relationships. |
Recent
Development
On
March 15, 2024, the Board of Directors appointed Christopher Hsin-Liang Lee as the Chief Financial Officer of the Company. Christopher
Lee, aged 53, brings over 25 years of experience in accounting and finance, encompassing US GAAP, PCAOB standards, and SEC rules and
regulations. Before joining the Company, Mr. Lee served as CFO of a Nasdaq-listed company for 10 years, was a partner at KEDP CPA Group
from August 2009 to June 2011, and operated as a self-employed accountant from July 2011 to August 2014. He has served on the Board of
Directors of Aixin Life International Inc. since February 2021. Mr. Lee holds a BS degree in accounting from Ohio State University and
an MS degree in business taxation from Golden Gate University. He is licensed as a Certified Public Accountant (CPA) in the United States.
On
January 9, 2024, the Company and Taiwan Carbon Nano Technology Corporation (“TCNT”) entered into an addendum to its five-year
Product Development Agreement (the “Addendum Agreement”) to modify the scope of co-development covered by the Product Development
Agreement and certain other terms. For products defined in the Addendum Agreement, TCNT will provide facilities, equipment, mass production
process technology, ISO9001 and ISO13485 related management, as well as mass production support. The procurement of parts and raw materials,
rental fees, and utility expenses are excluded. The Company will pay a total fee of NT$5 million (approximately USD$161,000) for five-years
of development commencing from 2024.
For
six months commencing from January 2024, TCNT will provide non-exclusive use of certain patents related to VOC and POCT technologies
for a monthly fee of US$95,000 (plus 5% sales tax), with negotiable payment terms. The parties can discuss subsequent use of the patents
at later dates.
On
May 3, 2024, the Company entered into a Convertible Note and Warrant Purchase Agreement with ASE Test, Inc., Taiwanese company (“ASE
Test”), pursuant to which the Company issued to ASE Test a convertible note in the aggregate principal amount of US$9,000,000.
The note bears six percent compound interest and has a three-year term through May 3, 2027. The note is convertible at ASE Test’s
election into shares of the Company’s common stock at a conversion price of US$4.50 per share, subject to customary anti-dilution
adjustments as set forth in the note. As part of the transaction, ASE Test received a five-year common stock purchase warrant which vests
and becomes exercisable on the first day following a six-month period from the date of issuance. The warrant may be exercised for up
to 500,000 shares of common stock at a price of US$4.50 per share. Closing of the placement is subject to customary closing conditions.
Our
Technologies
VELDONA
Interferons
are proteins made by host cells in response to the presence of pathogens. Interferons allow for communication between cells to trigger
the protective defenses of the immune system. VELDONA formulation, delivered into the oral cavity as a lozenge in low doses, is designed
to enhance autoimmunity to resist virus damages, potentially reducing side effects and risks caused by high-dose interferon and other
small molecule drugs.
We
believe VELDONA has shown to be safe and effective in the clinical studies for treatment of intended human and animal diseases. Since
our inception to date, 68 human clinical trials have been conducted with low-dose oral IFNα. 63 studies were Phase 2 trials, and
3 Phase 1 and 2 Phase 3 studies have also been conducted.
In
28 studies performed by Ainos, VELDONA was found to exhibit systemic effects in mice, cats, dogs, ferrets, chickens, rats, guinea pigs,
horses, calves/cows, and particularly pigs. VELDONA aided in boosting feed conversion efficiency and fighting deadly viral infections
in these species, including canine parvovirus, equine herpesvirus, feline coronavirus, and others. We believe the studies demonstrate
VELDONA’s therapeutic or preventive effect via the oral mucosa and shows VELDONA modulates systemic and mucosal immunity without
serious side effects.
We
have researched VELDONA for a broad range of human disease indications. We intend to prioritize advancing the following candidates: oral
warts for HIV-seropositive patients, Sjogren’s Syndrome, mid COVID-19 syndromes, common cold, influenza, aphthous stomatitis, and
chemotherapy-induced stomatitis. The United States Food and Drug Administration (the “U.S. FDA”) has granted Orphan
Drug Designation (“ODD”) for our VELDONA formulation as a potential treatment for oral warts in HIV-seropositive patients.
Leveraging
our VELDONA technology, we have launched a series of health supplements for dogs and cats under the brand name “VELDONA Pet”
in Taiwan since the second quarter of 2023 and we intend to explore international sales and marketing opportunities. Our VELDONA Pet
product line is formulated to address a variety of health issues, including skin, gum, emotion, discomfort caused by allergies, eye,
and weight-related issues. We also intend to conduct clinical studies in Taiwan for the treatment of feline chronic gingivostomatitis
(FCGS).
Point-of-Care
Tests (POCTs)
Our
POCT technologies aim to provide a simple, effective and telehealth-friendly tests that can deliver results within minutes. Our POCT
detection technologies consists of VOC sensing, lateral flow immunochromatographic assay and nucleic acid. Currently we prioritize developing
products based on VOC sensing. We intend to evaluate our lateral flow and nucleic acid test technologies for potential applications for
other disease indication.
VOC
Sensing Powered by AI Nose
We
believe the analysis of VOC is a powerful, non-invasive option for disease detection and health monitoring. Our VOC sensing technology
aims to detect the target VOCs within few minutes. AI Nose, the key enabler of our VOC sensing, consists of three key technologies: 1)
a “digital nose” detects the target VOCs; 2) a trained artificial intelligence (“AI”) algorithm analyzes the
target VOCs; 3) a “Smell ID” stores the VOC’s digital profile in the cloud.
We
believe VOC sensing powered by AI Nose is scalable into a broad range of industries for two reasons. First, digital nose sensors can
be made small and at low cost through semiconductor manufacturing technology. Second, as we train our AI with more Smell IDs, our VOC
sensing can continue to improve. While health testing is our near-term focus, we believe we can broaden VOC sensing powered by AI Nose
to other applications including telehealth, automotive, industrial, and environmental safety.
Our
Pipeline
An
integral part of our operating strategy is to create multiple revenue streams through sales of commercially ready products, out-licensing
or forming strategic relationships to develop and commercialize our products. As of March 31, 2024, we have commercialized the following
products:
|
● |
COVID-19
Antigen Rapid Test Kit. As the first commercialized products we sell, we have marketed
COVID-19 antigen rapid test kits in Taiwan under emergency use authorization (“EUA”)
issued by the Taiwan Food and Drug Administration (“TFDA”) to TCNT,
the product manufacturer. We have pivoted away from this business and have ceased selling
the product since the first quarter of 2024.
|
|
|
|
|
● |
VELDONA
Pet. VELDONA Pet is formulated to address a variety of health issues in dogs and cats,
including skin, gum, emotion, discomfort caused by allergies, eye, and weight-related issues.
We currently sell VELDONA Pet in Taiwan.
|
From time to time, we assess our development plan based on available resources and market dynamics. Our current pipeline of the products, which are under development, includes the following:
|
● |
VELDONA
human drugs. Our programs include treatment of oral warts in human immunodeficiency
virus (HIV) seropositive patients, Sjögren’s syndrome common cold, influenza,
and treatment for mild COVID-19 symptoms. Except for COVID-19, we have conducted Phase 2
studies for these programs. The United States Food and Drug Administration (the “U.S.
FDA”) have granted orphan drug designation for our VELDONA formulation as a potential
treatment for oral warts in HIV-seropositive patients.
|
|
|
|
|
● |
VOC
POCT - Ainos Flora. Ainos Flora, powered by AI Nose, is intended to perform a non-invasive test for female vaginal health and
certain common STIs within a few minutes. A companion app is also being developed that enables users to conveniently manage test
results. We believe Ainos Flora can provide connected, convenient, discreet, rapid testing in a point-of-care setting. We are conducting
a clinical study in Taiwan and exploring strategic opportunities to commercialize the product. |
|
|
|
|
● |
VOC
platform - NISD co-development. We are co-developing a VOC sensing platform with Nisshinbo Micro Devices Inc. (“NISD”)
and Taiwan Inabata Sangyo Co. (“Taiwan Inabata”). The platform under development is intended to be used in applications
including telehealth, automotive, industrial, and environmental safety. |
|
|
|
|
● |
VOC
POCT - Ainos Pen. The device is intended to be a cloud-connected, multi-purpose, portable breath analyzer that is intended to
monitor health conditions within minutes, powered by AI Nose. We expect consumers to be empowered to share test results with their
physicians through in-person and telehealth medical consultations. |
|
|
|
|
● |
VOC
POCT - CHS430. The CHS430 device, powered by AI Nose, is intended to provide non-invasive testing for ventilator-associated pneumonia
within a few minutes, as compared to current standard of care invasive culture tests that typically take more than two days
to provide results. |
|
|
|
|
● |
Synthetic
RNA (“SRNA”). We plan to develop a SRNA technology platform in Taiwan with a long-term goal of developing
next-generating precision treatments and rapid tests. |
Our
Business Model
We
believe our business model is capital efficient based on the following:
Operation
in Taiwan. We have constructed our operation to be capital efficient by choosing Taiwan as our R&D and operating center.
We believe Taiwan has been a key center of the global technology supply chain and it is also home to high-caliber engineers, scientists
and healthcare professionals. We believe maintaining operations in Taiwan, at least in the near-term, allows us to access high-caliber
talent while staying cost effective, enabling us to develop high quality, affordable, consumer-friendly products.
Outsourced
Manufacturing. We believe our outsourced manufacturing strategy potentially saves us the time and resources required to establish
our own infrastructure. We outsource manufacturing of our POCT product candidates to Taiwan Carbon Nano Technology (“TCNT”).
We outsource manufacturing of VELDONA drugs for human-use to Swiss Pharmaceutical Co., Ltd., a Taiwan-based company. We outsource manufacturing
of VELDONA Pet supplements to a Taiwan-based third party and to TCNT.
Distribution
Relationships. We work with distributors to sell products. We appointed Inabata & Co. Ltd. (“Inabata”), a Japanese
corporation, as our non-exclusive worldwide distributor and preferred distributor for customers based in Japan. Inabata’s Taiwan
subsidiary (Taiwan Inabata Sangyo Co.) coordinates business logistics and working capital for our designated programs. Topmed International
Biotech Co., Ltd. (“Topmed”), a Taiwanese biotech company, is a distributor of our VELDDONA Pet supplements in Taiwan.
Intellectual
Property
We
own a portfolio of patents covering various aspects of our core technologies. As of March 31, 2024, we had fifty-four (54) patents issued
and sixteen (16) pending patent applications. Forty-seven (47) of the issued patents relate to acquired VOC and POCT technologies, four
(4) relate to interferon technologies and three (3) relate to our smart drug injection technology. Forty-seven (47) of the issued patents
are foreign patents and seven (7) are U.S. patents. Two (2) issued patents are licensed patents. Of the issued patents, thirty-two (32)
are invention patents, fourteen (14) are utility model patents and eight (8) are design patents. Of our issued patents, five (5) shall
expire between 2026 and 2029; twenty-two (22) between 2030 and 2034, twenty-seven (27) between 2035 and 2046.
Pursuant
to the Addendum Agreement with TCNT, for six months commencing from January 2024, TCNT will provide non-exclusive use of certain patents
related to VOC and POCT technologies for a monthly fee of US$95,000 (plus 5% sales tax), with negotiable payment terms. The parties will
discuss subsequent use of the patents at later dates.
We
own a registered trademark for VELDONA as well as certain trademarks for our VELDONA Pet supplement in Taiwan. We also have several trademark
applications for certain countries outside of Taiwan.
Employees
As
of May 10, 2024, we had 49 full-time employees, of which 25 are in research and development. Majority of our employees are in Taiwan.
None of our employees are represented by a labor union or are a party to a collective bargaining agreement. We plan to continue expand
our manpower in research development, sales and marketing, and general operations to support our business programs.
Additional
Information
Under
our former name, Amarillo Biosciences, Inc., we completed an initial public offering on the Nasdaq SmallCap Market in August 1996 and
have traded on the U.S. over-the-counter market since October 1999. On October 31, 2013, we filed a voluntary petition for reorganization
under Chapter 11 of the United States bankruptcy code. We emerged from bankruptcy on January 23, 2015. We established a Taiwan branch
office in 2017. We renamed as Ainos, Inc in April 2021.
On
August 9, 2022, our common stock and warrants began trading on the Nasdaq Capital Market under the trading symbols “AIMD”
and “AIMDW,” respectively. We effectuated a 1-for-15 reverse stock split of our common stock on August 8, 2022, and a 1-for-5
reverse stock split on December 14, 2023.
Our
annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports are available
free of charge on the Company’s website at www.ainos.com as soon as reasonably practicable after such material is electronically
filed with, or furnished to, the Securities and Exchange Commission. Information contained on or accessible through our website is not,
and should not be considered, part of, or incorporated by reference into, this prospectus.
Government
Regulation
Regulation
of Medical Devices in Taiwan
Our
product candidates and operations are subject to the Taiwan Medical Devices Act and its implementation regulations (collectively the
“Taiwan MDA”), which govern the development, design, pre-clinical and clinical research, manufacturing, safety, efficacy,
labeling, packaging, storage, installation, servicing, recordkeeping, premarket clearance or approval, import, export, adverse event
reporting, advertising, promotion, marketing and distribution of medical devices. Under the Taiwan MDA, medical devices, depending on
the degree of risk associated with each medical device and the extent of manufacturer and regulatory control needed to provide reasonable
assurance of its safety and effectiveness, will be subject to differentiated level of review and examination of TFDA before marketing
the device. Unless an exemption applies, each medical device requires either (a) an approval granted by TFDA or (b) a registration with
TFDA before launching distribution or marketing in Taiwan. The latter is a simplified premarket review process applicable to some medical
devices classified as “lower risk level” items listed in the TFDA announcement. Our product candidates are not on the list
of “lower risk level” and the approval of TFDA will be required for us to launch distribution or marketing of such products
in Taiwan.
Personal
Data Protection Laws in Taiwan
Under
the Taiwan Personal Data Protection Act (“PDPA”), each individual or governmental or non-governmental agencies, including
our affiliate in Taiwan, should be subject to certain requirements and restrictions for collecting, processing or using personal data.
The definition of “personal data” is extended to cover a broad scope, including name, birthday, ID, special features, fingerprints,
marriage status, family, education, occupation, medical records, medical history, genetic information, sex life, health examination report,
criminal records, contact information, financial status, social activities, and any other data which is sufficient to directly or indirectly
identify a specific person. Due to the nature of the use of medical devices, our operation and the operation of our partners might collect,
process, or use the data pertaining to a person’s medical records and healthcare, genetics (collectively, sensitive data), which
is subject to stricter scrutiny. Generally, we can only obtain such sensitive data when the person consents in writing or electronically.
Furthermore, in January 2022, the TFDA published the Regulations for the Security and the Maintenance of Personal Information Files in
Wholesaling and Retailing Medical Devices authorized under the PDPA, which requires the medical devices wholesalers and retailers to
adopt necessary data security/protection measures, and establish prevention and reporting mechanisms in relation to any data breach.
The bill also empowers the TFDA to conduct regular inspections and audits. If we fail to comply with the PDPA, we may be subject to punishment
for civil claims, criminal offenses and administrative liabilities; the defendant may be subject to an imprisonment; and the penalty
for administrative liabilities, and may be imposed consecutively if such violation continues.
Regulation
of Veterinary Drugs in Taiwan
Our
veterinary product candidates are subject laws and regulations in Taiwan including, but not limited to, the Veterinary Drugs Control
Act, Enforcement Rules under the Veterinary Control Act, Guidelines of Good Manufacture Practice for Veterinary Drug Manufacturers, and
Taiwan Regulations for Pet Foods and Supplements. The laws and regulations govern, among other things, product design and development,
pre-clinical and clinical testing, quality testing, manufacturing, packaging, labeling, storage, record keeping and reporting, clearance
or approval, marketing, sales and distribution, promotion and advertising, import and export and post-marketing surveillance.
Under
Taiwan law, a “veterinary drug” refers to one of the following substances in the form of bulk chemical compound, formulated
preparation, or over the counter drug: Biologics specifically made for preventing and treating animal diseases based on microbiology,
immunology or molecular biology; Antibiotics specifically made for preventing and treating animal diseases; Diagnostics announced and
designated by the central competent authority for the diagnosis of animal diseases; and drugs that enhance or regulate animal physical
functions specifically for preventing and treating animal diseases.
The
competent authorities with licensing and enforcement authority under the Veterinary Drugs Control Act include the Council of Agriculture
of the central government, the municipal government of a special municipality, or a local city or county.
Regulation
of Medical Devices in the United States
Our
product candidates and operations are subject to extensive and ongoing regulation by the FDA under the Federal Food, Drug, and Cosmetic
Act of 1938 and its implementing regulations, collectively referred to as the FDCA, as well as other federal and state regulatory bodies
in the United States. The laws and regulations govern, among other things, product design and development, pre-clinical and clinical
testing, manufacturing, packaging, labeling, storage, record keeping and reporting, clearance or approval, marketing, distribution, promotion,
import and export and post-marketing surveillance.
The
FDA regulates the development, design, pre-clinical and clinical research, manufacturing, safety, efficacy, labeling, packaging, storage,
installation, servicing, recordkeeping, premarket clearance or approval, import, export, adverse event reporting, advertising, promotion,
marketing and distribution of medical devices in the United States to ensure that medical devices distributed domestically are safe and
effective for their intended uses and otherwise meet the requirements of the FDCA. Failure to comply with applicable requirements may
subject a device and/or its manufacturer to a variety of administrative sanctions, such as FDA refusal to approve pending premarket applications,
issuance of warning letters, mandatory product recalls, import detentions, civil monetary penalties, and/or judicial sanctions, such
as product seizures, injunctions, and criminal prosecution.
U.S.
drug and biological product development
In
the United States, the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act (FDCA) and its implementing regulations and
biologics under the FDCA, the Public Health Service Act (PHSA), and their implementing regulations. Both drugs and biologics also are
subject to other federal, state and local statutes and regulations. Failure to comply with applicable U.S. requirements at any time during
the product development process, approval process or following approval may subject us to administrative or judicial sanctions. These
sanctions could include, among other actions, the FDA’s refusal to approve pending applications, license revocation, a clinical
hold, untitled or warning letters, product recalls, market withdrawals, product seizures, total or partial suspension of production or
distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement and civil or criminal penalties.
Our
VELDONA product candidates for human use must be approved by the FDA through a Biologics License Application (BLA) or new drug application
(NDA), or supplemental BLA or supplemental NDA, process before they may be legally marketed in the United States.
Health
Insurance Portability and Accountability Act
We
may be subject to compliance with the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Healthcare
Information Technology for Economic and Clinical Health Act of 2009, or HIPAA, among other things, established federal protection for
the privacy and security of protected health information, or PHI. The HIPAA privacy regulations protect PHI by limiting its use and disclosure,
giving patients the right to access certain information about them, and limiting most disclosures of PHI to the minimum amount necessary
to accomplish an intended purpose. The HIPAA security standards require the adoption of administrative, physical, and technical safeguards
and the adoption of written security policies and procedures.
U.S.
Federal, State and Foreign Fraud and Abuse Laws
The
U.S. federal and state governments have enacted, and actively enforce, a number of laws to address fraud and abuse in federal healthcare
programs. Our business is subject to compliance with these laws.
Implications
of Being a Smaller Reporting Company
We
are a “smaller reporting company” as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act, and
have elected to take advantage of certain of the scaled disclosures available to smaller reporting companies. Accordingly, we may provide
less public disclosure than larger public companies, including the inclusion of only two years of audited consolidated financial statements
and only two years of management’s discussion and analysis of financial condition and results of operations disclosure and the
inclusion of reduced disclosure about our executive compensation arrangements. As a smaller reporting company, we are also exempt from
compliance with the auditor attestation requirements pursuant to the Sarbanes-Oxley Act. As a result, the information that we provide
to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests.
We will continue to be a “smaller reporting company” until we have $250 million or more in public float (based on our common
stock) measured as of the last business day of our most recently completed second fiscal quarter or, in the event we have no public float
or a public float (based on our common stock) that is less than $700 million, annual revenues of $100 million or more during the most
recently completed fiscal year.
Corporate
Information
Our
principal executive offices are located at 8880 Rio San Diego Drive, Ste. 800, San Diego, CA 92108, and our telephone number is (858)
869-2986. We maintain a website at www.ainos.com. Information contained on or accessible through our website is not, and should
not be considered, part of, or incorporated by reference into, this prospectus.
RISK
FACTORS
Investment
in any securities offered pursuant to this prospectus and the applicable prospectus supplement involves risks. You should carefully consider
the risk factors incorporated by reference to our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form
10-Q or Current Reports on Form 8-K we file after the date of this prospectus, and all other information contained or incorporated by
reference into this prospectus, as updated by our subsequent filings under the Exchange Act, and the risk factors and other information
contained in the applicable prospectus supplement before acquiring any of such securities. The occurrence of any of these risks might
cause you to lose all or part of your investment in the offered securities.
USE
OF PROCEEDS
We
intend to use the net proceeds from the sale of the securities as set forth in the applicable prospectus supplement.
DESCRIPTION
OF CAPITAL STOCK
The
following summarizes the material terms and provisions of our capital stock. For the complete terms of our capital stock, please refer
to our certificate of formation and bylaws that are filed as exhibits to the registration statement of which this prospectus is a part.
The summary description of our capital stock below is qualified in its entirety by reference to our certificate of formation and bylaws.
General
As
of the date of this prospectus, our authorized capital stock consists of 300,000,000 shares of common stock, par value $0.01 per share,
and 50,000,000 shares of preferred stock, par value $0.01 per share. As of May 23, 2024, there were 6,503,118 shares of
our common stock issued and outstanding. No shares of preferred stock have been issued or are outstanding.
Common
Stock
Holders
of our common stock are entitled to one vote for each share of common stock held of record for the election of directors and on all matters
submitted to a vote of stockholders. Holders of our common stock are entitled to receive dividends ratably, if any, as may be declared
by the Board out of legally available funds, subject to any preferential dividend rights of any preferred stock then outstanding. In
the event of our dissolution, liquidation or winding up, holders of our common stock are entitled to share ratably in our net assets
legally available after the payment of all of our debts and other liabilities, subject to the liquidation preferences of any preferred
stock then outstanding. Holders of our common stock have no preemptive, subscription, redemption or conversion rights. The rights, preferences
and privileges of holders of common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any
series of preferred stock that we may designate and issue in the future. All outstanding shares of our common stock are fully paid and
non-assessable.
Preferred
Stock
Under
the terms of the certificate of formation, our Board of Directors is authorized to direct us to issue shares of preferred stock in one
or more series without stockholder approval. Our Board of Directors has the discretion to determine the rights, powers, preferences,
privileges and restrictions, including voting rights, dividend rights, conversion rights, redemption privileges and liquidation preferences,
of each series of preferred stock.
The
purpose of authorizing our Board of Directors to issue preferred stock and determine its rights and preferences is to eliminate delays
associated with a stockholder vote on specific issuances. The issuance of preferred stock, while providing flexibility in connection
with possible acquisitions, future financings and other corporate purposes, could have the effect of making it more difficult for a third
party to acquire, or could discourage a third party from seeking to acquire, a majority of the outstanding voting stock. Additionally,
the issuance of preferred stock may adversely affect the holders of common stock by restricting dividends on the common stock, diluting
the voting power of the common stock or subordinating the liquidation rights of the common stock. As a result of these or other factors,
the issuance of preferred stock could have an adverse impact on the market price of the common stock.
Business
Combinations under Texas Law
A
number of provisions of Texas law, our Certificate of Formation and Bylaws could make it more difficult for the acquisition of the Company
by means of a tender offer, a proxy contest or otherwise and the removal of incumbent officers and directors. These provisions are intended
to discourage coercive takeover practices and inadequate takeover bids and to encourage persons seeking to acquire control of the Company
to negotiate first with our Board.
We
are subject to the provisions of Title 2, Chapter 21, Subchapter M of the Texas Business Organizations Code (the “Texas Business
Combination Law”). That law provides that a Texas corporation may not engage in specified types of business combinations, including
mergers, consolidations and asset sales, with a person, or an affiliate or associate of that person, who is an “affiliated shareholder”,
for a period of three years from the date that person became an affiliated shareholder, subject to certain exceptions (described below).
An “affiliated shareholder” is generally defined as the holder of 20% or more of the corporation’s voting shares. The
law’s prohibitions do not apply if the business combination or the acquisition of shares by the affiliated shareholder was approved
by the Board of Directors of the corporation before the affiliated shareholder became an affiliated shareholder; or the business combination
was approved by the affirmative vote of the holders of at least two-thirds of the outstanding voting shares of the corporation not beneficially
owned by the affiliated shareholder, at a meeting of shareholders called for that purpose, not less than six months after the affiliated
shareholder became an affiliated shareholder.
Because
we have more than 100 of record shareholders, we are considered an “issuing public corporation” for purposes of this law.
The Texas Business Combination Law does not apply to the following:
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the
business combination of an issuing public corporation: where the corporation’s original charter or bylaws contain a provision
expressly electing not to be governed by the Texas Business Combination Law; or that adopts an amendment to its charter or bylaws,
by the affirmative vote of the holders, other than affiliated shareholders, of at least two-thirds of the outstanding voting shares
of the corporation, expressly electing not to be governed by the Texas Business Combination Law and so long as the amendment does
not take effect for 18 months following the date of the vote and does not apply to a business combination with an affiliated shareholder
who became affiliated on or before the effective date of the amendment; |
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a
business combination of an issuing public corporation with an affiliated shareholder that became an affiliated shareholder inadvertently,
if the affiliated shareholder divests itself, as soon as possible, of enough shares to no longer be an affiliated shareholder and
would not at any time within the three- year period preceding the announcement of the business combination have been an affiliated
shareholder but for the inadvertent acquisition; |
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a
business combination with an affiliated shareholder who became an affiliated shareholder through a transfer of shares by will or
intestacy and continuously was an affiliated shareholder until the announcement date of the business combination; or |
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a
business combination of a corporation with its wholly owned Texas subsidiary if the subsidiary is not an affiliate or associate of
the affiliated shareholder other than by reason of the affiliated shareholder’s beneficial ownership of voting shares of the
corporation. |
Neither
our Certificate of Formation nor our Bylaws contain any provision expressly providing that we will not be subject to the Texas Business
Combination Law. The Texas Business Combination Law may have the effect of inhibiting a non-negotiated merger or other business combination
involving the Company, even if that event would be beneficial to our shareholders.
Anti-Takeover
Provisions of Our Articles of Formation and Bylaws
Our
Articles of Formation and Bylaws contain various provisions intended to promote the stability of our stockholder base and render more
difficult certain unsolicited or hostile attempts to take over the Company, that could disrupt the Company, divert the attention of our
directors, officers and employees and adversely affect the independence and integrity of our business. These provisions include:
Restated
Certificate of Formation
Undesignated
Preferred Stock. Our Board has the ability to issue preferred stock with voting or other rights or preferences that could impede
the success of any attempt to change control of us. These and other provisions may have the effect of deferring hostile takeovers or
delaying changes in control or management of our company.
Board
Vacancies Filled Only by Majority of Directors. Vacancies and newly created seats on our Board may be filled only by a majority of
the directors then in office. Only our Board may determine the number of directors on our board. The inability of stockholders to determine
the number of directors or to fill vacancies or newly created seats on our Board makes it more difficult to change the composition of
our Board, but these provisions promote a continuity of existing management.
No
Cumulative Voting. Our certificate of formation expressly prohibits cumulative voting in the election of directors.
Authorized
but Unissued Shares. Our Board may cause the Company to issue authorized but unissued shares of common stock in the future without
stockholders’ approval. These additional shares may be utilized for a variety of corporate purposes, including future public offerings
to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued shares of common
stock could render more difficult or discourage an attempt to obtain control of a majority of common stock by means of a proxy contest,
tender offer, merger or otherwise.
Transfer
Agent and Registrar
Our
transfer agent and registrar for our capital stock is Equiniti Trust Company, LLC. The transfer agent’s address is 6201 15th Ave.,
Brooklyn, NY 11219, and its telephone number is (800) 937-5449.
Listing
Our
common stock and public warrants are reported on the Nasdaq Capital Market under the symbols “AIMD” and “AIMDW,”
respectively.
DESCRIPTION
OF DEBT SECURITIES
General
The
debt securities that we may offer by this prospectus consist of notes, debentures, or other evidences of indebtedness. The debt securities
may constitute either senior or subordinated debt securities, and in either case may be either secured or unsecured. Any debt securities
that we offer and sell will be our direct obligations. Debt securities may be issued in one or more series. All debt securities of any
one series need not be issued at the same time, and unless otherwise provided, a series of debt securities may be reopened, with the
required consent of the holders of outstanding debt securities, for issuance of additional debt securities of that series or to establish
additional terms of that series of debt securities (with such additional terms applicable only to unissued or additional debt securities
of that series). The form of indenture has been filed as an exhibit to the registration statement of which this prospectus is a part
and is subject to any amendments or supplements that we may enter into with the trustee(s), however, we may issue debt securities not
subject to the indenture provided such terms of debt securities are not otherwise required to be set forth in the indenture. The material
terms of the indenture are summarized below and we refer you to the indenture for a detailed description of these material terms. Additional
or different provisions that are applicable to a particular series of debt securities will, if material, be described in a prospectus
supplement relating to the offering of debt securities of that series. These provisions may include, among other things and to the extent
applicable, the following:
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the
title of the debt securities, including, as applicable, whether the debt securities will be issued as senior debt securities, senior
subordinated debt securities or subordinated debt securities, any subordination provisions particular to the series of debt securities; |
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any
limit on the aggregate principal amount of the debt securities; |
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whether
the debt securities are senior debt securities or subordinated debt securities and applicable subordination provisions, if any; |
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whether
the debt securities will be secured or unsecured; |
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if
other than 100% of the aggregate principal amount, the percentage of the aggregate principal amount at which we will sell the debt
securities, such as an original issuance discount; |
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the
date or dates, whether fixed or extendable, on which the principal of the debt securities will be payable; |
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the
rate or rates, which may be fixed or variable, at which the debt securities will bear interest, if any, the date or dates from which
any such interest will accrue, the interest payment dates on which we will pay any such interest, the basis upon which interest will
be calculated if other than that of a 360-day year consisting of twelve 30-day months, and, in the case of registered securities,
the record dates for the determination of holders to whom interest is payable; |
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the
place or places where the principal of and any premium or interest on the debt securities will be payable and where the debt securities
may be surrendered for conversion or exchange; |
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whether
we may, at our option, redeem the debt securities, and if so, the price or prices at which, the period or periods within which, and
the terms and conditions upon which, we may redeem the debt securities, in whole or in part, pursuant to any sinking fund or otherwise; |
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if
other than 100% of the aggregate principal amount thereof, the portion of the principal amount of the debt securities which will
be payable upon declaration of acceleration of the maturity date thereof or provable in bankruptcy, or, if applicable, which is convertible
or exchangeable; |
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any
obligation we may have to redeem, purchase or repay the debt securities pursuant to any sinking fund or analogous provisions or at
the option of a holder of debt securities, and the price or prices at which, the currency in which and the period or periods within
which, and the terms and conditions upon which, the debt securities will be redeemed, purchased or repaid, in whole or in part, pursuant
to any such obligation, and any provision for the remarketing of the debt securities; |
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the
issuance of debt securities as registered securities or unregistered securities or both, and the rights of the holders of the debt
securities to exchange unregistered securities for registered securities, or vice versa, and the circumstances under which any such
exchanges, if permitted, may be made; |
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the
denominations, which may be in United States Dollars or in any foreign currency, in which the debt securities will be issued, if
other than denominations of $1,000 and any integral multiple thereof; |
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whether
the debt securities will be issued in the form of certificated debt securities, and if so, the form of the debt securities (or forms
thereof if unregistered and registered securities are issuable in that series), including the legends required by law or as we deem
necessary or appropriate, the form of any coupons or temporary global security which may be issued and the forms of any other certificates
which may be required under the indenture or which we may require in connection with the offering, sale, delivery or exchange of
the debt securities; |
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if
other than United States Dollars, the currency or currencies in which payments of principal, interest and other amounts payable with
respect to the debt securities will be denominated, payable, redeemable or repurchasable, as the case may be; |
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whether
the debt securities may be issuable in tranches; |
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the
obligations, if any, we may have to permit the conversion or exchange of the debt securities into common stock, preferred stock or
other capital stock or property, or a combination thereof, and the terms and conditions upon which such conversion or exchange will
be effected (including conversion price or exchange ratio), and any limitations on the ownership or transferability of the securities
or property into which the debt securities may be converted or exchanged; |
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if
other than the trustee under the indenture, any trustees, authenticating or paying agents, transfer agents or registrars or any other
agents with respect to the debt securities; |
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any
deletions from, modifications of or additions to the events of default with respect to the debt securities or the right of the Trustee
or the holders of the debt securities in connection with events of default; |
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any
deletions from, modifications of or additions to the covenants with respect to the debt securities; |
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if
the amount of payments of principal of, and make-whole amount, if any, and interest on the debt securities may be determined with
reference to an index, the manner in which such amount will be determined; |
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whether
the debt securities will be issued in whole or in part in the global form of one or more debt securities and, if so, the depositary
for such debt securities, the circumstances under which any such debt security may be exchanged for debt securities registered in
the name of, and under which any transfer of debt securities may be registered in the name of, any person other than such depositary
or its nominee, and any other provisions regarding such debt securities; |
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whether,
under what circumstances and the currency in which, we will pay additional amounts on the debt securities to any holder of the debt
securities who is not a United States person in respect of any tax, assessment or governmental charge and, if so, whether we will
have the option to redeem such debt securities rather than pay such additional amounts, and the terms of any such option; |
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whether
the debt securities will be secured by any collateral and, if so, a general description of the collateral and the terms of any related
security, pledge or other agreements; |
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the
persons to whom any interest on the debt securities will be payable, if other than the registered holders thereof on the regular
record date therefor; and |
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any
other material terms or conditions upon which the debt securities will be issued. |
Unless
otherwise indicated in the applicable prospectus supplement, we will issue debt securities in fully registered form without coupons and
in denominations of $1,000 and in integral multiples of $1,000, and interest will be computed on the basis of a 360-day year of twelve
30-day months. If any interest payment date or the maturity date falls on a day that is not a business day, then the payment will be
made on the next business day without additional interest and with the same effect as if it were made on the originally scheduled date.
“Business day” means any calendar day that is not a Saturday, Sunday or legal holiday in New York, New York, and on which
the trustee and commercial banks are open for business in New York, New York.
Unless
we inform you otherwise in a prospectus supplement, each series of our senior debt securities will rank equally in right of payment with
all of our other unsubordinated debt. The subordinated debt securities will rank junior in right of payment and be subordinate to all
of our unsubordinated debt.
Unless
otherwise indicated in the applicable prospectus supplement, the trustee will act as paying agent and registrar for the debt securities
under the indenture. We may act as paying agent under the indenture.
The
prospectus supplement will contain a description of United States federal income tax consequences relating to the debt securities, to
the extent applicable.
Covenants
The
applicable prospectus supplement will describe any covenants, such as restrictive covenants restricting us or our subsidiaries, if any,
from incurring, issuing, assuming or guarantying any indebtedness or restricting us or our subsidiaries, if any, from paying dividends
or acquiring any of our or its capital stock.
Consolidation,
Merger and Transfer of Assets
The
indenture permits a consolidation or merger between us and another entity and/or the sale, conveyance or lease by us of all or substantially
all of our property and assets, provided that:
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the
resulting or acquiring entity, if other than us, is organized and existing under the laws of a United States jurisdiction and assumes
all of our responsibilities and liabilities under the indenture, including the payment of all amounts due on the debt securities
and performance of the covenants in the indenture; |
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immediately
after the transaction, and giving effect to the transaction, no event of default under the indenture exists; and |
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we
have delivered to the trustee an officers’ certificate stating that the transaction and, if a supplemental indenture is required
in connection with the transaction, the supplemental indenture comply with the indenture and that all conditions precedent to the
transaction contained in the indenture have been satisfied. |
If
we consolidate or merge with or into any other entity, or sell or lease all or substantially all of our assets in compliance with the
terms and conditions of the indenture, the resulting or acquiring entity will be substituted for us in the indenture and the debt securities
with the same effect as if it had been an original party to the indenture and the debt securities. As a result, such successor entity
may exercise our rights and powers under the indenture and the debt securities, in our name and, except in the case of a lease, we will
be released from all our liabilities and obligations under the indenture and under the debt securities.
Notwithstanding
the foregoing, we may transfer all of our property and assets to another entity if, immediately after giving effect to the transfer,
such entity is our wholly owned subsidiary. The term “wholly owned subsidiary” means any subsidiary in which we and/or our
other wholly owned subsidiaries, if any, own all of the outstanding capital stock.
Modification
and Waiver
Under
the indenture, some of our rights and obligations and some of the rights of the holders of the debt securities may be modified or amended
with the consent of the holders of not less than a majority in aggregate principal amount of the outstanding debt securities affected
by the modification or amendment. However, the following modifications and amendments will not be effective against any holder without
its consent:
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a
change in the stated maturity date of any payment of principal or interest; |
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a
reduction in the principal amount of or interest on any debt securities; |
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an
alteration or impairment of any right to convert at the rate or upon the terms provided in the indenture; |
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a
change in the currency in which any payment on the debt securities is payable; |
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an
impairment of a holder’s right to sue us for the enforcement of payments due on the debt securities; or |
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a
reduction in the percentage of outstanding debt securities required to consent to a modification or amendment of the indenture or
required to consent to a waiver of compliance with certain provisions of the indenture or certain defaults under the indenture. |
Under
the indenture, the holders of not less than a majority in aggregate principal amount of the outstanding debt securities may, on behalf
of all holders of the debt securities:
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waive
compliance by us with certain restrictive provisions of the indenture; and |
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waive
any past default under the indenture in accordance with the applicable provisions of the indenture, except a default in the payment
of the principal of or interest on any series of debt securities. |
Events
of Default
Unless
we indicate otherwise in the applicable prospectus supplement, “event of default” under the indenture will mean, with respect
to any series of debt securities, any of the following:
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failure
to pay interest on any debt security for 30 days after the payment is due; |
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failure
to pay the principal of any debt security when due, either at maturity, upon redemption, by declaration or otherwise; |
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failure
on our part to observe or perform any other covenant or agreement in the indenture that applies to the debt securities for 90 days
after we have received written notice of the failure to perform in the manner specified in the indenture; and |
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certain
events of bankruptcy, insolvency or reorganization. |
Remedies
Upon an Event of Default
If
an event of default occurs and continues, the trustee or the holders of not less than 25% in aggregate principal amount of the outstanding
debt securities of such series may declare the entire principal of all the debt securities to be due and payable immediately, except
that, if the event of default is caused by certain events in bankruptcy, insolvency or reorganization, the entire principal of all of
the debt securities of such series will become due and payable immediately without any act on the part of the trustee or holders of the
debt securities. If such a declaration occurs, the holders of a majority of the aggregate principal amount of the outstanding debt securities
of such series can, subject to conditions, rescind the declaration.
The
indenture requires us to furnish to the trustee not less often than annually, a certificate from our principal executive officer, principal
financial officer or principal accounting officer, as the case may be, as to such officer’s knowledge of our compliance with all
conditions and covenants under the indenture. The trustee may withhold notice to the holders of debt securities of any default, except
defaults in the payment of principal of or interest on any debt securities if the trustee in good faith determines that the withholding
of notice is in the best interests of the holders. For purposes of this paragraph, “default” means any event which is, or
after notice or lapse of time or both would become, an event of default under the indenture.
The
trustee is not obligated to exercise any of its rights or powers under the indenture at the request, order or direction of any holders
of debt securities, unless the holders offer the trustee satisfactory security or indemnity. If satisfactory security or indemnity is
provided, then, subject to other rights of the trustee, the holders of a majority in aggregate principal amount of the outstanding debt
securities may direct the time, method and place of:
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conducting
any proceeding for any remedy available to the trustee; or |
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exercising
any trust or power conferred upon the trustee. |
The
holder of a debt security will have the right to begin any proceeding with respect to the indenture or for any remedy only if:
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the
holder has previously given the trustee written notice of a continuing event of default; |
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the
holders of not less than a majority in aggregate principal amount of the outstanding debt securities have made a written request
of, and offered reasonable indemnity to, the trustee to begin such proceeding; |
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the
trustee has not started such proceeding within 60 days after receiving the request; and |
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no
direction inconsistent with such written request has been given to the trustee under the indenture. |
However,
the holder of any debt security will have an absolute right to receive payment of principal of and interest on the debt security when
due and to institute suit to enforce this payment.
Satisfaction
and Discharge; Defeasance
Satisfaction
and Discharge of Indenture. Unless otherwise indicated in the applicable prospectus supplement, if at any time,
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we
have paid the principal of and interest on all the debt securities of any series, except for debt securities which have been destroyed,
lost or stolen and which have been replaced or paid in accordance with the indenture, as and when the same shall have become due
and payable, or |
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we
have delivered to the trustee for cancellation all debt securities of any series theretofore authenticated, except for debt securities
of such series which have been destroyed, lost or stolen and which have been replaced or paid as provided in the indenture, or |
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all
the debt securities of such series not theretofore delivered to the trustee for cancellation have become due and payable, or are
by their terms are to become due and payable within one year or are to be called for redemption within one year, and we have deposited
with the trustee, in trust, sufficient money or government obligations, or a combination thereof, to pay the principal, any interest
and any other sums due on the debt securities, on the dates the payments are due or become due under the indenture and the terms
of the debt securities, |
then
the indenture shall cease to be of further effect with respect to the debt securities of such series, except for:
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rights
of registration of transfer and exchange, and our right of optional redemption; |
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substitution
of mutilated, defaced, destroyed, lost or stolen debt securities; |
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rights
of holders to receive payments of principal thereof and interest thereon upon the original stated due dates therefor (but not upon
acceleration) and remaining rights of the holders to receive mandatory sinking fund payments, if any; |
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the
rights, obligations and immunities of the trustee under the indenture; and |
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the
rights of the holders of such series of debt securities as beneficiaries thereof with respect to the property so deposited with the
trustee payable to all or any of them. |
Defeasance
and Covenant Defeasance. Unless otherwise indicated in the applicable prospectus supplement, we may elect with respect to any debt
securities of any series either:
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to
defeasance and be discharged from all of our obligations with respect to such debt securities (“defeasance”), with certain
exceptions described below; or |
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to
be released from our obligations with respect to such debt securities under such covenants as may be specified in the applicable
prospectus supplement, and any omission to comply with those obligations will not constitute a default or an event of default with
respect to such debt securities (“covenant defeasance”). |
We
must comply with the following conditions before the defeasance or covenant defeasance can be effected:
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we
must irrevocably deposit with the indenture trustee or other qualifying trustee, under the terms of an irrevocable trust agreement
in form and substance satisfactory to the trustee, trust funds in trust solely for the benefit of the holders of such debt securities,
sufficient money or government obligations, or a combination thereof, to pay the principal, any interest and any other sums on the
due dates for those payments; and |
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we
must deliver to the trustee an opinion of counsel to the effect that the holders of such debt securities will not recognize income,
gain or loss for federal income tax purposes as a result of defeasance or covenant defeasance, as the case may be, to be effected
with respect to such debt securities and will be subject to federal income tax on the same amount, in the same manner and at the
same times as would be the case if such defeasance or covenant defeasance, as the case may be, had not occurred. |
In
connection with defeasance, any irrevocable trust agreement contemplated by the indenture must include, among other things, provision
for:
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payment
of the principal of and interest on such debt securities, if any, appertaining thereto when due (by redemption, sinking fund payments
or otherwise), |
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the
payment of the expenses of the trustee incurred or to be incurred in connection with carrying out such trust provisions, |
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rights
of registration, transfer, substitution and exchange of such debt securities in accordance with the terms stated in the indenture,
and |
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continuation
of the rights, obligations and immunities of the trustee as against the holders of such debt securities as stated in the indenture. |
The
accompanying prospectus supplement may further describe any provisions permitting or restricting defeasance or covenant defeasance with
respect to the debt securities of a particular series.
Global
Securities
Unless
otherwise indicated in the applicable prospectus supplement, each debt security offered by this prospectus will be issued in the form
of one or more global debt securities representing all or part of that series of debt securities. This means that we will not issue certificates
for that series of debt securities to the holders. Instead, a global debt security representing that series will be deposited with, or
on behalf of, a securities depositary and registered in the name of the depositary or a nominee of the depositary. Any such depositary
must be a clearing agency registered under the Exchange Act. We will describe the specific terms of the depositary arrangement with respect
to a series of debt securities to be represented by a global security in the applicable prospectus supplement.
Notices
We
will give notices to holders of the debt securities by mail at the addresses listed in the security register. In the case of notice in
respect of unregistered securities or coupon securities, we may give notice by publication in a newspaper of general circulation in New
York, New York.
Governing
Law
The
particular terms of a series of debt securities will be described in a prospectus supplement relating to such series of debt securities.
Any indentures will be subject to and governed by the Trust Indenture Act of 1939, as amended, and may be supplemented or amended from
time to time following their execution. Unless otherwise stated in the applicable prospectus supplement, we will not be limited in the
amount of debt securities that we may issue, and neither the senior debt securities nor the subordinated debt securities will be secured
by any of our property or assets. Thus, by owning debt securities, you are one of our unsecured creditors.
Regarding
the Trustee
From
time to time, we may maintain deposit accounts and conduct other banking transactions with the trustee to be appointed under the indenture
or its affiliates in the ordinary course of business.
DESCRIPTION
OF WARRANTS
We
may offer to sell warrants from time to time. If we do so, we will describe the specific terms of the warrants in a prospectus supplement.
In particular, we may issue warrants for the purchase of common stock, preferred stock and/or debt securities in one or more series.
We may also issue warrants independently or together with other securities and the warrants may be attached to or separate from those
securities.
We
will evidence each series of warrants by warrant certificates that we will issue under a separate agreement. We will enter into the warrant
agreement with a warrant agent. We will indicate the name and address of the warrant agent in the applicable prospectus supplement relating
to a particular series of warrants.
We
will describe in the applicable prospectus supplement the terms of the series of warrants, including:
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the
offering price and aggregate number of warrants offered; |
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the
currency for which the warrants may be purchased; |
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if
applicable, the designation and terms of the securities with which the warrants are issued and the number of warrants issued with
each such security or each principal amount of such security; |
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if
applicable, the date on and after which the warrants and the related securities will be separately transferable; |
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in
the case of warrants to purchase debt securities, the principal amount of debt securities purchasable upon exercise of one warrant
and the price at, and currency in which, this principal amount of debt securities may be purchased upon such exercise; |
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in
the case of warrants to purchase common stock or preferred stock, the number of shares of common stock or preferred stock, as the
case may be, purchasable upon the exercise of one warrant and the price at which these shares may be purchased upon such exercise; |
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the
effect of any merger, consolidation, sale or other disposition of our business on the warrant agreement and the warrants; |
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the
terms of any rights to redeem or call the warrants; |
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any
provisions for changes to or adjustments in the exercise price or number of securities issuable upon exercise of the warrants; |
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the
dates on which the right to exercise the warrants will commence and expire; |
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the
manner in which the warrant agreement and warrants may be modified; |
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certain
United States federal income tax consequences of holding or exercising the warrants; |
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the
terms of the securities issuable upon exercise of the warrants; and |
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any
other specific material terms, preferences, rights or limitations of or restrictions on the warrants. |
Holders
may exercise the warrants by delivering the warrant certificate representing the warrants to be exercised together with other requested
information, and paying the required amount to the warrant agent in immediately available funds, as provided in the applicable prospectus
supplement. We will set forth in the applicable prospectus supplement the information that the holder of the warrant will be required
to deliver to the warrant agent.
Upon
receipt of the required payment and the warrant certificate properly completed and duly executed at the office of the warrant agent or
any other office indicated in the applicable prospectus supplement, we will issue and deliver the securities purchasable upon such exercise.
If a holder exercises fewer than all of the warrants represented by the warrant certificate, then we will issue a new warrant certificate
for the remaining amount of warrants.
Holder
will not have any of the rights of the holders of the securities purchasable upon the exercise of warrants until you exercise them. Accordingly,
holder will not be entitled to, among other things, vote or receive dividend payments or similar distributions on the securities you
can purchase upon exercise of the warrants.
The
information provided above is only a summary of the terms under which we may offer warrants for sale. Accordingly, investors must carefully
review the applicable warrant agreement for more information about the specific terms and conditions of these warrants before investing
in us. In addition, please carefully review the information provided in the applicable prospectus supplement, which contains additional
information that is important for you to consider in evaluating an investment in our securities.
DESCRIPTION
OF RIGHTS
We
may issue rights to our stockholders to purchase shares of our common stock or preferred stock described in this prospectus. We may offer
rights separately or together with one or more additional rights, preferred stock, common stock, warrants or any combination of those
securities in the form of units, as described in the applicable prospectus supplement. Each series of rights will be issued under a separate
rights agreement to be entered into between us and a bank or trust company, as rights agent. The rights agent for any rights we offer
will be set forth in the applicable prospectus supplement. The rights agent will act solely as our agent in connection with the certificates
relating to the rights of the series of certificates and will not assume any obligation or relationship of agency or trust for or with
any holders of rights certificates or beneficial owners of rights. The following description sets forth certain general terms and provisions
of the rights to which any prospectus supplement may relate. The particular terms of the rights to which any prospectus supplement may
relate and the extent, if any, to which the general provisions may apply to the rights so offered will be described in the applicable
prospectus supplement. To the extent that any particular terms of the rights, rights agreement or rights certificates described in a
prospectus supplement differ from any of the terms described below, then the terms described below will be deemed to have been superseded
by that prospectus supplement. We encourage you to read the applicable rights agreement and rights certificate for additional information
before you decide whether to purchase any of our rights.
The
prospectus supplement relating to any rights that we offer will include specific terms relating to the offering, including, among other
matters:
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the
date of determining the stockholders entitled to the rights distribution; |
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the
aggregate number of shares of common stock, preferred stock or other securities purchasable upon exercise of the rights; |
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the
exercise price; |
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the
aggregate number of rights issued; |
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whether
the rights are transferrable and the date, if any, on and after which the rights may be separately transferred; |
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the
date on which the right to exercise the rights will commence, and the date on which the right to exercise the rights will expire; |
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the
method by which holders of rights will be entitled to exercise; |
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the
conditions to the completion of the offering; |
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the
withdrawal, termination and cancellation rights; |
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whether
there are any backstop or standby purchaser or purchasers and the terms of their commitment; |
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whether
stockholders are entitled to oversubscription right; |
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any
U.S. federal income tax considerations; and |
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any
other terms of the rights, including terms, procedures and limitations relating to the distribution, exchange and exercise of the
rights. |
If
less than all of the rights issued in any rights offering are exercised, we may offer any unsubscribed securities directly to persons
other than stockholders, to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to
standby arrangements, as described in the applicable prospectus supplement. In connection with any rights offering, we may enter into
a standby underwriting or other arrangement with one or more underwriters or other persons pursuant to which such underwriters or other
persons would purchase any offered securities remaining unsubscribed for after such rights offering.
DESCRIPTION
OF UNITS
We
may issue units consisting of any combination of the other types of securities offered under this prospectus in one or more series. We
may evidence each series of units by unit certificates that we will issue under a separate agreement. We may enter into unit agreements
with a unit agent. We will indicate the name and address of the unit agent in the applicable prospectus supplement relating to a particular
series of units.
The
following description, together with the additional information included in any applicable prospectus supplement, summarizes the general
features of the units that we may offer under this prospectus. You should read any prospectus supplement and any free writing prospectus
that we may authorize to be provided to you related to the series of units being offered, as well as the complete unit agreements that
contain the terms of the units. Specific unit agreements will contain additional important terms and provisions and we will file as an
exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from another report that we
file with the SEC, the form of each unit agreement relating to units offered under this prospectus.
If
we offer any units, certain terms of that series of units will be described in the applicable prospectus supplement, including, without
limitation, the following, as applicable:
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the
title of the series of units; |
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identification
and description of the separate constituent securities comprising the units; |
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the
price or prices at which the units will be issued; |
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the
date, if any, on and after which the constituent securities comprising the units will be separately transferable; |
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a
discussion of certain United States federal income tax considerations applicable to the units; and |
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any
other terms of the units and their constituent securities. |
PLAN
OF DISTRIBUTION
We
may sell the securities from time to time pursuant to underwritten public offerings, negotiated transactions, block trades or a combination
of these methods or through underwriters or dealers, through agents and/or directly to one or more purchasers. The securities may be
distributed from time to time in one or more transactions:
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at
a fixed price or prices, which may be changed; |
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at
market prices prevailing at the time of sale; |
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at
prices related to such prevailing market prices; or |
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at
negotiated prices. |
Each
time that we sell securities covered by this prospectus, we will provide a prospectus supplement or supplements that will describe the
method of distribution and set forth the terms and conditions of the offering of such securities, including the offering price of the
securities and the proceeds to us, if applicable.
Offers
to purchase the securities being offered by this prospectus may be solicited directly. Agents may also be designated to solicit offers
to purchase the securities from time to time. Any agent involved in the offer or sale of our securities will be identified in a prospectus
supplement.
If
a dealer is utilized in the sale of the securities being offered by this prospectus, the securities will be sold to the dealer, as principal.
The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale.
If
an underwriter is utilized in the sale of the securities being offered by this prospectus, an underwriting agreement will be executed
with the underwriter at the time of sale and the name of any underwriter will be provided in the prospectus supplement that the underwriter
will use to make resales of the securities to the public. In connection with the sale of the securities, we or the purchasers of securities
for whom the underwriter may act as agent, may compensate the underwriter in the form of underwriting discounts or commissions. The underwriter
may sell the securities to or through dealers, and those dealers may receive compensation in the form of discounts, concessions or commissions
from the underwriters and/or commissions from the purchasers for which they may act as agent. Unless otherwise indicated in a prospectus
supplement, an agent will be acting on a best efforts basis and a dealer will purchase securities as a principal, and may then resell
the securities at varying prices to be determined by the dealer.
Any
compensation paid to underwriters, dealers or agents in connection with the offering of the securities, and any discounts, concessions
or commissions allowed by underwriters to participating dealers will be provided in the applicable prospectus supplement. Underwriters,
dealers and agents participating in the distribution of the securities may be deemed to be underwriters within the meaning of the Securities
Act of 1933, as amended, and any discounts and commissions received by them and any profit realized by them on resale of the securities
may be deemed to be underwriting discounts and commissions. We may enter into agreements to indemnify underwriters, dealers and agents
against civil liabilities, including liabilities under the Securities Act, or to contribute to payments they may be required to make
in respect thereof and to reimburse those persons for certain expenses.
Any
common stock will be listed on the Nasdaq Capital Market, but any other securities may or may not be listed on a national securities
exchange. To facilitate the offering of securities, certain persons participating in the offering may engage in transactions that stabilize,
maintain or otherwise affect the price of the securities. This may include over-allotments or short sales of the securities, which involve
the sale by persons participating in the offering of more securities than were sold to them. In these circumstances, these persons would
cover such over-allotments or short positions by making purchases in the open market or by exercising their over-allotment option, if
any. In addition, these persons may stabilize or maintain the price of the securities by bidding for or purchasing securities in the
open market or by imposing penalty bids, whereby selling concessions allowed to dealers participating in the offering may be reclaimed
if securities sold by them are repurchased in connection with stabilization transactions. The effect of these transactions may be to
stabilize or maintain the market price of the securities at a level above that which might otherwise prevail in the open market. These
transactions may be discontinued at any time.
We
may engage in at the market offerings into an existing trading market in accordance with Rule 415(a)(4) under the Securities Act.
In
addition, we may enter into derivative transactions with third parties, or sell securities not covered by this prospectus to third parties
in privately negotiated transactions. If the applicable prospectus supplement so indicates, in connection with those derivatives, the
third parties may sell securities covered by this prospectus and the applicable prospectus supplement, including in short sale transactions.
If so, the third party may use securities pledged by us or borrowed from us or others to settle those sales or to close out any related
open borrowings of stock, and may use securities received from us in settlement of those derivatives to close out any related open borrowings
of stock. The third party in such sale transactions will be an underwriter and, if not identified in this prospectus, will be named in
the applicable prospectus supplement (or a post-effective amendment). In addition, we may otherwise loan or pledge securities to a financial
institution or other third party that in turn may sell the securities short using this prospectus and an applicable prospectus supplement.
Such financial institution or other third party may transfer its economic short position to investors in our securities or in connection
with a concurrent offering of other securities.
We
do not make any representation or prediction as to the direction or magnitude of any effect that the transactions described above might
have on the price of the securities. In addition, we do not make any representation that underwriters will engage in such transactions
or that such transactions, once commenced, will not be discontinued without notice.
The
specific terms of any lock-up provisions in respect of any given offering will be described in the applicable prospectus supplement.
To
comply with applicable state securities laws, the securities offered by this prospectus will be sold, if necessary, in such jurisdictions
only through registered or licensed brokers or dealers. In addition, securities may not be sold in some states unless they have been
registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available
and is complied with.
The
underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business for
which they receive compensation.
LEGAL
MATTERS
Lucosky
Brookman LLP will pass upon certain legal matters relating to the issuance and sale of the securities offered hereby on behalf of Ainos,
Inc. Additional legal matters may be passed upon for us or any underwriters, dealers or agents, by counsel that we will name in the applicable
prospectus supplement.
EXPERTS
The
financial statements of the Company at December 31, 2023 and 2022, and for each of the two years then ended, have been audited by KCCW
Accountancy Corp. (KCCW), an independent registered public accounting firm, as set forth in their report thereon and have been incorporated
by reference herein and in the registration statement.
The
information in this 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.
Subject
to Completion, dated May 31, 2024.
(To
prospectus dated , 2024)
PROSPECTUS
AINOS,
INC.
$1,353,197
We
have entered into an At The Market Offering Agreement, or sales agreement, with H.C. Wainwright & Co., LLC or Wainwright, relating
to shares of our common stock offered by this prospectus supplement. In accordance with the terms of the sales agreement, we may offer
and sell shares of our common stock having an aggregate offering price of up to $1,353,197 from time to time through Wainwright
acting as our sales agent.
Our
common stock and public warrants are listed on the Nasdaq Capital Market under the symbols “AIMD” and “AIMDW,”
respectively. On May 23, 2024, the last reported sale price of our common stock on the Nasdaq Capital Market was $1.26
per share.
Sales
of our common stock, if any, under this prospectus supplement will be made by any method permitted that is deemed an “at the market
offering” as defined in Rule 415 under the Securities Act of 1933, as amended, or the Securities Act, including sales made directly
on or through Nasdaq or any other existing trading market in the United States for our common stock, sales made to or through a market
maker other than on an exchange or otherwise, directly to Wainwright as principal, in negotiated transactions at market prices prevailing
at the time of sale or at prices related to such prevailing market prices and/or in any other method permitted by law. Wainwright is not required to sell any specific number or dollar amount of securities,
but will act as our sales agent using commercially reasonable efforts consistent with its normal trading and sales practices. There is
no arrangement for funds to be received in any escrow, trust or similar arrangement.
Wainwright
will be entitled to compensation at a commission rate equal to 3.0% of the gross sales price per share sold. In connection with
the sale of the common stock on our behalf, Wainwright will be deemed to be an “underwriter” within the meaning of the Securities
Act and the compensation of Wainwright will be deemed to be underwriting commissions or discounts. We have also agreed to provide indemnification
and contribution to Wainwright with respect to certain liabilities, including liabilities under the Securities Act or the Exchange Act
of 1934, as amended, or the Exchange Act.
Investing
in our securities involves significant risks. Please read the information contained in or incorporated by reference under the heading
“Risk Factors” beginning on page S-10 of this prospectus supplement, and under similar headings in other documents
filed after the date hereof and incorporated by reference into this prospectus supplement and the accompanying prospectus.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities, or determined
if this prospectus is accurate or complete. Any representation to the contrary is a criminal offense.
H.C.
Wainwright & Co.
The
date of this prospectus supplement is , 2024
TABLE
OF CONTENTS
Prospectus
Supplement
SPECIAL
NOTICE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus contains forward-looking statements that involve risks and uncertainties, principally in the sections entitled “Risk
Factors.” All statements other than statements of historical fact contained in this prospectus, including statements regarding
future events, our future financial performance, business strategy and plans and objectives of management for future operations, are
forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,”
“believes,” “can,” “continue,” “could,” “estimates,” “expects,”
“intends,” “may,” “plans,” “potential,” “predicts,” “should,”
or “will” or the negative of these terms or other comparable terminology. Although we do not make forward looking statements
unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. These statements are only predictions
and involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Risk Factors” or
elsewhere in this prospectus, which may cause our or our industry’s actual results, levels of activity, performance or achievements
expressed or implied by these forward-looking statements.
Forward-looking
statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the
times at, or by which, that performance or those results will be achieved. Forward-looking statements are based on information available
at the time they are made and/or management’s good faith belief as of that time with respect to future events, and are subject
to risks and uncertainties that could cause actual performance or results to differ materially from what is expressed in or suggested
by the forward-looking statements.
Forward-looking
statements speak only as of the date they are made. You should not put undue reliance on any forward-looking statements. We assume no
obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting
forward-looking information, except to the extent required by applicable securities laws. If we do update one or more forward-looking
statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.
ABOUT
THIS PROSPECTUS SUPPLEMENT
This
document is part of the registration statement that we filed with the Securities and Exchange Commission, or the SEC, using a “shelf”
registration process and consists of two parts. The first part is this prospectus supplement, which describes the specific terms of this
offering. The second part, the accompanying prospectus, gives more general information, some of which may not apply to this offering.
Generally, when we refer only to the “prospectus,” we are referring to both parts combined. This prospectus supplement may
add to, update or change information in the accompanying prospectus and the documents incorporated by reference into this prospectus
supplement or the accompanying prospectus. By using a shelf registration statement, we may offer shares of our common stock having an
aggregate offering price of up to $1,353,197 from time to time under this prospectus supplement at prices and on terms to be determined
by market conditions at the time of offering.
If
information in this prospectus supplement is inconsistent with the accompanying prospectus or with any document incorporated by reference
that was filed with the SEC before the date of this prospectus supplement, you should rely on this prospectus supplement. This prospectus
supplement, the accompanying prospectus and the documents incorporated into each by reference include important information about us,
the securities being offered and other information you should know before investing in our securities. You should also read and consider
information in the documents we have referred you to in the sections of this prospectus supplement entitled “Where You Can Find
More Information” and “Incorporation by Reference.”
You
should rely only on this prospectus supplement, the accompanying prospectus, the documents incorporated or deemed to be incorporated
by reference herein or therein and any free writing prospectus prepared by us or on our behalf. We have not, and the underwriters have
not, authorized anyone to provide you with information that is in addition to or different from that contained or incorporated by reference
in this prospectus supplement and the accompanying prospectus. If anyone provides you with different or inconsistent information, you
should not rely on it. We and the underwriters are not offering to sell these securities in any jurisdiction where the offer or sale
is not permitted. You should not assume that the information contained in this prospectus supplement, the accompanying prospectus or
any free writing prospectus, or incorporated by reference herein, is accurate as of any date other than as of the date of this prospectus
supplement or the accompanying prospectus or any free writing prospectus, as the case may be, or in the case of the documents incorporated
by reference, the date of such documents regardless of the time of delivery of this prospectus supplement and the accompanying prospectus
or any sale of our securities. Our business, financial condition, liquidity, results of operations and prospects may have changed since
those dates.
We
further note that the representations, warranties and covenants made by us in any agreement that is filed as an exhibit to any document
that is incorporated by reference in this prospectus supplement or the accompanying prospectus were made solely for the benefit of the
parties to such agreement, including, in some cases, for the purpose of allocating risk among the parties to such agreements, and should
not be deemed to be a representation, warranty or covenant to you. Moreover, such representations, warranties or covenants were accurate
only as of the date when made. Accordingly, such representations, warranties and covenants should not be relied on as accurately representing
the current state of our affairs.
When
we refer to “we,” “our,” “us,” “our Company” and the “Company” in this prospectus,
we mean Ainos, Inc., unless otherwise specified. When we refer to “you,” we mean the holders of the applicable series of
securities.
No
action is being taken in any jurisdiction outside the United States to permit a public offering of the securities or possession or distribution
of this prospectus supplement or the accompanying prospectus in that jurisdiction. Persons who come into possession of this prospectus
supplement or the accompanying prospectus in jurisdictions outside the United States are required to inform themselves about and to observe
any restrictions as to this offering and the distribution of this prospectus supplement or the accompanying prospectus applicable to
that jurisdiction.
PROSPECTUS
SUPPLEMENT SUMMARY
This
summary highlights information contained elsewhere or incorporated by reference in this prospectus. This summary does not contain all
of the information that you should consider before deciding to invest in our common stock. You should read this entire prospectus carefully,
including the “Risk Factors” section contained in this prospectus, our consolidated financial statements and the related
notes thereto and the other documents incorporated by reference in this prospectus.
Our
Company
Overview
Ainos,
Inc. (the “Company”), incorporated in the State of Texas in 1984, is a diversified healthcare company focused on the development
of novel point-of-care testing (the “POCT”), therapeutics based on very low-dose interferon alpha (the “VELDONA”),
and synthetic RNA-driven preventative medicine. Our product pipeline includes commercial-stage VELDONA Pet cytoprotein supplements, clinical-stage
VELDONA human therapeutics and telehealth-friendly POCTs powered by the AI Nose technology platform.
We
have historically been involved in the research and development of therapeutics based on VELDONA. Building on our research and
development on VELDONA since inception, we are focused on commercializing a suite of VELDONA-based product candidates.
In
2021 and 2022, we acquired certain types of intellectual property from controlling shareholder, Ainos Inc., a Cayman Island corporation
(“Ainos KY”), to expand our product portfolio into POCTs aimed to provide connected, rapid, and convenient testing
for a broad range of health conditions. Pivoting from the sales of COVID-19 POCT, we aim to commercialize POCTs that detect volatile
organic compounds (the “VOC”) emitted by the body, powered by our AI Nose technology platform. Our lead VOC POCT candidate,
Ainos Flora, aims to test female vaginal health and certain common sexually transmitted infections (the “STIs”) quickly and
easily.
We
believe the following attributes differentiate us from other diversified life science companies:
|
- |
Intuitive,
telehealth-friendly point-of-care testing; |
|
- |
AI-powered
VOC testing platform; |
|
- |
decades
of proprietary low-dose oral interferon clinical research; |
|
- |
capital-efficient
business model; |
|
- |
outsourced
manufacturing; and |
|
- |
global
distribution relationships. |
Recent
Development
On
March 15, 2024, the Board of Directors appointed Christopher Hsin-Liang Lee as the Chief Financial Officer of the Company. Christopher
Lee, aged 53, brings over 25 years of experience in accounting and finance, encompassing US GAAP, PCAOB standards, and SEC rules and
regulations. Before joining the Company, Mr. Lee served as CFO of a Nasdaq-listed company for 10 years, was a partner at KEDP CPA Group
from August 2009 to June 2011, and operated as a self-employed accountant from July 2011 to August 2014. He has served on the Board of
Directors of Aixin Life International Inc. since February 2021. Mr. Lee holds a BS degree in accounting from Ohio State University and
an MS degree in business taxation from Golden Gate University. He is licensed as a Certified Public Accountant (CPA) in the United States.
On
January 9, 2024, the Company and Taiwan Carbon Nano Technology Corporation (“TCNT”) entered into an addendum to its five-year
Product Development Agreement (the “Addendum Agreement”) to modify the scope of co-development covered by the Product Development
Agreement and certain other terms. For products defined in the Addendum Agreement, TCNT will provide facilities, equipment, mass production
process technology, ISO9001 and ISO13485 related management, as well as mass production support. The procurement of parts and raw materials,
rental fees, and utility expenses are excluded. The Company will pay a total fee of NT$5 million (approximately USD$161,000) for five-years
of development commencing from 2024.
For
six months commencing from January 2024, TCNT will provide non-exclusive use of certain patents related to VOC and POCT technologies
for a monthly fee of US$95,000 (plus 5% sales tax), with negotiable payment terms. The parties can discuss subsequent use of the patents
at later dates.
On
May 3, 2024, the Company entered into a Convertible Note and Warrant Purchase Agreement with ASE Test, Inc., Taiwanese company (“ASE
Test”), pursuant to which the Company issued to ASE Test a convertible note in the aggregate principal amount of US$9,000,000.
The note bears six percent compound interest and has a three-year term through May 3, 2027. The note is convertible at ASE Test’s
election into shares of the Company’s common stock at a conversion price of US$4.50 per share, subject to customary anti-dilution
adjustments as set forth in the note. As part of the transaction, ASE Test received a five-year common stock purchase warrant which vests
and becomes exercisable on the first day following a six-month period from the date of issuance. The warrant may be exercised for up
to 500,000 shares of common stock at a price of US$4.50 per share. Closing of the placement is subject to customary closing conditions.
Our
Technologies
VELDONA
Interferons
are proteins made by host cells in response to the presence of pathogens. Interferons allow for communication between cells to trigger
the protective defenses of the immune system. VELDONA formulation, delivered into the oral cavity as a lozenge in low doses, is designed
to enhance autoimmunity to resist virus damages, potentially reducing side effects and risks caused by high-dose interferon and other
small molecule drugs.
We
believe VELDONA has shown to be safe and effective in the clinical studies for treatment of intended human and animal diseases. Since
our inception to date, 68 human clinical trials have been conducted with low-dose oral IFNα. 63 studies were Phase 2 trials, and
3 Phase 1 and 2 Phase 3 studies have also been conducted.
In
28 studies performed by Ainos, VELDONA was found to exhibit systemic effects in mice, cats, dogs, ferrets, chickens, rats, guinea pigs,
horses, calves/cows, and particularly pigs. VELDONA aided in boosting feed conversion efficiency and fighting deadly viral infections
in these species, including canine parvovirus, equine herpesvirus, feline coronavirus, and others. We believe the studies demonstrate
VELDONA’s therapeutic or preventive effect via the oral mucosa and shows VELDONA modulates systemic and mucosal immunity without
serious side effects.
We
have researched VELDONA for a broad range of human disease indications. We intend to prioritize advancing the following candidates: oral
warts for HIV-seropositive patients, Sjogren’s Syndrome, mid COVID-19 syndromes, common cold, influenza, aphthous stomatitis, and
chemotherapy-induced stomatitis. The United States Food and Drug Administration (the “U.S. FDA”) has granted Orphan
Drug Designation (“ODD”) for our VELDONA formulation as a potential treatment for oral warts in HIV-seropositive patients.
Leveraging
our VELDONA technology, we have launched a series of health supplements for dogs and cats under the brand name “VELDONA Pet”
in Taiwan since the second quarter of 2023 and we intend to explore international sales and marketing opportunities. Our VELDONA Pet
product line is formulated to address a variety of health issues, including skin, gum, emotion, discomfort caused by allergies, eye,
and weight-related issues. We also intend to conduct clinical studies in Taiwan for the treatment of feline chronic gingivostomatitis
(FCGS).
Point-of-Care
Tests (POCTs)
Our
POCT technologies aim to provide a simple, effective and telehealth-friendly tests that can deliver results within minutes. Our POCT
detection technologies consists of VOC sensing, lateral flow immunochromatographic assay and nucleic acid. Currently we prioritize developing
products based on VOC sensing. We intend to evaluate our lateral flow and nucleic acid test technologies for potential applications for
other disease indication.
VOC
Sensing Powered by AI Nose
We
believe the analysis of VOC is a powerful, non-invasive option for disease detection and health monitoring. Our VOC sensing technology
aims to detect the target VOCs within few minutes. AI Nose, the key enabler of our VOC sensing, consists of three key technologies: 1)
a “digital nose” detects the target VOCs; 2) a trained artificial intelligence (“AI”) algorithm analyzes the
target VOCs; 3) a “Smell ID” stores the VOC’s digital profile in the cloud.
We
believe VOC sensing powered by AI Nose is scalable into a broad range of industries for two reasons. First, digital nose sensors can
be made small and at low cost through semiconductor manufacturing technology. Second, as we train our AI with more Smell IDs, our VOC
sensing can continue to improve. While health testing is our near-term focus, we believe we can broaden VOC sensing powered by AI Nose
to other applications including telehealth, automotive, industrial, and environmental safety.
Our
Pipeline
An
integral part of our operating strategy is to create multiple revenue streams through sales of commercially ready products, out-licensing
or forming strategic relationships to develop and commercialize our products. As of March 31, 2024, we have commercialized
the following products:
|
● |
COVID-19
Antigen Rapid Test Kit. As the first commercialized products we sell, we have marketed COVID-19
antigen rapid test kits in Taiwan under emergency use authorization (“EUA”) issued by the Taiwan Food and Drug
Administration (“TFDA”) to TCNT, the product manufacturer. We have pivoted away from this business and have ceased selling
the product since the first quarter of 2024. |
|
|
|
|
● |
VELDONA
Pet. VELDONA Pet is formulated to address a variety of health issues in dogs and cats, including
skin, gum, emotion, discomfort caused by allergies, eye, and weight-related issues. We currently sell VELDONA Pet in Taiwan. |
From
time to time, we assess our development plan based on available resources and market dynamics. Our current pipeline of the products,
which are under development, includes the following:
|
● |
VELDONA
human drugs. Our programs include treatment of oral warts in human immunodeficiency virus (HIV) seropositive patients,
Sjögren’s syndrome common cold, influenza, and treatment for mild COVID-19 symptoms. Except for COVID-19, we have conducted
Phase 2 studies for these programs. The United States Food and Drug Administration (the “U.S. FDA”) have granted orphan
drug designation for our VELDONA formulation as a potential treatment for oral warts in HIV-seropositive patients. |
|
|
|
|
● |
VOC
POCT - Ainos Flora. Ainos Flora, powered by AI Nose, is intended to perform a non-invasive test for female vaginal health and
certain common STIs within a few minutes. A companion app is also being developed that enables users to conveniently manage test
results. We believe Ainos Flora can provide connected, convenient, discreet, rapid testing in a point-of-care setting. We are conducting
a clinical study in Taiwan and exploring strategic opportunities to commercialize the product. |
|
|
|
|
● |
VOC
platform - NISD co-development. We are co-developing a VOC sensing platform with Nisshinbo Micro Devices Inc. (“NISD”)
and Taiwan Inabata Sangyo Co. (“Taiwan Inabata”). The platform under development is intended to be used in applications
including telehealth, automotive, industrial, and environmental safety. |
|
|
|
|
● |
VOC
POCT - Ainos Pen. The device is intended to be a cloud-connected, multi-purpose, portable breath analyzer that is intended to
monitor health conditions within minutes, powered by AI Nose. We expect consumers to be empowered to share test results with their
physicians through in-person and telehealth medical consultations. |
|
● |
VOC
POCT - CHS430. The CHS430 device, powered by AI Nose, is intended to provide non-invasive testing for ventilator-associated pneumonia
within a few minutes, as compared to current standard of care invasive culture tests that typically take more than two days
to provide results. |
|
|
|
|
● |
Synthetic
RNA (“SRNA”). We plan to develop a SRNA technology platform in Taiwan with a long-term goal of developing
next-generating precision treatments and rapid tests. |
Our
Business Model
We
believe our business model is capital efficient based on the following:
Operation
in Taiwan. We have constructed our operation to be capital efficient by choosing Taiwan as our R&D and operating center.
We believe Taiwan has been a key center of the global technology supply chain and it is also home to high-caliber engineers, scientists
and healthcare professionals. We believe maintaining operations in Taiwan, at least in the near-term, allows us to access high-caliber
talent while staying cost effective, enabling us to develop high quality, affordable, consumer-friendly products.
Outsourced
Manufacturing. We believe our outsourced manufacturing strategy potentially saves us the time and resources required to establish
our own infrastructure. We outsource manufacturing of our POCT product candidates to Taiwan Carbon Nano Technology (“TCNT”).
We outsource manufacturing of VELDONA drugs for human-use to Swiss Pharmaceutical Co., Ltd., a Taiwan-based company. We outsource manufacturing
of VELDONA Pet supplements to a Taiwan-based third party and to TCNT.
Distribution
Relationships. We work with distributors to sell products. We appointed Inabata & Co. Ltd. (“Inabata”), a Japanese
corporation, as our non-exclusive worldwide distributor and preferred distributor for customers based in Japan. Inabata’s Taiwan
subsidiary (Taiwan Inabata Sangyo Co.) coordinates business logistics and working capital for our designated programs. Topmed International
Biotech Co., Ltd. (“Topmed”), a Taiwanese biotech company, is a distributor of our VELDDONA Pet supplements in Taiwan.
Intellectual
Property
We
own a portfolio of patents covering various aspects of our core technologies. As of March 31, 2024, we had fifty-four (54)
patents issued and sixteen (16) pending patent applications. Forty-seven (47) of the issued patents relate to acquired VOC and POCT technologies,
four (4) relate to interferon technologies and three (3) relate to our smart drug injection technology. Forty-seven (47) of the issued
patents are foreign patents and seven (7) are U.S. patents. Two (2) issued patents are licensed patents. Of the issued patents, thirty-two
(32) are invention patents, fourteen (14) are utility model patents and eight (8) are design patents. Of our issued patents, five (5)
shall expire between 2026 and 2029; twenty-two (22) between 2030 and 2034, twenty-seven (27) between 2035 and 2046.
Pursuant
to the Addendum Agreement with TCNT, for six months commencing from January 2024, TCNT will provide non-exclusive use of certain patents
related to VOC and POCT technologies for a monthly fee of US$95,000 (plus 5% sales tax), with negotiable payment terms. The parties will
discuss subsequent use of the patents at later dates.
We
own a registered trademark for VELDONA as well as certain trademarks for our VELDONA Pet supplement in Taiwan. We also have several trademark
applications for certain countries outside of Taiwan.
Employees
As
of May 10, 2023, we had 49 full-time employees, of which 25 are in research and development. Majority of our employees are in Taiwan.
None of our employees are represented by a labor union or are a party to a collective bargaining agreement. We plan to continue expand
our manpower in research development, sales and marketing, and general operations to support our business programs. Please refer to Part
3 Item 10 and 11 for executive profile and compensation.
Additional
Information
Under
our former name, Amarillo Biosciences, Inc., we completed an initial public offering on the Nasdaq SmallCap Market in August 1996 and
have traded on the U.S. over-the-counter market since October 1999. On October 31, 2013, we filed a voluntary petition for reorganization
under Chapter 11 of the United States bankruptcy code. We emerged from bankruptcy on January 23, 2015. We established a Taiwan branch
office in 2017. We renamed as Ainos, Inc in April 2021.
On
August 9, 2022, our common stock and warrants began trading on the Nasdaq Capital Market under the trading symbols “AIMD”
and “AIMDW,” respectively. We effectuated a 1-for-15 reverse stock split of our common stock on August 8, 2022, and a 1-for-5
reverse stock split on December 14, 2023.
Our
annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports are available
free of charge on the Company’s website at www.ainos.com as soon as reasonably practicable after such material is electronically
filed with, or furnished to, the Securities and Exchange Commission.
Government
Regulation
Regulation
of Medical Devices in Taiwan
Our
product candidates and operations are subject to the Taiwan Medical Devices Act and its implementation regulations (collectively the
“Taiwan MDA”), which govern the development, design, pre-clinical and clinical research, manufacturing, safety, efficacy,
labeling, packaging, storage, installation, servicing, recordkeeping, premarket clearance or approval, import, export, adverse event
reporting, advertising, promotion, marketing and distribution of medical devices. Under the Taiwan MDA, medical devices, depending on
the degree of risk associated with each medical device and the extent of manufacturer and regulatory control needed to provide reasonable
assurance of its safety and effectiveness, will be subject to differentiated level of review and examination of TFDA before marketing
the device. Unless an exemption applies, each medical device requires either (a) an approval granted by TFDA or (b) a registration with
TFDA before launching distribution or marketing in Taiwan. The latter is a simplified premarket review process applicable to some medical
devices classified as “lower risk level” items listed in the TFDA announcement. Our product candidates are not on the list
of “lower risk level” and the approval of TFDA will be required for us to launch distribution or marketing of such products
in Taiwan.
Personal
Data Protection Laws in Taiwan
Under
the Taiwan Personal Data Protection Act (“PDPA”), each individual or governmental or non-governmental agencies, including
our affiliate in Taiwan, should be subject to certain requirements and restrictions for collecting, processing or using personal data.
The definition of “personal data” is extended to cover a broad scope, including name, birthday, ID, special features, fingerprints,
marriage status, family, education, occupation, medical records, medical history, genetic information, sex life, health examination report,
criminal records, contact information, financial status, social activities, and any other data which is sufficient to directly or indirectly
identify a specific person. Due to the nature of the use of medical devices, our operation and the operation of our partners might collect,
process, or use the data pertaining to a person’s medical records and healthcare, genetics (collectively, sensitive data), which
is subject to stricter scrutiny. Generally, we can only obtain such sensitive data when the person consents in writing or electronically.
Furthermore, in January 2022, the TFDA published the Regulations for the Security and the Maintenance of Personal Information Files in
Wholesaling and Retailing Medical Devices authorized under the PDPA, which requires the medical devices wholesalers and retailers to
adopt necessary data security/protection measures, and establish prevention and reporting mechanisms in relation to any data breach.
The bill also empowers the TFDA to conduct regular inspections and audits. If we fail to comply with the PDPA, we may be subject to punishment
for civil claims, criminal offenses and administrative liabilities; the defendant may be subject to an imprisonment; and the penalty
for administrative liabilities, and may be imposed consecutively if such violation continues.
Regulation
of Veterinary Drugs in Taiwan
Our
veterinary product candidates are subject laws and regulations in Taiwan including, but not limited to, the Veterinary Drugs Control
Act, Enforcement Rules under the Veterinary Control Act, Guidelines of Good Manufacture Practice for Veterinary Drug Manufacturers, and
Taiwan Regulations for Pet Foods and Supplements. The laws and regulations govern, among other things, product design and development,
pre-clinical and clinical testing, quality testing, manufacturing, packaging, labeling, storage, record keeping and reporting, clearance
or approval, marketing, sales and distribution, promotion and advertising, import and export and post-marketing surveillance.
Under
Taiwan law, a “veterinary drug” refers to one of the following substances in the form of bulk chemical compound, formulated
preparation, or over the counter drug: Biologics specifically made for preventing and treating animal diseases based on microbiology,
immunology or molecular biology; Antibiotics specifically made for preventing and treating animal diseases; Diagnostics announced and
designated by the central competent authority for the diagnosis of animal diseases; and drugs that enhance or regulate animal physical
functions specifically for preventing and treating animal diseases.
The
competent authorities with licensing and enforcement authority under the Veterinary Drugs Control Act include the Council of Agriculture
of the central government, the municipal government of a special municipality, or a local city or county.
Regulation
of Medical Devices in the United States
Our
product candidates and operations are subject to extensive and ongoing regulation by the FDA under the Federal Food, Drug, and Cosmetic
Act of 1938 and its implementing regulations, collectively referred to as the FDCA, as well as other federal and state regulatory bodies
in the United States. The laws and regulations govern, among other things, product design and development, pre-clinical and clinical
testing, manufacturing, packaging, labeling, storage, record keeping and reporting, clearance or approval, marketing, distribution, promotion,
import and export and post-marketing surveillance.
The
FDA regulates the development, design, pre-clinical and clinical research, manufacturing, safety, efficacy, labeling, packaging, storage,
installation, servicing, recordkeeping, premarket clearance or approval, import, export, adverse event reporting, advertising, promotion,
marketing and distribution of medical devices in the United States to ensure that medical devices distributed domestically are safe and
effective for their intended uses and otherwise meet the requirements of the FDCA. Failure to comply with applicable requirements may
subject a device and/or its manufacturer to a variety of administrative sanctions, such as FDA refusal to approve pending premarket applications,
issuance of warning letters, mandatory product recalls, import detentions, civil monetary penalties, and/or judicial sanctions, such
as product seizures, injunctions, and criminal prosecution.
U.S.
drug and biological product development
In
the United States, the FDA regulates drugs under the Federal Food, Drug, and Cosmetic Act (FDCA) and its implementing regulations and
biologics under the FDCA, the Public Health Service Act (PHSA), and their implementing regulations. Both drugs and biologics also are
subject to other federal, state and local statutes and regulations. Failure to comply with applicable U.S. requirements at any time during
the product development process, approval process or following approval may subject us to administrative or judicial sanctions. These
sanctions could include, among other actions, the FDA’s refusal to approve pending applications, license revocation, a clinical
hold, untitled or warning letters, product recalls, market withdrawals, product seizures, total or partial suspension of production or
distribution, injunctions, fines, refusals of government contracts, restitution, disgorgement and civil or criminal penalties.
Our
VELDONA product candidates for human use must be approved by the FDA through a BLA or new drug application (NDA), or supplemental BLA
or supplemental NDA, process before they may be legally marketed in the United States.
Health
Insurance Portability and Accountability Act
We
may be subject to compliance with the federal Health Insurance Portability and Accountability Act of 1996, as amended by the Healthcare
Information Technology for Economic and Clinical Health Act of 2009, or HIPAA, among other things, established federal protection for
the privacy and security of protected health information, or PHI. The HIPAA privacy regulations protect PHI by limiting its use and disclosure,
giving patients the right to access certain information about them, and limiting most disclosures of PHI to the minimum amount necessary
to accomplish an intended purpose. The HIPAA security standards require the adoption of administrative, physical, and technical safeguards
and the adoption of written security policies and procedures.
U.S.
Federal, State and Foreign Fraud and Abuse Laws
The
U.S. federal and state governments have enacted, and actively enforce, a number of laws to address fraud and abuse in federal healthcare
programs. Our business is subject to compliance with these laws.
Implications
of Being a Smaller Reporting Company
We
are a “smaller reporting company” as defined in the Securities Exchange Act of 1934, as amended, or the Exchange Act, and
have elected to take advantage of certain of the scaled disclosures available to smaller reporting companies. Accordingly, we may provide
less public disclosure than larger public companies, including the inclusion of only two years of audited consolidated financial statements
and only two years of management’s discussion and analysis of financial condition and results of operations disclosure and the
inclusion of reduced disclosure about our executive compensation arrangements. As a smaller reporting company, we are also exempt from
compliance with the auditor attestation requirements pursuant to the Sarbanes-Oxley Act. As a result, the information that we provide
to our stockholders may be different than you might receive from other public reporting companies in which you hold equity interests.
We will continue to be a “smaller reporting company” until we have $250 million or more in public float (based on our common
stock) measured as of the last business day of our most recently completed second fiscal quarter or, in the event we have no public float
or a public float (based on our common stock) that is less than $700 million, annual revenues of $100 million or more during the most
recently completed fiscal year.
Corporate
Information
Our
principal executive offices are located at 8880 Rio San Diego Drive, Ste. 800, San Diego, CA 92108, and our telephone number is (858)
869-2986. We maintain a website at www.ainos.com. Information contained on or accessible through our website is not, and should
not be considered, part of, or incorporated by reference into, this prospectus.
THE
OFFERING
Common
stock offered by us pursuant to this prospectus |
|
Shares
of our common stock having an aggregate offering price of up to $1,353,197. |
|
|
|
Common
stock to be outstanding after this offering |
|
Up
to 1,073,966 shares, assuming a sales price of $1.26 per share, which was the closing price on the Nasdaq Capital Market
on May 23, 2024. The actual number of shares of common stock issued and outstanding will vary depending on the price at which
shares may be sold from time to time during this offering. |
|
|
|
Manner
of offering |
|
“At
the market offering” that may be made from time to time on the Nasdaq Capital Market or other market for our common stock in
the U.S. through our sales agent, H.C. Wainwright & Co., LLC. See “Plan of Distribution” on page S-14
of this prospectus. |
|
|
|
Use
of proceeds |
|
We
intend to use the net proceeds of this offering for general corporate purposes. See the section entitled “Use of Proceeds”
on page S-11 of this prospectus. |
|
|
|
Risk
factors |
|
See
“Risk Factors” beginning on page S-10 of this prospectus supplement and the other information included in, or incorporated
by reference into, our prospectus for a discussion of certain factors you should carefully consider before deciding to invest in
shares of our common stock. |
|
|
|
NASDAQ
Capital Market symbol |
|
AIMD |
The
number of shares of our common stock to be outstanding immediately after this offering is based on 6,503,118 shares of common
stock outstanding as of May 23, 2024, and excludes the following:
| ● | 1,909,810
shares
of common stock issuable upon the exercise of outstanding warrants at exercise prices ranging
from $2.16 to $23.375 per share, 1,201,944 of which, with an exercise price from $2.16
to $ 4.5, are subject to potential anti-dilution adjustment as a result of this offering; |
| ● | 13,366
shares of common stock issuable upon exercise of options (or in the form of warrants) granted
under the 2018 Employee Stock Option Plan and 2018 Officers, Directors, Employees, and Consultants
Nonqualified Stock Option Plan; |
| ● | 91,802
shares of common stock issuable upon the vesting of restricted stock units under the 2021
Stock Incentive Plan; |
| ● | 6,231,473
shares
of common stock reserved for issuance upon conversion of convertible notes issued in March
and September 2023 and January 2024, 3,400,001 of which issuable upon conversion of the September 2023 convertible
notes are subject to potential anti-dilution adjustment as a result of this offering; and |
| ● | 718,180
shares of common stock reserved for future issuance under our 2023 Stock Incentive Plan. |
The
share and per share information in this prospectus reflects a reverse stock split of our outstanding common stock at a ratio of 1-for-5
which became effective at 9:00 AM ET on December 14, 2023.
RISK
FACTORS
Investment
in any securities offered pursuant to this prospectus and the applicable prospectus supplement involves risks. You should carefully consider
the risk factors incorporated by reference to our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form
10-Q or Current Reports on Form 8-K we file after the date of this prospectus, and all other information contained or incorporated by
reference into this prospectus, as updated by our subsequent filings under the Exchange Act, and the risk factors and other information
contained in the applicable prospectus supplement before acquiring any of such securities. The occurrence of any of these risks might
cause you to lose all or part of your investment in the offered securities.
Risks
Associated with this Offering
We
have broad discretion in the use of the net proceeds of this offering and may not use them effectively.
We
intend to use the net proceeds from this offering for general corporate purposes. However, our management will have broad discretion
in the application of the net proceeds from this offering and could spend the proceeds in ways that do not improve our results of operations
or enhance the value of our common stock. The failure by management to apply these funds effectively could result in financial losses
that could have a material adverse effect on our business, cause the price of our common stock to decline and delay the development of
our product candidates.
You
may experience immediate and substantial dilution.
The
offering price per share in this offering may exceed the net tangible book value per share of our common stock outstanding prior to this
offering. Assuming that an aggregate of 1,073,966 shares of our common stock are sold at a price of $1.26 per share, the
last reported sale price of our common stock on the Nasdaq on May 23, 2024, for aggregate gross proceeds of $1,353,197,
and after deducting commissions and estimated offering expenses payable by us, if you purchase common stock in this offering, you will
experience immediate dilution of $1.71 per share, representing the difference between our pro forma, as adjusted net tangible
book value per share as of March 31, 2024 after giving effect to this offering and the assumed offering price. The exercise of outstanding
stock options and warrants, or the conversion of outstanding preferred stock into common stock, will result in further dilution of your
investment. See “Dilution” below for a more detailed illustration of the dilution you would incur if you participate
in this offering.
You
may experience future dilution as a result of future equity offerings.
In
order to raise additional capital, we may in the future offer additional shares of our common stock or other securities convertible into
or exchangeable for our common stock at prices that may not be the same as the price per share in this offering. We may sell shares or
other securities in any other offering at a price per share that is less than the price per share paid by investors in this offering,
and investors purchasing shares or other securities in the future could have rights superior to existing stockholders. The price per
share at which we sell additional shares of our common stock, or securities convertible or exchangeable into common stock, in future
transactions may be higher or lower than the price per share paid by investors in this offering.
The
common stock offered hereby will be sold in “at-the-market” offerings, and investors who buy shares at different times will
likely pay different prices.
Investors
who purchase shares in this offering at different times will likely pay different prices, and so may experience different outcomes in
their investment results. We will have discretion, subject to market demand, to vary the timing, prices and numbers of shares sold, and
there is no minimum or maximum sales price. Investors may experience a decline in the value of their shares as a result of share sales
made at prices lower than the prices they paid.
The
actual number of shares we will issue under the sales agreement, at any one time or in total, is uncertain.
Subject
to certain limitations in the sales agreement and compliance with applicable law, we have the discretion to deliver a sales notice to
Wainwright at any time throughout the term of the sales agreement. The number of shares that are sold by Wainwright after we deliver
a sales notice will fluctuate based on the market price of the common stock during the sales period and limits we set with Wainwright.
Because the price per share of each share sold will fluctuate based on the market price of our common stock during the sales period,
it is not possible at this stage to predict the number of shares that will be ultimately issued.
USE
OF PROCEEDS
We
may issue and sell shares of our common stock having aggregate sales proceeds of up to $1,353,197 from time to time. Because there
is no minimum offering amount required as a condition to close this offering, the actual total public offering amount, commissions and
proceeds to us, if any, are not determinable at this time. We estimate that the net proceeds from the sale of the shares of common stock
that we are offering may be up to approximately $897,000, after deducting Wainwright’s commission and estimated offering
expenses payable by us.
We
intend to use the net proceeds of this offering for general corporate purposes.
DIVIDEND
POLICY
We
have never declared or paid, and do not anticipate declaring or paying, any cash dividends on any of our capital stock. We do not anticipate
paying any dividends in the foreseeable future, and we currently intend to retain all available funds and any future earnings for use
in the operation of our business, to finance the growth and development of our business and for future repayment of debt. Future determinations
as to the declaration and payment of dividends, if any, will be at the discretion of our board of directors and will depend on then-existing
conditions, including our operating results, financial condition, contractual restrictions, capital requirements, business prospects
and other factors our board of directors may deem relevant.
DILUTION
If
you invest in our common stock, your interest will be diluted to the extent of the difference between the price per share you pay in
this offering and the net tangible book value per share of our common stock immediately after this offering.
Our
historic net tangible book value of our common stock as of March 31, 2024 was approximately ($4,476,801) or approximately
($0.73) per share of common stock based upon 6,144,506 shares outstanding. Net tangible book value per share is equal to our total tangible
assets, less our total liabilities, divided by the total number of shares outstanding as of March 31, 2024.
Subsequent
to March 31, 2024, on May 3, 2024, we entered into a Convertible Note and Warrant Purchase Agreement with ASE Test, pursuant to which
the Company issued to ASE Test a convertible note in the aggregate principal amount of $9,000,000. On a pro forma basis, adjusting for
the issuance of the convertible note to ASE Test, our pro forma, historical net tangible book value as of March 31, 2024, was approximately
($4,476,801) or ($0.73) per share of common stock.
After
giving further effect to the sale of our common stock in the aggregate amount of $1,353,197 at an assumed offering price
of $1.26 per share, the last reported sale price of our common stock on the Nasdaq Capital Market on May 23, 2024, and
after deducting estimated offering commissions payable by us, our pro forma, as adjusted, historical net tangible book value as
of March 31, 2024 would have been ($3,248,720) or ($0.45) per share of common stock. This represents, on an as adjusted,
pro forma historical basis, an immediate increase in net tangible book value of $0.28 per share to our existing stockholders
and an immediate dilution in net tangible book value of $1.71 per share to new investors in this offering.
The
following table illustrates this calculation on a per share basis:
Assumed offering price per share | |
| | | |
$ | 1.26 | |
Historical net tangible book value per share as of March 31, 2024 | |
$ | (0.73 | ) | |
| | |
Increase in pro forma net tangible book value per share attributable to the offering | |
$ | 0.28 | | |
| | |
As-adjusted pro forma net tangible book value per share after giving effect to the offering | |
| | | |
$ | (0.45 | ) |
Dilution in net tangible book value per share to new investors | |
| | | |
$ | 1.71 | |
The
number of shares of our common stock to be outstanding immediately after this offering is based on 6,144,506 shares of common
stock outstanding as of March 31, 2024, and excludes the following:
| ● | 894,444
shares
of common stock issuable upon the exercise of outstanding warrants at exercise prices ranging
from $4.5 to $23.375 per share, 691,244 of which, with an exercise price $ 4.5,
are subject to potential anti-dilution adjustment as a result of this offering; |
| ● | 13,366
shares of common stock issuable upon exercise of options (or in the form of warrants) granted
under the 2018 Employee Stock Option Plan and 2018 Officers, Directors, Employees, and Consultants
Nonqualified Stock Option Plan; |
| ● | 92,642
shares
of common stock issuable upon the vesting of restricted stock units under the 2021 Stock
Incentive Plan; |
| ● | 449,441
shares
of common stock reserved for issuance upon conversion of convertible notes issued in March
and September 2023 and January 2024, one (1) of which issuable upon conversion of the September 2023 convertible notes is
subject to potential anti-dilution adjustment as a result of this offering; and |
| ● | 721,750
shares
of common stock reserved for future issuance under our 2023 Stock Incentive Plan. |
The
share and per share information in this prospectus reflects a reverse stock split of our outstanding common stock at a ratio of 1-for-5
which became effective at 9:00 AM ET on December 14, 2023.
The
foregoing table does not give effect to the exercise of any outstanding options or warrants or the conversion of preferred stock to common
stock. To the extent options and warrants are exercised, or to the extent preferred stock is converted to common stock, there may be
further dilution to new investors.
The
table above assumes for illustrative purposes that an aggregate of 1,073,966 shares of our common stock are sold at a price
of $1.26 per share, the last reported sale price of our common stock on the NASDAQ Capital Market on May 23, 2024, for
aggregate gross proceeds of $1,353,197. The shares, if any, sold in this offering will be sold from time to time at various
prices. An increase of $1.00 per share in the price at which the shares are sold from the assumed offering price of $2.26 per
share shown in the table above, assuming we sell the same aggregate 1,073,966 shares, would increase our pro forma, as
adjusted, net tangible book value per share after this offering to $(0.31) per share and would increase the dilution in
net tangible book value per share to new investors in this offering to $2.57 per share, after deducting commissions and
estimated aggregate offering expenses payable by us. A decrease of $1.00 per share in the price at which the shares are sold from
the assumed offering price of $0.26 per share shown in the table above, assuming we sell the same aggregate 1,073,966
shares, would decrease our pro forma, as adjusted, net tangible book value per share after this offering to $(0.59)
per share and would decrease the dilution in net tangible book value per share to new investors in this offering to $0.85 per
share, after deducting commissions and estimated aggregate offering expenses payable by us.
PLAN
OF DISTRIBUTION
We
have entered into an At The Market Offering Agreement, or the sales agreement, with H.C. Wainwright & Co., LLC, or Wainwright, under
which we may issue and sell our common stock from time to time through Wainwright acting as sales agent, subject to certain limitations,
including the number of shares registered under the registration statement to which the offering relates. The sales, if any, of shares
made under the sales agreement will be made by any method that is deemed an “at the market offering” as defined in Rule 415
promulgated under the Securities Act, including sales made directly on or through Nasdaq or any other existing trading
market in the United States for our common stock, sales made to or through a market maker other than on an exchange or otherwise,
directly to Wainwright as principal, in negotiated transactions at market prices prevailing at the time of sale or at prices related
to such prevailing market prices and/or in any other method permitted by law.
Each
time we wish to issue and sell common stock under the sales agreement, we will notify Wainwright of the number of shares to be issued,
the dates on which such sales are anticipated to be made, any minimum price below which sales may not be made and other sales parameters
as we deem appropriate. Once we have so instructed Wainwright, unless Wainwright declines to accept the terms of the notice, Wainwright
has agreed to use its commercially reasonable efforts consistent with its normal trading and sales practices to sell such shares up to
the amount specified on such terms. The obligations of Wainwright under the sales agreement to sell our common stock are subject to a
number of conditions that we must meet. We may instruct Wainwright not to sell common stock if the sales cannot be effected at or above
the price designated by us from time to time. We or Wainwright may suspend the offering of common stock upon notice and subject to other
conditions.
We
will pay Wainwright commissions for its services in acting as agent in the sale of common stock. Wainwright will be entitled to a commission
in an amount equal to 3.0% of the gross proceeds from the sale of common stock offered hereby. We have also agreed to reimburse
Wainwright for fees and disbursements of its legal counsel in an amount not to exceed $50,000, in addition to up to a maximum
of $2,500 per due diligence update, plus any incidental expense incurred by Wainwright in connection therewith. We
estimate that the total expenses for the offering, excluding compensation payable to Wainwright under the terms of the sales agreement,
will be approximately $50,000.
Settlement
for sales of common stock will generally occur on the first trading day following the date on which any sales are made (or any such
shorter settlement cycle as may be in effect under Exchange Act Rule 15c6-1 from time to time), or on some other date that is agreed
upon by us and Wainwright in connection with a particular transaction, in return for payment of the net proceeds to us. There is no arrangement
for funds to be received in an escrow, trust or similar arrangement.
In
connection with the sale of the common stock on our behalf in this “at the market offering,”, Wainwright will be deemed to
be an “underwriter” within the meaning of the Securities Act and the compensation of Wainwright will be deemed to be underwriting
commissions or discounts. We have agreed to provide indemnification and contribution to Wainwright against certain civil liabilities,
including liabilities under the Securities Act or the Exchange Act.
The
offering of our common stock pursuant to the sales agreement will terminate upon the earlier of (i) the sale of all of our common stock
provided for in this prospectus or (ii) termination of the sales agreement as provided therein.
Wainwright
and its affiliates may in the future provide various investment banking and other financial services for us and our affiliates, for which
services they may in the future receive customary fees. To the extent required by Regulation M, Wainwright will not engage in any market
making activities involving our common stock while the offering is ongoing under this prospectus.
LEGAL
MATTERS
The
validity of the common stock offered hereby will be passed upon by Lucosky Brookman LLP. Ellenoff Grossman & Schole LLP, is counsel
for Wainwright in connection with this offering.
EXPERTS
The
financial statements of the Company at December 31, 2023 and 2022, and for each of the two years then ended, have been audited by KCCW
Accountancy Corp. (KCCW), an independent registered public accounting firm, as set forth in their report thereon and have been incorporated
by reference herein and in the registration statement.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act with respect to the securities being offered by
this prospectus. This prospectus, which constitutes part of the registration statement, does not contain all of the information in the
registration statement and its exhibits. For further information with respect to us and our securities offered by this prospectus, we
refer you to the registration statement and its exhibits. Statements contained in this prospectus as to the contents of any contract
or any other document referred to are not necessarily complete, and in each instance, we refer you to the copy of the contract or other
document filed as an exhibit to the registration statement. Each of these statements is qualified in all respects by this reference.
You can read our SEC filings, including the registration statement, over the internet at the SEC’s website at www.sec.gov.
We
are subject to the information reporting requirements of the Exchange Act, and we file reports, proxy statements and other information
with the SEC. These reports, proxy statements and other information will be available for review at the SEC’s website at www.sec.gov.
INCORPORATION
BY REFERENCE
The
SEC’s rules allow us to “incorporate by reference” information into this prospectus, which means that we can disclose
important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference
is deemed to be part of this prospectus, and subsequent information that we file with the SEC will automatically update and supersede
that information. Any statement contained in a previously filed document incorporated by reference will be deemed to be modified or superseded
for purposes of this prospectus to the extent that a statement contained in this prospectus modifies or replaces that statement.
We
incorporate by reference our documents listed below and any future filings made by us with the SEC under Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended, which we refer to as the “Exchange Act” in this prospectus, between
the date of this prospectus and the termination of the offering of the securities described in this prospectus. We are not, however,
incorporating by reference any documents or portions thereof, whether specifically listed below or filed in the future, that are not
deemed “filed” with the SEC, including any information furnished pursuant to Items 2.02 or 7.01 of Form 8-K or related exhibits
furnished pursuant to Item 9.01 of Form 8-K.
This
prospectus and any accompanying prospectus supplement incorporate by reference the documents set forth below that have previously been
filed with the SEC:
| ● | Our
Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March
8, 2024; |
| ● | Our
Quarterly Report on Form 10-Q for the period ended March 31, 2024, filed with the SEC on
May 13, 2024; and |
| ● | Our
Current Reports on Form 8-K filed with the SEC on January 2, 2024, January 12, 2024, January 25, 2024, March 15, 2024, March 19, 2024, and May 6, 2024. |
All
reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination
of this offering, including all such documents we may file with the SEC after the date of the initial registration statement and prior
to the effectiveness of the registration statement, but excluding any information furnished to, rather than filed with, the SEC, will
also be incorporated by reference into this prospectus and deemed to be part of this prospectus from the date of the filing of such reports
and documents.
You
may request a free copy of any of the documents incorporated by reference in this prospectus (other than exhibits, unless they are specifically
incorporated by reference in the documents) by writing or telephoning us at the following address:
Ainos,
Inc.
Attn:
Chief Financial Officer
8880
Rio San Diego Drive, Ste. 800
San
Diego, CA 92108
(858)
869-2986
Exhibits
to the filings will not be sent, however, unless those exhibits have specifically been incorporated by reference in this prospectus and
any accompanying prospectus supplement.
The
incorporated reports and other documents may also be accessed on website at www.ainos.com. The information on our website, however, is
not, and should not be deemed to be, a part of this prospectus.
$1,353,197
Common
Stock
PROSPECTUS
SUPPLEMENT
H.C.
Wainwright & Co.
,
2024
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution
The
following is an estimate of the expenses (all of which are to be paid by the registrant) that we may incur in connection with the securities
being registered hereby .
SEC registration fee | |
$ | 29,520 | |
FINRA filing fee | |
| | * |
Printing expenses | |
| | * |
Legal fees and expenses | |
| | * |
Accounting fees and expenses | |
| 5,000 | * |
Blue Sky, qualification fees and expenses | |
| | * |
Transfer agent fees and expenses | |
| | * |
Trustee fees and expenses | |
| | * |
Warrant agent fees and expenses | |
| | * |
Miscellaneous | |
| | * |
| |
| | |
Total | |
$ | | * |
*
These fees are calculated based on the securities offered and the number of issuances and accordingly cannot be estimated at this time.
Item
15. Indemnification of Directors and Officers
Section
8.101 of the Texas Business Organizations Code allows a Texas corporation to indemnify a person who was, is, or is threatened to be made
a defendant or respondent in a proceeding because the person is or was a director or officer if it is determined that the person (1)
acted in good faith, (2) reasonably believed that his conduct in his official capacity as director was in the best interest of the corporation
and in all other cases was at least not opposed to the corporation’s best interest, and (3) in the case of any criminal proceeding,
had no reasonable cause to believe his conduct was unlawful. Indemnification under section 8.101 may be made for judgments, penalties,
fines, settlements, and reasonable expenses actually incurred by the person in connection with the proceeding, subject to limitations
provided therein. Section 8.051(A) requires indemnification of a defendant / respondent director or officer against reasonable expenses
incurred by him in connection with a proceeding in which he has been wholly successful, on the merits or otherwise, in the defense of
the proceeding. Our Bylaws provide for such limitation of liability.
Item
16. Exhibits
(a)
Exhibits
EXHIBIT
INDEX
Exhibit
No. |
|
Exhibit
Description |
1.1* |
|
At The Market Offering Agreement between Ainos, Inc. and H.C. Wainwright & Co., LLC |
3.1 |
|
Amended and Restated Certificate of Formation, dated as of April 15, 2021 (incorporated by reference to Exhibit 3.1 to Ainos Inc.’s Current Report on Form 8-K filed with the SEC on April 21, 2021). |
3.2 |
|
Certificate of Amendment to the Restated Certificate of Formation, dated August 8, 2022 (incorporated by reference to Exhibit 3.1 to Ainos Inc.’s Current Report on Form 8-K filed with the SEC on August 12, 2022). |
3.3 |
|
Amended and Restated Bylaws of the Company, effective September 28, 2022 (incorporated by reference to Exhibit 3.2 to Ainos Inc.’s Current Report on Form 8-K filed with the SEC on October 4, 2022). |
3.4 |
|
Amended and Restated Bylaws of the Company, effective November 27, 2023 (incorporated by reference to Exhibit 3.1 to Ainos Inc.’s Current Report on Form 8-K filed with the SEC on December 14, 2023). |
4.1* |
|
Form of Indenture relating to the issuance from time to time in one or more series of debentures, notes, bonds or other evidences of indebtedness |
5.1* |
|
Opinion of Lucosky Brookman LLP |
23.1* |
|
Consent of KCCW Accountancy Corp., Independent Registered Public Accounting Firm. |
23.2* |
|
Consent of Lucosky Brookman LLP (reference is made to Exhibit 5.1) |
24.1* |
|
Power of Attorney (included on the signature page of this Registration Statement) |
107* |
|
Filing Fee Table |
Item
17. Undertakings
The
undersigned registrant hereby undertakes:
(a)
Rule 415 Offering. 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; |
|
|
|
|
(ii) |
To
reflect in the prospectus any facts or events arising after the effective date of this 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 this 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 Securities and Exchange Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement;
and |
|
(iii) |
To
include any material information with respect to the plan of distribution not previously disclosed in this registration statement
or any material change to such information in this registration statement; |
provided,
however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in reports filed with or furnished to the Securities and Exchange Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in this registration statement, or is
contained in a form of prospectus filed pursuant to Rule 424(b) that is part of this registration statement;
(2)
That, for the purpose of determining any liability under the Securities Act, 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 to any purchaser:
|
(A) |
Each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of this registration statement as of the
date the filed prospectus was deemed part of and included in this registration statement; and |
|
(B) |
Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule
430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information required
by Section 10(a) of the Securities Act shall be deemed to be part of and included in this registration statement as of the earlier
of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in
the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at
that date an underwriter, such date shall be deemed to be a new effective date of this registration statement relating to the securities
in this registration statement to which the prospectus relates, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement
or prospectus that is part of this registration statement or made in a document incorporated or deemed incorporated by reference
into this registration statement or prospectus that is part of this registration statement will, as to a purchaser with a time of
contract of sale prior to such effective date, supersede or modify any statement that was made in this registration statement or
prospectus that was part of this registration statement or made in any such document immediately prior to such effective date; and |
|
(5) |
That,
for the purpose of determining liability of the registrant under the Securities Act to any purchaser in the initial distribution
of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant
to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities
are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller
to the purchaser and will be considered to offer or sell such securities to such purchaser: |
|
(i) |
Any
preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule
424; |
|
(ii) |
Any
free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by
the undersigned registrant; |
|
(iii) |
The
portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant
or its securities provided by or on behalf of the undersigned registrant; and |
|
(iv) |
Any
other communication that is an offer in the offering made by the undersigned registrant to the purchaser. |
(b)
Filings Incorporating Subsequent Exchange Act Documents by Reference. The undersigned registrant hereby undertakes that,
for purposes of determining any liability under the Securities Act, each filing of the registrant’s annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant
to Section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(c)
Request for Acceleration of Effective Date or Filing of Registration Statement Becoming Effective Upon Filing. Insofar
as indemnification for liabilities arising under the Securities Act 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 and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(d)
That, for purposes of determining any liability under the Securities Act, (i) the information omitted from the form of prospectus filed
as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant
to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time
it was declared effective and (ii) each post-effective amendment that contains a form of prospectus 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.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Taipei, Taiwan (R.O.C.), on May 31, 2024.
AINOS,
INC. |
|
|
|
By: |
/s/
Chun-Hsien Tsai |
|
|
Chun-Hsien
Tsai, Chairman of the Board, |
|
|
President,
and Chief Executive Officer |
|
POWER
OF ATTORNEY
Each
person whose signature appears below hereby constitutes and appoints Chun-Hsien Tsai his true and lawful attorney-in-fact and agent with
full power of substitution and re-substitution, for him and in his name, place, and stead, in any and all capacities, to sign any and
all amendments (including post-effective amendments) and additions to this registration statement, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorney-in-fact
and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all
intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or
his substitute or substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this registration statement has been signed below by the following persons in the
capacities and on the dates indicated.
Signature |
|
Title |
|
Date |
|
|
|
|
|
/s/
Chun-Hsien Tsai |
|
Chairman
of the Board, President and Chief Executive Officer |
|
May
31, 2024 |
Chun-Hsien
Tsai |
|
|
|
|
|
|
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/s/
Christopher Hsin-Liang Lee |
|
Chief
Financial Officer |
|
May
31, 2024 |
Christopher
Hsin-Liang Lee |
|
|
|
|
|
|
|
|
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/s/
Wen-Han Chang |
|
Director |
|
May
31, 2024 |
Wen-Han
Chang |
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|
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/s/
Yao-Chung Chiang |
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Director |
|
May
31, 2024 |
Yao-Chung
Chiang |
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|
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/s/
Pao-Sheng Wei |
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Director |
|
May
31, 2024 |
Pao-Sheng
Wei |
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|
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/s/
Ting-Chuan Lee |
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Director |
|
May
31, 2024 |
Ting-Chuan
Lee |
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|
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|
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|
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/s/
Chun-Jung Tsai |
|
Director |
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May
31, 2024 |
Chun-Jung
Tsai |
|
|
|
|
|
|
|
|
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/s/
Chung-Yi Tsai |
|
Director |
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May
31, 2024 |
Chung-Yi
Tsai |
|
|
|
|
Exhibit
1.1
AT
THE MARKET OFFERING AGREEMENT
May
31, 2024
H.C.
Wainwright & Co., LLC
430
Park Avenue
New
York, New York 10022
Ladies
and Gentlemen:
Ainos,
Inc., a corporation organized under the laws of Texas (the “Company”), confirms its agreement (this “Agreement”)
with H.C. Wainwright & Co., LLC (the “Manager”) as follows:
1.
Definitions. The terms that follow, when used in this Agreement and any Terms Agreement, shall have the meanings indicated.
“Accountants”
shall have the meaning ascribed to such term in Section 4(m).
“Act”
shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.
“Action”
shall have the meaning ascribed to such term in Section 3(p).
“Affiliate”
shall have the meaning ascribed to such term in Section 3(o).
“Applicable
Time” shall mean, with respect to any Shares, the time of sale of such Shares pursuant to this Agreement or any relevant Terms
Agreement.
“Base
Prospectus” shall mean the base prospectus contained in the Registration Statement at the Effective Time.
“Board”
shall have the meaning ascribed to such term in Section 2(b)(iii).
“Broker
Fee” shall have the meaning ascribed to such term in Section 2(b)(v).
“Business
Day” shall mean 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; provided, however, that, for purposes of clarity, commercial banks shall not be deemed
to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential
employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental
authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York
generally are open for use by customers on such day.
“Commission”
shall mean the United States Securities and Exchange Commission.
“Common
Stock” shall have the meaning ascribed to such term in Section 2.
“Common
Stock Equivalents” shall have the meaning ascribed to such term in Section 3(g).
“Company
Counsel” shall have the meaning ascribed to such term in Section 4(l).
“DTC”
shall have the meaning ascribed to such term in Section 2(b)(vii).
“Effective
Date” shall mean each date and time that the Registration Statement and any post-effective amendment or amendments thereto
became or becomes effective.
“Effective
Time” shall mean the first date and time that the Registration Statement becomes effective.
“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated
thereunder.
“Execution
Time” shall mean the date and time that this Agreement is executed and delivered by the parties hereto.
“Free
Writing Prospectus” shall mean a free writing prospectus, as defined in Rule 405.
“GAAP”
shall have the meaning ascribed to such term in Section 3(m).
“Incorporated
Documents” shall mean the documents or portions thereof filed with the Commission on or prior to the Effective Date that are
incorporated by reference in the Registration Statement or the Prospectus and any documents or portions thereof filed with the Commission
after the Effective Date that are deemed to be incorporated by reference in the Registration Statement or the Prospectus.
“Intellectual
Property Rights” shall have the meaning ascribed to such term in Section 3(v).
“Issuer
Free Writing Prospectus” shall mean an issuer free writing prospectus, as defined in Rule 433.
“Losses”
shall have the meaning ascribed to such term in Section 7(d).
“Material
Adverse Effect” shall have the meaning ascribed to such term in Section 3(b).
“Material
Permits” shall have the meaning ascribed to such term in Section 3(t).
“Net
Proceeds” shall have the meaning ascribed to such term in Section 2(b)(v).
“Permitted
Free Writing Prospectus” shall have the meaning ascribed to such term in Section 4(g).
“Placement”
shall have the meaning ascribed to such term in Section 2(c).
“Proceeding”
shall have the meaning ascribed to such term in Section 3(b).
“Prospectus”
shall mean the Base Prospectus, as supplemented by the Prospectus Supplement included in the Registration Statement at the Effective
Time and any subsequently filed Prospectus Supplement.
“Prospectus
Supplement” shall mean the prospectus supplement relating to the Shares included in the Registration Statement at the Effective
Time and any other prospectus supplement relating to the Shares prepared and filed pursuant to Rule 424(b) from time to time.
“Registration
Statement” shall mean the shelf registration statement on Form S-3 registering $200,000,000 of securities of the Company
to be filed on or immediately following the Execution Time, including exhibits and financial statements and any prospectus supplement
relating to the Shares that is filed with the Commission pursuant to Rule 424(b) and deemed part of such registration statement pursuant
to Rule 430B, as amended on each Effective Date and, in the event any post-effective amendment thereto becomes effective, shall also
mean such registration statement as so amended.
“Representation
Date” shall have the meaning ascribed to such term in Section 4(k).
“Required
Approvals” shall have the meaning ascribed to such term in Section 3(e).
“Rule
158”, “Rule 164”, “Rule 172”, “Rule 173”, “Rule 405”,
“Rule 415”, “Rule 424”, “Rule 430B” and “Rule 433” refer
to such rules under the Act.
“Sales
Notice” shall have the meaning ascribed to such term in Section 2(b)(i).
“SEC
Reports” shall have the meaning ascribed to such term in Section 3(m).
“Settlement
Date” shall have the meaning ascribed to such term in Section 2(b)(vii).
“Subsidiary”
shall have the meaning ascribed to such term in Section 3(a).
“Terms
Agreement” shall have the meaning ascribed to such term in Section 2(a).
“Time
of Delivery” shall have the meaning ascribed to such term in Section 2(c).
“Trading
Day” means a day on which the Trading Market is open for trading.
“Trading
Market” means the Nasdaq Capital Market.
2.
Sale and Delivery of Shares. The Company proposes to issue and sell through or to the Manager, as sales agent and/or principal,
from time to time during the term of this Agreement and on the terms set forth herein, up to such number of shares (the “Shares”)
of the Company’s common stock, $0.01 par value per share (“Common Stock”), that does not exceed (a) the number
or dollar amount of shares of Common Stock registered on the Prospectus Supplement, pursuant to which the offering is being made, (b)
the number of authorized but unissued shares of Common Stock (less the number of shares of Common Stock issuable upon exercise, conversion
or exchange of any outstanding securities of the Company or otherwise reserved from the Company’s authorized capital stock), or
(c) the number or dollar amount of shares of Common Stock that would cause the Company or the offering of the Shares to not satisfy the
eligibility and transaction requirements for use of Form S-3, including, if applicable, General Instruction I.B.6 of Registration Statement
on Form S-3 (the lesser of (a), (b) and (c), the “Maximum Amount”). Notwithstanding anything to the contrary contained
herein, the parties hereto agree that compliance with the limitations set forth in this Section 2 on the number and aggregate sales price
of Shares issued and sold under this Agreement shall be the sole responsibility of the Company and that the Manager shall have no obligation
in connection with such compliance.
(a)
Appointment of Manager as Selling Agent; Terms Agreement. For purposes of selling the Shares through the Manager, the Company
hereby appoints the Manager as exclusive agent of the Company for the purpose of selling the Shares of the Company pursuant to this Agreement
and the Manager agrees to use its commercially reasonable efforts to sell the Shares on the terms and subject to the conditions stated
herein. The Company agrees that, whenever it determines to sell the Shares directly to the Manager as principal, it will enter into a
separate agreement (each, a “Terms Agreement”) in substantially the form of Annex I hereto, relating to such
sale in accordance with Section 2 of this Agreement.
(b)
Agent Sales. Subject to the terms and conditions and in reliance upon the representations and warranties herein set forth, following
the effectiveness of the Registration Statement, the Company will issue and agrees to sell Shares from time to time through the Manager,
acting as sales agent, and the Manager agrees to use its commercially reasonable efforts to sell, as sales agent for the Company, on
the following terms:
(i)
The Shares are to be sold on a daily basis or otherwise as shall be agreed to by the Company and the Manager on any day that (A) is a
Trading Day, (B) the Company has instructed the Manager by electronic mail to make such sales (“Sales Notice”) and
(C) the Company has satisfied its obligations under Section 6 of this Agreement. The Company will designate the maximum amount of the
Shares to be sold by the Manager daily (subject to the limitations set forth in Section 2(d)) and the minimum price per Share at which
such Shares may be sold. Subject to the terms and conditions hereof, the Manager shall use its commercially reasonable efforts consistent
with its normal trading and sales practices to sell on a particular day all of the Shares designated for the sale by the Company on such
day. The gross sales price of the Shares sold under this Section 2(b) shall be the market price for the shares of Common Stock sold by
the Manager under this Section 2(b) on the Trading Market at the time of sale of such Shares.
(ii)
The Company acknowledges and agrees that (A) there can be no assurance that the Manager will be successful in selling the Shares, (B)
the Manager will incur no liability or obligation to the Company or any other person or entity if it does not sell the Shares for any
reason other than a failure by the Manager to use its commercially reasonable efforts consistent with its normal trading and sales practices
and applicable law and regulations to sell such Shares as required under this Agreement, and (C) the Manager shall be under no obligation
to purchase Shares on a principal basis pursuant to this Agreement, except as otherwise specifically agreed by the Manager and the Company
pursuant to a Terms Agreement.
(iii)
The Company shall not authorize the issuance and sale of, and the Manager shall not be obligated to use its commercially reasonable efforts
to sell, any Share at a price lower than the minimum price therefor designated from time to time by the Company’s Board of Directors
(the “Board”), or a duly authorized committee thereof, or such duly authorized officers of the Company, and notified
to the Manager in writing. The Company or the Manager may, upon notice to the other party hereto by electronic mail, suspend the offering
of the Shares for any reason and at any time; provided, however, that such suspension or termination shall not affect or
impair the parties’ respective obligations with respect to the Shares sold hereunder prior to the giving of such notice.
(iv)
The Manager may sell Shares by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415
under the Act, including without limitation sales made directly on the Trading Market, on any other existing trading market for the Common
Stock or to or through a market maker. The Manager may also sell Shares in privately negotiated transactions, provided that the Manager
receives the Company’s prior written approval for any sales in privately negotiated transactions and if so provided in the “Plan
of Distribution” section of the Prospectus Supplement or a supplement to the Prospectus Supplement or a new Prospectus Supplement
disclosing the terms of such privately negotiated transaction.
(v)
The compensation to the Manager for sales of the Shares under this Section 2(b) shall be a placement fee of 3.0% of the gross sales price
of the Shares sold pursuant to this Section 2(b) (“Broker Fee”). The foregoing rate of compensation shall not apply
when the Manager acts as principal, in which case the Company may sell Shares to the Manager as principal at a price agreed upon at the
relevant Applicable Time pursuant to a Terms Agreement. The remaining proceeds, after deduction of the Broker Fee and deduction of any
transaction fees imposed by any clearing firm, execution broker, or governmental or self-regulatory organization in respect of such sales,
shall constitute the net proceeds to the Company for such Shares (the “Net Proceeds”).
(vi)
The Manager shall provide written confirmation (which may be by electronic mail) to the Company following the close of trading on the
Trading Market each day in which the Shares are sold under this Section 2(b) setting forth the number of the Shares sold on such day,
the aggregate gross sales proceeds and the Net Proceeds to the Company, and the compensation payable by the Company to the Manager with
respect to such sales.
(vii)
Unless otherwise agreed between the Company and the Manager, settlement for sales of the Shares will occur at 10:00 a.m. (New York City
time) on the first (1st) Trading Day (or any such shorter settlement cycle as may be in effect pursuant to Rule 15c6-1
under the Exchange Act from time to time) following the date on which such sales are made (each, a “Settlement Date”).
On or before the Trading Day prior to each Settlement Date, the Company will, or will cause its transfer agent to, electronically transfer
the Shares being sold by crediting the Manager’s or its designee’s account (provided that the Manager shall have given the
Company written notice of such designee at least one Trading Day prior to the Settlement Date) at The Depository Trust Company (“DTC”)
through its Deposit and Withdrawal at Custodian System or by such other means of delivery as may be mutually agreed upon by the parties
hereto which Shares in all cases shall be freely tradable, transferable, registered shares in good deliverable form. On each Settlement
Date, the Manager will deliver the related Net Proceeds in same day funds to an account designated by the Company. The Company agrees
that, if the Company, or its transfer agent (if applicable), defaults in its obligation to deliver duly authorized Shares on a Settlement
Date, in addition to and in no way limiting the rights and obligations set forth in Section 7 hereto, the Company will (i) hold the Manager
harmless against any loss, claim, damage, or reasonable, documented expense (including reasonable and documented legal fees and expenses),
as incurred, arising out of or in connection with such default by the Company, and (ii) pay to the Manager any commission, discount or
other compensation to which the Manager would otherwise have been entitled absent such default.
(viii)
At each Applicable Time, Settlement Date, and Representation Date, the Company shall be deemed to have affirmed each representation and
warranty contained in this Agreement as if such representation and warranty were made as of such date, modified as necessary to relate
to the Registration Statement and the Prospectus as amended as of such date. Any obligation of the Manager to use its commercially reasonable
efforts to sell the Shares on behalf of the Company shall be subject to the continuing accuracy of the representations and warranties
of the Company herein, to the performance by the Company of its obligations hereunder and to the continuing satisfaction of the additional
conditions specified in Section 6 of this Agreement.
(ix)
If 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 or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other
similar transaction) (a “Distribution” and the record date for the determination of stockholders entitled to receive
the Distribution, the “Record Date”), the Company hereby covenants that, in connection with any sales of Shares pursuant
to a Sales Notice on the Record Date, the Company shall issue and deliver such Shares to the Manager on the Record Date and the Record
Date shall be the Settlement Date and the Company shall cover any additional costs of the Manager in connection with the delivery of
Shares on the Record Date.
(c)
Term Sales. If the Company wishes to sell the Shares pursuant to this Agreement in a manner other than as set forth in Section
2(b) of this Agreement (each, a “Placement”), the Company will notify the Manager of the proposed terms of such Placement.
If the Manager, acting as principal, wishes to accept such proposed terms (which it may decline to do for any reason in its sole discretion)
or, following discussions with the Company wishes to accept amended terms, the Manager and the Company will enter into a Terms Agreement
setting forth the terms of such Placement. The terms set forth in a Terms Agreement will not be binding on the Company or the Manager
unless and until the Company and the Manager have each executed such Terms Agreement accepting all of the terms of such Terms Agreement.
In the event of a conflict between the terms of this Agreement and the terms of a Terms Agreement, the terms of such Terms Agreement
will control. A Terms Agreement may also specify certain provisions relating to the reoffering of such Shares by the Manager. The commitment
of the Manager to purchase the Shares pursuant to any Terms Agreement shall be deemed to have been made on the basis of the representations
and warranties of the Company herein contained and shall be subject to the terms and conditions herein set forth. Each Terms Agreement
shall specify the number of the Shares to be purchased by the Manager pursuant thereto, the price to be paid to the Company for such
Shares, any provisions relating to rights of, and default by, underwriters acting together with the Manager in the reoffering of the
Shares, and the time and date (each such time and date being referred to herein as a “Time of Delivery”) and place
of delivery of and payment for such Shares. Such Terms Agreement shall also specify any requirements for opinions of counsel, accountants’
letters and officers’ certificates pursuant to Section 6 of this Agreement and any other information or documents required by the
Manager.
(d)
Maximum Number of Shares. Under no circumstances shall the Company cause or request the offer or sale of any Shares if, after
giving effect to the sale of such Shares, the aggregate amount of Shares sold pursuant to this Agreement would exceed the lesser of (A)
together with all sales of Shares under this Agreement, the Maximum Amount, (B) the amount available for offer and sale under the currently
effective Registration Statement and (C) the amount authorized from time to time to be issued and sold under this Agreement by the Board,
a duly authorized committee thereof or a duly authorized executive committee, and notified to the Manager in writing. Under no circumstances
shall the Company cause or request the offer or sale of any Shares pursuant to this Agreement at a price lower than the minimum price
authorized from time to time by the Board, a duly authorized committee thereof or a duly authorized executive officer, and notified to
the Manager in writing. Further, under no circumstances shall the Company cause or permit the aggregate offering amount of Shares sold
pursuant to this Agreement to exceed the Maximum Amount.
(e)
Regulation M Notice. Unless the exceptive provisions set forth in Rule 101(c)(1) of Regulation M under the Exchange Act are satisfied
with respect to the Shares, the Company shall give the Manager at least one (1) Business Day’s prior notice of its intent to sell
any Shares in order to allow the Manager time to comply with Regulation M.
3.
Representations and Warranties. The Company represents and warrants to, and agrees with, the Manager at the Execution Time and
the Effective Time and on each such time that the following representations and warranties are repeated or deemed to be made pursuant
to this Agreement, as set forth below, except as set forth in the Registration Statement, the Prospectus or the Incorporated Documents.
(a)
Subsidiaries. All of the direct and indirect subsidiaries (individually, a “Subsidiary”) of the Company, if
any, are set forth in the SEC Reports . The Company owns, directly or indirectly, all of the capital stock or other equity interests
of each Subsidiary free and clear of any “Liens” (which for purposes of this Agreement shall mean a lien, charge,
security interest, encumbrance, right of first refusal, preemptive right or other restriction), and all of the issued and outstanding
shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights
to subscribe for or purchase securities. If the Company has no subsidiaries, all other references to the Subsidiaries in this Agreement
shall be disregarded.
(b)
Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power
and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any
Subsidiary is in violation or in default of any of the provisions of its respective certificate or articles of incorporation, bylaws
or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in
good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property
owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be,
could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of this
Agreement, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise)
of the Company and the Subsidiaries, taken as a whole, from that set forth in the Registration Statement, the Base Prospectus, any Prospectus
Supplement, the Prospectus or the Incorporated Documents, or (iii) a material adverse effect on the Company’s ability to perform
in any material respect on a timely basis its obligations under this Agreement (any of (i), (ii) or (iii), a “Material Adverse
Effect”) and no “Proceeding” (which for purposes of this Agreement shall mean any action, claim, suit, investigation
or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced
or threatened) has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such
power and authority or qualification.
(c)
Authorization and Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the
transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder. The execution and delivery of this
Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary
action on the part of the Company and no further action is required by the Company, the Board or the Company’s stockholders in
connection herewith other than in connection with the Required Approvals. This Agreement has been duly executed and delivered by the
Company and, when delivered in accordance with the terms hereof, will constitute the valid and binding obligation of the Company enforceable
against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as
limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar
as indemnification and contribution provisions may be limited by applicable law.
(d)
No Conflicts. The execution, delivery and performance by the Company of this Agreement, the issuance and sale of the Shares and
the consummation by it of the transactions contemplated hereby do not and will not (i) conflict with or violate any provision of the
Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents,
or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under,
result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights
of termination, amendment, anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time
or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other
understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is
bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order,
judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject
(including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound
or affected; except in the case of each of clauses (ii) and (iii), such as could not, individually or in the aggregate, have or reasonably
be expected to result in a Material Adverse Effect.
(e)
Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any
notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other
“Person” (defined as an individual or corporation, partnership, trust, incorporated or unincorporated association, joint
venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind,
including the Trading Market) in connection with the execution, delivery and performance by the Company of this Agreement, other than
(i) the filings required by this Agreement, (ii) the filing with the Commission of the Prospectus Supplement, (iii) the filing of application(s)
to and approval by the Trading Market for the listing of the Shares for trading thereon in the time and manner required thereby, and
(iv) such filings as are required to be made under applicable state securities laws and the rules and regulations of the Financial Industry
Regulatory Authority, Inc. (“FINRA”) (collectively, the “Required Approvals”).
(f)
Issuance of Shares. The Shares are duly authorized and, when issued and paid for in accordance with this Agreement, will be duly
and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its
duly authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement. On and after the Effective
Time, the issuance by the Company of the Shares has been registered under the Act and all of the Shares are freely transferable and tradable
by the purchasers thereof without restriction (other than any restrictions arising solely from an act or omission of such a purchaser).
The Shares are being issued pursuant to the Registration Statement and the issuance of the Shares has been registered by the Company
under the Act on and after the Effective Time. The “Plan of Distribution” section within the Registration Statement
permits the issuance and sale of the Shares as contemplated by this Agreement. Upon receipt of the Shares, the purchasers of such Shares
will have good and marketable title to such Shares and the Shares will be freely tradable on the Trading Market.
(g)
Capitalization. The capitalization of the Company is as set forth in the SEC Reports. The Company has not issued any capital stock
since its most recently filed periodic report under the Exchange Act, other than pursuant to the exercise of employee stock options under
the Company’s stock option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee
stock purchase plan and pursuant to the conversion and/or exercise of securities exercisable, exchangeable or convertible into Common
Stock (“Common Stock Equivalents”) outstanding as of the date of the most recently filed periodic report under the
Exchange Act, or as set forth in the SEC Reports. No Person has any right of first refusal, preemptive right, right of participation,
or any similar right to participate in the transactions contemplated by this Agreement. Except as set forth in the SEC Reports, there
are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for
or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements
by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents
or capital stock of any Subsidiary. The issuance and sale of the Shares will not obligate the Company or any Subsidiary to issue shares
of Common Stock or other securities to any Person. Except as set forth in the SEC Reports, there are no outstanding securities or instruments
of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or
instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the
Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings
or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary.
The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement.
All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have
been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of
any preemptive rights or similar rights to subscribe for or purchase securities. No further approval or authorization of any stockholder,
the Board or others is required for the issuance and sale of the Shares. Except as set forth in the SEC Reports, there are no stockholders
agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a
party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
(h)
Registration Statement. The Company meets the requirements for use of Form S-3 under the Act and has prepared and filed with the
Commission the Registration Statement, including a related Base Prospectus, for registration under the Act of the offering and sale of
the Shares. Upon the Effective Time, such Registration Statement shall be effective and available for the offer and sale of the Shares
as of the date hereof. As filed, the Base Prospectus contains all information required by the Act and the rules thereunder, and, except
to the extent the Manager shall agree in writing to a modification, shall be in all substantive respects in the form furnished to the
Manager prior to the Execution Time or prior to any such time this representation is repeated or deemed to be made. The Registration
Statement, at the Execution Time, each such time this representation is repeated or deemed to be made, and at all times during which
a prospectus is required by the Act to be delivered (whether physically or through compliance with Rule 172, 173 or any similar rule)
in connection with any offer or sale of the Shares, meets the requirements set forth in Rule 415(a)(1)(x). The Company meets the transaction
requirements as set forth in General Instruction I.B.1 of Form S-3 or, if applicable, as set forth in General Instruction I.B.6 of Form
S-3 with respect to the aggregate market value of securities being sold pursuant to this offering and during the twelve (12) months prior
to this offering.
(i)
Accuracy of Incorporated Documents. The Incorporated Documents, when they were filed with the Commission, conformed in all material
respects to the requirements of the Exchange Act and the rules thereunder, and none of the Incorporated Documents, when they were filed
with the Commission, contained any untrue statement of a material fact or omitted to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made not misleading; and any further documents so filed and incorporated
by reference in the Registration Statement, the Base Prospectus, the Prospectus Supplement or the Prospectus, when such documents are
filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the rules thereunder, as
applicable, and will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading.
(j)
Ineligible Issuer. (i) At the earliest time after the filing of the Registration Statement that the Company or another offering
participant made a bona fide offer (within the meaning of Rule 164(h)(2)) of the Shares and (ii) as of the Execution Time and on each
such time this representation is repeated or deemed to be made (with such date being used as the determination date for purposes of this
clause (ii)), 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.
(k)
Free Writing Prospectus. The Company is eligible to use Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus
does not include any information the substance of which conflicts with the information contained in the Registration Statement, including
any Incorporated Documents and any prospectus supplement deemed to be a part thereof that has not been superseded or modified; and each
Issuer Free Writing Prospectus does not contain any untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The foregoing
sentence does not apply to statements in or omissions from any Issuer Free Writing Prospectus based upon and in conformity with written
information furnished to the Company by the Manager specifically for use therein. Any Issuer Free Writing Prospectus that the Company
is required to file pursuant to Rule 433(d) has been, or will be, filed with the Commission in accordance with the requirements of the
Act and the rules thereunder. Each Issuer Free Writing Prospectus that the Company has filed, or is required to file, pursuant to Rule
433(d) or that was prepared by or behalf of or used by the Company complies or will comply in all material respects with the requirements
of the Act and the rules thereunder. The Company will not, without the prior consent of the Manager, prepare, use or refer to, any Issuer
Free Writing Prospectuses.
(l)
Proceedings Related to Registration Statement. The Registration Statement is not the subject of a pending proceeding or examination
under Section 8(d) or 8(e) of the Act, and the Company is not the subject of a pending proceeding under Section 8A of the Act in connection
with the offering of the Shares. The Company has not received any notice that the Commission has issued or intends to issue a stop-order
with respect to the Registration Statement or that the Commission otherwise has suspended or withdrawn the effectiveness of the Registration
Statement, either temporarily or permanently, or intends or has threatened in writing to do so.
(m)
SEC Reports. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company
under the Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof
(or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the
exhibits thereto and documents incorporated by reference therein, together with the Prospectus and the Prospectus Supplement, being collectively
referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing
and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied
in all material respects with the requirements of the Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed,
contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order
to make the statements therein, in the light of the circumstances under which they were made, not misleading. The financial statements
of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in
accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”),
except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements
may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and
its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended,
subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.
(n)
[RESERVED]
(o)
Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included
within the SEC Reports, except as specifically disclosed in a subsequent SEC Report filed prior to the date on which this representation
is being made, (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in
a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables
and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be
reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company
has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property
to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock, (v) the Company
has not issued any equity securities to any officer, director or “Affiliate” (defined as any Person that, directly
or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms
are used in and construed under Rule 144 under the Act), except pursuant to existing Company stock option plans, and (vi) no executive
officer of the Company or member of the Board has resigned from any position with the Company. The Company does not have pending before
the Commission any request for confidential treatment of information. Except for the issuance of the Shares contemplated by this Agreement,
no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist
with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial
condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made
or deemed made that has not been publicly disclosed at least one (1) Trading Day prior to the date that this representation is made.
(p)
Litigation. Except as set forth in the SEC Reports, there is no action, suit, inquiry, notice of violation, proceeding or investigation
pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties
before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign)
(collectively, an “Action”). None of the Actions set forth in the SEC Reports, (i) adversely affects or challenges
the legality, validity or enforceability of this Agreement or the Shares or (ii) could, if there were an unfavorable decision, have or
reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof,
is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim
of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation
by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any
stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the
Exchange Act or the Act.
(q)
Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees
of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’
employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither
the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe
that their relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary,
is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary
information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third
party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability
with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all applicable U.S. federal, state,
local and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages
and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(r)
Compliance. Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that
has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor
has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture,
loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound
(whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator
or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental
authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational
health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be
expected to result in a Material Adverse Effect.
(s)
Environmental Laws. The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating
to pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface
strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or
toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating
to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well
as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders,
permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have
received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses;
and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and
(iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.
(t)
Regulatory Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate
federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports,
except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material
Permits”), and neither the Company nor any Subsidiary has received any notice of proceedings relating to the revocation or
modification of any Material Permit.
(u)
Title to Assets. The Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them
and good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries,
in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially
interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries, (ii) Liens for the payment
of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of
which is neither delinquent nor subject to penalties, and (iii) as specifically disclosed in a SEC Report filed prior to the date on
which this representation is being made. Any real property and facilities held under lease by the Company and the Subsidiaries are held
by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.
(v)
Intellectual Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks,
trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights
and similar rights necessary or required for use in connection with their respective businesses as described in the SEC Reports and which
the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None
of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights
has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date
of this Agreement, except as could not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect. Neither
the Company nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC Reports,
a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights
of any Person, except as could not have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company,
all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual
Property Rights. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and
value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
(w)
Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses
and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including,
but not limited to, directors and officers insurance coverage. Neither the Company nor any Subsidiary has any reason to believe that
it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business without a significant increase in cost.
(x)
Affiliate Transactions. Except as set forth in the SEC Reports, none of the officers or directors of the Company or any Subsidiary
and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction
with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement
or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from,
providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from any officer, director or
such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial
interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment
of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other
employee benefits, including stock option agreements under any stock option plan of the Company.
(y)
Sarbanes Oxley Compliance. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the
Sarbanes-Oxley Act of 2002, as amended, that are effective as of the date hereof, and any and all applicable rules and regulations promulgated
by the Commission thereunder that are effective as of the date hereof. The Company and the Subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s
general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity
with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general
or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals
and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established disclosure controls
and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure
controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the
Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms.
The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and
the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date, the
“Evaluation Date”). The Company presented in its most recently filed periodic report under the Exchange Act the conclusions
of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation
Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as such term is defined
in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely to materially affect,
the internal control over financial reporting of the Company and its Subsidiaries.
(z)
Certain Fees. Other than payments to be made to the Manager, no brokerage or finder’s fees or commissions are or will be
payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker,
bank or other Person with respect to the transactions contemplated by this Agreement. The Manager shall have no obligation with respect
to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that
may be due in connection with the transactions contemplated by this Agreement.
(aa)
No Other Sales Agency Agreement. The Company has not entered into any other sales agency agreements or other similar arrangements
with any agent or any other representative in respect of at the market offerings of the Shares.
(bb)
Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares from
the Manager pursuant to this Agreement, will not be or be an Affiliate of, an “investment company” within the meaning of
the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an “investment
company” subject to registration under the Investment Company Act of 1940, as amended. The Company shall conduct its business in
a manner so as to reasonably ensure that it or its Subsidiaries will not become an “investment company” subject to registration
under the Investment Company Act of 1940, as amended.
(cc)
Listing and Maintenance Requirements. The Common Stock is listed on the Trading Market and the issuance of the Shares as contemplated
by this Agreement does not contravene the rules and regulations of the Trading Market. The Common Stock is registered pursuant to Section
12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the
effect of, terminating the registration of the Common Stock under the Exchange Act nor has the Company received any notification that
the Commission is contemplating terminating such registration. The Company has not, in the 12 months preceding the date hereof, received
notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance
with the listing or maintenance requirements of such Trading Market. The Company is, and has no reason to believe that it will not in
the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Common Stock is currently
eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is
current in payment of the fees to the Depository Trust Company (or such other established clearing corporation) in connection with such
electronic transfer.
(dd)
Application of Takeover Protections. The Company and the Board have taken all necessary action, if any, in order to render inapplicable
any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar
anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of its state
of incorporation that is or could become applicable to the Shares.
(ee)
Solvency. Based on the consolidated financial condition of the Company as of the date hereof, (i) the fair saleable value of the
Company’s assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and
other liabilities (including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably
small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account
the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital
availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to
liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or
in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability
to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt) within
one year from the date hereof. The Company has no knowledge of any facts or circumstances which lead it to believe that it will file
for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the date hereof.
The SEC Reports set forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary,
or for which the Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means
(x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary
course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether
or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties
by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (z)
the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with GAAP. Neither
the Company nor any Subsidiary is in default with respect to any Indebtedness.
(ff)
Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a
Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income
and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii)
has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such
returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material
taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material
amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no
basis for any such claim.
(gg)
Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any
agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful
payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate
funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf
of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt
Practices Act of 1977, as amended.
(hh)
Accountants. The Company’s accounting firm is set forth in the SEC Reports. To the knowledge and belief of the Company,
such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with
respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending December 31, 2024.
(ii)
Regulation M Compliance. The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly,
any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate
the sale or resale of any of the Shares, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of
the Shares, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of
the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Manager in connection with the Shares.
(jj)
FDA. As to each product subject to the jurisdiction of the U.S. Food and Drug Administration (“FDA”) under
the Federal Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (“FDCA”) that is manufactured,
packaged, labeled, tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each such product, a “Pharmaceutical
Product”), such Pharmaceutical Product is being manufactured, packaged, labeled, tested, distributed, sold and/or marketed
by or on behalf of the Company in compliance with all applicable requirements under FDCA and similar laws, rules and regulations relating
to registration, investigational use, premarket clearance, licensure, or application approval, good manufacturing practices, good laboratory
practices, good clinical practices, product listing, quotas, labeling, advertising, record keeping and filing of reports, except where
the failure to be in compliance would not have a Material Adverse Effect. There is no pending, completed or, to the Company’s knowledge,
threatened, action (including any lawsuit, arbitration, or legal or administrative or regulatory proceeding, charge, complaint, or investigation)
against the Company or any of its Subsidiaries, and none of the Company or any of its Subsidiaries has received any notice, warning letter
or other communication from the FDA or any other governmental entity, which (i) contests the premarket clearance, licensure, registration,
or approval of, the uses of, the distribution of, the manufacturing or packaging of, the testing of, the sale of, or the labeling and
promotion of any Pharmaceutical Product, (ii) withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws
or orders the withdrawal of advertising or sales promotional materials relating to, any Pharmaceutical Product, (iii) imposes a clinical
hold on any clinical investigation by the Company or any of its Subsidiaries, (iv) enjoins production at any facility of the Company
or any of its Subsidiaries, (v) enters or proposes to enter into a consent decree of permanent injunction with the Company or any of
its Subsidiaries, or (vi) otherwise alleges any violation of any laws, rules or regulations by the Company or any of its Subsidiaries,
and which, either individually or in the aggregate, would have a Material Adverse Effect. The properties, business and operations of
the Company have been and are being conducted in all material respects in accordance with all applicable laws, rules and regulations
of the FDA. The Company has not been informed by the FDA that the FDA will prohibit the marketing, sale, license or use in the United
States of any product proposed to be developed, produced or marketed by the Company nor has the FDA expressed any concern as to approving
or clearing for marketing any product being developed or proposed to be developed by the Company.
(kk)
Stock Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance
with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value of the
Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the
Company’s stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company
policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the
release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results or
prospects.
(ll)
Cybersecurity. (i)(x) There has been no security breach or other compromise of or relating to any of the Company’s or any
Subsidiary’s information technology and computer systems, networks, hardware, software, data (including the data of its respective
customers, employees, suppliers, vendors and any third party data maintained by or on behalf of it), equipment or technology (collectively,
“IT Systems and Data”) and (y) the Company and the Subsidiaries have not been notified of, and has no knowledge of
any event or condition that would reasonably be expected to result in, any security breach or other compromise to its IT Systems and
Data; (ii) the Company and the Subsidiaries are presently in compliance with all applicable laws or statutes and all judgments, orders,
rules and regulations of any court or arbitrator or governmental or regulatory authority, internal policies and contractual obligations
relating to the privacy and security of IT Systems and Data and to the protection of such IT Systems and Data from unauthorized use,
access, misappropriation or modification, except as would not, individually or in the aggregate, have a Material Adverse Effect; (iii)
the Company and the Subsidiaries have implemented and maintained commercially reasonable safeguards to maintain and protect its material
confidential information and the integrity, continuous operation, redundancy and security of all IT Systems and Data; and (iv) the Company
and the Subsidiaries have implemented backup and disaster recovery technology consistent with industry standards and practices.
(mm)
Compliance with Data Privacy Laws. (i) The Company and the Subsidiaries are, and at all times during the past three years were,
in compliance with all applicable data privacy and security laws and regulations, including, as applicable, the European Union General
Data Protection Regulation (“GDPR”) (EU 2016/679) (collectively, “Privacy Laws”); (ii) the Company
and the Subsidiaries have in place, comply with, and take appropriate steps reasonably designed to ensure compliance with their policies
and procedures relating to data privacy and security and the collection, storage, use, disclosure, handling and analysis of Personal
Data (the “Policies”); (iii) the Company provides accurate notice of its applicable Policies to its customers, employees,
third party vendors and representatives as required by Privacy Laws; and (iv) applicable Policies provide accurate and sufficient notice
of the Company’s then-current privacy practices relating to its subject matter, and do not contain any material omissions of the
Company’s then-current privacy practices, as required by Privacy Laws. “Personal Data” means (i) a natural person’s
name, street address, telephone number, email address, photograph, social security number, bank information, or customer or account number;
(ii) any information which would qualify as “personally identifying information” under the Federal Trade Commission Act,
as amended; (iii) “personal data” as defined by GDPR; and (iv) any other piece of information that allows the identification
of such natural person, or his or her family, or permits the collection or analysis of any identifiable data related to an identified
person’s health or sexual orientation. (i) None of such disclosures made or contained in any of the Policies have been inaccurate,
misleading, or deceptive in violation of any Privacy Laws and (ii) the execution, delivery and performance of this Agreement will not
result in a breach of any Privacy Laws or Policies. Neither the Company nor the Subsidiaries, (i) has, to the knowledge of the Company,
received written notice of any actual or potential liability of the Company or the Subsidiaries under, or actual or potential violation
by the Company or the Subsidiaries of, any of the Privacy Laws; (ii) is currently conducting or paying for, in whole or in part, any
investigation, remediation or other corrective action pursuant to any regulatory request or demand pursuant to any Privacy Law; or (iii)
is a party to any order, decree, or agreement by or with any court or arbitrator or governmental or regulatory authority that imposed
any obligation or liability under any Privacy Law.
(nn)
Office of Foreign Assets Control. Neither the Company nor any of its Subsidiaries, nor to the knowledge of the Company, any of
the directors, officers or employees of the Company or its Subsidiaries, is an individual or entity that is, or is owned or controlled
by an individual or entity that is: (i) the subject of any sanctions administered or enforced by the U.S. Department of Treasury’s
Office of Foreign Assets Control, the United Nations Security Council, the European Union, Her Majesty’s Treasury, or other relevant
sanctions authority (collectively, “Sanctions”), nor (ii) located, organized or resident in a country or territory
that is the subject of Sanctions. Neither the Company nor any of its Subsidiaries will, directly or indirectly, use the proceeds of the
transactions contemplated hereby, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner
or other individual or entity: (i) to fund or facilitate any activities or business of or with any individual or entity or in any country
or territory that, at the time of such funding or facilitation, is the subject of Sanctions or (ii) in any other manner that will result
in a violation of Sanctions by any individual or entity (including any individual or entity participating in the transactions contemplated
hereby, whether as underwriter, advisor, investor or otherwise). For the past five years, neither the Company nor any of its Subsidiaries
has knowingly engaged in, and is not now knowingly engaged in, any dealings or transactions with any individual or entity, or in any
country or territory, that at the time of the dealing or transaction is or was the subject of Sanctions.
(oo)
U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within
the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon the Manager’s
request.
(pp)
Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company
Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the
“Federal Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly,
five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent (25%) or more of the total
equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its
Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject
to the BHCA and to regulation by the Federal Reserve.
(qq)
Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with
applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended,
applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”),
and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company
or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.
(rr)
FINRA Member Shareholders. There are no affiliations with any FINRA member firm among the Company’s officers, directors
or, to the knowledge of the Company, any five percent (5%) or greater stockholder of the Company, except as set forth in the Registration
Statement, the Base Prospectus, any Prospectus Supplement or the Prospectus.
4.
Agreements. The Company agrees with the Manager that:
(a)
Right to Review Amendments and Supplements to Registration Statement and Prospectus. During any period when the delivery of a
prospectus relating to the Shares is required (including in circumstances where such requirement may be satisfied pursuant to Rule 172,
173 or any similar rule) to be delivered under the Act in connection with the offering or the sale of Shares, the Company will not file
any amendment to the Registration Statement or supplement (including any Prospectus Supplement) to the Base Prospectus unless the Company
has furnished to the Manager a copy for its review prior to filing and will not file any such proposed amendment or supplement to which
the Manager reasonably objects. The Company will cause any supplement to the Prospectus filed after the Effective Time to be properly
completed, in a form approved by the Manager, and will file such supplement with the Commission pursuant to the applicable paragraph
of Rule 424(b) within the time period prescribed thereby and will provide evidence reasonably satisfactory to the Manager of such timely
filing. The Company will promptly advise the Manager (i) when the Prospectus, and any supplement thereto, shall have been filed (if required)
with the Commission pursuant to Rule 424(b), (ii) when, during any period when the delivery of a prospectus (whether physically or through
compliance with Rule 172, 173 or any similar rule) is required under the Act in connection with the offering or sale of the Shares, any
amendment to the Registration Statement shall have been filed or become effective (other than any annual report of the Company filed
pursuant to Section 13(a) or 15(d) of the Exchange Act), (iii) of any request by the Commission or its staff for any amendment of the
Registration Statement, or for any supplement to the Prospectus or for any additional information, (iv) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement or of any notice objecting to its use or the institution
or threatening of any proceeding for that purpose and (v) of the receipt by the Company of any notification with respect to the suspension
of the qualification of the Shares for sale in any jurisdiction or the institution or threatening of any proceeding for such purpose.
The Company will use its best efforts to prevent the issuance of any such stop order or the occurrence of any such suspension or objection
to the use of the Registration Statement and, upon such issuance, occurrence or notice of objection, to obtain as soon as possible the
withdrawal of such stop order or relief from such occurrence or objection, including, if necessary, by filing an amendment to the Registration
Statement or a new registration statement and using its best efforts to have such amendment or new registration statement declared effective
as soon as practicable.
(b)
Subsequent Events. If, at any time on or after an Applicable Time but prior to the related Settlement Date, any event occurs as
a result of which the Registration Statement or Prospectus would include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the light of the circumstances under which they were made or the circumstances
then prevailing not misleading, the Company will (i) notify promptly the Manager so that any use of the Registration Statement or Prospectus
may cease until such are amended or supplemented; (ii) amend or supplement the Registration Statement or Prospectus to correct such statement
or omission; and (iii) supply any such amendment or supplement to the Manager in such quantities as the Manager may reasonably request.
(c)
Notification of Subsequent Filings. During any period when the delivery of a prospectus relating to the Shares is required (including
in circumstances where such requirement may be satisfied pursuant to Rule 172, 173 or any similar rule) to be delivered under the Act,
any event occurs as a result of which the Prospectus as then supplemented would include any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein in the light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend the Registration Statement, file a new registration statement or supplement the Prospectus
to comply with the Act or the Exchange Act or the respective rules thereunder, including in connection with use or delivery of the Prospectus,
the Company promptly will (i) notify the Manager of any such event, (ii) subject to Section 4(a), prepare and file with the Commission
an amendment or supplement or new registration statement which will correct such statement or omission or effect such compliance, (iii)
use its best efforts to have any amendment to the Registration Statement or new registration statement declared effective as soon as
practicable in order to avoid any disruption in use of the Prospectus and (iv) supply any supplemented Prospectus to the Manager in such
quantities as the Manager may reasonably request.
(d)
Earnings Statements. As soon as practicable, the Company will make generally available to its security holders and to the Manager
an earnings statement or statements of the Company and its Subsidiaries which will satisfy the provisions of Section 11(a) of the Act
and Rule 158. For the avoidance of doubt, the Company’s compliance with the reporting requirements of the Exchange Act shall be
deemed to satisfy the requirements of this Section 4(d).
(e)
Delivery of Registration Statement. Upon the request of the Manager, the Company will furnish to the Manager and counsel for the
Manager, without charge, signed copies of the Registration Statement (including exhibits thereto) and, so long as delivery of a prospectus
by the Manager or dealer may be required by the Act (including in circumstances where such requirement may be satisfied pursuant to Rule
172, 173 or any similar rule), as many copies of the Prospectus and each Issuer Free Writing Prospectus and any supplement thereto as
the Manager may reasonably request. The Company will pay the expenses of printing or other production of all documents relating to the
offering.
(f)
Qualification of Shares. The Company will arrange, if necessary, for the qualification of the Shares for sale under the laws of
such jurisdictions as the Manager may designate and will maintain such qualifications in effect so long as required for the distribution
of the Shares; provided that in no event shall the Company be obligated to qualify to do business in any jurisdiction where it is not
now so qualified or to take any action that would subject it to service of process in suits, other than those arising out of the offering
or sale of the Shares, in any jurisdiction where it is not now so subject.
(g)
Free Writing Prospectus. The Company agrees that, unless it has or shall have obtained the prior written consent of the Manager,
and the Manager agrees with the Company that, unless it has or shall have obtained, as the case may be, the prior written consent of
the Company, it has not made and will not make any offer relating to the Shares that would constitute an Issuer Free Writing Prospectus
or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405) required to be filed by the Company
with the Commission or retained by the Company under Rule 433. Any such free writing prospectus consented to by the Manager or the Company
is hereinafter referred to as a “Permitted Free Writing Prospectus.” The Company agrees that (i) it has treated and
will treat, as the case may be, each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus and (ii) it has complied
and will comply, as the case may be, with the requirements of Rules 164 and 433 applicable to any Permitted Free Writing Prospectus,
including in respect of timely filing with the Commission, legending and record keeping.
(h)
Subsequent Equity Issuances. The Company shall not deliver any Sales Notice hereunder (and any Sales Notice previously delivered
shall not apply during such three Trading Days) for at least three (3) Trading Days prior to any date on which the Company or any Subsidiary
offers, sells, issues, contracts to sell, contracts to issue or otherwise disposes of, directly or indirectly, any other shares of Common
Stock or any Common Stock Equivalents (other than the Shares), subject to Manager’s right to waive this obligation, provided that,
without compliance with the foregoing obligation, the Company may issue and sell Common Stock pursuant to any employee equity plan, stock
ownership plan or dividend reinvestment plan of the Company in effect at the Execution Time and the Company may issue Common Stock issuable
upon the conversion or exercise of Common Stock Equivalents outstanding at the Execution Time.
(i)
Market Manipulation. Until the termination of this Agreement, the Company will not take, directly or indirectly, any action designed
to or that would constitute or that might reasonably be expected to cause or result in, under the Exchange Act or otherwise, stabilization
or manipulation in violation of the Act, Exchange Act or the rules and regulations thereunder of the price of any security of the Company
to facilitate the sale or resale of the Shares or otherwise violate any provision of Regulation M under the Exchange Act.
(j)
Notification of Incorrect Certificate. The Company will, at any time during the term of this Agreement, as supplemented from time
to time, advise the Manager immediately after it shall have received notice or obtained knowledge thereof, of any information or fact
that would alter or affect any opinion, certificate, letter and other document provided to the Manager pursuant to Section 6 herein.
(k)
Certification of Accuracy of Disclosure. Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement
of the offering of the Shares under this Agreement following the termination of a suspension of sales hereunder lasting more than 30
Trading Days), and each time that (i) the Registration Statement or Prospectus shall be amended or supplemented, other than by means
of Incorporated Documents, (ii) the Company files its Annual Report on Form 10-K under the Exchange Act, (iii) the Company files its
quarterly reports on Form 10-Q under the Exchange Act, (iv) the Company files a Current Report on Form 8-K containing amended financial
information (other than information that is furnished and not filed), if the Manager reasonably determines that the information in such
Form 8-K is material, or (v) the Shares are delivered to the Manager as principal at the Time of Delivery pursuant to a Terms Agreement
(such commencement or recommencement date and each such date referred to in (i), (ii), (iii), (iv) and (v) above, a “Representation
Date”), unless waived by the Manager, the Company shall furnish or cause to be furnished to the Manager forthwith a certificate
dated and delivered on the Representation Date, in form reasonably satisfactory to the Manager to the effect that the statements contained
in the certificate referred to in Section 6 of this Agreement which were last furnished to the Manager are true and correct at the Representation
Date, as though made at and as of such date (except that such statements shall be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to such date) or, in lieu of such certificate, a certificate of the same tenor as the certificate
referred to in said Section 6, modified as necessary to relate to the Registration Statement and the Prospectus as amended and supplemented
to the date of delivery of such certificate.
(l)
Bring Down Opinions; Negative Assurance. Within five (5) Trading Days of each Representation Date, unless waived by the Manager,
the Company shall furnish or cause to be furnished forthwith to the Manager and to counsel to the Manager a written opinion of counsel
to the Company (“Company Counsel”) addressed to the Manager and dated and delivered within five (5) Trading Days of
such Representation Date, in form and substance reasonably satisfactory to the Manager, including a negative assurance representation.
The requirement to furnish or cause to be furnished an opinion (but not with respect to a negative assurance representation) under this
Section 4(l) shall be waived for any Representation Date other than a Representation Date on which a material amendment to the Registration
Statement or Prospectus is made or the Company files its Annual Report on Form 10-K or a material amendment thereto under the Exchange
Act, unless the Manager reasonably requests such deliverable required by this Section 4(l) in connection with a Representation Date,
upon which request such deliverable shall be deliverable hereunder.
(m)
Auditor Bring Down “Comfort” Letter. Within five (5) Trading Days of each Representation Date, unless waived by the
Manager, the Company shall cause (1) the Company’s auditors (the “Accountants”), or other independent accountants
satisfactory to the Manager forthwith to furnish the Manager a letter, and (2) the Chief Financial Officer of the Company forthwith to
furnish the Manager a certificate, in each case dated within five (5) Trading Days of such Representation Date, in form and substance
reasonably satisfactory to the Manager, of the same tenor as the letters and certificate referred to in Section 6 of this Agreement but
modified to relate to the Registration Statement and the Prospectus, as amended and supplemented to the date of such letters and certificate.
The requirement to furnish or cause to be furnished a “comfort” letter under this Section 4(m) shall be waived for any Representation
Date other than a Representation Date on which a material amendment to the Registration Statement or Prospectus is made or the Company
files its Annual Report on Form 10-K or a material amendment thereto under the Exchange Act, unless the Manager reasonably requests the
deliverables required by this Section 4(m) in connection with a Representation Date, upon which request such deliverable shall be deliverable
hereunder.
(n)
Due Diligence Session. Upon commencement of the offering of the Shares under this Agreement (and upon the recommencement of the
offering of the Shares under this Agreement following the termination of a suspension of sales hereunder lasting more than 30 Trading
Days), and at each Representation Date, the Company will conduct a due diligence session, in form and substance, reasonably satisfactory
to the Manager, which shall include representatives of management and Accountants. The Company shall cooperate timely with any reasonable
due diligence request from or review conducted by the Manager or its agents from time to time in connection with the transactions contemplated
by this Agreement, including, without limitation, providing information and available documents and access to appropriate corporate officers
and the Company’s agents during regular business hours, and timely furnishing or causing to be furnished such certificates, letters
and opinions from the Company, its officers and its agents, as the Manager may reasonably request. The Company shall reimburse the Manager
for Manager’s counsel’s fees in each such due diligence update session, up to a maximum of $2,500 per update, plus any incidental
expense incurred by the Manager in connection therewith.
(o)
Acknowledgment of Trading. The Company consents to the Manager trading in the Common Stock for the Manager’s own account
and for the account of its clients at the same time as sales of the Shares occur pursuant to this Agreement or pursuant to a Terms Agreement.
(p)
Disclosure of Shares Sold. The Company will disclose in its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, as
applicable, the number of Shares sold through the Manager under this Agreement, the Net Proceeds to the Company and the compensation
paid by the Company with respect to sales of Shares pursuant to this Agreement during the relevant quarter; and, if required by any subsequent
change in Commission policy or request, more frequently by means of a Current Report on Form 8-K or a further Prospectus Supplement.
(q)
Rescission Right. If to the knowledge of the Company, the conditions set forth in Section 6 shall not have been satisfied as of
the applicable Settlement Date, the Company will offer to any person who has agreed to purchase Shares from the Company as the result
of an offer to purchase solicited by the Manager the right to refuse to purchase and pay for such Shares.
(r)
Bring Down of Representations and Warranties. Each acceptance by the Company of an offer to purchase the Shares hereunder, and
each execution and delivery by the Company of a Terms Agreement, shall be deemed to be an affirmation to the Manager that the representations
and warranties of the Company contained in or made pursuant to this Agreement are true and correct in all material respects as of the
date of such acceptance or of such Terms Agreement as though made at and as of such date, and an undertaking that such representations
and warranties will be true and correct as of the Settlement Date for the Shares relating to such acceptance or as of the Time of Delivery
relating to such sale, as the case may be, as though made at and as of such date (except that such representations and warranties shall
be deemed to relate to the Registration Statement and the Prospectus as amended and supplemented relating to such Shares).
(s)
Reservation of Shares. The Company shall ensure that there are at all times sufficient shares of Common Stock to provide for the
issuance, free of any preemptive rights, out of its authorized but unissued shares of Common Stock or shares of Common Stock held in
treasury, of the maximum aggregate number of Shares authorized for issuance by the Board pursuant to the terms of this Agreement. The
Company will use its commercially reasonable efforts to cause the Shares to be listed for trading on the Trading Market and to maintain
such listing.
(t)
Obligation Under Exchange Act. During any period when the delivery of a prospectus relating to the Shares is required (including
in circumstances where such requirement may be satisfied pursuant to Rule 172, 173 or any similar rule) to be delivered under the Act,
the Company 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 the regulations thereunder.
(u)
DTC Facility. The Company shall cooperate with the Manager and use its reasonable efforts to permit the Shares to be eligible
for clearance and settlement through the facilities of DTC.
(v)
Use of Proceeds. The Company will apply the Net Proceeds from the sale of the Shares in the manner set forth in the Prospectus.
(w)
Filing of Prospectus Supplement. If any sales are made pursuant to this Agreement which are not made in “at the market”
offerings as defined in Rule 415, including, without limitation, any Placement pursuant to a Terms Agreement, the Company shall file
a Prospectus Supplement describing the terms of such transaction, the amount of Shares sold, the price thereof, the Manager’s compensation,
and such other information as may be required pursuant to Rule 424 and Rule 430B, as applicable, within the time required by Rule 424.
(x)
Additional Registration Statement. To the extent that the Registration Statement is not available for the sales of the Shares
as contemplated by this Agreement, the Company shall file a new registration statement with respect to any additional shares of Common
Stock necessary to complete such sales of the Shares and shall cause such registration statement to become effective as promptly as practicable.
After the effectiveness of any such registration statement, all references to “Registration Statement” included in
this Agreement shall be deemed to include such new registration statement, including all documents incorporated by reference therein
pursuant to Item 12 of Form S-3, and all references to “Base Prospectus” included in this Agreement shall be deemed
to include the final form of prospectus, including all documents incorporated therein by reference, included in any such registration
statement at the time such registration statement became effective.
5.
Payment of Expenses. The Company agrees to pay the costs and expenses incident to the performance of its obligations under this
Agreement, whether or not the transactions contemplated hereby are consummated, including without limitation: (i) the preparation, printing
or reproduction and filing with the Commission of the Registration Statement (including financial statements and exhibits thereto), the
Prospectus and each Issuer Free Writing Prospectus, and each amendment or supplement to any of them; (ii) the printing (or reproduction)
and delivery (including postage, air freight charges and charges for counting and packaging) of such copies of the Registration Statement,
the Prospectus, and each Issuer Free Writing Prospectus, and all amendments or supplements to any of them, as may, in each case, be reasonably
requested for use in connection with the offering and sale of the Shares; (iii) the preparation, printing, authentication, issuance and
delivery of certificates for the Shares, including any stamp or transfer taxes in connection with the original issuance and sale of the
Shares; (iv) the printing (or reproduction) and delivery of this Agreement, any blue sky memorandum and all other agreements or documents
printed (or reproduced) and delivered in connection with the offering of the Shares; (v) the registration of the Shares under the Exchange
Act, if applicable, and the listing of the Shares on the Trading Market; (vi) any registration or qualification of the Shares for offer
and sale under the securities or blue sky laws of the several states (including filing fees and the reasonable fees and expenses of counsel
for the Manager relating to such registration and qualification); (vii) the transportation and other expenses incurred by or on behalf
of Company representatives in connection with presentations to prospective purchasers of the Shares; (viii) the fees and expenses of
the Company’s accountants and the fees and expenses of counsel (including local and special counsel) for the Company; (ix) the
filing fee under FINRA Rule 5110; (x) the reasonable fees and expenses of the Manager’s counsel, not to exceed $50,000 (excluding
any periodic due diligence fees provided for under Section 4(n)), which shall be paid upon the Effective Time; and (xi) all other costs
and expenses incident to the performance by the Company of its obligations hereunder.
6.
Conditions to the Obligations of the Manager. The obligations of the Manager under this Agreement and any Terms Agreement shall
be subject to (i) the accuracy of the representations and warranties on the part of the Company contained herein as of the Execution
Time, each Representation Date, and as of each Applicable Time, Settlement Date and Time of Delivery, (ii) the performance by the Company
of its obligations hereunder and (iii) the following additional conditions:
(a)
Effectiveness of the Registration Statement; Filing of Prospectus Supplement. The Registration Statement shall have been declared
effective by the Commission and the Prospectus, and any supplement thereto, required by Rule 424 to be filed with the Commission shall
have been filed in the manner and within the time period required by Rule 424(b) with respect to any sale of Shares; each Prospectus
Supplement filed after the Effective Time shall have been filed in the manner required by Rule 424(b) within the time period required
hereunder and under the Act; any other material required to be filed by the Company pursuant to Rule 433(d) under the Act, shall have
been filed with the Commission within the applicable time periods prescribed for such filings by Rule 433; and no stop order suspending
the effectiveness of the Registration Statement or any notice objecting to its use shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(b)
Delivery of Opinion. The Company shall have caused the Company Counsel to furnish to the Manager its opinion and negative assurance
statement, dated as of such date and addressed to the Manager in form and substance acceptable to the Manager.
(c)
Delivery of Officer’s Certificate. The Company shall have furnished or caused to be furnished to the Manager a certificate
of the Company signed by the Chief Executive Officer or the President and the principal financial or accounting officer of the Company,
dated as of such date, to the effect that the signers of such certificate have carefully examined the Registration Statement, the Prospectus,
any Prospectus Supplement and any documents incorporated by reference therein and any supplements or amendments thereto and this Agreement
and that:
(i)
the representations and warranties of the Company in this Agreement are true and correct on and as of such date with the same effect
as if made on such date and the Company has complied with all the agreements and satisfied all the conditions on its part to be performed
or satisfied at or prior to such date;
(ii)
no stop order suspending the effectiveness of the Registration Statement or any notice objecting to its use has been issued and no proceedings
for that purpose have been instituted or, to the Company’s knowledge, threatened; and
(iii)
since the date of the most recent financial statements included in the Registration Statement, the Prospectus and the Incorporated Documents,
there has been no Material Adverse Effect on the condition (financial or otherwise), earnings, business or properties of the Company
and its subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary course of business, except as set forth
in or contemplated in the Registration Statement and the Prospectus.
(d)
Delivery of Accountants’ “Comfort” Letter . Subject to Section 4(m) of this Agreement, the Company shall
have requested and caused the Accountants to have furnished to the Manager letters (which may refer to letters previously delivered to
the Manager), dated as of such date, in form and substance satisfactory to the Manager, confirming that they are independent accountants
within the meaning of the Act and the Exchange Act and the respective applicable rules and regulations adopted by the Commission thereunder
and that they have performed a review of any unaudited interim financial information of the Company included or incorporated by reference
in the Registration Statement and the Prospectus and provide customary “comfort” as to such review in form and substance
satisfactory to the Manager.
(e)
No Material Adverse Event. Since the respective dates as of which information is disclosed in the Registration Statement, the
Prospectus and the Incorporated Documents, except as otherwise stated therein, there shall not have been (i) any change or decrease in
previously reported results specified in the letter or letters referred to in paragraph (d) of this Section 6 or (ii) any change, or
any development involving a prospective change, in or affecting the condition (financial or otherwise), earnings, business or properties
of the Company and its subsidiaries taken as a whole, whether or not arising from transactions in the ordinary course of business, except
as set forth in or contemplated in the Registration Statement, the Prospectus and the Incorporated Documents (exclusive of any amendment
or supplement thereto) the effect of which, in any case referred to in clause (i) or (ii) above, is, in the sole judgment of the Manager,
so material and adverse as to make it impractical or inadvisable to proceed with the offering or delivery of the Shares as contemplated
by the Registration Statement (exclusive of any amendment thereof), the Incorporated Documents and the Prospectus (exclusive of any amendment
or supplement thereto).
(f)
Payment of All Fees. The Company shall have paid the required Commission filing fees relating to the Shares within the time period
required by Rule 456(b)(1)(i) of the Act without regard to the proviso therein and otherwise in accordance with Rules 456(b) and 457(r)
of the Act and, if applicable, shall have updated the “Calculation of Registration Fee” table in accordance with Rule 456(b)(1)(ii)
either in a post-effective amendment to the Registration Statement or on the cover page of a prospectus filed pursuant to Rule 424(b).
(g)
No FINRA Objections. FINRA shall not have raised any objection with respect to the fairness and reasonableness of the terms and
arrangements under this Agreement.
(h)
Shares Listed on Trading Market. The Shares shall have been listed and admitted and authorized for trading on the Trading Market,
and satisfactory evidence of such actions shall have been provided to the Manager.
(i)
Other Assurances. Prior to each Settlement Date and Time of Delivery, as applicable, the Company shall have furnished to the Manager
such further information, certificates and documents as the Manager may reasonably request.
If
any of the conditions specified in this Section 6 shall not have been fulfilled when and as provided in this Agreement, or if any of
the opinions and certificates mentioned above or elsewhere in this Agreement shall not be reasonably satisfactory in form and substance
to the Manager and counsel for the Manager, this Agreement and all obligations of the Manager hereunder may be canceled at, or at any
time prior to, any Settlement Date or Time of Delivery, as applicable, by the Manager. Notice of such cancellation shall be given to
the Company in writing or by telephone and confirmed in writing by electronic mail.
The
documents required to be delivered by this Section 6 shall be delivered to the office of Ellenoff Grossman & Schole LLP, counsel
for the Manager, at 1345 Avenue of the Americas, New York, New York 10105, email: capmkts@egsllp.com, on each such date as provided in
this Agreement.
7.
Indemnification and Contribution.
(a)
Indemnification by Company. The Company agrees to indemnify and hold harmless the Manager, the directors, officers, employees
and agents of the Manager and each person who controls the Manager within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to which they or any of them may become subject under the Act, the
Exchange Act or other Federal or state statutory law or regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement for the registration of the Shares as originally filed or in any amendment thereof, or in
the Base Prospectus, any Prospectus Supplement, the Prospectus, any Issuer Free Writing Prospectus, or in any amendment thereof or supplement
thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading or result from or relate to any breach of any of the representations, warranties,
covenants or agreements made by the Company in this Agreement, and agrees to reimburse each such indemnified party for any legal or other
expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Company will not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon any such untrue statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to the Company by the Manager specifically for inclusion
therein. This indemnity agreement will be in addition to any liability that the Company may otherwise have.
(b)
Indemnification by Manager. The Manager agrees to indemnify and hold harmless the Company, each of its directors, each of its
officers who signs the Registration Statement, and each person who controls the Company within the meaning of either the Act or the Exchange
Act, to the same extent as the foregoing indemnity from the Company to the Manager, but only with reference to written information relating
to the Manager furnished to the Company by the Manager specifically for inclusion in the documents referred to in the foregoing indemnity;
provided, however, that in no case shall the Manager be responsible for any amount in excess of the Broker Fee applicable
to the Shares and paid hereunder. This indemnity agreement will be in addition to any liability which the Manager may otherwise have.
(c)
Indemnification Procedures. Promptly after receipt by an indemnified party under this Section 7 of notice of the commencement
of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under this Section
7, notify the indemnifying party in writing of the commencement thereof; but the failure so to notify the indemnifying party (i) will
not relieve it from liability under paragraph (a) or (b) above unless and to the extent it did not otherwise learn of such action and
such failure results in the forfeiture by the indemnifying party of substantial rights and defenses and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified party other than the indemnification obligation provided in paragraph
(a) or (b) above. The indemnifying party shall be entitled to appoint counsel of the indemnifying party’s choice at the indemnifying
party’s expense to represent the indemnified party in any action for which indemnification is sought (in which case the indemnifying
party shall not thereafter be responsible for the fees and expenses of any separate counsel retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be reasonably satisfactory to the indemnified party.
Notwithstanding the indemnifying party’s election to appoint counsel to represent the indemnified party in an action, the indemnified
party shall have the right to employ separate counsel (including local counsel), and the indemnifying party shall bear the reasonable
fees, costs and expenses of such separate counsel if (i) the use of counsel chosen by the indemnifying party to represent the indemnified
party would present such counsel with a conflict of interest, (ii) the actual or potential defendants in, or targets of, any such action
include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that there may
be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying
party, (iii) the indemnifying party shall not have employed counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution of such action or (iv) the indemnifying party shall authorize
the indemnified party to employ separate counsel at the expense of the indemnifying party. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise or consent to the entry of any judgment with respect to any pending
or threatened claim, action, suit or proceeding in respect of which indemnification or contribution may be sought hereunder (whether
or not the indemnified parties are actual or potential parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability arising out of such claim, action, suit or proceeding.
(d)
Contribution. In the event that the indemnity provided in paragraph (a), (b) or (c) of this Section 7 is unavailable to or insufficient
to hold harmless an indemnified party for any reason, the Company and the Manager agree to contribute to the aggregate losses, claims,
damages and liabilities (including legal or other expenses reasonably incurred in connection with investigating or defending the same)
(collectively “Losses”) to which the Company and the Manager may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and by the Manager on the other from the offering of the Shares;
provided, however, that in no case shall the Manager be responsible for any amount in excess of the Broker Fee applicable
to the Shares and paid hereunder. If the allocation provided by the immediately preceding sentence is unavailable for any reason, the
Company and the Manager severally shall contribute in such proportion as is appropriate to reflect not only such relative benefits but
also the relative fault of the Company on the one hand and of the Manager on the other in connection with the statements or omissions
which resulted in such Losses as well as any other relevant equitable considerations. Benefits received by the Company shall be deemed
to be equal to the total net proceeds from the offering (before deducting expenses) received by it, and benefits received by the Manager
shall be deemed to be equal to the Broker Fee applicable to the Shares and paid hereunder as determined by this Agreement. Relative fault
shall be determined by reference to, among other things, whether any untrue or any alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information provided by the Company on the one hand or the Manager on
the other, the intent of the parties and their relative knowledge, access to information and opportunity to correct or prevent such untrue
statement or omission. The Company and the Manager agree that it would not be just and equitable if contribution were determined by pro
rata allocation or any other method of allocation which does not take account of the equitable considerations referred to above. Notwithstanding
the provisions of this paragraph (d), no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section
7, each person who controls the Manager within the meaning of either the Act or the Exchange Act and each director, officer, employee
and agent of the Manager shall have the same rights to contribution as the Manager, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, each officer of the Company who shall have signed the Registration Statement and each
director of the Company shall have the same rights to contribution as the Company, subject in each case to the applicable terms and conditions
of this paragraph (d).
8.
Termination.
(a)
The Company shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating
to the solicitation of offers to purchase the Shares in its sole discretion at any time upon ten (10) Business Days’ prior written
notice. Any such termination shall be without liability of any party to any other party except that (i) with respect to any pending sale,
through the Manager for the Company, the obligations of the Company, including in respect of compensation of the Manager, shall remain
in full force and effect notwithstanding the termination and (ii) the provisions of Sections 5, 6, 7, 8, 9, 10, 12, 14 and 15 of this
Agreement shall remain in full force and effect notwithstanding such termination.
(b)
The Manager shall have the right, by giving written notice as hereinafter specified, to terminate the provisions of this Agreement relating
to the solicitation of offers to purchase the Shares in its sole discretion at any time upon ten (10) Business Days’ prior written
notice. Any such termination shall be without liability of any party to any other party except that the provisions of Sections 5, 6,
7, 8, 9, 10, 12, 14 and 15 of this Agreement shall remain in full force and effect notwithstanding such termination.
(c)
This Agreement shall remain in full force and effect until such date that this Agreement is terminated pursuant to Sections 8(a) or (b)
above or otherwise by mutual agreement of the parties, provided that any such termination by mutual agreement shall in all cases be deemed
to provide that Sections 5, 6, 7, 8, 9, 10, 12, 14 and 15 of this Agreement shall remain in full force and effect.
(d)
Any termination of this Agreement shall be effective on the date specified in such notice of termination, provided that such termination
shall not be effective until the close of business on the date of receipt of such notice by the Manager or the Company, as the case may
be. If such termination shall occur prior to the Settlement Date or Time of Delivery for any sale of the Shares, such sale of the Shares
shall settle in accordance with the provisions of Section 2(b) of this Agreement.
(e)
In the case of any purchase of Shares by the Manager pursuant to a Terms Agreement, the obligations of the Manager pursuant to such Terms
Agreement shall be subject to termination, in the absolute discretion of the Manager, by prompt oral notice given to the Company prior
to the Time of Delivery relating to such Shares, if any, and confirmed promptly by electronic mail, if since the time of execution of
the Terms Agreement and prior to such delivery and payment, (i) trading in the Common Stock shall have been suspended by the Commission
or the Trading Market or trading in securities generally on the Trading Market shall have been suspended or limited or minimum prices
shall have been established on such exchange, (ii) a banking moratorium shall have been declared either by Federal or New York State
authorities or (iii) there shall have occurred any outbreak or escalation of hostilities, declaration by the United States of a national
emergency or war, or other calamity or crisis the effect of which on financial markets is such as to make it, in the sole judgment of
the Manager, impractical or inadvisable to proceed with the offering or delivery of the Shares as contemplated by the Prospectus (exclusive
of any amendment or supplement thereto).
9.
Representations and Indemnities to Survive. The respective agreements, representations, warranties, indemnities and other statements
of the Company or its officers and of the Manager set forth in or made pursuant to this Agreement will remain in full force and effect,
regardless of any investigation made by the Manager or the Company or any of the officers, directors, employees, agents or controlling
persons referred to in Section 7, and will survive delivery of and payment for the Shares.
10.
Notices. All communications hereunder will be in writing and effective only on receipt, and will be mailed, delivered, or e-mailed
to the addresses of the Company and the Manager, respectively, set forth on the signature page hereto.
11.
Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto and their respective successors
and the officers, directors, employees, agents and controlling persons referred to in Section 7, and no other person will have any right
or obligation hereunder.
12.
No Fiduciary Duty. The Company hereby acknowledges that (a) the purchase and sale of the Shares pursuant to this Agreement is
an arm’s-length commercial transaction between the Company, on the one hand, and the Manager and any affiliate through which it
may be acting, on the other, (b) the Manager is acting solely as sales agent and/or principal in connection with the purchase and sale
of the Company’s securities and not as a fiduciary of the Company and (c) the Company’s engagement of the Manager in connection
with the offering and the process leading up to the offering is as independent contractors and not in any other capacity. Furthermore,
the Company agrees that it is solely responsible for making its own judgments in connection with the offering (irrespective of whether
the Manager has advised or is currently advising the Company on related or other matters). The Company agrees that it will not claim
that the Manager has rendered advisory services of any nature or respect, or owe an agency, fiduciary or similar duty to the Company,
in connection with such transaction or the process leading thereto.
13.
Integration. This Agreement and any Terms Agreement supersede all prior agreements and understandings (whether written or oral)
between the Company and the Manager with respect to the subject matter hereof.
14.
Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument
signed, in the case of an amendment, by the Company and the Manager. No waiver of any default with respect to any provision, condition
or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver
of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder
in any manner impair the exercise of any such right.
15.
Applicable Law. This Agreement and any Terms Agreement will be governed by and construed in accordance with the laws of the State
of New York applicable to contracts made and to be performed within the State of New York. Each of the Company and the Manager: (i) agrees
that any legal suit, action or proceeding arising out of or relating to this Agreement shall be instituted exclusively in New York Supreme
Court, County of New York, or in the United States District Court for the Southern District of New York, (ii) waives any objection which
it may have or hereafter to the venue of any such suit, action or proceeding, and (iii) irrevocably consents to the exclusive jurisdiction
of the New York Supreme Court, County of New York, and the United States District Court for the Southern District of New York in any
such suit, action or proceeding. Each of the Company and the Manager further agrees to accept and acknowledge service of any and all
process which may be served in any such suit, action or proceeding in the New York Supreme Court, County of New York, or in the United
States District Court for the Southern District of New York and agrees that service of process upon the Company mailed by certified mail
to the Company’s address shall be deemed in every respect effective service of process upon the Company, in any such suit, action
or proceeding, and service of process upon the Manager mailed by certified mail to the Manager’s address shall be deemed in every
respect effective service process upon the Manager, in any such suit, action or proceeding. If either party shall commence an action
or proceeding to enforce any provision of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed
by the other party for its reasonable attorney’s fees and other costs and expenses incurred with the investigation, preparation
and prosecution of such action or proceeding.
16.
Waiver of Jury Trial. The Company 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, any Terms Agreement or the transactions contemplated
hereby or thereby.
17.
Counterparts. This Agreement and any Terms Agreement may be executed in one or more counterparts, each one of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon one and the same agreement. Counterparts may be delivered
via electronic mail (including any electronic signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions
Act, the Electronic Signatures and Records Act or other applicable law, e.g., www.docusign.com) or other transmission method and any
counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.
***************************
18.
Headings. The section headings used in this Agreement and any Terms Agreement are for convenience only and shall not affect the
construction hereof.
If
the foregoing is in accordance with your understanding of our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement among the Company and the Manager.
Very
truly yours, |
|
|
|
|
Ainos,
Inc. |
|
|
|
|
By: |
/s/
Chun-Hsien Tsai |
|
Name:
|
Chun-Hsien
Tsai |
|
Title:
|
Chairman,
President and CEO |
|
Address
for Notice:
8880
Rio San Diego Drive
Ste.
800
San
Diego, California 92108
Attention:
Chun-Hsien Tsai
E-mail:
et@ainos.com
The
foregoing Agreement is hereby confirmed and accepted as of the date first written above.
H.C.
WAINWRIGHT & CO., LLC
By: |
/s/
Edward D. Silvera |
|
Name: |
Edward
D. Silvera |
|
Title: |
Chief
Operating Officer |
|
Address
for Notice:
430
Park Avenue
New
York, New York 10022
Attention:
Chief Executive Officer
E-mail:
notices@hcwco.com
Form
of Terms Agreement
ANNEX
I
Ainos,
Inc.
TERMS
AGREEMENT
Dear
Sirs:
Ainos,
Inc. (the “Company”) proposes, subject to the terms and conditions stated herein and in the At The Market Offering
Agreement, dated May 31, 2024 (the “At The Market Offering Agreement”), between the Company and H.C. Wainwright
& Co., LLC (“Manager”), to issue and sell to Manager the securities specified in the Schedule I hereto
(the “Purchased Shares”).
Each
of the provisions of the At The Market Offering Agreement not specifically related to the solicitation by the Manager, as agent of the
Company, of offers to purchase securities is incorporated herein by reference in its entirety, and shall be deemed to be part of this
Terms Agreement to the same extent as if such provisions had been set forth in full herein. Each of the representations and warranties
set forth therein shall be deemed to have been made at and as of the date of this Terms Agreement and the Time of Delivery, except that
each representation and warranty in Section 3 of the At The Market Offering Agreement which makes reference to the Prospectus (as therein
defined) shall be deemed to be a representation and warranty as of the date of the At The Market Offering Agreement in relation to the
Prospectus, and also a representation and warranty as of the date of this Terms Agreement and the Time of Delivery in relation to the
Prospectus as amended and supplemented to relate to the Purchased Shares.
An
amendment to the Registration Statement (as defined in the At The Market Offering Agreement), or a supplement to the Prospectus, as the
case may be, relating to the Purchased Shares, in the form heretofore delivered to the Manager is now proposed to be filed with the Securities
and Exchange Commission.
Subject
to the terms and conditions set forth herein and in the At The Market Offering Agreement which are incorporated herein by reference,
the Company agrees to issue and sell to the Manager and the latter agrees to purchase from the Company the number of shares of the Purchased
Shares at the time and place and at the purchase price set forth in the Schedule I hereto.
If
the foregoing is in accordance with your understanding, please sign and return to us a counterpart hereof, whereupon this Terms Agreement,
including those provisions of the At The Market Offering Agreement incorporated herein by reference, shall constitute a binding agreement
between the Manager and the Company.
Ainos,
Inc. |
|
|
|
|
By: |
|
|
Name: |
|
|
Title: |
|
|
ACCEPTED
as of the date first written above.
H.C.
WAINWRIGHT & CO., LLC |
|
|
|
|
By: |
|
|
Name: |
|
|
Title: |
|
|
Exhibit
4.1
AINOS,
INC.
AND
_______________________,
TRUSTEE
____________________
INDENTURE
DATED
AS OF
_______,
2024
DEBT
SECURITIES
AINOS,
INC.
RECONCILIATION
AND TIE BETWEEN TRUST INDENTURE ACT OF 1939
AND
INDENTURE, DATED AS OF _______ ___, 2024
Section
of Trust Indenture Act of 1939 |
|
Section(s)
of Indenture |
|
|
|
§
310(a)(1) |
|
609 |
(a)(2) |
|
609 |
(a)(3) |
|
Not
Applicable |
(a)(4) |
|
Not
Applicable |
(a)(5) |
|
609 |
(b) |
|
608,
610 |
§
311(a) |
|
613 |
(b) |
|
613 |
(c) |
|
Not
Applicable |
§
312(a) |
|
701,
702 (a) |
(b) |
|
702
(b) |
(c) |
|
702
(b) |
§
313(a) |
|
703
(a) |
(b) |
|
703
(a) |
(c) |
|
703
(a) |
(d) |
|
703
(b) |
§
314(a) |
|
704,
1005 |
(b) |
|
Not
Applicable |
(c)(1) |
|
103 |
(c)(2) |
|
103 |
(c)(3) |
|
Not
Applicable |
(d) |
|
Not
Applicable |
(e) |
|
103 |
§
315(a) |
|
601
(a) |
(b) |
|
602 |
(c) |
|
601
(b) |
(d) |
|
601
(c) |
(d)(1) |
|
601
(c) (1) |
(d)(2) |
|
601
(c) (2) |
(d)(3) |
|
601
(c) (3) |
(e) |
|
511 |
§
316(a)(1)(A) |
|
505 |
(a)(1)(B) |
|
504 |
(a)(2) |
|
Not
Applicable |
(a)(last
sentence) |
|
101 |
(b) |
|
507 |
(c) |
|
105 |
§
317(a)(1) |
|
503 |
(a)(2) |
|
509 |
(b) |
|
1003 |
§
318(a) |
|
108 |
(b) |
|
Not
Applicable |
(c) |
|
108 |
Note:
This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.
TABLE
OF CONTENTS
|
|
Page |
|
|
|
ARTICLE I DEFINITIONS
AND OTHER PROVISIONS OF GENERAL APPLICATION |
1 |
|
|
|
SECTION 101. |
DEFINITIONS. |
1 |
SECTION 102. |
INCORPORATION BY REFERENCE
OF TRUST INDENTURE ACT. |
7 |
SECTION 103. |
COMPLIANCE CERTIFICATES
AND OPINIONS. |
8 |
SECTION 104. |
FORM OF DOCUMENTS DELIVERED
TO TRUSTEE. |
8 |
SECTION 105. |
ACTS OF HOLDERS; RECORD
DATES. |
8 |
SECTION 106. |
NOTICES, ETC., TO TRUSTEE
AND COMPANY. |
9 |
SECTION 107. |
NOTICE TO HOLDERS; WAIVER. |
10 |
SECTION 108. |
CONFLICT WITH TRUST INDENTURE
ACT. |
10 |
SECTION 109. |
EFFECT OF HEADINGS AND
TABLE OF CONTENTS. |
10 |
SECTION 110. |
SUCCESSORS AND ASSIGNS. |
10 |
SECTION 111. |
SEPARABILITY CLAUSE. |
11 |
SECTION 112. |
BENEFITS OF INDENTURE. |
11 |
SECTION 113. |
GOVERNING LAW. |
11 |
SECTION 114. |
LEGAL HOLIDAYS. |
11 |
SECTION 115. |
CORPORATE OBLIGATION. |
11 |
SECTION 116. |
WAIVER OF TRIAL JURY. |
11 |
SECTION 117. |
FORCE MAJEURE. |
11 |
|
|
|
ARTICLE II
SECURITY FORMS |
12 |
|
|
|
SECTION 201. |
FORMS GENERALLY. |
12 |
SECTION 202. |
FORM OF TRUSTEE’S
CERTIFICATE OF AUTHENTICATION. |
12 |
SECTION 203. |
SECURITIES IN GLOBAL FORM. |
12 |
SECTION 204. |
BOOK-ENTRY SECURITIES. |
13 |
|
|
|
ARTICLE III
THE SECURITIES |
14 |
|
|
|
SECTION 301. |
AMOUNT UNLIMITED; ISSUABLE
IN SERIES. |
14 |
SECTION 302. |
DENOMINATIONS. |
16 |
SECTION 303. |
EXECUTION, AUTHENTICATION,
DELIVERY AND DATING. |
16 |
SECTION 304. |
TEMPORARY SECURITIES. |
17 |
SECTION 305. |
REGISTRATION, REGISTRATION
OF TRANSFER AND EXCHANGE. |
18 |
SECTION 306. |
MUTILATED, DESTROYED, LOST
AND STOLEN SECURITIES. |
19 |
SECTION 307. |
PAYMENT OF INTEREST; INTEREST
RIGHTS PRESERVED. |
19 |
SECTION 308. |
PERSONS DEEMED OWNERS. |
20 |
SECTION 309. |
CANCELLATION. |
20 |
SECTION 310. |
COMPUTATION OF INTEREST. |
21 |
SECTION 311. |
CUSIP NUMBERS. |
21 |
|
|
|
ARTICLE IV
SATISFACTION AND DISCHARGE; LEGAL DEFEASANCE AND COVENANT DEFEASANCE |
21 |
|
|
|
SECTION 401. |
SATISFACTION AND DISCHARGE
OF INDENTURE. |
21 |
SECTION 402. |
OPTION TO EFFECT LEGAL
DEFEASANCE OR COVENANT DEFEASANCE. |
22 |
|
|
|
SECTION 403. |
LEGAL DEFEASANCE AND DISCHARGE. |
22 |
SECTION 404. |
COVENANT DEFEASANCE. |
22 |
SECTION 405. |
CONDITIONS TO LEGAL OR
COVENANT DEFEASANCE. |
23 |
SECTION 406. |
DEPOSITED MONEY AND U.S.
GOVERNMENT OBLIGATIONS TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS. |
23 |
SECTION 407. |
REPAYMENT TO COMPANY. |
24 |
SECTION 408. |
REINSTATEMENT. |
24 |
|
|
|
ARTICLE V REMEDIES |
24 |
|
|
|
SECTION 501. |
EVENTS OF DEFAULT. |
24 |
SECTION 502. |
ACCELERATION. |
26 |
SECTION 503. |
OTHER REMEDIES. |
26 |
SECTION 504. |
WAIVER OF PAST DEFAULTS. |
26 |
SECTION 505. |
CONTROL BY MAJORITY. |
26 |
SECTION 506. |
LIMITATION ON SUITS. |
26 |
SECTION 507. |
RIGHTS OF HOLDERS OF SECURITIES
TO RECEIVE PAYMENT. |
27 |
SECTION 508. |
COLLECTION SUIT BY TRUSTEE. |
27 |
SECTION 509. |
TRUSTEE MAY FILE PROOFS
OF CLAIM. |
27 |
SECTION 510. |
PRIORITIES. |
28 |
SECTION 511. |
UNDERTAKING FOR COSTS. |
28 |
ARTICLE VI
THE TRUSTEE |
28 |
|
|
|
SECTION 601. |
CERTAIN DUTIES AND RESPONSIBILITIES. |
28 |
SECTION 602. |
NOTICE OF DEFAULTS. |
29 |
SECTION 603. |
CERTAIN RIGHTS OF TRUSTEE. |
29 |
SECTION 604. |
NOT RESPONSIBLE FOR RECITALS
OR ISSUANCE OF SECURITIES. |
30 |
SECTION 605. |
MAY HOLD SECURITIES. |
30 |
SECTION 606. |
MONEY HELD IN TRUST. |
30 |
SECTION 607. |
COMPENSATION AND REIMBURSEMENT. |
31 |
SECTION 608. |
DISQUALIFICATION; CONFLICTING
INTERESTS. |
31 |
SECTION 609. |
CORPORATE TRUSTEE REQUIRED;
ELIGIBILITY. |
32 |
SECTION 610. |
RESIGNATION AND REMOVAL;
APPOINTMENT OF SUCCESSOR. |
32 |
SECTION 611. |
ACCEPTANCE OF APPOINTMENT
BY SUCCESSOR. |
33 |
SECTION 612. |
MERGER, CONVERSION, CONSOLIDATION
OR SUCCESSION TO BUSINESS. |
33 |
SECTION 613. |
PREFERENTIAL COLLECTION
OF CLAIMS AGAINST COMPANY. |
34 |
SECTION 614. |
APPOINTMENT OF AUTHENTICATING
AGENT. |
34 |
|
|
|
ARTICLE VII
HOLDER’S LISTS AND REPORTS BY TRUSTEE AND COMPANY |
35 |
|
|
|
SECTION 701. |
COMPANY TO FURNISH TRUSTEE
NAMES AND ADDRESSES OF HOLDERS. |
35 |
SECTION 702. |
PRESERVATION OF INFORMATION;
COMMUNICATIONS TO HOLDERS. |
35 |
SECTION 703. |
REPORTS BY TRUSTEE. |
35 |
SECTION 704. |
REPORTS BY COMPANY. |
36 |
|
|
|
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE |
36 |
SECTION 801. |
COMPANY MAY CONSOLIDATE,
ETC., ONLY ON CERTAIN TERMS. |
36 |
SECTION 802. |
SUCCESSOR PERSON SUBSTITUTED. |
37 |
|
|
|
ARTICLE IX
SUPPLEMENTAL INDENTURES |
37 |
|
|
|
SECTION 901. |
WITHOUT CONSENT OF HOLDERS. |
37 |
SECTION 902. |
WITH CONSENT OF HOLDERS. |
38 |
SECTION 903. |
COMPLIANCE WITH TRUST INDENTURE
ACT. |
39 |
SECTION 904. |
REVOCATION AND EFFECT OF
CONSENTS. |
39 |
SECTION 905. |
NOTATION ON OR EXCHANGE
OF SECURITIES. |
39 |
SECTION 906. |
TRUSTEE TO SIGN AMENDMENTS,
ETC. |
39 |
|
|
|
ARTICLE X COVENANTS |
39 |
|
|
|
SECTION 1001. |
PAYMENT OF PRINCIPAL, PREMIUM
AND INTEREST. |
39 |
SECTION 1002. |
MAINTENANCE OF OFFICE OR
AGENCY. |
40 |
SECTION 1003. |
MONEY FOR SECURITIES PAYMENTS
TO BE HELD IN TRUST. |
40 |
SECTION 1004. |
EXISTENCE. |
41 |
SECTION 1005. |
STATEMENT BY OFFICERS AS
TO DEFAULT. |
41 |
SECTION 1006. |
WAIVER OF CERTAIN COVENANTS. |
41 |
SECTION 1007. |
ADDITIONAL AMOUNTS. |
41 |
|
|
|
ARTICLE XI
REDEMPTION OF SECURITIES |
42 |
|
|
|
SECTION 1101. |
APPLICABILITY OF ARTICLE. |
42 |
SECTION 1102. |
ELECTION TO REDEEM; NOTICE
TO TRUSTEE. |
42 |
SECTION 1103. |
SELECTION BY TRUSTEE OF
SECURITIES TO BE REDEEMED. |
42 |
SECTION 1104. |
NOTICE OF REDEMPTION. |
43 |
SECTION 1105. |
DEPOSIT OF REDEMPTION PRICE. |
43 |
SECTION 1106. |
SECURITIES PAYABLE ON REDEMPTION
DATE. |
43 |
SECTION 1107. |
SECURITIES REDEEMED IN
PART. |
44 |
SECTION 1108. |
PURCHASE OF SECURITIES. |
44 |
|
|
|
ARTICLE XII
SINKING FUNDS |
44 |
|
|
|
SECTION 1201. |
APPLICABILITY OF ARTICLE. |
44 |
SECTION 1202. |
SATISFACTION OF SINKING
FUND PAYMENTS WITH SECURITIES. |
44 |
SECTION 1203. |
REDEMPTION OF SECURITIES
FOR SINKING FUND. |
44 |
|
|
|
ARTICLE XIII
MEETINGS OF HOLDERS OF SECURITIES |
45 |
|
|
|
SECTION 1301. |
PURPOSES FOR WHICH MEETINGS
MAY BE CALLED. |
45 |
SECTION 1302. |
CALL, NOTICE AND PLACE
OF MEETINGS. |
45 |
SECTION 1303. |
PERSONS ENTITLED TO VOTE
AT MEETINGS. |
45 |
SECTION 1304. |
QUORUM; ACTION. |
45 |
SECTION 1305. |
DETERMINATION OF VOTING
RIGHTS; CONDUCT AND ADJOURNMENT OF MEETINGS. |
46 |
SECTION 1306. |
COUNTING VOTES AND RECORDING
ACTION OF MEETINGS. |
46 |
INDENTURE
THIS
Indenture, dated as of ________ ___, 2024, between Ainos, Inc., a corporation duly organized and existing under the laws of the State
of Texas (herein called the “Company”), having its principal office at 8880 Rio San Diego Drive, Ste. 800, San Diego, CA
92108, and ________________, a ________ banking corporation, as Trustee (herein called the “Trustee”) the office of the Trustee
at which at the date hereof its corporate trust business is principally administered being ______________________.
RECITALS
OF THE COMPANY
The
Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured
debentures, notes or other evidences of indebtedness (herein called the “Securities”), to be issued in one or more series
as in this Indenture provided.
The
Securities of each series will be in such form as may be established by or pursuant to a Board Resolution or in one or more indentures
supplemental hereto, in each case with such appropriate insertions, omissions, substitutions, and other variations as are required or
permitted by this Indenture, and may have such letters, numbers, or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange or as may, consistently herewith, be determined by the
officers executing such Securities, as evidenced by their execution of the Securities.
This
Indenture is subject to the provisions of the Trust Indenture Act and the rules and regulations of the SEC promulgated thereunder that
are required to be part of this Indenture and, to the extent applicable, shall be governed by such provisions.
All
things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done.
NOW,
THEREFORE, THIS INDENTURE WITNESSETH:
For
and in consideration of the premises and the purchase of the Securities by the Holders thereof, it is mutually covenanted and agreed,
for the equal and proportionate benefit of all Holders of the Securities or of series thereof, as follows:
ARTICLE
I
DEFINITIONS
AND OTHER PROVISIONS
OF
GENERAL APPLICATION
SECTION
101. DEFINITIONS.
For
all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:
(1)
the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;
(2)
all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with generally accepted accounting
principles in the United States, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles”
with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted in the
United States at the date of such computation; and
(3)
the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Indenture
as a whole and not to any particular Article, Section or other subdivision.
Certain
terms, used principally in Article V, are defined in Section 102.
“Act”
when used with respect to any Holder, has the meaning specified in Section 105.
“Additional
Amounts” means any additional amounts that are required by the express terms of a Security or by or pursuant to a Board Resolution,
under circumstances specified therein or pursuant thereto, to be paid by the Company with respect to certain taxes, assessments or other
governmental charges imposed on certain Holders and that are owing to such Holders.
“Affiliate”
of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified
Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of
voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative
to the foregoing.
“Authenticating
Agent” means any Person authorized by the Trustee to act on behalf of the Trustee pursuant to Section 614 to authenticate Securities
of one or more series.
“Authorized
Newspaper” means a newspaper, in the English language or in an official language of the country of publication, customarily published
on each Business Day, whether or not published on Saturdays, Sundays or holidays, and of general circulation in the place in connection
with which the term is used or in the financial community of such place. Where successive publications are required to be made in Authorized
Newspapers, the successive publications may be made in the same or in different newspapers in the same city meeting the foregoing requirements
and in each case on any Business Day.
“Board
of Directors” means
(1)
with respect to a corporation, the board of directors of the corporation;
(2)
with respect to a partnership, the board of directors of the general partner of the partnership; and
(3)
with respect to any other Person, the board or committee of such Person serving a similar function.
“Board
Resolution” means, with respect to any Person, a resolution of such Person duly adopted by the Board of Directors of such Person
and in full force and effect.
“Book-Entry
Security” has the meaning specified in Section 204.
“Business
Day,” when used with respect to any Place of Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday that is not a
day on which banking institutions in that Place of Payment or the city in which the Corporate Trust Office is located are authorized
or obligated by law or executive order to close.
“Capital
Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital
lease that would at that time be required to be capitalized on a balance sheet in accordance with GAAP.
“Capital
Stock” means:
(i)
in the case of a corporation, corporate stock;
(ii)
in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however
designated) of corporate stock;
(iii)
in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and
(iv)
any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions
of assets of, the issuing Person.
“Company”
means the Person named as the “Company” in the first paragraph of this instrument until a successor Person shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.
“Company
Request” and “Company Order” mean, respectively, a written request or order signed in the name of the Company by its
Chairman of the Board, its President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Controller, an Assistant
Controller, its Secretary or an Assistant Secretary, and delivered to the Trustee.
“Corporate
Trust Office” means the office of the Trustee at which at any particular time its corporate trust business shall be principally
administered, which office at the date hereof is that indicated in the introductory paragraph of this Indenture or such other address
as the Trustee may designate from time to time by notice to the Holders and the Company.
“Currency
Agreement” means, with respect to any specified Person, any foreign exchange contract, currency swap agreement or other similar
agreement or arrangement designed to protect such specified Person against fluctuations in currency values.
“Default”
means an event or condition the occurrence of which is, or with the lapse of time or the giving of notice or both would be, an Event
of Default.
“Defaulted
Interest” has the meaning specified in Section 307.
“Depositary”
means, with respect to the Securities of any series issuable or issued in the form of a global Security, the Person designated as Depositary
by the Company pursuant to Section 301 until a successor Depositary shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter “Depositary” shall mean or include each Person who is then a Depositary hereunder, and if at any
time there is more than one such person, “Depositary” as used with respect to the Securities of any series shall mean the
Depositary with respect to the Securities of that series.
“Dollar”
or “$” means a dollar or other equivalent unit in such coin or currency of the United States as at the time shall be legal
tender for the payment of public and private debts.
“Event
of Default” has the meaning specified in Section 501.
“GAAP”
means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States
of America, as in effect as of the date of issuance of Securities.
“Guarantee”
means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements),
of all or any part of Indebtedness.
“Guarantor”
means any Subsidiary that incurs a Guarantee.
“Hedging
Agreement” means, with respect to any Person, any agreement with respect to the hedging of price risk associated with the purchase
of commodities used in the business of such Person, so long as any such agreement has been entered into in the ordinary course of business
and not for purposes of speculation.
“Holder”
when used with respect to any Security, means the Person in whose name the Security is registered in the Security Register.
“Indebtedness”
means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent, in respect of:
(1)
borrowed money;
(2)
evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof) (other
than obligations with respect to letters of credit securing obligations (other than obligations described in clause (1), (2) and (4)
of this definition) entered into in the ordinary course of business of such Person to the extent that such letters of credit are not
drawn upon);
(3)
banker’s acceptances;
(4)
any Capital Lease Obligations;
(5)
the balance deferred and unpaid of the purchase price of any property, except any such balance that constitutes an accrued expense or
trade payable incurred in the ordinary course of business; or
(6)
any Hedging Agreements,
if
and to the extent any of the preceding items (other than letters of credit and Hedging Agreements) would appear as a liability upon a
balance sheet of the specified Person prepared in accordance with GAAP. In addition, the term “Indebtedness” includes all
Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified
Person) and, to the extent not otherwise included, the guarantee by the specified Person of any indebtedness of any other Person.
The
amount of any Indebtedness outstanding as of any date shall be:
(1)
the accreted value thereof, in the case of any Indebtedness issued with original issue discount; and
(2)
the principal amount thereof, together with any interest thereon that is more than 30 days past due, in the case of any other Indebtedness.
“Indenture”
means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof and shall include the terms of particular series of Securities established
as contemplated by Section 301 and the provisions of the Trust Indenture Act that are deemed to be a part of and govern this instrument.
“Interest
Payment Date,” means the Stated Maturity of an installment of interest on such Security.
“Interest
Swap Obligations,” means the obligations of any Person pursuant to any arrangement with any other Person, whereby directly or indirectly,
such Person is entitled to receive from time to time periodic payments calculated by applying either a floating or a fixed rate of interest
on a stated notional amount in exchange for periodic payments made by such other Person calculated by applying a fixed or a floating
rate of interest on the same notional amount and shall include, without limitation, interest rate swaps, options, caps, floors, collars
and similar agreements.
“Lien”
means any lien, mortgage, deed of trust, pledge, security interest, charge or encumbrance of any kind (including any conditional sale
or other title retention agreement, any lease in the nature thereof and any agreement to give any security interest).
“Maturity,”
when used with respect to any Security, means the date on which the principal of such Security or an installment of principal becomes
due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption
or otherwise.
“Officers’
Certificate” means a certificate signed by the Chairman of the Board, the President or a Vice President, and by the Treasurer,
the Controller, the Secretary or an Assistant Treasurer, Assistant Controller or Assistant Secretary, of the Company, and delivered to
the Trustee, which certificate shall be in compliance with Section 103 hereof.
“Opinion
of Counsel” means a written opinion of counsel, who may be counsel for or an employee of the Company, rendered, if applicable,
in accordance with Section 314(c) of the Trust Indenture Act, which opinion shall be in compliance with Section 103 hereof.
“Original
Issue Discount Security” means any Security that provides for an amount less than the principal amount thereof to be due and payable
upon a declaration of acceleration of the Maturity thereof pursuant to Section 502.
“Outstanding”
when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i)
Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation;
(ii)
Securities for whose payment or redemption money in the necessary amount has been theretofore irrevocably deposited with the Trustee
or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as
its own Paying Agent) for the Holders of such Securities; provided that, if such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made; and
(iii)
Securities that have been paid pursuant to Section 306 or in exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee
proof satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations
of the Company;
provided,
however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given any request,
demand, authorization, direction, notice, consent or waiver hereunder, or whether a quorum is present at a meeting of Holders of Securities,
(a) the principal amount of an Original Issue Discount Security that shall be deemed to be Outstanding for such purposes shall be the
principal amount thereof that would be due and payable as of the date of such determination upon acceleration of the Maturity thereof
pursuant to Section 502, (b) the principal amount of a Security denominated in a foreign currency shall be the U.S. Dollar equivalent,
determined by the Company on the date of original issuance of such Security, of the principal amount (or, in the case of an Original
Issue Discount Security, the U.S. Dollar equivalent, determined on the date of original issuance of such Security, of the amount determined
as provided in (a) above), of such Security and (c) Securities owned by the Company or any other obligor upon the Securities or any Affiliate
of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the
Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver or upon any
such determination as to the presence of a quorum, only Securities which the Trustee knows to be so owned shall be so disregarded. Securities
so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee
the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon
the Securities or any Affiliate of the Company or of such other obligor.
“Paying
Agent” means any Person, which may include the Company, authorized by the Company to pay the principal of (and premium, if any)
or interest on any one or more series of Securities on behalf of the Company.
“Person”
means an individual, partnership, corporation, limited liability company, unincorporated organization, trust or joint venture, or a governmental
agency or political subdivision thereof.
“Place
of Payment” when used with respect to the Securities of any series, means the place or places where the principal of (and premium,
if any) and interest on the Securities of that series are payable as specified in accordance with Section 301 subject to the provisions
of Section 1002.
“Post-Petition
Interest” means any interest that accrues after the commencement of any case, proceeding or other action relating to the bankruptcy,
insolvency or reorganization of the Company (or would accrue but for the operation of applicable bankruptcy or insolvency laws), whether
or not such interest is allowed or allowable as a claim in any such proceeding.
“Predecessor
Security” of any particular Security means every previous Security evidencing all or a portion of the same debt as that evidenced
by such particular Security; and, for the purposes of this definition, any Security authenticated and delivered under Section 306 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security shall be deemed to evidence the same debt as the mutilated,
destroyed, lost or stolen Security.
“Redemption
Date” when used with respect to any Security to be redeemed, means the date fixed for such redemption by or pursuant to this Indenture.
“Redemption
Price” when used with respect to any Security to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.
“Registered
Security” means any Security in the form established pursuant to Section 201 which is registered in the Security Register.
“Regular
Record Date” for the interest payable on any Interest Payment Date on the Registered Securities of any series means the date specified
for that purpose as contemplated by Section 301, or, if not so specified, the last day of the calendar month preceding such Interest
Payment Date if such Interest Payment Date is the fifteenth day of the calendar month or the fifteenth day of the calendar month preceding
such Interest Payment Date if such Interest Payment Date is the first day of a calendar month, whether or not such day shall be a Business
Day.
“Responsible
Officer” when used with respect to the Trustee, means any officer within the corporate trust department of the Trustee including
any vice-president, assistant vice-president, assistant treasurer, trust officer or any other officer who customarily performs functions
similar to those performed by the Persons who at the time shall be such officers who have direct responsibility for the administration
of the Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
“Securities”
has the meaning stated in the first recital of this Indenture and more particularly means any Securities authenticated and delivered
under this Indenture.
“Security
Register” and “Security Registrar” have the respective meanings specified in Section 305.
“Special
Record Date” for the payment of any Defaulted Interest on the Registered Securities of any series means a date fixed by the Trustee
pursuant to Section 307.
“Stated
Maturity” when used with respect to any Security or any installment of principal thereof or interest thereon, means the date specified
in such Security as the fixed date on which the principal of such Security or such installment of principal or interest is due and payable.
“Subsidiary”
means, with respect to any specified Person:
(i)
any corporation of which the outstanding Capital Stock having at least a majority of the votes entitled to be cast in the election of
directors under ordinary circumstances shall at the time be owned, directly or indirectly by such Person; or
(ii)
any other Person of which at least a majority of the voting interest under ordinary circumstances is at the time, directly or indirectly,
owned by such Person.
“Trustee”
means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean or include each Person
who is then a Trustee hereunder, and if at any time there is more than one such Person, “Trustee” as used with respect to
the Securities of any series shall mean the Trustee with respect to Securities of that series.
“Trust
Indenture Act” means the Trust Indenture Act of 1939 as in force at the date as of which this instrument was executed, except as
provided in Section 903.
“United
States” means the United States of America (including the States and the District of Columbia) and its “possessions,”
which include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands.
“United
States Alien” means any Person who, for United States federal income tax purposes, is a foreign corporation, a nonresident alien
individual, a nonresident alien or foreign fiduciary of an estate or trust, or a foreign partnership.
“U.S.
Government Obligations” means direct noncallable obligations of, or noncallable obligations the payment of principal of and interest
on which is guaranteed by, the United States of America, or to the payment of which obligations or guarantees the full faith and credit
of the United States of America is pledged, or beneficial interests in a trust the corpus of which consists exclusively of money or such
obligations or a combination thereof.
“Vice
President” when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number
or a word or words added before or after the title “vice president”.
“Wholly
Owned Subsidiary” of any Person means any Subsidiary of such Person of which all the outstanding voting securities (other than
in the case of a Restricted Subsidiary that is incorporated in a jurisdiction other than a State in the United States of America or the
District of Columbia, directors’ qualifying shares or an immaterial amount of shares required to be owned by other Persons pursuant
to applicable law) are owned by such Person or any Wholly Owned Subsidiary of such Person.
“Yield
to Maturity” when used with respect to any Original Issue Discount Security, means the yield to maturity, if any, set forth on
the face thereof.
SECTION
102. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever
this Indenture refers to a provision of the Trust Indenture Act, the provision is incorporated by reference in and made a part of this
Indenture. The following Trust Indenture Act terms used in this Indenture have the following meanings:
“Bankruptcy
Act” means the Bankruptcy Act or Title 11 of the United States Code, as amended.
“indenture
securities” means the Securities.
“indenture
securityholder” means a Holder.
“indenture
to be qualified” means this Indenture.
“indenture
trustee” or “institutional trustee” means the Trustee.
“obligor”
on the indenture securities means the Company or any other obligor on the Securities.
All
terms used in this Indenture that are defined by the Trust Indenture Act, defined by Trust Indenture Act reference to another statute
or defined by SEC rule under the Trust Indenture Act and not otherwise defined herein have the meanings assigned to them therein.
SECTION
103. COMPLIANCE CERTIFICATES AND OPINIONS.
Except
as otherwise expressly provided by this Indenture, upon any application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an Officers’ Certificate stating that all conditions
precedent, if any (including any covenants the compliance with which constitutes a condition precedent), provided for in this Indenture
relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any (including any covenants the compliance with which constitutes a condition precedent), have been complied
with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required
by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished.
Every
certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include
(1)
a statement that each Person signing such certificate or opinion has read such covenant or condition and the definitions herein relating
thereto;
(2)
a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3)
a statement that, in the opinion of each such Person, such Person has made such examination or investigation as is necessary to enable
such Person to express an informed opinion as to whether or not such covenant or condition has been complied with; and
(4)
a statement as to whether or not, in the opinion of each such Person, such condition or covenant has been complied with.
SECTION
104. FORM OF DOCUMENTS DELIVERED TO TRUSTEE.
In
any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary
that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by
only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.
Any
certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate
or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by,
an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company,
unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with
respect to such matters are erroneous.
Where
any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and form one instrument.
SECTION
105. ACTS OF HOLDERS; RECORD DATES.
(1)
Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person
or by an agent duly appointed in writing. Except as herein otherwise expressly provided, such action shall become effective when such
instrument or instruments or record or both are delivered to the Trustee and, where it is hereby expressly required, to the Company.
Such instrument or instruments and any such record (and the action embodied therein and evidenced thereby) are herein sometimes referred
to as the “Act” of the Holders signing such instrument or instruments and so voting at any such meeting. Proof of execution
of any such instrument or of a writing appointing any such agent, or the holding of any Person of a Security, shall be sufficient for
any purpose of this Indenture and (subject to Section 601) conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section. The record of any meeting of Holders of Securities shall be proved in the manner provided in Section 1306.
The
Company may set in advance a record date for purposes of determining the identity of Holders of Registered Securities entitled to vote
or consent to any action by vote or consent authorized or permitted under this Indenture. If not set by the Company prior to the first
solicitation of a Holder of Registered Securities of such series made by any Person in respect of any such action, or in the case of
any such vote, prior to such vote, the record date for any such action or vote shall be the later of 30 days prior to such first solicitation
of such consent or the date of the most recent list of Holders furnished to the Trustee prior to such solicitation. If a record date
is fixed, those Persons who were Holders of Outstanding Registered Securities at such record date (or their duly designated proxies),
and only those Persons, shall be entitled with respect to such Securities to take such action by vote or consent or to revoke any vote
or consent previously given, whether or not such Persons continue to be Holders after such record date. Promptly after any record date
is set pursuant to this paragraph, the Company, at its own expense, shall cause notice thereof to be given to the Trustee in writing
in the manner provided in Section 106 and to the relevant Holders as set forth in Section 107.
(2)
The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that
the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting
in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority.
The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be
proved in any other manner which the Trustee deems sufficient.
(3)
The principal amount and serial numbers of Registered Securities held by any Person, and the date of holding the same, shall be proved
by the Security Register.
(4)
Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future
Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor
or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether
or not notation of such action is made upon such Security. Any Holder or subsequent Holder may revoke the request, demand, authorization,
direction, notice, consent or other Act as to his Security or portion of his Security; provided, however, that such revocation
shall be effective only if the Trustee receives the notice of revocation before the date the Act becomes effective.
SECTION
106. NOTICES, ETC., TO TRUSTEE AND COMPANY.
Any
request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with,
(1)
the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, Attention: Corporate Trust Administration, or
(2)
the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided)
if in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of its principal office specified
in the first paragraph of this Indenture or at any other address previously furnished in writing to the Trustee by the Company, Attention:
Corporate Secretary.
The
Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications.
All
notices and communications (other than those sent to the Trustee) shall be deemed to have been duly given: at the time delivered by hand,
if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt acknowledged,
if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next-day
delivery. All notices and communications to the Trustee shall be deemed duly given and effective only upon receipt.
Any
notice or communication to a Holder shall be mailed by first class mail, certified or registered, return receipt requested, or by overnight
air courier guaranteeing next-day delivery to its address shown on the Security Register. Any notice or communication shall also be so
mailed to any Person described in TIA Section 313(c), to the extent required by the TIA. Failure to mail a notice or communication to
a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.
If
a notice or communication is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee
receives it.
If
the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time.
SECTION
107. NOTICE TO HOLDERS; WAIVER.
Where
this Indenture provides for notice to Holders of Securities of any event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at the address of such
Holder as it appears in the Security Register, not later than the latest date, and not earlier than the earliest date, prescribed for
the giving of such notice.
In
case by reason of the suspension of regular mail service, or by reason of any other cause it shall be impracticable to give such notice
to Holders of Registered Securities by mail, then such notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder. In any case in which notice to Holders of Registered Securities is given by mail,
neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder of a Registered Security, shall
affect the sufficiency of such notice with respect to other Holders of Registered Securities.
Where
this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed
with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.
SECTION
108. CONFLICT WITH TRUST INDENTURE ACT.
If
any provision hereof limits, qualifies or conflicts with any provision of the Trust Indenture Act or another provision hereof required
to be included in this Indenture by any of the provisions of the Trust Indenture Act, such provision of the Trust Indenture Act shall
control. If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or
excluded, the former provision shall be deemed to apply to this Indenture as so modified or to be excluded.
SECTION
109. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The
Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.
SECTION
110. SUCCESSORS AND ASSIGNS.
All
covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether or not so expressed.
SECTION
111. SEPARABILITY CLAUSE.
In
case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability
of the remaining provisions shall not in any way be affected or impaired thereby.
SECTION
112. BENEFITS OF INDENTURE.
Nothing
in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors
hereunder, any Authenticating Agent, Paying Agent and Security Registrar, and the Holders, any benefit or any legal or equitable right,
remedy or claim under this Indenture.
SECTION
113. GOVERNING LAW.
This
Indenture and the Securities shall be governed by and construed in accordance with the laws of the State of New York, but without giving
effect to applicable principles of conflicts of law to the extent the application of the laws of another jurisdiction would be required
thereby.
SECTION
114. LEGAL HOLIDAYS.
In
any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Security shall not be a Business Day at any Place
of Payment, then (notwithstanding any other provision of this Indenture or of the Securities) payment of principal and interest (and
premium and Additional Amounts, if any) need not be made at such Place of Payment on such date, but may be made on the next succeeding
Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date, or at
the Stated Maturity, provided that no interest shall accrue for the period from and after such Interest Payment Date, Redemption
Date or Stated Maturity, as the case may be.
SECTION
115. CORPORATE OBLIGATION.
No
recourse may be taken, directly or indirectly, against any incorporator, subscriber to the capital stock, stockholder, officer, director
or employee of the Company or the Trustee or of any predecessor or successor of the Company or the Trustee with respect to the Company’s
obligations on the Securities or the obligations of the Company or the Trustee under this Indenture or any certificate or other writing
delivered in connection herewith.
SECTION
116. WAIVER OF TRIAL JURY.
EACH
OF THE COMPANY AND THE TRUSTEE 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 INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.
SECTION
117. FORCE MAJEURE.
In
no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising
out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents,
acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or
malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use
reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable
under the circumstances.
ARTICLE
II
SECURITY
FORMS
SECTION
201. FORMS GENERALLY.
The
Securities of each series shall be Registered Securities and shall be in substantially such form or forms (including temporary or permanent
global form) as shall be established by or pursuant to a Board Resolution or in one or more indentures supplemental hereto, in each case
with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture and may
have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution of the Securities. If temporary Securities of any series are issued in global form as permitted by Section
304, the form thereof shall be established as provided in the preceding sentence. A copy of the Board Resolution establishing the form
or forms of Securities of any series (or any such temporary global Security) shall be delivered to the Trustee at or prior to the delivery
of the Company Order contemplated by Section 303 for the authentication and delivery of such Securities (or any such temporary global
Security).
The
definitive Securities shall be printed, lithographed or engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their execution thereof.
SECTION
202. FORM OF TRUSTEE’S CERTIFICATE OF AUTHENTICATION.
The
Trustee’s certificate of authentication shall be in substantially the following form:
“This
is one of the Securities of the series designated therein referred to in the within-mentioned Indenture.
SECTION
203. SECURITIES IN GLOBAL FORM.
If
Securities of a series are issuable in global form, as contemplated by Section 301, then, notwithstanding clause (10) of Section 301
and the provisions of Section 302, any such Security shall represent such of the Outstanding Securities of such series as shall be specified
therein and may provide that it shall represent the aggregate amount of Outstanding Securities from time to time endorsed thereon and
that the aggregate amount of Outstanding Securities represented thereby may from time to time be reduced to reflect exchanges. Any endorsement
of a Security in global form to reflect the amount, or any increase or decrease in the amount, of Outstanding Securities represented
thereby shall be made by the Trustee in such manner and upon instructions given by such Person or Persons as shall be specified in such
Security or in a Company Order to be delivered to the Trustee pursuant to Section 303 or Section 304. Subject to the provisions of Section
303 and, if applicable, Section 304, the Trustee shall deliver and redeliver any Security in permanent global form in the manner and
upon instructions given by the Person or Persons specified in such Security or in the applicable Company Order. If a Company Order pursuant
to Section 303 or 304 has been, or simultaneously is, delivered, any instructions by the Company with respect to endorsement or delivery
or redelivery of a Security in global form shall be in writing but need not comply with Section 103 and need not be accompanied by an
Opinion of Counsel.
The
provisions of the last sentence of Section 303 shall apply to any Security in global form if such Security was never issued and sold
by the Company and the Company delivers to the Trustee the Security in global form together with written instructions (which need not
comply with Section 103 and need not be accompanied by an Opinion of Counsel) with regard to the reduction in the principal amount of
Securities represented thereby, together with the written statement contemplated by the last sentence of Section 303.
Notwithstanding
the provisions of Sections 201 and 307, unless otherwise specified as contemplated by Section 301, payment of principal of (and premium,
if any) and interest on any Security in permanent global form shall be made to the Person or Persons specified therein.
Notwithstanding
the provisions of Section 308 and except as provided in the preceding paragraph, the Company, the Trustee and any agent of the Company
or of the Trustee shall treat a Person as the Holder of such principal amount of Outstanding Securities represented by a global Security
as shall be specified in a written statement, if any, of the Holder of such global Security, which is produced to the Security Registrar
by such Holder.
Global
Securities may be issued in either temporary or permanent form. Permanent global Securities will be issued in definitive form.
SECTION
204. BOOK-ENTRY SECURITIES.
Notwithstanding
any provision of this Indenture to the contrary:
(a)
At the discretion of the Company, any Registered Security may be issued from time to time, in whole or in part, in permanent global form
registered in the name of a Depositary, or its nominee. Each such Registered Security in permanent global form is hereafter referred
to as a “Book-Entry Security.” Subject to Section 303, upon such election, the Company shall execute, and the Trustee or
an Authenticating Agent shall authenticate and deliver, one or more Book-Entry Securities that (i) are denominated in an amount equal
to the aggregate principal amount of the Outstanding Securities of such series if elected in whole or such lesser amount if elected in
part, (ii) are registered in the name of the Depositary or its nominee, (iii) are delivered by the Trustee or an Authenticating Agent
to the Depositary or pursuant to the Depositary’s instructions and (iv) bear a legend in substantially the following form (or such
other form as the Depositary and the Company may agree upon):
UNLESS
THIS SECURITY IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF [THE DEPOSITARY], TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF [NOMINEE OF THE DEPOSITARY] OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF [THE DEPOSITARY] (AND ANY PAYMENT IS MADE TO [NOMINEE OF THE DEPOSITARY] OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF [THE DEPOSITARY]), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, [NOMINEE OF THE DEPOSITARY], HAS AN INTEREST HEREIN.
(b)
Any Book-Entry Security shall be initially executed and delivered as provided in Section 303. Notwithstanding any other provision of
this Indenture, unless and until it is exchanged in whole or in part for Registered Securities not issued in global form, a Book-Entry
Security may not be transferred except as a whole by the Depositary to a nominee of such Depositary, by a nominee of such Depositary
to such Depositary or another nominee of such Depositary, or by such Depositary or any such nominee to a successor Depositary or a nominee
of such successor Depositary.
(c)
If at any time the Depositary notifies the Company or the Trustee that it is unwilling or unable to continue as Depositary for any Book-Entry
Securities, the Company shall appoint a successor Depositary, whereupon the retiring Depositary shall surrender or cause the surrender
of its Book-Entry Security or Securities to the Trustee. The Trustee shall promptly notify the Company upon receipt of such notice. If
a successor Depositary has not been so appointed by the effective date of the resignation of the Depositary, the Book-Entry Securities
will be issued as Registered Securities not issued in global form, in an aggregate principal amount equal to the principal amount of
the Book-Entry Security or Securities theretofore held by the Depositary.
The
Company may at any time and in its sole discretion determine that the Securities shall no longer be Book-Entry Securities represented
by a global certificate or certificates, and will so notify the Depositary. Upon receipt of such notice, the Depositary shall promptly
surrender or cause the surrender of its Book-Entry Security or Securities to the Trustee. Concurrently therewith, Registered Securities
not issued in global form will be issued in an aggregate principal amount equal to the principal amount of the Book-Entry Security or
Securities theretofore held by the Depositary.
Upon
any exchange of Book-Entry Securities for Registered Securities not issued in global form as set forth in this Section 204(c), such Book-Entry
Securities shall be cancelled by the Trustee, and Securities issued in exchange for such Book-Entry Securities pursuant to this Section
shall be registered in such names and in such authorized denominations as the Depositary for such Book-Entry Securities, pursuant to
instructions from its direct or indirect participants or otherwise, shall instruct the Trustee. The Trustee or any Authenticating Agent
shall deliver such Securities to the Persons in whose names such Securities are so registered.
(d)
The Company and the Trustee shall be entitled to treat the Person in whose name any Book-Entry Security is registered as the Holder thereof
for all purposes of the Indenture and any applicable laws, notwithstanding any notice to the contrary received by the Trustee or the
Company; and the Trustee and the Company shall have no responsibility for transmitting payments to, communication with, notifying, or
otherwise dealing with any beneficial owners of any Book-Entry Security. Neither the Company nor the Trustee shall have any responsibility
or obligations, legal or otherwise, to the beneficial owners or to any other party including the Depositary, except for the Holder of
any Book-Entry Security; provided however, notwithstanding anything herein to the contrary, (i) for the purposes of determining
whether the requisite principal amount of Outstanding Securities have given, made or taken any request, demand, authorization, direction,
notice, consent, waiver, instruction or other action hereunder as of any date, the Trustee shall treat any Person specified in a written
statement of the Depositary with respect to any Book-Entry Securities as the Holder of the principal amount of such Securities set forth
therein and (ii) nothing herein shall prevent the Company, the Trustee, or any agent of the Company or Trustee, from giving effect to
any written certification, proxy or other authorization furnished by a Depositary with respect to any Book-Entry Securities, or impair,
as between a Depositary and holders of beneficial interests in such Securities, the operation of customary practices governing the exercise
of the rights of the Depositary as Holder of such Securities.
(e)
So long as any Book-Entry Security is registered in the name of a Depositary or its nominee, all payments of the principal of (and premium,
if any) and interest on such Book-Entry Security and redemption thereof and all notices with respect to such Book-Entry Security shall
be made and given, respectively, in the manner provided in the arrangements of the Company with such Depositary.
ARTICLE
III
THE
SECURITIES
SECTION
301. AMOUNT UNLIMITED; ISSUABLE IN SERIES.
The
aggregate principal amount of Securities that may be authenticated and delivered under this Indenture is unlimited.
The
Securities may be issued in one or more series. There shall be established in or pursuant to a Board Resolution, and set forth in an
Officers’ Certificate, or established in one or more indentures supplemental hereto, prior to the issuance of Securities of any
series:
(1)
the title of the Securities of the series (which shall distinguish the Securities of the series from all other Securities);
(2)
any limit, if any, upon the aggregate principal amount of the Securities of the series that may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of,
other Securities of the series pursuant to Section 304, 305, 306, 905 or 1107);
(3)
whether Securities of the series are to be issuable as Registered Securities, whether any Securities of the series are to be issuable
initially in temporary global form and whether any Securities of the series are to be issuable in permanent global form, as Book-Entry
Securities or otherwise, and, if so, whether beneficial owners of interests in any such permanent global Security may exchange such interests
for Securities of such series and of like tenor of any authorized form and denomination and the circumstances under which any such exchanges
may occur, if other than in the manner provided in Section 305, and the Depositary for any global Security or Securities;
(4)
the manner in which any interest payable on a temporary global Security on any Interest Payment Date will be paid if other than in the
manner provided in Section 304;
(5)
the date or dates on which the principal of (and premium, if any, on) the Securities of the series is payable or the method of determination
thereof;
(6)
the rate or rates, or the method of determination thereof, at which the Securities of the series shall bear interest, if any, whether
and under what circumstances Additional Amounts with respect to such Securities shall be payable, the date or dates from which such interest
shall accrue, the Interest Payment Dates on which such interest shall be payable and, if other than as set forth in Section 101, the
Regular Record Date for the interest payable on any Registered Securities on any Interest Payment Date;
(7)
if other than the Corporate Trust Office of the Trustee, the place or places where, subject to the provisions of Section 1002, the principal
of (and premium, if any), any interest on and any Additional Amounts with respect to the Securities of the series shall be payable;
(8)
the period or periods within which, the price or prices (whether denominated in cash, securities or otherwise) at which and the terms
and conditions upon which Securities of the series may be redeemed, in whole or in part, at the option of the Company, if the Company
is to have that option, and the manner in which the Company must exercise any such option;
(9)
the obligation, if any, of the Company to redeem or purchase Securities of the series pursuant to any sinking fund or analogous provisions
or at the option of a Holder thereof and the period or periods within which, the price or prices (whether denominated in cash, securities
or otherwise) at which and the terms and conditions upon which Securities of the series shall be redeemed or purchased in whole or in
part pursuant to such obligation;
(10)
the denomination in which any Registered Securities of that series shall be issuable, if other than denominations of $2,000 and any integral
multiple of $1,000 in excess thereof;
(11)
the currency or currencies (including composite currencies) in which payment of the principal of (and premium, if any), any interest
on and any Additional Amounts with respect to the Securities of the series shall be payable if other than the currency of the United
States of America;
(12)
if the principal of (and premium, if any) or interest on the Securities of the series are to be payable, at the election of the Company
or a Holder thereof, in a currency or currencies (including composite currencies) other than that in which the Securities are stated
to be payable, the currency or currencies (including composite currencies) in which payment of the principal of (and premium, if any)
and interest on and any Additional Amounts with respect to Securities of such series as to which such election is made shall be payable,
and the periods within which and the terms and conditions upon which such election is to be made;
(13)
if the amount of payments of principal of (and premium, if any), any interest on and any Additional Amounts with respect to the Securities
of the series may be determined with reference to any commodities, currencies or indices, or values, rates or prices, the manner in which
such amounts shall be determined;
(14)
if other than the entire principal amount thereof, the portion of the principal amount of Securities of the series that shall be payable
upon declaration of acceleration of the Maturity thereof pursuant to Section 502;
(15)
any additional means of satisfaction and discharge of this Indenture with respect to Securities of the series pursuant to Section 401,
any additional conditions to discharge pursuant to Section 401, 402, 403, 404, or 405, and the application, if any, of Section 403 and
404;
(16)
any deletions or modifications of or additions to the Events of Default set forth in Section 501, the right of the Trustee or the requisite
Holders of such Securities to declare the principal amount thereof due and payable pursuant to Section 502, or the covenants of the Company
set forth in Article X pertaining to the Securities of the series;
(17)
the terms, if any, on which the Securities of any series may be converted into or exchanged for stock or other securities of the Company
or other entities, any specific terms relating to the adjustment thereof and the period during which such Securities may be so converted
or exchanged;
(18)
whether the Securities of a series will be issued as part of units consisting of Securities and other securities of the Company or another
issuer; and
(19)
any other terms of the series permitted under the provisions of the Trust Indenture Act.
All
Securities of any one series shall be substantially identical except, in the case of Registered Securities, as to denomination and except
as may otherwise be provided in or pursuant to the Board Resolution referred to above and (subject to Section 303) set forth, or determined
in the manner provided, in the Officers’ Certificate referred to above or in any such indenture supplemental hereto.
All
Securities of any one series need not be issued at the same time and, unless otherwise provided in such Board Resolution or supplemental
indenture, a series may be reopened for issuances of additional Securities of such series pursuant to a Board Resolution or in any indenture
supplemental hereto.
At
the option of the Company, interest on the Registered Securities of any series that bears interest may be paid by mailing a check or
otherwise transmitting payment to the address of any Holder as such address shall appear in the Security Register.
If
any of the terms of the series are established by action taken pursuant to a Board Resolution, a copy of an appropriate record of such
action together with such Board Resolution shall be certified by the Secretary or an Assistant Secretary of the Company and delivered
to the Trustee at or prior to the delivery of the Officers’ Certificate setting forth the terms of the series.
SECTION
302. DENOMINATIONS.
The
Securities of each series shall be issuable in such denominations as shall be specified as contemplated by Section 301. In the absence
of any such provisions with respect to the Securities of any series, the Registered Securities of such series denominated in Dollars
shall be issuable in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. Unless otherwise provided as contemplated
by Section 301 with respect to any series of Securities, any Securities of a series denominated in a currency other than Dollars shall
be issuable in denominations that are the equivalent, as determined by the Company by reference to the noon buying rate in the City of
New York for cable transfers for such currency, as such rate is reported or otherwise made available by the Federal Reserve Bank of New
York, on the applicable issue date for such Securities, of $2,000 and any integral multiple of $1,000 in excess thereof.
SECTION
303. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The
Securities shall be executed on behalf of the Company by its Chairman of the Board, its Chief Executive Officer, its President, its Chief
Financial Officer, its Treasurer or one of its Vice Presidents, under its corporate seal reproduced thereon or affixed thereto attested
by its Secretary or one of its Assistant Secretaries. The signature of any of these officers on the Securities may be manual or facsimile.
Coupons shall bear the facsimile signature of the Chairman of the Board, President, Treasurer or any Vice President of the Company.
Securities
bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such
Securities or did not hold such offices at the date of such Securities.
At
any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities of any series executed
by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities,
and the Trustee in accordance with the Company Order shall authenticate and deliver such Securities as in this Indenture provided and
not otherwise.
If
the form or terms of the Securities of the series have been established in or pursuant to one or more Board Resolutions or Officer’s
Certificate as permitted by Sections 201 and 301, in authenticating such Securities, and accepting the additional responsibilities under
this Indenture in relation to such Securities, the Trustee shall be given (in addition to the other documents required by Section 103
hereof), and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating,
(a)
if the form of such Securities has been established by or pursuant to Board Resolution as permitted by Section 201, that such form has
been established in conformity with the provisions of this Indenture;
(b)
if the terms of such Securities have been established by or pursuant to Board Resolution as permitted by Section 301, that such terms
have been established in conformity with the provisions of this Indenture; and
(c)
that such Securities, when authenticated and delivered by the Trustee and issued by the Company in the manner and subject to any conditions
specified in such Opinion of Counsel, will constitute legal, valid and binding obligations of the Company, enforceable in accordance
with their terms, except as such enforcement is subject to the effect of bankruptcy, insolvency, fraudulent conveyance, reorganization
or other laws relating to or affecting creditors’ rights, and general principles of equity (regardless of whether such enforcement
is considered in a proceeding in equity or at law); provided that such Opinion of Counsel need express no opinion as to whether
a court in the United States would render a money judgment in currency other than that of the United States.
If
such form or terms have been so established, the Trustee shall not be required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee’s own rights, duties or immunities under the Securities and this Indenture or
otherwise in a manner not reasonably acceptable to the Trustee.
Each
Security shall be dated the date of its authentication.
No
Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such
Security a certificate of authentication substantially in the form provided for herein executed by the Trustee by manual signature, and
such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated
and delivered hereunder. Notwithstanding the foregoing, if any Security shall have been authenticated and delivered hereunder but never
issued and sold by the Company, and the Company shall deliver such Security to the Trustee for cancellation as provided in Section 309
together with a written statement (which need not comply with Section 103 and need not be accompanied by an Opinion of Counsel) stating
that such Security has never been issued and sold by the Company, for all purposes of this Indenture such Security shall be deemed never
to have been authenticated and delivered hereunder and shall never be entitled to the benefits of this Indenture.
SECTION
304. TEMPORARY SECURITIES.
Pending
the preparation of definitive Securities of any series, the Company may execute, and upon Company Order, the Trustee shall authenticate
and deliver, temporary Securities that are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of which they are issued, in registered form and with such
appropriate insertions, omissions, substitutions and other variations as the officers of the Company executing such Securities may determine,
as evidenced by their execution of such Securities.
Except
in the case of temporary Securities in global form (which shall be exchanged in accordance with the provisions of the following paragraphs),
if temporary Securities of any series are issued, the Company will cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such series, the temporary Securities of such series shall be exchangeable
for definitive Securities of such series upon surrender of the temporary Securities of such series at the office or agency of the Company
in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Securities
of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount
of definitive Securities of the same series of authorized denominations. Until so exchanged, the temporary Securities of any series shall
in all respects be entitled to the same benefits under this Indenture as definitive Securities of such series.
All
Outstanding temporary Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive
Securities of the same series and of like tenor authenticated and delivered hereunder.
SECTION
305. REGISTRATION, REGISTRATION OF TRANSFER AND EXCHANGE.
The
Company shall cause to be kept for each series of Securities at one of the offices or agencies maintained pursuant to Section 1002 a
register (the register maintained in such office and in any other office or agency of the Company in a Place of Payment being herein
sometimes collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as it may
prescribe, the Company shall provide for the registration of Registered Securities and of transfers of Registered Securities of such
series. The Trustee is hereby initially appointed “Security Registrar” for the purpose of registering Securities and transfers
of Securities as herein provided.
Upon
surrender for registration of transfer of any Registered Security of any series at the office or agency in a Place of Payment for that
series, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees,
one or more new Registered Securities of the same series and of like tenor, of any authorized denominations and of a like aggregate principal
amount.
At
the option of the Holder, Registered Securities of any series may be exchanged for other Registered Securities of the same series and
of like tenor, of any authorized denominations and of a like aggregate principal amount, upon surrender of the Securities to be exchanged
at such office or agency. Whenever any Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate
and deliver, the Securities that the Holder making the exchange is entitled to receive.
Notwithstanding
the foregoing, except as otherwise specified as contemplated by Section 301, any permanent global Security shall be exchangeable only
as provided in this paragraph. If the beneficial owners of interests in a permanent global Security are entitled to exchange such interest
for Securities of such series and of like tenor and principal amount of another authorized form and denomination, as specified as contemplated
by Section 301, then without unnecessary delay but in any event not later than the earliest date on which such interests may be so exchanged,
the Company shall deliver to the Trustee definitive Securities of that series in an aggregate principal amount equal to the principal
amount of such permanent global Security, executed by the Company. On or after the earliest date on which such interests may be so exchanged,
such permanent global Security shall be surrendered from time to time in accordance with instructions given to the Trustee and the Depositary
(which instructions shall be in writing but need not comply with Section 103 or be accompanied by an Opinion of Counsel) or such other
depositary as shall be specified in the Company Order with respect thereto to the Trustee, as the Company’s agent for such purpose,
to be exchanged, in whole or in part, for definitive Securities of the same series without charge and the Trustee shall authenticate
and deliver, in exchange for each portion of such permanent global Security, a like aggregate principal amount of other definitive Securities
of the same series of authorized denominations and of like tenor as the portion of such permanent global Security to be exchanged; provided,
however, that no such exchanges may occur during a period beginning at the opening of business 15 days before any selection of
Securities of that series is to be redeemed and ending on the relevant Redemption Date. Promptly following any such exchange in part,
such permanent global Security marked to evidence the partial exchange shall be returned by the Trustee to the Depositary or such other
depositary referred to above in accordance with the instructions of the Company referred to above. If a Registered Security is issued
in exchange for any portion of a permanent global Security after the close of business at the office or agency where such exchange occurs
on (i) any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or
(ii) any Special Record Date and before the opening of business at such office or agency on the related proposed date for payment of
Defaulted Interest, interest or Defaulted Interest, as the case may be, will not be payable on such Interest Payment Date or proposed
date for payment, as the case may be, in respect of such Registered Security, but will be payable on such Interest Payment Date or proposed
date for payment, as the case may be, only to the Person to whom interest in respect of such portion of such permanent global Security
is payable in accordance with the provisions of this Indenture.
All
Securities issued upon any registration of transfer or exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer
or exchange.
Every
Registered Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the
Trustee) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Security
Registrar duly executed, by the Holder thereof or his attorney duly authorized in writing.
No
service charge shall be made for any registration of transfer or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange
of Securities, other than exchange pursuant to Section 304, 905 or 1107 not involving any transfer.
The
Company shall not be required (i) to issue, register the transfer of or exchange Securities of any series during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of redemption of Securities of such series selected for redemption
and ending at the close of business on the day of the mailing of the relevant notice of redemption or (ii) to register the transfer of
or exchange any Registered Security so selected for redemption in whole or in part, except the unredeemed portion of any Security being
redeemed in part.
SECTION
306. MUTILATED, DESTROYED, LOST AND STOLEN SECURITIES.
If
any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a new Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously Outstanding.
If
there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of them and any agent of either of them harmless, then, in
the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall
execute and upon its request the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new
Security of the same series and of like tenor and principal amount and bearing a number not contemporaneously Outstanding.
In
case any such mutilated, destroyed, lost or stolen Security has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon
the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other expenses (including the fee and expenses of the Trustee) connected
therewith.
Every
new Security of any series issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable
by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities
of that series duly issued hereunder.
The
provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION
307. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Interest
on any Registered Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security (or one or more Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest. Unless otherwise provided with respect to the Securities of any series, payment of interest may be made
at the option of the Company by check mailed or delivered to the address of any Person entitled thereto as such address shall appear
in the Security Register.
Any
interest on any Registered Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest
Payment Date (herein called “Defaulted Interest”) shall forthwith cease to be payable to the Holder on the relevant Regular
Record Date by virtue of having been such Holder, and such Defaulted Interest may be paid by the Company, at its election in each case,
as provided in clause (1) or (2) below:
(1)
The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Registered Securities of such series
(or their respective Predecessor Securities) are registered at the close of business on a Special Record Date for the payment of such
Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Registered Security of such series and the date of the proposed payment, and at the same time the
Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted
Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money
when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this Clause provided. Thereupon
the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less
than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the
Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class
postage prepaid, to each Holder of Registered Securities of such series at his address as it appears in the Security Register, not less
than 10 days prior to such Special Record Date. The Trustee may, in its discretion, in the name and at the expense of the Company, cause
a similar notice to be published at least once in an Authorized Newspaper, but such publication shall not be a condition precedent to
the establishment of such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date
therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Registered Securities of such
series (or their respective Predecessor Securities) are registered at the close of business on such Special Record Date and shall no
longer be payable pursuant to the following clause (2).
(2)
The Company may make payment of any Defaulted Interest on the Registered Securities of any series in any other lawful manner not inconsistent
with the requirements of any securities exchange on which such Securities may be listed, and upon such notice as may be required by such
exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this Clause, such manner of payment
shall be deemed practicable by the Trustee.
Subject
to the foregoing provisions of this Section, each Security delivered under this Indenture, upon registration of transfer of, in exchange
for or in lieu of, any other Security, shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such
other Security.
SECTION
308. PERSONS DEEMED OWNERS.
Prior
to due presentment of a Registered Security for registration of transfer, the Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name such Registered Security is registered as the owner of such Registered Security for the purpose
of receiving payment of principal of (and premium, if any) and (subject to Sections 305 and 307) interest on such Registered Security
and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of
the Company or the Trustee shall be affected by notice to the contrary.
SECTION
309. CANCELLATION.
All
Securities surrendered for payment, redemption, registration of transfer or exchange or for credit against any sinking fund payment shall,
if surrendered to any Person other than the Trustee, be delivered to the Trustee. All Registered Securities so delivered shall be promptly
cancelled by the Trustee. The Company may at any time deliver to the Trustee for cancellation any Securities previously authenticated
and delivered hereunder which the Company may have acquired in any manner whatsoever, and all Securities so delivered shall be promptly
cancelled by the Trustee. No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in
this Section, except as expressly permitted by this Indenture. All cancelled Securities held by the Trustee shall be disposed of in its
customary manner.
SECTION
310. COMPUTATION OF INTEREST.
Except
as otherwise specified as contemplated by Section 301 for Securities of any series, interest on the Securities of each series shall be
computed on the basis of a year comprising twelve 30-day months.
SECTION
311. CUSIP NUMBERS.
The
Company, in issuing the Securities, may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use
“CUSIP” numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that
no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of
a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption
shall not be affected by any defect in or omission of such numbers.
ARTICLE
IV
SATISFACTION
AND DISCHARGE; LEGAL DEFEASANCE AND
COVENANT
DEFEASANCE
SECTION
401. SATISFACTION AND DISCHARGE OF INDENTURE.
This
Indenture shall upon Company Request cease to be of further effect with respect to Securities of any series (except as to any surviving
rights of registration of transfer, exchange or replacement of such series of Securities herein expressly provided for), and the Trustee,
at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect
to such Securities, when
(1)
either
(A)
all such Securities of such series theretofore authenticated and delivered (other than (i) such Securities which have been destroyed,
lost or stolen and which have been replaced or paid as provided in Section 306 and (ii) such Securities of such series for whose payment
money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 1003) have been delivered to the Trustee for cancellation; or
(B)
all such Securities of such series not theretofore delivered to the Trustee for cancellation
(i)
have become due and payable, or
(ii)
will become due and payable at their Stated Maturity within one year, or
(iii)
are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption
by the Trustee in the name, and at the expense, of the Company,
and
the Company, in the case of (B)(i), (ii) or (iii) above, has deposited or caused to be deposited with the Trustee, as funds in trust
for such purpose, an amount in the currency or currencies or currency unit or units in which such Securities of such series are payable
or U.S. Government Obligations maturing as to principal and interest in such amounts and at such times as will, together with any interest
thereon, be sufficient to pay and discharge the entire indebtedness on such Securities of such series not theretofore delivered to the
Trustee for cancellation, for principal and any premium and interest to the date of such deposit (in the case of Securities which have
become due and payable) or to the Stated Maturity or Redemption Date, as the case may be;
(2)
the Company has paid or caused to be paid all other sums payable hereunder by the Company; and
(3)
the Company has delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent
herein provided for relating to the satisfaction and discharge of this Indenture with respect to such series of Securities have been
complied with.
Notwithstanding
the satisfaction and discharge of this Indenture with respect to the Outstanding Securities of such series pursuant to this Section 401,
the obligations of the Company to the Trustee under Section 607 and to any Authenticating Agent under Section 614 and, if money or U.S.
Government Obligations shall have been deposited with the Trustee pursuant to subclause (B) of Clause (1) of this Section, the obligations
of the Trustee under Section 406, Article VI and the last paragraph of Section 1003 shall survive such satisfaction and discharge.
SECTION
402. OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
In
addition to the Company’s rights under Section 401 (which shall not be affected by this Section 402), the Company may, at the option
of its Board of Directors evidenced by a resolution set forth in an Officers’ Certificate, at any time, elect to have either Section
403 or 404 hereof applied to all Outstanding Securities of any series upon compliance with the conditions set forth in Sections 403 through
406 hereof.
SECTION
403. LEGAL DEFEASANCE AND DISCHARGE.
Upon
the Company’s exercise under Section 402 hereof of the option applicable to this Section 403, the Company and the Guarantors shall,
subject to the satisfaction of the conditions set forth in Section 405 hereof, be deemed to have been discharged from their obligations
with respect to all Outstanding Securities of a series on the date the conditions set forth below are satisfied (hereinafter, “Legal
Defeasance”). For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire
Indebtedness represented by the Outstanding Securities of a series, which shall thereafter be deemed to be “outstanding”
only for the purposes of Section 406 hereof and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied
all its other obligations under such Securities and this Indenture (and the Trustee, on demand of and at the expense of the Company,
shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated
or discharged hereunder: (a) the rights of Holders of Outstanding Securities of any series to receive payments in respect of the principal
of, premium, if any, and interest, if any, on such Securities when such payments are due from the trust referred to in Section 405, (b)
the Company’s obligations with respect to such Securities under Sections 304, 305, 306 and 1002 of this Indenture, (c) the rights,
powers, trusts, duties and immunities of the Trustee hereunder and the Company’s obligations in connection therewith and (d) this
Article IV. Subject to compliance with Sections 402 through 406 hereof, the Company may exercise its option under this Section 403 notwithstanding
the prior exercise of its option under Section 404 hereof.
SECTION
404. COVENANT DEFEASANCE.
Upon
the Company’s exercise under Section 402 hereof of the option applicable to this Section 404, the Company shall, subject to the
satisfaction of the conditions set forth in Section 405 hereof, be released from the operation of Section 801 hereof with respect to
the Outstanding Securities of a series and any other covenant contained in the Board Resolution or supplemental indenture relating to
such series on and after the date the conditions set forth in Section 405 are satisfied (hereinafter, “Covenant Defeasance”),
and the Securities of such series shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver,
consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue
to be deemed “outstanding” for all other purposes hereunder (it being understood that such Securities shall not be deemed
outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the Outstanding Securities of
such series, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth
in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of
any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute
a Default or an Event of Default under Section 501 hereof, but, except as specified above, the remainder of this Indenture and such series
of Securities shall be unaffected thereby. In addition, upon the Company’s exercise under Section 402 hereof of the option applicable
to this Section 404 hereof, subject to the satisfaction of the conditions set forth in Section 405 hereof, Sections 501(3) through 501(6)
and Section 501(9) hereof shall not constitute Events of Default.
SECTION
405. CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The
following shall be the conditions to the application of either Section 403 or 404 hereof to the Outstanding Securities of any series:
In
order to exercise either Legal Defeasance or Covenant Defeasance:
(a)
the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders of the Securities, cash in United States
dollars, U.S. Government Obligations, or a combination thereof, in such amounts as will be sufficient, to pay the principal of, or interest
and premium, if any, on the Outstanding Securities of such series on the Stated Maturity or on the applicable redemption date, as the
case may be, and the Company must specify whether the Securities are being defeased to maturity or to a particular redemption date;
(b)
in the case of Legal Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee
confirming that (i) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (ii) since
the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and
based thereon such Opinion of Counsel shall confirm that, the Holders of the Outstanding Securities of such series will not recognize
income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;
(c)
in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the
Trustee confirming that the Holders of the Outstanding Securities of such series will not recognize income, gain or loss for federal
income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
(d)
no Default or Event of Default shall have occurred and be continuing either: (i) on the date of such deposit (other than a Default or
Event of Default resulting from the borrowing of funds to be applied to such deposit); or (ii) insofar as Events of Default from bankruptcy
or insolvency events are concerned, at any time in the period ending on the 91st day after the date of deposit;
(e)
such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under any material
agreement or instrument (other than this Indenture) to which the Company is a party or by which the Company is bound;
(f)
the Company must have delivered to the Trustee an Opinion of Counsel to the effect that, assuming no intervening bankruptcy of the Company
or any Guarantor between the date of deposit and the 91st day following the deposit and assuming that no Holder is an “insider”
of the Company under applicable bankruptcy law, after the 91st day following the deposit, the trust funds will not be subject to the
effect of any applicable bankruptcy, insolvency, reorganization or similar laws affecting creditors’ rights generally;
(g)
the Company must deliver to the Trustee an Officers’ Certificate stating that the deposit was not made by the Company with the
intent of preferring the Holders of Securities over the other creditors of the Company with the intent of defeating, hindering, delaying
or defrauding creditors of the Company or others; and
(h)
the Company must deliver to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that all conditions precedent
relating to the Legal Defeasance or the Covenant Defeasance have been complied with.
SECTION
406. DEPOSITED MONEY AND U.S. GOVERNMENT OBLIGATIONS TO BE HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject
to Section 407 hereof, all money and non callable U.S. Government Obligations (including the proceeds thereof) deposited with the Trustee
(or other qualifying trustee, collectively for purposes of this Section 406, the “Trustee”) pursuant to Section 401 or 404
hereof in respect of the Outstanding Securities of any series shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Securities and this Indenture, to the payment, either directly or through any paying agent (including the Company
acting as paying agent) as the Trustee may determine, to the Holders of such Securities of all sums due and to become due thereon in
respect of principal, premium on , if any, and interest, but such money need not be segregated from other funds except to the extent
required by law.
The
Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable
U.S. Government Obligations deposited pursuant to Section 401 or 404 hereof or the principal and interest received in respect thereof
other than any such tax, fee or other charge which by law is for the account of the Holders of the Outstanding Securities.
Anything
in this Article IV to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the written
request of the Company any money or non-callable U.S. Government Obligations held by it as provided in Section 401 or 404 hereof which,
in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered
to the Trustee, are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance
or Covenant Defeasance or satisfaction and discharge of this Indenture.
SECTION
407. REPAYMENT TO COMPANY.
Any
money deposited with the Trustee or any paying agent, or then held by the Company, in trust for the payment of the principal of, premium
on, if any, or interest on any Securities and remaining unclaimed for two years after such principal, and premium, if any, or interest
has become due and payable shall be paid to the Company on its written request or (if then held by the Company) shall be discharged from
such trust; and the Holder of such Securities shall thereafter, as an unsecured creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such paying agent with respect to such trust money, and all liability of the Company as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such paying agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national
edition), notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from
the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Company.
SECTION
408. REINSTATEMENT.
If
the Trustee or Paying Agent is unable to apply any money or U.S. Government Obligations deposited with respect to Securities of any series
in accordance with Section 401, 403 or 404 hereof, as the case may be, by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture
with respect to the Securities of such series and the Securities of such series shall be revived and reinstated as though no deposit
had occurred pursuant to Section 401, 403 or 404 hereof until such time as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with Section 401, 403 or 404 hereof, as the case may be; provided, however,
that, if the Company makes any payment of principal of, premium on, if any, or interest on any Securities following the reinstatement
of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the
money or U.S. Government Obligations held by the Trustee or Paying Agent.
ARTICLE
V
REMEDIES
SECTION
501. EVENTS OF DEFAULT.
An
“Event of Default” on a series occurs if:
(1)
the Company defaults in the payment of interest on any Security of such series when the same becomes due and payable and the Default
continues for a period of 30 days;
(2)
the Company defaults in the payment of the principal of any Security of such series when the same becomes due and payable at maturity,
upon redemption or otherwise;
(3)
the Company fails to comply with any of its other agreements in the Securities of such series or this Indenture (as they relate thereto)
and the Default continues for the period and after the notice specified below (except in the case of a default with respect to any Change
of Control Provisions or Article VIII (or any replacement provisions contemplated by Article VIII), which will constitute Events of Default
with notice but without passage of time);
(4)
the acceleration of any Indebtedness of the Company in an amount of $50 million or more, individually or in the aggregate, and such acceleration
does not cease to exist, or such Indebtedness is not satisfied, in either case within five days after such acceleration;
(5)
the failure by the Company to make any principal or interest payment in an amount of $50 million or more, individually or in the aggregate,
in respect of Indebtedness of the Company within five days of such principal or interest becoming due and payable (after giving effect
to any applicable grace period set forth in the documents governing such Indebtedness);
(6)
a final judgment or judgments in an amount of $50 million or more, individually or in the aggregate, for the payment of money having
been entered by a court or courts of competent jurisdiction against the Company and such judgment or judgments is not satisfied, stayed,
annulled or rescinded within 90 days after being entered;
(7)
the Company pursuant to or within the meaning of any Bankruptcy Law:
(a)
commences a voluntary case,
(b)
consents to the entry of an order for relief against it in an involuntary case,
(c)
consents to the appointment of a Custodian of it or for all or substantially all of its property, or
(d)
makes a general assignment for the benefit of creditors;
(8)
a court of competent jurisdiction enters into an order or decree under any Bankruptcy Law that:
(a)
is for relief against the Company in an involuntary case,
(b)
appoints a Custodian of the Company or for all or substantially all of its property, or
(c)
orders the liquidation of the Company, and the order or decree remains unstayed and in effect for 60 days; or
(9)
any other Event of Default occurs with respect to Securities of that series as provided in the supplemental indenture or Board Resolutions
establishing such series of Securities.
The
term “Bankruptcy Law” means the Bankruptcy Act or any similar Federal or State law for the relief of debtors. The term “Custodian”
means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
A
Default under clause (3) above is not an Event of Default until the Trustee notifies the Company, or the Holders of at least 25% in principal
amount of the Securities of the applicable series notify the Company and the Trustee of the Default and (except in the case of a default
with respect to any provisions of any supplemental indenture or Board Resolution establishing such series of Securities giving the Holders
of Securities of such series the right to require the Company to repurchase or redeem such Securities of such series upon the occurrence
of a change of control prior to the final maturity date of such Securities of such series (“Change of Control Provisions”)
or Article VIII (or any replacement provisions contemplated by Article VIII)) the Company does not cure the Default within 90 days after
receipt of the notice. The notice must specify the Default, demand that it be remedied and state that the notice is a “Notice of
Default.”
SECTION
502. ACCELERATION.
If
any Event of Default (other than an Event of Default specified in clause (7) or (8) of Section 501 hereof) with respect to Securities
of any series occurs and is continuing, either the Trustee or the Holders of at least 25% in principal amount of the then Outstanding
Securities of that series may declare all the Securities of that series to be due and payable immediately. Upon any such declaration,
the Securities of that series shall become due and payable immediately, by a notice in writing to the Company (and to the Trustee if
given by Holders). Notwithstanding the foregoing, if an Event of Default specified in clause (7) or (8) of Section 501 hereof occurs
with respect to any series of Securities, all outstanding Securities of that series shall become due and payable without further action
or notice. The Holders of a majority in aggregate principal amount of Securities of any series then Outstanding by notice to the Trustee
may on behalf of the Holders of all of the Securities of that series waive any existing Default or Event of Default and its consequences
under this Indenture except a continuing Default or Event of Default in the payment of interest or premium, if any, on, or the principal
of, the Securities of that series.
SECTION
503. OTHER REMEDIES.
If
an Event of Default with respect to Securities of any series occurs and is continuing, the Trustee may pursue any available remedy to
collect the payment of principal, premium, if any, and interest on the Securities of that series or to enforce the performance of any
provision of the Securities of that series or this Indenture.
The
Trustee may maintain a proceeding even if it does not possess any of the Securities in a series or does not produce any of them in the
proceeding. A delay or omission by the Trustee or any Holder of a Security in exercising any right or remedy accruing upon an Event of
Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
SECTION
504. WAIVER OF PAST DEFAULTS.
Holders
of not less than a majority in aggregate principal amount of the then outstanding Securities in any series by notice to the Trustee may
on behalf of the Holders of all of the Securities of that series waive any existing Default or Event of Default and its consequences
hereunder, except a continuing Default or Event of Default in the payment of the principal of, premium, if any, or interest on, the Securities
of that series (including in connection with an offer to purchase) (provided, however, that the Holders of a majority in
aggregate principal amount of the then outstanding Securities of any series may rescind an acceleration and its consequences, including
any related payment default that resulted from such acceleration, with respect to that series). Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but
no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.
SECTION
505. CONTROL BY MAJORITY.
With
respect to any series of Securities, Holders of a majority in principal amount of the then outstanding Securities of that series may
direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee or exercising any trust
or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture that the
Trustee determines may be unduly prejudicial to the rights of other Holders of Securities of any series or that may involve the Trustee
in personal liability.
SECTION
506. LIMITATION ON SUITS.
A
Holder of a Security of any series may pursue a remedy with respect to this Indenture or the Securities of that series only if:
(a)
the Holder of a Security of that series gives to the Trustee written notice of a continuing Event of Default;
(b)
the Holders of at least 25% in principal amount of the then outstanding Securities of that series make a written request to the Trustee
to pursue the remedy;
(c)
such Holder of a Security or Holders of Securities offer and, if requested, provide to the Trustee indemnity satisfactory to the Trustee
against any loss, liability or expense;
(d)
the Trustee does not comply with the request within 60 days after receipt of the request and the offer and, if requested, the provision
of indemnity; and
(e)
during such 60-day period the Holders of a majority in principal amount of the then outstanding Securities of that series do not give
the Trustee a direction inconsistent with the request.
A
Holder of a Security may not use this Indenture to prejudice the rights of another Holder of a Security or to obtain a preference or
priority over another Holder of a Security.
SECTION
507. RIGHTS OF HOLDERS OF SECURITIES TO RECEIVE PAYMENT.
Notwithstanding
any other provision of this Indenture, the right of any Holder of a Security of any series to receive payment of principal, premium,
if any, and interest on the Security, on or after the respective due dates expressed in the Security (including in connection with an
offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired
or affected without the consent of such Holder.
SECTION
508. COLLECTION SUIT BY TRUSTEE.
With
respect to the Securities of any series, if an Event of Default specified in clause (1) or (2) of Section 501 hereof occurs and is continuing,
the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount
of principal of, premium on, if any, and interest remaining unpaid on the Securities of that series and interest on overdue principal
and, to the extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION
509. TRUSTEE MAY FILE PROOFS OF CLAIM.
The
Trustee is authorized to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the
claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel) and the Holders of the Securities of any series allowed in any judicial proceedings relative to the Company (or any
other obligor upon the Securities), its creditors or its property and shall be entitled and empowered to collect, receive and distribute
any money or other property payable or deliverable on any such claims and any custodian in any such judicial proceeding is hereby authorized
by each Holder of that series to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of
such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 607 of this Indenture. To the
extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 607 of this Indenture out of the estate in any such proceeding, shall be denied for any reason,
payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities
and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization
or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Holder of any series of Securities any plan of reorganization, arrangement, adjustment or composition affecting
the Securities of that series or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder
in any such proceeding.
SECTION
510. PRIORITIES.
If
the Trustee collects any money pursuant to this Article, it shall pay out the money in the following order:
(a)
First: to the Trustee, its agents and attorneys for amounts due under Section 607 of this Indenture, including payment of all compensation,
expense and liabilities incurred, and all advances made, by the Trustee and the costs and expenses of collection;
(b)
Second: to Holders of Securities for amounts due and unpaid on the Securities for principal, premium, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and payable on the Securities for principal, premium, if any,
and interest, respectively; and
(c)
Third: to the Company or to such party as a court of competent jurisdiction shall direct.
The
Trustee may fix a record date and payment date for any payment to Holders of Securities pursuant to this Section 510.
SECTION
511. UNDERTAKING FOR COSTS.
In
any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted
by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against
any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.
This Section does not apply to a suit by the Trustee, a suit by a Holder of a Security pursuant to Section 507 hereof, or a suit by Holders
of more than 10% in principal amount of the then outstanding Securities of any series.
ARTICLE
VI
THE
TRUSTEE
SECTION
601. CERTAIN DUTIES AND RESPONSIBILITIES.
(a)
Except during the continuance of an Event of Default with respect to the Securities of any series:
(1)
the Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants
or obligations shall be read into this Indenture against the Trustee; and
(2)
in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture;
but in the case of any such certificates or opinions that by any provision hereof are specifically required to be furnished to the Trustee,
the Trustee shall be under a duty to examine the same to determine whether they conform to the requirements of this Indenture (but need
not confirm or investigate the accuracy of mathematical calculation or other facts stated therein).
(b)
In case an Event of Default has occurred and is continuing with respect to the Securities of any series, the Trustee shall exercise such
of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own affairs.
(c)
No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent
failure to act or its own willful misconduct, except that:
(1)
this Subsection shall not be construed to limit the effect of Subsection (a) of this Section;
(2)
the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts;
(3)
the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with the direction of
the Holders of a majority in principal amount of the Outstanding Securities of any series or of all series, determined as provided in
Section 505, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred upon the Trustee, under this Indenture with respect to the Securities of such series; and
(4)
no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in
the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds
for believing that repayment of such funds or indemnity satisfactory to it against such risk or liability is not assured to it.
(d)
Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of
or affording protection to the Trustee shall be subject to the provisions of this Section.
SECTION
602. NOTICE OF DEFAULTS.
Within
90 days after the occurrence of any Default or Event of Default with respect to the Securities of any series, the Trustee shall give
notice of such Default or Event of Default known to the Trustee to all Holders of Securities of such series in the manner provided in
Section 107 and in compliance with the Trust Indenture Act, unless such Default or Event of Default shall have been cured or waived;
provided, however, that, except in the case of a Default or Event of Default in the payment of the principal of (or premium,
if any) or interest on or any Additional Amounts with respect to any Security of such series or in the payment of any sinking fund installment
with respect to Securities of such series, the Trustee shall be protected in withholding such notice if and so long as the board of directors,
the executive committee or a trust committee of directors and/or Responsible Officers of the Trustee in good faith determines that the
withholding of such notice is in the interest of the Holders of Securities of such series; and provided, further, that
in the case of any Default or Event of Default of the character specified in Section 501(3) with respect to Securities of such series,
no such notice to Holders shall be given until at least 30 days after the occurrence thereof.
SECTION
603. CERTAIN RIGHTS OF TRUSTEE.
Subject
to the provisions of Section 601:
(a)
the Trustee may conclusively rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, coupon, other evidence of indebtedness
or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;
(b)
any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution;
(c)
whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the
absence of bad faith on its part, rely upon an Officers’ Certificate;
(d)
the Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;
(e)
the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction
of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity satisfactory
to it against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction;
(f)
the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, coupon, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine
the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry or investigation;
(g)
the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents
or attorneys and, except for any Affiliates of the Trustee, the Trustee shall not be responsible for any misconduct or negligence on
the part of any agent or attorney appointed with due care by it hereunder;
(h)
the Trustee shall not be charged with knowledge of any Default or Event of Default with respect to the Securities of any series for which
it is acting as Trustee unless either (1) a Responsible Officer shall have actual knowledge of such Default or Event of Default or (2)
written notice of such Default or Event of Default which is in fact such a default shall have been received by the Trustee at the Corporate
Trust Office of the Trustee and such notice references the Securities and this Indenture by the Company or any other obligor on such
Securities or by any Holder of such Securities;
(i)
the Trustee shall not be liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Indenture.
(j)
in no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever
(including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or
damage and regardless of the form of action;
(k)
the rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified,
are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person
employed to act hereunder; and
(l)
the Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized
at such time to take specified actions pursuant to this Indenture.
SECTION
604. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The
recitals contained herein and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements
of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. The Trustee shall not be accountable for the use or application by the Company
of Securities or the proceeds thereof.
SECTION
605. MAY HOLD SECURITIES.
The
Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar or any other agent of the Company, in its individual or any
other capacity, may become the owner or pledgee of Securities and, subject to Sections 608 and 613, may otherwise deal with the Company
with the same rights it would have if it were not the Trustee, Authenticating Agent, Paying Agent, Security Registrar or such other agent.
SECTION
606. MONEY HELD IN TRUST.
Money
held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall
be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Company.
SECTION
607. COMPENSATION AND REIMBURSEMENT.
The
Company agrees:
(1)
to pay to the Trustee from time to time compensation for all services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an express trust);
(2)
except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the compensation and the reasonable
expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as shall be determined to have
been caused by its own negligence or willful misconduct; and
(3)
to indemnify the Trustee and each of its directors, officers, employees, agents and/or representatives for, and to hold each of them
harmless against, any loss, liability or expense incurred without negligence or willful misconduct on each of their part, arising out
of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and expenses of defending
themselves against any claim or liability in connection with the exercise or performance of any of the Trustee’s powers or duties
hereunder.
As
security for the performance of the obligations of the Company under this Section 607, the Trustee shall have a lien prior to the Securities
on all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of, premium,
if any, or interest, if any, on or any Additional Amounts with respect to particular Securities.
Any
expenses and compensation for any services rendered by the Trustee after the occurrence of an Event of Default (including the reasonable
charges and expenses of its counsel) specified in clause (7) or (8) of Section 501 shall constitute expenses and compensation for services
of administration under all applicable federal or state bankruptcy, insolvency, reorganization or other similar laws.
The
provisions of this Section 607 and any lien arising hereunder shall survive the resignation or removal of the Trustee or the discharge
of the Company’s obligations under this Indenture and the termination of this Indenture.
SECTION
608. DISQUALIFICATION; CONFLICTING INTERESTS.
(a)
If the Trustee has or shall acquire any conflicting interest, as defined in this Section 608, with respect to the Securities of any series,
it shall, within 90 days after ascertaining that it has such conflicting interest, either eliminate such conflicting interest or resign
with respect to the Securities of that series in the manner and with the effect hereinafter specified in this Article.
(b)
In the event that the Trustee shall fail to comply with the provisions of Subsection (a) of this Section 608 with respect to the Securities
of any series, the Trustee shall, within 10 days after the expiration of such 90-day period, transmit by mail to all Holders of Securities
of that series, as their names and addresses appear in the Security Register, notice of such failure in compliance with the Trust Indenture
Act.
(c)
For the purposes of this Section, the term “conflicting interest” shall have the meaning specified in Section 310(b) of the
Trust Indenture Act and the Trustee shall comply with Section 310(b) of the Trust Indenture Act; provided, that there shall be
excluded from the operation of Section 310(b)(1) of the Trust Indenture Act with respect to the Securities of any series any indenture
or indentures under which other securities, or certificates of interest or participation in other securities, of the Company are outstanding,
if the requirements for such exclusion set forth in Section 310(b)(1) of the Trust Indenture Act are met. For purposes of the preceding
sentence, the optional provision permitted by the second sentence of Section 310(b)(1) of the Trust Indenture Act shall be applicable.
SECTION
609. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
There
shall at all times be a Trustee hereunder which shall be a corporation organized and doing business under the laws of the United States
of America, any State thereof or the District of Columbia, authorized under such laws to exercise corporate trust powers, having a combined
capital and surplus of at least $50 million and subject to supervision or examination by Federal or State (or the District of Columbia)
authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising
or examining authority, then for the purposes of this Section 609, the combined capital and surplus of such corporation shall be deemed
to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article.
The
Indenture shall always have a Trustee who satisfies the requirements of Sections 310(a)(1), 310(a)(2) and 310(a)(5) of the Trust Indenture
Act.
SECTION
610. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a)
No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until
the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 611.
(b)
The Trustee may resign at any time with respect to the Securities of one or more series by giving written notice thereof to the Company.
If the instrument of acceptance by a successor Trustee required by Section 611 shall not have been delivered to the resigning Trustee
within 30 days after the giving of such notice of resignation, the resigning Trustee may petition at the expense of the Company any court
of competent jurisdiction for the appointment of a successor Trustee with respect to the Securities of such series.
(c)
The Trustee may be removed at any time with respect to the Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series, delivered to the Trustee and to the Company. If the instrument of acceptance by
a successor Trustee required by Section 611 shall not have been delivered to the resigning Trustee within 30 days after the giving of
such notice of resignation, the resigning Trustee may petition at the expense of the Company any court of competent jurisdiction for
the appointment of a successor Trustee with respect to the Securities of such series.
(d)
If at any time:
(1)
the Trustee shall fail to comply with Section 608(a) after written request therefor by the Company or by any Holder who has been a bona
fide Holder of a Security for at least six months, or
(2)
the Trustee shall cease to be eligible under Section 609 and shall fail to resign after written request therefor by the Company or by
any such Holder of Securities, or
(3)
the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then,
in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to all Securities, or (ii) subject to Section
505, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Securities and the appointment
of a successor Trustee or Trustees.
(e)
If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause,
with respect to the Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee
or Trustees with respect to the Securities of that or those series (it being understood that any such successor Trustee may be appointed
with respect to the Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect
to the Securities of any particular series) and such successor Trustee or Trustees shall comply with the applicable requirements of Section
611. If no successor Trustee with respect to the Securities of any series shall have been so appointed by the Company and accepted appointment
in the manner required by Section 611, any Holder who has been a bona fide Holder of a Security of such series for at least six months
may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.
(f)
The Company shall give notice of each resignation and each removal of the Trustee with respect to the Securities of any series and each
appointment of a successor Trustee with respect to the Securities of any series by mailing written notice of such event by first-class
mail, postage prepaid, to all Holders of Securities of such series as their names and addresses appear in the Security Register. Each
notice shall include the name of the successor Trustee with respect to the Securities of such series and the address of its Corporate
Trust Office.
SECTION
611. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
(a)
In case of the appointment hereunder of a successor Trustee with respect to all Securities, every such successor Trustee so appointed
shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon
the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on the request of the Company
or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to
such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such
successor Trustee all property and money held by such retiring Trustee hereunder.
(b)
In case of the appointment hereunder of a successor Trustee with respect to the Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall
be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Securities of that or those series to which the appointment of such successor Trustee relates,
(2) if the retiring Trustee is not retiring with respect to all Securities, shall contain such provisions as shall be deemed necessary
or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of that
or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee and (3) shall add
to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees
co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any
trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture,
the resignation or removal of the retiring Trustee shall become effective to the extent provided therein and each such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee
with respect to the Securities of that or those series to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee all property
and money held by such retiring Trustee hereunder with respect to the Securities of that or those series to which the appointment of
such successor Trustee relates.
(c)
Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in
and confirming to such successor Trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the
case may be.
(d)
No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
SECTION
612. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any
corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from
any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be
otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part of any
of the parties hereto; provided, however, that in the case of a corporation succeeding to all or substantially all the
corporate trust business of the Trustee, such successor corporation shall expressly assume all of the Trustee’s liabilities hereunder.
In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion
or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION
613. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The
Trustee shall comply with Section 311(a) of the Trust Indenture Act, excluding any creditor relationship described in Section 311(b)
of the Trust Indenture Act. A Trustee who has resigned or been removed shall be subject to Section 311(a) of the Trust Indenture Act
to the extent indicated therein.
SECTION
614. APPOINTMENT OF AUTHENTICATING AGENT.
The
Trustee may appoint an Authenticating Agent or Agents that shall be authorized to act on behalf of the Trustee to authenticate Securities
issued upon original issue and upon exchange, registration of transfer or partial redemption or pursuant to Section 306, and Securities
so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated
by the Trustee hereunder. Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee
or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf
of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating
Agent. Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business
under the laws of the United States of America, any State thereof or the District of Columbia having a combined capital and surplus of
not less than $50 million or equivalent amount expressed in a foreign currency and subject to supervision or examination by Federal or
State (or the District of Columbia) authority or authority of such country. If such Authenticating Agent publishes reports of condition
at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section
614, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section 614, such Authenticating Agent shall resign immediately in the manner and with the effect specified
in this Section 614.
Any
corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided
such corporation shall be otherwise eligible under this Section 614, without the execution or filing of any paper or any further act
on the part of the Trustee or the Authenticating Agent.
An
Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company. The Trustee may at any
time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company.
Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease
to be eligible in accordance with the provisions of this Section 614, the Trustee may appoint a successor Authenticating Agent which
shall be acceptable to the Company and shall mail written notice of such appointment by first-class mail, postage prepaid, to all Holders
as their names and addresses appear in the Security Register. Any successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an
Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section 614.
The
Trustee agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section 614,
and the Trustee shall be entitled to be reimbursed for such payments, subject to the provisions of Section 607.
If
an appointment is made pursuant to this Section 614, the Securities may have endorsed thereon, in addition to the Trustee’s certificate
of authentication, an alternate certificate of authentication in the following form:
“This
is one of the Securities of the series designated therein referred to in the within mentioned Indenture.
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AS
TRUSTEE |
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By |
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AS
AUTHENTICATING AGENT |
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AS
AUTHORIZED SIGNATORY” |
Notwithstanding
any provision of this Section 614 to the contrary, if at any time any Authenticating Agent appointed hereunder with respect to any series
of Securities shall not also be acting as the Security Registrar hereunder with respect to any series of Securities, then, in addition
to all other duties of an Authenticating Agent hereunder, such Authenticating Agent shall also be obligated (i) to furnish to the Security
Registrar promptly all information necessary to enable the Security Registrar to maintain at all times an accurate and current Security
Register and (ii) prior to authenticating any Security denominated in a foreign currency, to ascertain from the Company the units of
such foreign currency that are required to be determined by the Company pursuant to Section 302.
ARTICLE
VII
HOLDER’S
LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION
701. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS.
With
respect to each series of Securities, the Company will furnish or cause to be furnished to the Trustee:
(a)
semi-annually, not more than 15 days after each Regular Record Date relating to that series (or, if there is no Regular Record Date relating
to that series, on January 1 and July 1), a list, in such form as the Trustee may reasonably require, of the names and addresses of the
Holders of that series as of such dates, and
(b)
at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list
of similar form and content, such list to be dated as of a date not more than 15 days prior to the time such list is furnished;
provided,
that so long as the Trustee is the Security Registrar, the Company shall not be required to furnish or cause to be furnished such a list
to the Trustee. The Company shall otherwise comply with Section 312(a) of the Trust Indenture Act.
SECTION
702. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(a)
The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders of each series contained
in the most recent list furnished to the Trustee as provided in Section 701 and the names and addresses of Holders of each series received
by the Trustee in its capacity as Security Registrar. The Trustee may destroy any list furnished to it as provided in Section 701 upon
receipt of a new list so furnished. The Trustee shall otherwise comply with Section 312(a) of the Trust Indenture Act.
(b)
Holders of Securities may communicate pursuant to Section 312(b) of the Trust Indenture Act with other Holders with respect to their
rights under this Indenture or under the Securities. The Company, the Trustee, the Security Registrar and any other Person shall have
the protection of Section 312(c) of the Trust Indenture Act.
SECTION
703. REPORTS BY TRUSTEE.
(a)
Within 60 days after May 15 of each year commencing with the year 2018, the Trustee shall transmit by mail to Holders a brief report
dated as of such May 15 that complies with Section 313(a) of the Trust Indenture Act. The Trustee shall comply with Section 313(b) of
the Trust Indenture Act. The Trustee shall transmit by mail all reports as required by Sections 313(c) and 313(d) of the Trust Indenture
Act.
(b)
A copy of each report pursuant to Subsection (a) of this Section 703 shall, at the time of its transmission to Holders, be filed by the
Trustee with each stock exchange upon which any Securities are listed, with the SEC and with the Company. The Company will notify the
Trustee when any Securities are listed or delisted on any stock exchange.
SECTION
704. REPORTS BY COMPANY.
The
Company shall file with the Trustee, within 15 days after the Company is required to file the same with the SEC, copies of the annual
reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the SEC may from time
to time by rules and regulations prescribe) which the Company may be required to file with the SEC pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934, as amended, and shall otherwise comply with Section 314(a) of the Trust Indenture Act.
Delivery
of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such
shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including
the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’
Certificates).
ARTICLE
VIII
CONSOLIDATION,
MERGER, CONVEYANCE,
TRANSFER
OR LEASE
SECTION
801. COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
(a)
The Company shall not, directly or indirectly, in any transaction or series of related transactions: (1) consolidate or merge with or
into another Person (whether or not the Company is the surviving corporation); (2) sell, assign, transfer, convey or otherwise dispose
of all or substantially all of the properties or assets of the Company and its Subsidiaries taken as a whole, or (3) assign any of its
obligations under the Securities and this Indenture, in one or more related transactions, to another Person; unless:
(i)
either: (A) the Company is the surviving corporation; or (B) the Person formed by or surviving any such consolidation or merger (if other
than the Company) or to which such sale, assignment, transfer, conveyance or other disposition shall have been made is a corporation
organized or existing under the laws of the United States, any state thereof or the District of Columbia;
(ii)
the Person formed by or surviving any such consolidation or merger (if other than the Company) or the Person to which such sale, assignment,
transfer, conveyance or other disposition shall have been made assumes all the obligations of the Company under the Securities and this
Indenture pursuant to agreements reasonably satisfactory to the Trustee;
(iii)
immediately after such transaction no Default or Event of Default exists;
(iv)
the Company shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel, each stating that such merger,
consolidation or sale, assignment, transfer, conveyance or other disposition of such properties or assets or assignment of its obligations
under the Securities and this Indenture and such supplemental indenture, if any, comply with this Indenture.
(b)
The Company shall not, directly or indirectly, lease all or substantially all of its properties or assets, in one or more related transactions,
to any other Person.
(c)
Notwithstanding the foregoing, this Section 801 shall not apply to a sale, assignment, transfer, conveyance or other disposition of assets
between or among the Company and any of its Wholly Owned Subsidiaries.
SECTION
802. SUCCESSOR PERSON SUBSTITUTED.
Upon
any consolidation or merger, any sale, assignment, transfer, lease, conveyance or other disposition of all or substantially all of the
assets of the Company, or any assignment of the obligations under the Securities and this Indenture in accordance with Section 801 hereof,
the successor corporation formed by such consolidation or into or with which the Company is merged or to which such sale, assignment,
transfer, lease, conveyance or other disposition is made shall succeed to, and be substituted for (so that from and after the date of
such consolidation, merger, sale, lease, conveyance or other disposition, the provisions of this Indenture referring to the “Company”
shall refer instead to the successor corporation and not to the Company), and may exercise every right and power of the Company under
this Indenture with the same effect as if such successor Person had been named as the Company herein; provided, however,
that the predecessor Company shall not be relieved from the obligation to pay the principal of and interest on the Securities except
in the case of a sale of all of the Company’s assets that meets the requirements of Section 801 hereof.
ARTICLE
IX
SUPPLEMENTAL
INDENTURES
SECTION
901. WITHOUT CONSENT OF HOLDERS.
Notwithstanding
Section 902 of this Indenture, the Company and the Trustee may amend or supplement this Indenture or the Securities of any series without
the consent of any Holder of a Security of any series:
(a)
to cure any ambiguity, defect or inconsistency;
(b)
to provide for uncertificated Securities in addition to or in place of certificated Securities or to alter the provisions of Article
II of this Indenture (including the related definitions) in a manner that does not materially adversely affect any Holder;
(c)
to establish the form or terms of Securities of any series as permitted by Sections 201 and 301 of this Indenture;
(d)
to provide for the assumption of the Company’s or any Guarantor’s obligations to the Holders of the Securities by a successor
to the Company pursuant to Article VIII of this Indenture;
(e)
to make any change that would provide any additional rights or benefits to the Holders of the Securities or that does not adversely affect
the legal rights hereunder of any such Holder;
(f)
to comply with requirements of the SEC in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act;
(g)
to evidence and provide the acceptance of the appointment of a successor Trustee pursuant to Sections 610 and 611 of this Indenture;
and
(h)
to add a Guarantor of the Securities.
Upon
the request of the Company accompanied by a resolution of its Board of Directors authorizing the execution of any such amended or supplemental
indenture, and upon receipt by the Trustee of the documents described in Section 603 of this Indenture, the Trustee shall join with the
Company in the execution of any amended or supplemental indenture authorized or permitted by the terms of this Indenture and to make
any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental indenture that affects its own rights, duties or immunities under this Indenture or otherwise.
SECTION
902. WITH CONSENT OF HOLDERS.
Except
as provided below in this Section 902, the Company and the Trustee may amend or supplement this Indenture and the Securities of any series
may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount at maturity of Securities
of that series then Outstanding voting as a single class (including, without limitation, consents obtained in connection with a purchase
of, or tender offer or exchange offer for, that series of Securities), and, subject to Sections 504 and 507 hereof, any existing Default
or Event of Default (other than a Default or Event of Default in the payment of the principal of, premium, if any, and interest, if any,
on such Securities, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision
of this Indenture or such Securities may be waived with the consent of the Holders of a majority in aggregate principal amount at maturity
of the then Outstanding Securities of that series voting as a single class (including without limitation, consents obtained in connection
with a purchase of, or tender offer or exchange offer for, that series of Securities).
Upon
the request of the Company accompanied by a Board Resolution authorizing the execution of any such amended or supplemental indenture,
and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the Holders of that series of Securities
as aforesaid, and upon receipt by the Trustee of the documents described in Section 603 of this Indenture, the Trustee shall join with
the Company in the execution of such amended or supplemental indenture unless such amended or supplemental indenture directly affects
the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion,
but shall not be obligated to, enter into such amended or supplemental indenture.
It
shall not be necessary for the consent of the Holders of Securities under this Section 902 to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the substance thereof.
After
an amendment, supplement or waiver under this Section becomes effective, the Company shall mail to the Holders of Securities of any series
affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or
any defect therein, shall not, however, in any way impair or affect the validity of any such amended or supplemental indenture or waiver.
Subject
to Sections 504 and 507 hereof, the Holders of a majority in aggregate principal amount at maturity of a series of Securities then Outstanding
voting as a single class may waive compliance in a particular instance by the Company with any provision of this Indenture or the Securities.
However, without the consent of each Holder of a series of Securities affected, an amendment or waiver under this Section 902 may not
(with respect to the series of Securities held by a non-consenting Holder):
(a)
reduce the principal amount of the then Outstanding Securities whose Holders must consent to an amendment, supplement or waiver;
(b)
reduce the principal of or change the fixed maturity of any Security or alter any of the provisions with respect to the redemption of
the Securities unless otherwise specifically provided for in the supplemental indenture;
(c)
reduce the rate of or change the time for payment of interest on any Security;
(d)
waive a Default or Event of Default in the payment of principal of, or interest or premium, if any, on the Securities (except a rescission
of acceleration of the Securities by the Holders of any series of Securities of at least a majority in aggregate principal amount of
the then Outstanding Securities of that series and a waiver of the payment default that resulted from such acceleration);
(e)
make any Security payable in money other than that stated in the Security;
(f)
make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of Holders of Securities to receive
payments of principal of, or interest or premium, if any, on the Securities;
(g)
waive a redemption payment with respect to any Security (other than as may be specifically permitted by the supplemental indenture);
(h)
cause the Securities to become subordinated in right of payment to any other Indebtedness;
(i)
release any Guarantor from any of its obligations under its Guarantee or this Indenture, except in accordance with the terms thereof;
or
(j)
make any change in Sections 504 or 507 or the foregoing amendment and waiver provisions.
SECTION
903. COMPLIANCE WITH TRUST INDENTURE ACT.
Every
amendment or supplement to this Indenture or the Securities shall be set forth in a amended or supplemental indenture that complies with
the Trust Indenture Act as then in effect.
SECTION
904. REVOCATION AND EFFECT OF CONSENTS.
Until
an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Security is a continuing consent by the Holder
of a Security and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s
Security, even if notation of the consent is not made on any Security. However, any such Holder of a Security or subsequent Holder of
a Security may revoke the consent as to its Security if the Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter
binds every Holder.
SECTION
905. NOTATION ON OR EXCHANGE OF SECURITIES.
The
Trustee may place an appropriate notation about an amendment, supplement or waiver on any Security thereafter authenticated. The Company
in exchange for all Securities of a series may issue and the Trustee shall, upon receipt of a written order from the Company to authenticate
such Securities, authenticate new Securities that reflect the amendment, supplement or waiver.
SECTION
906. TRUSTEE TO SIGN AMENDMENTS, ETC.
The
Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article IX if the amendment or supplement does not
adversely affect the rights, duties, liabilities or immunities of the Trustee. The Company may not sign an amendment or supplemental
indenture until the Board of Directors approves it. In executing any amended or supplemental indenture, the Trustee shall be given and
(subject to Section 601 of this Indenture) shall be fully protected in relying upon, in addition to the documents required by Section
603 this Indenture, an Officer’s Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental
indenture is authorized or permitted by this Indenture.
ARTICLE
X
COVENANTS
SECTION
1001. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST.
The
Company covenants and agrees for the benefit of each series of Securities that it will duly and punctually pay the principal of (and
premium, if any), interest on and any Additional Amounts with respect to the Securities of that series in accordance with the terms of
the Securities and this Indenture.
SECTION
1002. MAINTENANCE OF OFFICE OR AGENCY.
If
Securities of a series are issuable only as Registered Securities, the Company will maintain in each Place of Payment for any series
of Securities an office or agency where Securities of that series may be presented or surrendered for payment, where Securities of that
series may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Company in respect of
the Securities of that series and this Indenture may be served. The Company will give prompt written notice to the Trustee of the location,
and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office
or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made
or served at the Corporate Trust Office of the Trustee.
The
Company may also from time to time designate one or more other offices or agencies where the Securities of one or more series may be
presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in each
Place of Payment for Securities of any series for such purposes. The Company will give prompt written notice to the Trustee of any such
designation or rescission and of any change in the location of any such other office or agency.
SECTION
1003. MONEY FOR SECURITIES PAYMENTS TO BE HELD IN TRUST.
If
the Company shall at any time act as its own Paying Agent with respect to any series of Securities, it will, on or before each due date
of the principal of (and premium, if any) or interest on or any Additional Amounts with respect to any of the Securities of that series,
segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal (and premium, if any)
or interest so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly
notify the Trustee of its action or failure so to act.
Whenever
the Company shall have one or more Paying Agents for any series of Securities, the Company will, on or before each due date of the principal
of (and premium, if any) or interest on any Securities of that series, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal,
premium or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.
The
Company will cause each Paying Agent for any series of Securities other than the Trustee to execute and deliver to the Trustee an instrument
in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will:
(1)
hold all sums held by it for the payment of the principal of (and premium, if any), interest on or any Additional Amounts with respect
to Securities of that series in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(2)
give the Trustee notice of any default by the Company (or any other obligor upon the Securities of that series) in the making of any
payment of principal (and premium, if any), interest on or any Additional Amounts with respect to the Securities of that series; and
(3)
at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums
so held in trust by such Paying Agent.
The
Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay,
or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums
to be held by the Trustee upon the same trusts as those upon which sums were held by the Company or such Paying Agent; and, upon such
payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.
Any
money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest on any Security of any series and remaining unclaimed for three years after such principal (and premium,
if any) or interest has become due and payable shall, unless otherwise required by mandatory provisions of applicable escheat, or abandoned
or unclaimed property law, be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof,
shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in an Authorized Newspaper in the Borough of Manhattan, the
City of New York and in such other Authorized Newspapers as the Trustee shall deem appropriate, notice that such money remains unclaimed
and that, after a date specified herein, which shall not be less than 30 days from the date of such publication, any unclaimed balance
of such money then remaining will, unless otherwise required by mandatory provisions of applicable escheat, or abandoned or unclaimed
property law, be repaid to the Company.
SECTION
1004. EXISTENCE.
Subject
to Article VIII, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate
existence.
SECTION
1005. STATEMENT BY OFFICERS AS TO DEFAULT.
The
Company shall deliver to the Trustee, within 120 days after the end of each fiscal year, an Officers’ Certificate stating that
a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made under the supervision of
the signing officers with a view to determining whether the Company has kept, observed, performed and fulfilled its obligations under
this Indenture, and further stating, as to each such officer signing such certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance
or observance of any of the terms, provisions and conditions of this Indenture (or, if a Default or Event of Default shall have occurred,
describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is taking or proposes
to take with respect thereto) and that to the best of his or her knowledge no event has occurred and remains in existence by reason of
which payments on account of the principal of or interest, if any, on the Securities is prohibited or if such event has occurred, a description
of the event and what action the Company is taking or proposes to take with respect thereto.
The
Company shall, so long as any of the Securities are outstanding, deliver to the Trustee, forthwith and in any event within five days
upon any officer becoming aware of any Default or Event of Default or an event which, with notice or the lapse of time or both, would
constitute an Event of Default, an Officers’ Certificate specifying such Default or Event of Default and what action the Company
is taking or proposes to take with respect thereto.
SECTION
1006. WAIVER OF CERTAIN COVENANTS.
The
Company may omit in any particular instance to comply with any covenant or condition set forth in Section 1005, or any covenant added
for the benefit of any series of Securities as contemplated by Section 301 (unless otherwise specified pursuant to Section 301) if before
or after the time for such compliance the Holders of a majority in principal amount of the Outstanding Securities of all series affected
by such omission (acting as one class) shall, by Act of such Holders, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to or affect such covenant or condition except to the extent
so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect
of any such covenant or condition shall remain in full force and effect.
SECTION
1007. ADDITIONAL AMOUNTS.
If
the Securities of a series expressly provide for the payment of Additional Amounts, the Company will pay to the Holder of any Security
of such series Additional Amounts as expressly provided therein. Whenever in this Indenture there is mentioned, in any context, the payment
of the principal of or any premium or interest on, or in respect of, any Security of any series or the net proceeds received from the
sale or exchange of any Security of any series, such mention shall be deemed to include mention of the payment of Additional Amounts
provided for in this Section 1007 to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof
pursuant to the provisions of this Section 1007 and express mention of the payment of Additional Amounts (if applicable) in any provisions
hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express mention is not made.
If
the Securities of a series provide for the payment of Additional Amounts, at least 10 days prior to the first Interest Payment Date with
respect to that series of Securities (or if the Securities of that series will not bear interest prior to Maturity, the first day on
which a payment of principal and any premium is made), and at least 10 days prior to each date of payment of principal and any premium
or interest if there has been any change with respect to the matters set forth in the below-mentioned Officers’ Certificate, the
Company shall furnish the Trustee and the Company’s principal Paying Agent or Paying Agents, if other than the Trustee, with an
Officers’ Certificate instructing the Trustee and such Paying Agent or Paying Agents whether such payment of principal of and any
premium or interest on the Securities of that series shall be made to Holders of Securities of that series who are United States Aliens
without withholding for or on account of any tax, assessment or other governmental charge described in the Securities of that series.
If any such withholding shall be required, then such Officers’ Certificate shall specify by country the amount, if any, required
to be withheld on such payments to such Holders of Securities and the Company will pay to such Paying Agent the Additional Amounts required
by this Section. The Company covenants to indemnify the Trustee and any Paying Agent for, and to hold them harmless against any loss,
liability or expense reasonably incurred without negligence or willful misconduct on their part arising out of or in connection with
actions taken or omitted by any of them in reliance on any Officers’ Certificate furnished pursuant to this Section 1007.
ARTICLE
XI
REDEMPTION
OF SECURITIES
SECTION
1101. APPLICABILITY OF ARTICLE.
Securities
of any series which are redeemable before their Stated Maturity shall be redeemable in accordance with their terms and (except as otherwise
specified as contemplated by Section 301 for Securities of any series) in accordance with this Article.
SECTION
1102. ELECTION TO REDEEM; NOTICE TO TRUSTEE.
The
election of the Company to redeem any Securities shall be evidenced by a Board Resolution. In case of any redemption at the election
of the Company of less than all the Securities of any series, the Company shall, a reasonable period prior to the Redemption Date fixed
by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and of the
principal amount of Securities of such series to be redeemed. In the case of any redemption of Securities prior to the expiration of
any restriction on such redemption provided in the terms of such Securities or elsewhere in this Indenture, the Company shall furnish
the Trustee with an Officers’ Certificate evidencing compliance with such restriction.
SECTION
1103. SELECTION BY TRUSTEE OF SECURITIES TO BE REDEEMED.
If
less than all the Securities of any series are to be redeemed, the particular Securities to be redeemed shall be selected not more than
60 days prior to the Redemption Date by the Trustee, from the Outstanding Securities of such series not previously called for redemption,
by such method as the Trustee shall deem fair and appropriate and that may provide for the selection for redemption of portions (equal
to the minimum authorized denomination for Securities of that series or any integral multiple thereof) of the principal amount of Securities
of such series of a denomination larger than the minimum authorized denomination for Securities of that series or of the principal amount
of global Securities of such series.
The
Trustee shall promptly notify the Company and the Security Registrar in writing of the Securities selected for redemption and, in the
case of any Securities selected for partial redemption, the principal amount thereof to be redeemed.
For
all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Securities shall
relate, in the case of any Securities redeemed or to be redeemed only in part, to the portion of the principal amount of such Securities
which has been or is to be redeemed.
SECTION
1104. NOTICE OF REDEMPTION.
Notice
of redemption shall be given in the manner provided in Section 107 to each Holder of Securities to be redeemed not less than 30 nor more
than 60 days prior to the Redemption Date.
All
notices of redemption shall state:
(1)
the Redemption Date,
(2)
the Redemption Price,
(3)
if less than all the Outstanding Securities of any series are to be redeemed, the identification (and, in the case of partial redemption,
the principal amounts) of the particular Securities to be redeemed,
(4)
that on the Redemption Date the Redemption Price will become due and payable upon each such Security to be redeemed and, if applicable,
that interest thereon will cease to accrue on and after said date,
(5)
the place or places where such Securities are to be surrendered for payment of the Redemption Price,
(6)
that the redemption is for a sinking fund, if such is the case, and
(7)
the “CUSIP” number, if applicable.
A
notice of redemption as contemplated by Section 107 need not identify particular Registered Securities to be redeemed. Notice of redemption
of Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company’s request and provision
to the Trustee of the notice information 10 days prior to delivery of the notice, by the Trustee in the name and at the expense of the
Company.
SECTION
1105. DEPOSIT OF REDEMPTION PRICE.
On
or before 10:00 a.m., New York City time, on any Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or,
if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money sufficient
to pay the Redemption Price of, and (except if the Redemption Date shall be an Interest Payment Date) accrued interest on and any Additional
Amounts with respect to all the Securities to be redeemed on that date.
SECTION
1106. SECURITIES PAYABLE ON REDEMPTION DATE.
Notice
of redemption having been given as aforesaid, the Securities so to be redeemed shall, on the Redemption Date, become due and payable
at the Redemption Price therein specified, and from and after such date (unless the Company shall default in the payment of the Redemption
Price and accrued interest) such Securities shall cease to bear interest. Upon surrender of any such Security for redemption in accordance
with said notice, such Security shall be paid by the Company at the Redemption Price, together with accrued interest (and any Additional
Amounts) to the Redemption Date; provided, however, that installments of interest whose Stated Maturity is on or prior
to the Redemption Date shall be payable to the Holders of such Securities, or one or more Predecessor Securities, registered as such
at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307.
If
any Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest from the Redemption Date at the rate prescribed therefor in the Security or, in the case of Original Issue
Discount Securities, the Securities’ Yield to Maturity.
SECTION
1107. SECURITIES REDEEMED IN PART.
Any
Registered Security which is to be redeemed only in part shall be surrendered at a Place of Payment therefor (with, if the Company or
the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee
duly executed by, the Holder thereof or his attorney duly authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge, a new Registered Security or Securities of the same series
and Stated Maturity, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange
for the unredeemed portion of the principal of the Security so surrendered.
SECTION
1108. PURCHASE OF SECURITIES.
Unless
otherwise specified as contemplated by Section 301, the Company and any Affiliate of the Company may at any time purchase or otherwise
acquire Securities in the open market or by private agreement. Such acquisition shall not operate as or be deemed for any purpose to
be a redemption of the indebtedness represented by such Securities. Any Securities purchased or acquired by the Company may be delivered
to the Trustee and, upon such delivery, the indebtedness represented thereby shall be deemed to be satisfied. Section 309 shall apply
to all Securities so delivered.
ARTICLE
XII
SINKING
FUNDS
SECTION
1201. APPLICABILITY OF ARTICLE.
The
provisions of this Article shall be applicable to any sinking fund for the retirement of Securities of a series except as otherwise specified
as contemplated by Section 301 for Securities of such series.
The
minimum amount of any sinking fund payment provided for by the terms of Securities of any series is herein referred to as a “mandatory
sinking fund payment,” and any payment in excess of such minimum amount provided for by the terms of Securities of any series is
herein referred to as an “optional sinking fund payment.” Unless otherwise provided by the terms of Securities of any series,
the cash amount of any sinking fund payment may be subject to reduction as provided in Section 1202. Each sinking fund payment shall
be applied to the redemption of Securities of any series as provided for by the terms of Securities of such series.
SECTION
1202. SATISFACTION OF SINKING FUND PAYMENTS WITH SECURITIES.
The
Company (1) may deliver Outstanding Securities of a series (other than any previously called for redemption), and (2) may apply as a
credit Securities of a series which have been redeemed either at the election of the Company pursuant to the terms of such Securities
or through the application of permitted optional sinking fund payments pursuant to the terms of such Securities, in each case in satisfaction
of all or any part of any sinking fund payment with respect to the Securities of such series required to be made pursuant to the terms
of such Securities as provided for by the terms of such series; provided that such Securities have not been previously so credited.
Such Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Securities for
redemption through operation of the sinking fund and the amount of such sinking payment shall be reduced accordingly.
SECTION
1203. REDEMPTION OF SECURITIES FOR SINKING FUND.
Not
less than 45 days prior (unless a shorter period shall be satisfactory to the Trustee) to each sinking fund payment date for any series
of Securities, the Company will deliver to the Trustee an Officers’ Certificate specifying the amount of the next ensuing sinking
fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of
cash and the portion thereof, if any, which is to be satisfied by delivery of or by crediting Securities of that series pursuant to Section
1202 and will also deliver to the Trustee any Securities to be so delivered. Not less than 30 days before each such sinking fund payment
date the Trustee shall select the Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 1103
and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section
1104. Such notice having been duly given, the redemption of such Securities shall be made upon the terms and in the manner stated in
Sections 1106 and 1107.
ARTICLE
XIII
MEETINGS
OF HOLDERS OF SECURITIES
SECTION
1301. PURPOSES FOR WHICH MEETINGS MAY BE CALLED.
A
meeting of Holders of Securities of any or all series may be called at any time and from time to time pursuant to this Article to make,
give or take any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be
made, given or taken by Holders of Securities of such series.
SECTION
1302. CALL, NOTICE AND PLACE OF MEETINGS.
(a)
The Trustee may at any time call a meeting of Holders of Securities of any series for any purpose specified in Section 1301, to be held
at such time and at such place in the Borough of Manhattan, the City of New York, or in any other location, as the Trustee shall determine.
Notice of every meeting of Holders of Securities of any series, setting forth the time and the place of such meeting and in general terms
the action proposed to be taken at such meeting, shall be given, in the manner provided in Section 107, not less than 20 nor more than
180 days prior to the date fixed for the meeting.
(b)
In case at any time the Company, pursuant to a Board Resolution, or the Holders of at least 10% in aggregate principal amount of the
Outstanding Securities of any series, shall have requested the Trustee for any such series to call a meeting of the Holders of Securities
of such series for any purpose specified in Section 1301, by written request setting forth in reasonable detail the action proposed to
be taken at the meeting, and the Trustee shall not have made the first publication of the notice of such meeting within 30 days after
receipt of such request or shall not thereafter proceed to cause the meeting to be held as provided herein, then the Company or the Holders
of Securities of such series in the amount above specified, as the case may be, may determine the time and the place in the Borough of
Manhattan, the City of New York for such meeting and may call such meeting for such purposes by giving notice thereof as provided in
Subsection (a) of this Section.
SECTION
1303. PERSONS ENTITLED TO VOTE AT MEETINGS.
To
be entitled to vote at any meeting of Holders of Securities of any series, a Person shall be (1) a Holder of one or more Outstanding
Securities of such series, or (2) a Person appointed by an instrument in writing as proxy for a Holder or Holders of one or more Outstanding
Securities of such series by such Holder or Holders. The only Persons who shall be entitled to be present or to speak at any meeting
of Holders of Securities of any series shall be the Persons entitled to vote at such meeting and their counsel, any representatives of
the Trustee and its counsel and any representatives of the Company and its counsel.
SECTION
1304. QUORUM; ACTION.
The
Persons entitled to vote a majority in aggregate principal amount of the Outstanding Securities of a series shall constitute a quorum
for a meeting of Holders of Securities of such series. In the absence of a quorum within 30 minutes of the time appointed for any such
meeting, the meeting shall, if convened at the request of Holders of Securities of such series, be dissolved. In any other case, the
meeting may be adjourned for a period of not less than 10 days as determined by the chairman of the meeting prior to the adjournment
of such meeting. In the absence of a quorum at any such adjourned meeting, such adjourned meeting may be further adjourned for a period
of not less than 10 days as determined by the chairman of the meeting prior to the adjournment of such adjourned meeting. Subject to
Section 1305(d), notice of the reconvening of any adjourned meeting shall be given as provided in Section 1302(a), except that such notice
need be given only once not less than five days prior to the date on which the meeting is scheduled to be reconvened. Notice of the reconvening
of an adjourned meeting shall state expressly that Persons entitled to vote a majority in principal amount of the Outstanding Securities
of such series shall constitute a quorum.
Except
as limited by the proviso to Section 902, any resolution presented to a meeting or adjourned meeting duly reconvened at which a quorum
is present as aforesaid may be adopted by the affirmative vote of the Holders of a majority in aggregate principal amount of the Outstanding
Securities of that series; provided, however, that, except as limited by the proviso to Section 902, any resolution with
respect to any request, demand, authorization, direction, notice, consent or waiver which this Indenture expressly provides may be made,
given or taken by the Holders of a specified percentage that is less than a majority in aggregate principal amount of the Outstanding
Securities of a series may be adopted at a meeting or an adjourned meeting duly reconvened and at which a quorum is present as aforesaid
by the affirmative vote of the Holders of such specified percentage in aggregate principal amount of the Outstanding Securities of that
series.
Except
as limited by the fourth paragraph of Section 902, any resolution passed or decision taken at any meeting of Holders of Securities of
any series duly held in accordance with this Section shall be binding on all the Holders of Securities of such series, whether or not
present or represented at the meeting.
SECTION
1305. DETERMINATION OF VOTING RIGHTS; CONDUCT AND ADJOURNMENT OF MEETINGS.
(a)
The holding of Securities shall be proved in the manner specified in Section 105 and the appointment of any proxy shall be proved in
the manner specified in Section 105. Such regulations may provide that written instruments appointing proxies, regular on their face,
may be presumed valid and genuine without the proof specified in Section 105 or other proof.
(b)
The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called
by the Company or by Holders of Securities as provided in Section 1302(b), in which case the Company or the Holders of Securities of
the series calling the meeting, as the case may be, shall appoint a temporary chairman. A permanent chairman and a permanent secretary
of the meeting shall be elected by vote of the Persons entitled to vote a majority in aggregate principal amount of the Outstanding Securities
of such series represented at the meeting.
(c)
At any meeting each Holder of a Security of such series and each proxy shall be entitled to one vote for each $1,000 principal amount
(or such other amount of the minimum denomination of any series of Securities as may be provided in the establishment of such series
as contemplated by Section 301 hereof) of the Outstanding Securities of such series held or represented by him; provided, however,
that no vote shall be cast or counted at any meeting in respect of any Security challenged as not Outstanding and ruled by the chairman
of the meeting to be not Outstanding. The chairman of the meeting shall have no right to vote, except as a Holder of a Security of such
series or as a proxy.
(d)
Any meeting of Holders of Securities of any series duly called pursuant to Section 1302 at which a quorum is present may be adjourned
from time to time by Persons entitled to vote a majority in aggregate principal amount of the Outstanding Securities of such series represented
at the meeting; and the meeting may be held as so adjourned without further notice.
SECTION
1306. COUNTING VOTES AND RECORDING ACTION OF MEETINGS.
The
vote upon any resolution submitted to any meeting of Holders of Securities of any series shall be by written ballots on which shall be
subscribed the signatures of the Holders of Securities of such series or of their representatives by proxy and the principal amounts
and serial numbers of the Outstanding Securities of such series held or represented by them. The permanent chairman of the meeting shall
appoint two inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file
with the secretary of the meeting their verified written reports in duplicate of all votes cast at the meeting. A record, at least in
duplicate, of the proceedings of each meeting of Holders of Securities of any series shall be prepared by the secretary of the meeting
and there shall be attached to such record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits
by one or more Persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that such notice was
given as provided in Section 1302 and, if applicable, Section 1304. Each copy shall be signed and verified by the affidavits of the permanent
chairman and secretary of the meeting and one such copy shall be delivered to the Company, and another to the Trustee to be preserved
by the Trustee, the latter to have attached thereto the ballots voted at the meeting. Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
*
* *
This
instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
[Signatures
on following page]
IN
WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed as of the day and year first above written.
|
AINOS,
INC.
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By: |
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Name: |
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Title: |
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___________________,
as Trustee
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By:
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Name: |
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Title: |
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EXHIBIT
5.1
|
LUCOSKY
BROOKMAN LLP
101
Wood Avenue South
5th
Floor
Woodbridge,
NJ 08830
T
- (732) 395-4400
F-
(732) 395-4401 |
May
31, 2024 |
|
|
111
Broadway
Suite
807
New
York, NY 10006
T
- (212) 332-8160
F
- (212) 332-8161 |
Ainos,
Inc.
8880
Rio San Diego Drive, Ste. 800
San
Diego, CA 92108 |
www.
lucbro.com |
RE:
Registration Statement on Form S-3
Ladies
and Gentlemen:
We
are acting as counsel for Ainos, Inc., a Texas corporation (the “Company”), in connection with the Registration Statement
on Form S-3 (such Registration Statement, as amended from time to time, is herein referred to as the “Registration Statement”),
filed by the Company with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933,
as amended (the “Securities Act”), on the date hereof, relating to the registration of the proposed public offering
from time to time of up to $200,000,000 of the securities described below. The Registration Statement includes two prospectuses: (i)
a base prospectus (the “Base Prospectus”) and (ii) a sales agreement prospectus (the “Sales Agreement Prospectus”),
covering up to $1,353,197 of shares of common stock, par value $0.01 per share, of the Company (the “Common Stock) that
may be sold under the at the market offering agreement, dated May [28], 2024, by and between the Company and H.C. Wainwright & Co.,
LLC. (such agreement, the “ATM Agreement,” and such shares, the “Placement Shares”). The Base Prospectus
provides it will be supplemented in the future by one or more prospectus supplements (each, a “Prospectus Supplement”).
The Registration Statement, including the Base Prospectus (as supplemented from time to time by one or more Prospectus Supplements) and
the Sales Agreement Prospectus will provide for the registration by the Company of:
|
● |
shares
of Common Stock of the Company issuable directly (the “Base Prospectus Shares”); |
|
● |
shares
of preferred stock, par value $0.01 per share (the “Preferred Stock”), of the Company issuable directly; |
|
● |
debt
securities of the Company (the “Debt Securities”), |
|
● |
warrants
of the Company (the “Warrants”) entitling the holders to purchase shares of Common Stock, shares of Preferred
Stock, or other securities of the Company; |
|
● |
rights
to purchase shares of Common Stock or Preferred Stock (the “Rights”); |
|
● |
units
(the “Units”) comprised of any combination of other Securities offered in the Registration Statement; and |
|
● |
the
Placement Shares (and, together with the Base Prospectus Shares, the Preferred Stock, the Debt Securities, the Warrants, the Rights,
the Units, and any Base Prospectus Shares or Preferred Stock that may be issued upon exercise, conversion or exchange pursuant to
the terms of any the foregoing securities, the “Securities”). |
The
shares of Common Stock (including the Base Prospectus Shares and the Placement Shares) are to be issued under the certificate of formation
of the Company, as amended (the “Certificate of Formation”). Each series of Preferred Stock is to be issued under
the Certificate of Formation and a certificate of designation (a “Certificate of Designation”) to be approved by the
board of directors of the Company (the “Board of Directors”) or a committee thereof and filed with the Texas Secretary
of State (the “Texas Secretary of State”). The Debt Securities may be issued pursuant to a senior debt indenture (the
“Senior Debt Indenture”) between the Company and the trustee to be named therein (the “Senior Debt Trustee”)
and a subordinated debt indenture (the “Subordinated Debt Indenture,” and together with the Senior Debt Indenture,
the “Indentures”) between the Company and the trustee to be named therein (the “Subordinated Debt Trustee”
and, together with the Senior Debt Trustee, the “Trustees”). The Warrants are to be issued under one or more warrant
agreements in a form to be filed and incorporated into the Registration Statement, with appropriate insertions (each, a “Warrant
Agreement”), to be entered into by the Company, a warrant agent to be named by the Company (the “Warrant Agent”),
and the holders from time to time of the Warrants. The Units are to be issued under one or more unit agreements in a form to be filed
and incorporated into the Registration Statement, with appropriate insertions (each, a “Unit Agreement”), to be entered
into by the Company and the unit agent named therein. The Rights are to be issued under one or more rights agent agreements in a form
to be filed and incorporated into the Registration Statement, with appropriate insertions (each, a “Rights Agreement”),
to be entered into by the Company and a bank, trust company or other financial institution to be identified therein as rights agents.
The Certificate of Formation, each Certificate of Designation, each Warrant Agreement, each Unit Agreement, and each Rights Agreement
are referred to herein individually as a “Governing Document” and collectively as the “Governing Documents.”
As
part of the corporate actions taken and to be taken in connection with issuance of any Securities to be issued and sold from time to
time under the Registration Statement, the Board of Directors, a committee thereof or certain authorized officers of the Company as authorized
by the Board of Directors will, before such Securities are issued under the Registration Statement, duly authorize the issuance and approve
the terms of such Securities (the “Corporate Proceedings”).
This
opinion is being furnished in connection with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act, and no opinion
is expressed herein as to any matter pertaining to the contents of the Registration Statement, the Base Prospectus, the Sales Agreement
Prospectus, or any Prospectus Supplement, other than as expressly stated herein with respect to the issue of the Securities. It is understood
that the opinions set forth below are to be used only in connection with the offer while the Registration Statement is in effect.
In
our capacity as your counsel in connection with such registration, we have reviewed and are familiar with such documents, certificates,
Corporate Proceedings and other materials, including an examination of originals or copies certified or otherwise identified to our satisfaction
of the Certificate of Formation and By-laws of the Company, Governing Documents and the Registration Statement (collectively, the “Constituent
Documents”), and have reviewed such questions of law, as we have considered relevant or necessary as a basis for this opinion.
In
our examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and
the conformity to authentic original documents of all documents submitted to us as copies. For purposes of this opinion, we have assumed
that proper proceedings in connection with the authorization and issuance or sale of the Securities will be timely and properly completed,
in accordance with all requirements of applicable federal laws and the Texas Business Organizations Code (the “TBOC”)
and, in the manner presently proposed. We have assumed and have not verified the accuracy of the factual matters of each document we
have reviewed.
As
to facts material to the opinions, statements and assumptions expressed herein, we have, with your consent, relied upon oral or written
statements and representations of officers and other representatives of the Company and others. We have specifically relied upon the
certification of an officer of the Company signed on even date herewith. In addition, we have obtained and relied upon such certificates
and assurances from public officials as we have deemed necessary.
With
respect to the Securities to be offered and sold by the Company, we have also assumed that (a) the Registration Statement shall have
become and remain effective under the Securities Act, a Prospectus Supplement shall have been prepared and filed with the Commission
describing the Securities, and such Securities shall have been issued and sold in accordance with the terms set forth in such Prospectus
Supplement; (b) such Securities, as issued and delivered, comply with any requirements and restrictions imposed by any court or governmental
or regulatory body applicable to the Company; (c) at the time of any offering or sale of any Securities, there shall be a sufficient
number of shares of Common Stock or Preferred Stock, authorized and unissued under the Certificate the Formation, and not otherwise reserved
for issuance, except in connection with the issuance of the Securities; (d) at the time of issuance or sale of the Securities, the Company
shall validly exist and shall be in good standing under the laws of the State of Texas, and, in the case of Securities, the Company shall
have the necessary corporate power for such issuance; (e) any definitive purchase, underwriting or similar agreement with respect to
any Securities, if applicable, shall have been duly authorized, executed and delivered by the parties thereto and shall constitute legally
valid and binding obligations of the parties thereto, enforceable against each of them in accordance with their respective terms, at
the time of issuance of the applicable Securities; (f) certificates representing the Securities, if any, shall have been duly executed,
countersigned, registered and delivered, or if uncertificated, valid book-entry notations shall have been made in the share or other
register of the Company, in each case in accordance with the Constituent Documents, and in the manner contemplated by the Registration
Statement and/or the applicable Prospectus Supplement, against payment therefor in an amount not less than the par value thereof, or
such other consideration determined by the Board of Directors, or an authorized committee thereof, as permitted under the TBOC, in accordance
with the provisions of any applicable definitive purchase agreement, underwriting agreement, or similar agreement approved by the Company;
and (g) the Constituent Documents shall be in full force and effect and shall not have been amended, restated, supplemented or otherwise
altered, and there shall be no authorization of any such amendment, restatement, supplement or alteration, in each case since the date
hereof.
Subject
to the foregoing and the other matters set forth herein, it is our opinion that as of the date hereof:
1. With
respect to the Base Prospectus Shares, upon (a) the completion of all required Corporate Proceedings with respect to the issuance of
such Base Prospectus Shares, (b) the due execution, registration of issuance and delivery of certificates representing such Base Prospectus
Shares against payment of the purchase price therefor in accordance with the applicable purchase, underwriting or other agreement, and
as contemplated by the Registration Statement, and (c) receipt by the Company of the consideration therefor, such Base Prospectus Shares
will be duly and validly issued, fully paid and nonassessable. The Base Prospectus Shares covered in the opinion in this paragraph includes
any Base Prospectus Shares that may be issued upon exercise, conversion or exchange pursuant to the terms of any other Securities.
2. With
respect to any Preferred Stock, upon (a) the completion of all required Corporate Proceedings with respect to the issuance and terms
of such Preferred Stock, (b) the due authorization, execution, acknowledgment, delivery and filing with, and recording by, the Texas
Secretary of State of a Certificate of Designation in respect of such Preferred Stock, (c) the due execution, registration of issuance
and delivery of certificates representing such Preferred Stock against payment of the purchase price therefor in accordance with the
applicable purchase, underwriting or other agreement, and as contemplated by the Registration Statement, and (d) receipt by the Company
of the consideration therefor, such Preferred Stock will be duly and validly issued, fully paid and nonassessable. The Preferred Stock
covered in the opinion in this paragraph includes any shares of Preferred Stock that may be issued upon exercise, conversion or exchange
pursuant to the terms of any other Securities.
3. With
respect to any Debt Securities, upon (a) the completion of all required Corporate Proceedings with respect to the issuance of such Debt
Securities, (b) the due execution, registration of issuance and delivery of the Debt Securities and the applicable Indenture relating
to the Debt Securities representing such Debt Securities against payment of the purchase price therefor in accordance with the applicable
purchase, underwriting or other agreement, and as contemplated by the Registration Statement, and (c) receipt by the Company of the consideration
therefor, such Debt Securities will constitute valid and binding obligations of the Company.
4. With
respect to any Warrants, upon (a) the completion of all required Corporate Proceedings relating to the terms and issuance of the Warrants,
(b) the due authorization, execution and delivery of a Warrant Agreement, (c) the preparation and due execution and delivery of the related
Warrants against payment of the purchase price therefor in accordance with the applicable purchase, underwriting or other agreement,
and as contemplated by the Registration Statement, (d) the due authentication of the related Warrants by the Warrant Agent, and (e) receipt
by the Company of the consideration therefor, such Warrants will be valid and binding obligations of the Company. The Warrants covered
in the opinion in this paragraph includes any Warrants that may be issued upon exercise, conversion or exchange pursuant to the terms
of any other Securities.
5. With
respect to any Rights, upon (a) the completion of all required Corporate Proceedings relating to the terms and issuance of the Rights,
(b) the due authorization, execution and delivery of a Rights Agreement against payment of the purchase price therefor in accordance
with the applicable purchase, underwriting or other agreement, and as contemplated by the Registration Statement, (c) the shares of Common
Stock or Preferred Stock, as the case may be, underlying such Rights having been deposited with the applicable rights agent, and (d)
receipt by the Company of the consideration therefor, such Rights Agreement will be a valid and binding obligation of the Company and
the Rights will be valid and binding obligations of the Company. The Rights covered in the opinion in this paragraph includes any Rights
that may be issued upon exercise, conversion or exchange pursuant to the terms of any other Securities.
6. With
respect to any Units, upon (a) the completion of all required Corporate Proceedings relating to the terms and issuance of the Units,
(b) the due authorization, execution and delivery of a Unit Agreement against payment of the purchase price therefor in accordance with
the applicable purchase, underwriting or other agreement, and as contemplated by the Registration Statement, (c) the Securities underlying
such Units having been deposited with the applicable unit agent, and (d) receipt by the Company of the consideration therefor such Unit
Agreement will be a valid and binding obligation of the Company and the Units will be valid and binding obligations of the Company. The
Units covered in the opinion in this paragraph includes any Units that may be issued upon exercise, conversion or exchange pursuant to
the terms of any other Securities.
7. With
respect to the Placement Shares, upon (a) the completion of all required Corporate Proceedings with respect to the issuance of such Placement
Shares, (b) the due execution, registration of issuance and delivery of certificates representing such Placement Shares against payment
of the purchase price therefor in accordance with the ATM Agreement, and as contemplated by the Sales Agreement Prospectus, and (c) receipt
by the Company of the consideration therefor, such Placement Shares will be duly and validly issued, fully paid and nonassessable.
The
opinions set forth above are subject to the following exceptions, limitations and qualifications: (i) the effect of bankruptcy, insolvency,
reorganization, fraudulent conveyance, moratorium or other similar laws now or hereafter in effect relating to or affecting the rights
and remedies of creditors; (ii) the effect of general principles of equity, including without limitation, concepts of materiality, reasonableness,
good faith and fair dealing and the possible unavailability of specific performance or injunctive relief, regardless of whether enforcement
is considered in a proceeding in equity or at law, and the discretion of the court before which any proceeding therefor may be brought;
(iii) the unenforceability under certain circumstances under law or court decisions of provision providing for the indemnification of,
or contribution to, a party with respect to liability where such indemnification or contribution is contrary to public policy. We express
no opinion concerning the enforceability of any waiver of rights or defenses with respect to stay, extension or usury laws. Our opinion
expressed herein is also subject to the qualification that no term or provision hereof shall be included in: (a) the Certificate of Designation
relating to any series of the Preferred Stock, (b) the Indenture, (c) the Warrant Agreement, (d) the Unit Agreement, (e) the Rights Agreement,
(f) the ATM Agreement or (g) any other agreement or instrument pursuant to which any of the Securities are to be issued that would affect
the validity of such opinion.
Our
opinion is limited to the federal laws of the United States and the TBOC. We express no opinion as to the effect of the law of any other
jurisdiction. Our opinion is rendered as of the date hereof, and we assume no obligation to advise you of changes in law or fact (or
the effect thereof on the opinions expressed herein) that hereafter may come to our attention.
We
hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement and to the reference to our firm under the
caption “Legal Matters” in the Registration Statement. In so doing, we do not admit that we are in the category of persons
whose consent is required under Section 7 of the Securities Act and the rules and regulations of the Commission promulgated thereunder.
|
Very
Truly Yours, |
|
|
|
/s/
Lucosky Brookman LLP |
|
Lucosky
Brookman LLP |
Exhibit
23.1
|
Audit
• Tax • Consulting • Financial Advisory
Registered
with Public Company Accounting Oversight Board (PCAOB) |
Consent
of Independent Registered Public Accounting Firm
We
hereby consent to the incorporation by reference in this Registration Statement on Form S-3 of Ainos, Inc. of our report dated March
8, 2024, relating to the financial statements of Ainos, Inc. (the “Company”), appearing in the Company’s Annual Report
on Form 10-K for the year ended December 31, 2023. Our report contains an explanatory paragraph regarding the Company’s ability
to continue as a going concern.
We
also consent to the reference to us under the caption “Experts” in such Registration Statement.
/s/
KCCW Accountancy Corp. |
|
Diamond Bar, California |
|
May 31, 2024 |
|
Exhibit
107
Calculation
of Filing Fee Table
Form
S-3
(Form
Type)
Ainos,
Inc.
(Exact
Name of Registrant as Specified in its Charter)
Table
1: Newly Registered Securities
Security Type | |
Security Class Title | |
Fee Calculation Rule | | |
Amount Registered (1)(2) | | |
Proposed Maximum Aggregate Offering Price Per Unit (1)(2) | | |
Maximum Aggregate Offering Price (3) | | |
Fee Rate | | |
Amount of Registration Fee (3) | |
| |
| |
| | |
| | |
| | |
| | |
| | |
| |
Equity | |
Common stock, $0.01 par value per share | |
| 457 | (o) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Equity | |
Preferred stock, $0.01 par value per share | |
| 457 | (o) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Debt | |
Debt securities | |
| 457 | (o) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Other | |
Warrants | |
| 457 | (o) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Other | |
Units | |
| 457 | (o) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Other | |
Rights | |
| 457 | (o) | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
Unallocated (Universal) Shelf | |
| |
| 457 | (o) | |
| — | | |
| — | | |
$ | 200,000,000 | | |
| 0.00014760 | | |
$ | 29,520 | |
| |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total Offering Amounts | | |
| | | |
$ | 200,000,000 | | |
| 0.00014760 | | |
$ | 29,520 | |
Total Fees Previously Paid | | |
| | | |
| | | |
| | | |
| — | |
Total Fee Offsets | | |
| | | |
| | | |
| | | |
| — | |
Net Fee Due | | |
| | | |
| | | |
| | | |
$ | 29,520 | |
(1)
The proposed amount to be registered, maximum offering price per class of security and maximum aggregate offering price per class of
security will be determined from time to time by the registrant in connection with the issuance by the registrant of the securities registered
hereunder.
(2)
This registration statement covers such indeterminate amount of shares of common stock and preferred stock, debt securities, warrants
and rights of Ainos, Inc., as having an aggregate offering price not to exceed $200,000,000. The securities registered hereunder are
to be issued from time to time at prices to be determined. The securities registered also include such indeterminate number of shares
of common stock and preferred stock and amount of debt securities as may be issued upon conversion of or exchange for preferred stock
or debt securities that provide for conversion or exchange, upon exercise of warrants or rights or pursuant to the anti-dilution provisions
of any such securities. In addition, pursuant to Rule 416 under the Securities Act of 1933, as amended (the “Securities Act”),
the shares being registered hereunder include such indeterminate number of shares of common stock and preferred stock as may be issuable
with respect to the shares being registered hereunder as a result of stock splits, stock dividends or similar transactions.
(3)
Estimated solely for the purpose of calculating the registration fee. Subject to Rule 462(b) under the Securities Act, the aggregate
maximum offering price of all securities issued by the registrant pursuant to this registration statement will not exceed $200,000,000.
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