PERSONAL AND CONFIDENTIAL
Mr. Huaxin WEN, Chief Financial Officer
Suites 3605-06, 36th Floor,
Tower 6, The Gateway,
Harbour City, Tsim Sha Tsui,
Kowloon, Hong Kong
| Re: |
Waton Financial Limited | Best Efforts Follow-On Offering | Placement Agent Agreement
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Dear Mr. WEN:
The purpose of this placement agent agreement (this “
Agreement”) is to outline our agreement pursuant to which Cathay Securities, Inc. (“
Cathay”)
will act as the placement agent on a “best efforts” basis in connection with the proposed Best Efforts Follow-On Offering (the “
Placement”)
by Waton Financial Limited (collectively, with its subsidiaries and affiliates, the “
Company”)
of its Ordinary Shares (the “
Securities”).
This placement agent agreement sets forth certain conditions and assumptions upon
which the
Placement is premised.
The Company expressly acknowledges and agrees that Cathay’s obligations hereunder are
on a reasonable “best efforts” basis only and that the execution of this Agreement does not constitute a commitment by Cathay to purchase the Securities and does not ensure the successful placement of the Securities or any portion thereof or the
success of Cathay with respect to securing any other financing on behalf of the Company. The Company confirms that entry into this Agreement and completion of the Placement with Cathay will not breach or otherwise violate the Company’s obligations
to any
other
party or require any payments to such other party.
For the sake of
clarity, such obligations may include, but not be limited to, obligations under an engagement letter, placement agency agreement, underwriting agreement, advisory agreement, right of first refusal, tail fee obligation or other agreement.
Any capitalized terms not defined herein shall have meaning set forth in the Securities Purchase Agreement.
The terms of our agreement are as follows:
| 1. |
Engagement. The Company hereby engages Cathay, for the period beginning on the date hereof and ending three (3) months or upon the completion of the Placement, whichever is earlier (the “ Engagement Period”), to act as the
Company’s exclusive placement agent in connection with the proposed Placement. During the Engagement Period or until the consummation of the Placement, and as long as Cathay is proceeding in good faith with preparations for the Placement,
the Company agrees not to solicit, negotiate with or enter into any agreement with any other source of financing (whether equity, debt or otherwise), any underwriter, potential underwriter, placement agent, financial advisor, investment
banking firm or any other person or entity in connection with an offering of the Company’s debt or equity securities or any other financing by the Company, other than commercial bank loans or credit facilities entered into in the ordinary
course of business. Cathay will use its reasonable “best efforts” to solicit offers to purchase the Securities from the Company on the
terms, and subject to the conditions, set forth in the Prospectus (as defined below). Cathay shall use commercially reasonable efforts to assist the Company in obtaining performance by
each investor that has entered into a Securities Purchase Agreement (defined below) to purchase Securities in the Placement (each, a "Purchaser") whose offer to purchase Securities has been solicited by
Cathay, but Cathay shall not, except as otherwise provided in this Agreement, be obligated to disclose the identity of any potential purchaser or have any liability to the Company in the event any such purchase is not consummated for any
reason. The Company acknowledges that under no circumstances will Cathay be obligated to underwrite or purchase any Securities for its own account and, in soliciting purchases of the Securities, Cathay shall act solely as an agent of the
Company. The services provided pursuant to this Agreement shall be on an “agency” basis and not on a “principal” basis.
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| 2. |
The Placement. The Placement is expected to consist of a sale of approximately $[●] million of the Company’s Securities. Cathay will act as placement agent for the Placement subject to, among other matters referred to herein and additional customary conditions, completion of Cathay’s due
diligence examination of the Company and its affiliates, and the execution of a definitive Securities Purchase Agreement in connection with the Placement (the “ Securities Purchase Agreement”). In connection with the entry into the Securities Purchase Agreement, the Company (i) will meet with Cathay and its representatives to discuss such due diligence matters and
to provide such documents as Cathay may reasonably require; (ii) will not file with the U.S. Securities and Exchange Commission (the “ Commission”) any document regarding the Placement without the prior approval of Cathay and its counsel (provided that such approval is not unreasonably withheld); (iii) will deliver to Cathay and the investors in the Placement
such legal and accounting opinions and letters (including, without limitation, accounting comfort letters, legal opinions, negative assurance letters, good standing certificates and officers’ and secretary certificates) as Cathay may
reasonably require, all in form and substance reasonably acceptable to Cathay and (iv) will ensure that Cathay is a third party beneficiary of all representations, and warranties in connection with the Placement.
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| 3. |
Placement Compensation. The placement commission will be 7.0% for the Placement if Cathay acts as the exclusive placement agent for the Placement consummated by the
Company.
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| 4. |
Registration Statement. To the extent the Company decides to proceed with the Placement, the Company will, as soon as practicable, prepare and file with the
Commission a Registration Statement on Form F-1 (the “ Registration Statement”) under the Securities Act of 1933, as amended (the “ Securities Act”), and a prospectus included therein (the “ Prospectus”) covering the Securities to be offered and sold in the Placement. The Registration Statement (including the Prospectus therein), and all amendments and supplements thereto, will be in form reasonably
satisfactory to Cathay and counsel to Cathay. Other than any information provided by Cathay in writing specifically for inclusion in the Registration Statement or the Prospectus, the Company will be solely responsible for the contents of
its Registration Statement and Prospectus and any and all other written or oral communications provided by or on behalf of the Company to any actual or prospective investor of the Securities, and the Company represents and warrants that
such materials and such other communications will not, as of the date of the offer or sale of the Securities, contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in light of the circumstances under which they were made, not misleading. If at any time prior to the completion of the offer and sale of the Securities an event occurs that would cause the Registration
Statement or Prospectus (as supplemented or amended) to contain an untrue statement of a material fact or to omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they
were made, not misleading, the Company will notify Cathay immediately of such event and Cathay will suspend solicitations of the prospective purchasers of the Securities until such time as the Company shall prepare a supplement or amendment
to the Registration Statement or Prospectus that corrects such statement or omission.
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| 5. |
Lock-Ups. In connection with the Placement, the Company’s
directors, executive officers, employees and shareholders holding at least ten percent (10%) of the outstanding ordinary shares will
enter into customary “lock-up” agreements for a period of one hundred and eighty ( 180) days after the Closing of the Placement (the “ Lock-Up Period”); provided, however, that any sales by parties to the
lock-ups shall be subject to the lock-up agreements, and provided further, that none of such ordinary shares shall be saleable in the public market until the expiration of the Lock-Up Period.
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| 6. |
Placement Agent Representations. Cathay represents and warrants that it (i) is a member in good standing of FINRA, (ii) is registered as a broker/dealer under the Securities Exchange
Act of 1934, as amended, (iii) is licensed as a broker/dealer under the laws of the United States applicable to the Placement, (iv) is a corporate entity validly existing under the laws of its place of incorporation, and (v) has full power
and authority to enter into and perform its obligations under this Agreement. Cathay will
immediately notify the Company in writing of any change in its status as such.
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| 7. |
Expenses. The Company will be responsible for and will pay all expenses relating to the Placement, including,
without limitation, (a) all filing fees and expenses relating to the registration of the Securities with the Commission; (b) all FINRA Public Offering filing fees; (c) all fees and expenses relating to the listing of the Company’s equity or
equity-linked securities on Nasdaq; (d) all fees, expenses and disbursements relating to the registration or qualification of the Securities under the “blue sky” securities laws of such states and other jurisdictions as Cathay may
reasonably designate (including, without limitation, all filing and registration fees, and the reasonable fees in connection therewith); provided, however, that no such filings shall be required in connection with the Company’s Nasdaq listing; (e) all fees, expenses and disbursements relating to the registration, qualification or exemption of the Securities under the securities laws of such
foreign jurisdictions as Cathay may reasonably designate; (f) the costs of all mailing and printing of the Placement documents; (g) transfer and/or stamp taxes, if any, payable upon the transfer of Securities from the Company to Cathay; (h)
the fees and expenses of the Company’s accountants; and (i) Cathay’s actual accountable out-of-pocket expenses (including reasonable
legal fees and disbursements for Cathay’s counsel and any blue sky related fees and disbursements) up to $100,000 payable upon termination or expiration of this Agreement. Upon
execution of this Agreement, the Company shall deliver, per Cathay’s instructions, an amount of $20,000 (by check or wire transfer of immediately available funds) as an advance to be
applied towards reasonable out-of-pocket expenses Cathay anticipates to incur (the “ Advance”). However, if the Placement is terminated, Cathay shall return any portion of the Advance not used
to pay its accountable out-of-pocket expenses actually incurred.
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| 8. |
Right of First Refusal. If, for the period beginning on the closing of the Placement with Cathay acting as the exclusive placement agent
(the “ Closing Date”) and ending twelve (12) months after the commencement of sales in the
Placement, the Company or any of its subsidiaries (a) decides to finance or refinance any indebtedness (excluding commercial bank debt), Cathay (or any affiliate designated by Cathay)
shall have the right to act as sole book-runner, sole manager, sole placement agent or sole agent with respect to such financing or refinancing; or (b) decides to raise funds by means of a public offering (including at-the-market facility)
or a private placement or any other capital raising financing of equity, equity-linked or debt securities, Cathay (or any affiliate designated by Cathay) shall have the right to act as sole book-running manager, sole underwriter or sole
placement agent for such financing. If Cathay or one of its affiliates decides to accept any such engagement, the agreement governing such engagement (each, a “ Subsequent Transaction Agreement”)
will contain, among other things, provisions for customary fees for transactions of similar size and nature. Notwithstanding the foregoing, the decision to accept the Company’s engagement under this Section 8 shall be made by Cathay or one
of its affiliates, by a written notice to the Company, within five (5) Business Days of the receipt of the Company’s notification of its financing needs, which notice shall include a detailed term sheet. The right of first refusal granted
hereunder may be terminated by the Company for cause in compliance with FINRA Rule 5110(g)(5)(B)(i).
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| 9. |
Closing; Closing Deliverables. Unless otherwise directed by the Placement Agent, settlement of the Securities shall occur via “Delivery Versus Payment” (“DVP”)
(i.e., on the Closing Date, the Company shall cause its transfer agent (the “Transfer Agent”) to issue the Securities directly to the clearing firm designated by the Placement Agent; upon receipt of such Securities, the Placement Agent
shall promptly electronically deliver such Securities to the applicable Purchaser, and payment therefor shall be made by the Placement Agent (or its clearing firm) by wire transfer to the Company).
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9.1.1. On the date hereof, the Company shall deliver each of the following:
9.1.1.1 This Agreement duly executed by the Company.
9.1.1.2 A cold comfort letter from the Company’s auditor, addressed to the Placement Agent in form and substance reasonably satisfactory in
all material respects.
9.1.1.3 A certificate executed by the Chief Financial Officer of the Company in customary form reasonably satisfactory to the Placement Agent and its counsel.
9.1.1.4 The Lock-Up Agreements
duly executed by the parties thereto.
9.1.2. On or prior to the Closing Date, the Company shall deliver each of the following:
9.1.2.1 Legal opinions of Hunter Taubman Fischer & Li LLC and Carey Olsen Singapore LLP, addressed to the Placement Agent and the Purchasers, in form and substance reasonably acceptable to
the Placement Agent and Purchasers.
9.1.2.2 A negative assurance letter from Hunter Taubman Fischer & Li LLC, addressed to the Placement Agent and dated the Closing Date, in a form reasonably satisfactory to the Placement
Agent.
9.1.2.3 A copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver, on an expedited basis, a certificate (or at the request of a Purchaser,
book-entry statement) evidencing a number of Shares equal to such Purchaser’s Subscription Amount divided by the Per Share Purchase Price, registered in the name of such Purchaser.
9.1.2.4 The Company shall have provided each Purchaser with the Company’s wire instructions, on Company letterhead and executed by the Chief Executive Officer or Chief Financial Officer.
9.1.2.5 The Company shall have provided Cathay the signed flow of funds executed by the Chief Executive Officer or Chief Financial Officer.
9.1.2.6 A duly executed and delivered Officers’ Certificate, in customary form reasonably satisfactory to the Placement Agent and its counsel.
9.1.2.7 A bring down to the cold comfort letter from the Company’s auditor, addressed to the Placement Agent in form and substance reasonably satisfactory in all material respects.
9.1.2.8 The good standing certificates for the Company and the entities listed in Exhibit A hereto, dated within three business days prior to the Closing Date.
9.1.2.9 The Prospectus and Final Prospectus (which may be delivered in accordance with Rule 172 under the Securities Act).
| 10. |
Conditions of the Obligations of the Placement Agent. The obligations of the Placement Agent hereunder shall be subject to the accuracy of the representations and warranties on the part of
the Company set forth in the Securities Purchase Agreement (on which the Company authorizes the Placement Agent to rely), in each case, as of the date hereof and as of the Closing Date as though then made, to the timely performance by each
of the Company of its covenants and other obligations hereunder on and as of such dates, and to each of the following additional conditions:
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10.1. Regulatory Matters.
10.1.1. Effectiveness of Registration Statement; Rule 424 Information. The Registration Statement is effective on the date of
this Agreement, and, on the Closing Date no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the Securities Act, no order preventing or suspending the use of any
Preliminary Prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company’s knowledge, contemplated by the Commission. The Company has complied with each request (if
any) from the Commission for additional information. All filings with the Commission required by Rule 424 under the Securities Act to have been filed by the Closing Date shall have been made within the applicable time period prescribed for such
filing by Rule 424.
10.1.2. FINRA Clearance. On or before the Closing Date, the Placement Agent shall have received clearance from FINRA as to the
amount of compensation allowable or payable to the Placement Agent as described in the Registration Statement.
10.1.3. Listing of Additional Shares. On or before the Closing Date, the Company shall have filed a notice with the Nasdaq with
respect to the Company’s additional listing of the securities sold in the Placement.
10.2. Closing Deliverables. The Company shall have delivered all closing deliverables to the Placement Agent as set forth in Section 9.1 as of
the time required and in form reasonably satisfactory to the Placement Agent.
10.2.1. No Material Changes. Prior to and on the Closing Date: (i) there shall have been no Material Adverse Effect or
development involving a prospective Material Adverse Effect in the condition or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement, the
Disclosure Package and the Prospectus; (ii) no action, suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any affiliates of the Company before or by any court or federal or state commission, board
or other administrative agency wherein an unfavorable decision, ruling or finding would reasonably be expected to materially adversely affect the business, operations, prospects or financial condition or income of the Company, except as set forth
in the Registration Statement and the Prospectus; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement and the
Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities Act and the Securities Act regulations and shall conform in all material respects
to the requirements of the Securities Act and the Securities Act regulations, and neither the Registration Statement nor the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading. “Disclosure Package” means the Preliminary Prospectus and any issuer free writing
prospectus, as defined in Rule 433 of the Securities Act.
10.2.2. Additional Documents. At the Closing Date, Placement Agent’s counsel shall have been furnished with such documents and
opinions as they may reasonably require upon written request therefor no later than three (3) business days prior to the Closing Date in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the
conditions, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Securities as herein contemplated shall be reasonably satisfactory in form and substance to the Placement Agent and Placement
Agent’s counsel.
| 11. |
Prior Agreement. By entering into this Agreement, the parties agree that the certain letter of engagement, dated May 13, 2026, entered into between the same parties hereof, shall
automatically terminate and cease to have any force or effect whatsoever and shall be superseded in its entirety by this Agreement.
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| 12. |
Termination. Either party may terminate this Agreement at any time by providing the other party with 30 days written notice. Notwithstanding anything
to the contrary contained herein, the Company agrees that the provisions relating to the payment of fees, reimbursement of expenses, right of first refusal, indemnification and contribution, equitable remedies, confidentiality, conflicts,
independent contractor and waiver of the right to trial by jury will survive any termination or expiration of this Agreement. Notwithstanding anything to the contrary contained herein, the Company has the right to terminate this Agreement
at any time for cause in compliance with FINRA Rule 5110(g)(5)(B)(i). The exercise of such right of termination for cause eliminates the Company’s obligations with respect to the provisions relating to right of first refusal . Notwithstanding anything to the contrary contained in this Agreement, in the event that no Placement is completed for any reason
whatsoever during the Engagement Period, the Company shall be obligated to pay to Cathay its actual and accountable out-of-pocket expenses related to the Placement (including the fees and disbursements of Placement Agent’s legal counsel)
and if applicable, for electronic road show service used in connection with the Placement, not to exceed $100,000. During the engagement hereunder: (i) the Company will not, and will not permit its representatives to, other than in
coordination with Cathay, contact or solicit institutions, corporations or other entities or individuals as potential purchasers of the Securities and (ii) the Company will not pursue any financing transaction which would be in lieu of the
Placement. Furthermore, the Company agrees that during Cathay’s engagement hereunder, all inquiries from prospective investors will be referred to Cathay.
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| 13. |
Publicity. The Company agrees that it will not issue press releases or engage in any other publicity, without Cathay’s prior written consent, which consent shall not be unreasonably
withheld, conditioned or delayed, commencing on the date hereof and continuing until the final closing of the Placement (the “ Closing”), except as required by applicable laws, regulations or
rules by the Commission or by Nasdaq.
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| 14. |
Information. During the Engagement Period or until the Closing, the Company agrees to cooperate with Cathay and to furnish, or cause to be furnished, to Cathay, any and all information and
data concerning the Company, and the Placement that Cathay deems appropriate (the “ Information”). The Company will provide Cathay reasonable access
during normal business hours from and after the date of execution of this Agreement until the Closing to all of the Company’s assets, properties, books, contracts, commitments and records and to the Company’s officers, directors, employees,
appraisers, independent accountants, legal counsel and other consultants and advisors. Except as contemplated by the terms hereof or as required by applicable law, Cathay will keep strictly confidential all non-public Information concerning
the Company provided to Cathay. No obligation of confidentiality will apply to Information that: (a) is in the public domain as of the date hereof or hereafter enters the public domain without a breach by Cathay, (b) was known or became
known by Cathay prior to the Company’s disclosure thereof to Cathay as demonstrated by the existence of its written records, (c) becomes known to Cathay from a source other than the Company which information is not provided by the breach of
an obligation of confidentiality owed to the Company, (d) is disclosed by the Company to a third party without restrictions on its disclosure, (e) is independently developed by Cathay as demonstrated by its written records, or (f) is
required to be disclosed by applicable laws, regulations or rules by the Commission or by Nasdaq. For the avoidance of doubt, except as otherwise provided herein, all information which is not publicly available
relating to the Company’s proprietary technology is proprietary and confidential.
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| 15. |
No Third Party Beneficiaries; No Fiduciary Obligations. This Agreement does not create, and shall not be construed as creating, rights enforceable by any person or entity not a party hereto,
except those entitled hereto by virtue of the indemnification provisions hereof. The Company acknowledges and agrees that: (i) Cathay is not and shall not be construed as a fiduciary of the Company and shall have no duties or liabilities to
the equity holders or the creditors of the Company or any other person or entity by virtue of this Agreement or the retention of Cathay hereunder, all of which are hereby expressly waived; and (ii) Cathay is a full service securities firm
engaged in a wide range of businesses and from time to time, in the ordinary course of its business, Cathay or its affiliates may hold long or short positions and trade or otherwise effect transactions for its own account or the account of
its customers in debt or equity securities or loans of the companies which may be the subject of the transactions contemplated by this Agreement. During the course of Cathay’s engagement with the Company, Cathay may have in its possession
material, non-public information regarding other companies that could potentially be relevant to the Company or the transactions contemplated herein but which cannot be shared due to an obligation of confidence to such other companies.
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| 16. |
Indemnification, Reimbursement & Contribution.
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16.1. Indemnification. The Company agrees to indemnify and hold harmless Cathay, its affiliates and each person controlling Cathay (within the
meaning of Section 15 of the Securities Act), and the directors, officers, agents and employees of Cathay, its affiliates and each such controlling person (Cathay, and each such entity or person hereafter is referred to as an “Indemnified Person”) from and against any losses, claims, damages, judgments, assessments, costs and other liabilities (collectively, the “Liabilities”),
and shall reimburse each Indemnified Person for all reasonable fees and expenses (including the reasonable fees and expenses of counsel for the Indemnified Persons) (collectively, the “Expenses”) and
agrees to reimburse payment of such Expenses as they are incurred by an Indemnified Person in investigating, preparing, pursuing or defending any actions, whether or not any Indemnified Person is a party thereto, arising out of or based upon (i)
any untrue statement or alleged untrue statement of a material fact contained in (A) the Registration Statement, Prospectus or any other offering documents (as from time to time each may be amended and supplemented), (B) any materials or
information provided to investors by, or with the approval of, the Company in connection with the marketing of the Placement, including any “road show” or investor presentations made to investors by the Company (whether in person or
electronically), or (C) any application or other document or written communication (collectively called “application”) executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the
Securities under the securities laws thereof or to file for an exemption from such requirement or filed with the Commission, any state securities commission or agency, any national securities exchange; or (ii) the omission or alleged omission
therefrom of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, unless such statement or omission was made in reliance upon, and
in conformity with, information provided to the Company by Cathay in writing specifically for use in the Registration Statement, Prospectus or any other offering documents with respect which or resulting from conduct by Cathay or another
Indemnified Party, as to which Cathay shall indemnify and hold harmless the Company, its officers, directors and controlling parties in the manner set forth in this Section 16. The Company also agrees to reimburse each Indemnified Person for all
reasonable Expenses as they are incurred in connection with such Indemnified Person’s enforcement of his or its rights under this Section 16.
16.2. Procedure. Upon receipt by an Indemnified Person of actual notice of an action against such Indemnified Person with respect to which
indemnity may reasonably be expected to be sought under this Section 16, such Indemnified Person shall promptly notify the Company in writing; provided that failure by any Indemnified Person so to notify the Company shall not relieve the Company
from any obligation or liability which the Company may have on account of this Section 16 or otherwise to such Indemnified Person. The Company shall, if requested by Cathay, assume the defense of any such action (including the employment of counsel
designated by Cathay and reasonably satisfactory to the Company). Any Indemnified Person shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be
at the expense of such Indemnified Person unless: (i) the Company has failed promptly to assume the defense and employ separate counsel reasonably acceptable to Cathay for the benefit of Cathay and the other Indemnified Persons or (ii) such
Indemnified Person shall have been advised that in the opinion of counsel that there is an actual or potential conflict of interest that prevents (or makes it imprudent for) the counsel designated by and engaged by the Company for the purpose of
representing the Indemnified Person, to represent both such Indemnified Person and any other person represented or proposed to be represented by such counsel, in which event the Company shall pay the reasonable fees and expenses of one counsel for
all Indemnified Parties, which counsel shall, if Cathay is a defendant, be designated by Cathay. The Company shall not be liable for any settlement of any action effected without its written consent (which shall not be unreasonably withheld). In
addition, the Company shall not, without the prior written consent of Cathay, settle, compromise or consent to the entry of any judgment in or otherwise seek to terminate any pending or threatened action in respect of which reimbursement,
indemnification or contribution may be sought hereunder (whether or not such Indemnified Person is a party thereto) unless such settlement, compromise, consent or termination (i) includes an unconditional release of each Indemnified Person,
acceptable to such Indemnified Party, from all Liabilities arising out of such action for which indemnification or contribution may be sought hereunder and (ii) does not include a statement as to or an admission of fault, culpability or a failure
to act, by or on behalf of any Indemnified Person. The reimbursement, indemnification and contribution obligations of the Company required hereby shall be made by periodic payments of the amount thereof during the course of the investigation or
defense, as every Liability and Expense is incurred and is due and payable, and in such amounts as fully satisfy each and every Liability and Expense as it is incurred (and in no event later than 30 calendar days following the date of any invoice
therefor for any undisputed amount).
16.3.
Contribution. In the event that a court of competent jurisdiction makes a finding, final beyond right of
review, that indemnity is unavailable to an Indemnified Person, the Company shall contribute to the Liabilities and Expenses paid or payable by such Indemnified Person in such proportion as is appropriate to reflect (i) the relative benefits to the
Company, on the one hand, and to Cathay and any other Indemnified Person, on the other hand, of the matters contemplated by this Section 16 or (ii) if the allocation provided by the immediately preceding clause is not permitted by applicable law,
not only such relative benefits but also the relative fault of the Company, on the one hand, and Cathay and any other Indemnified Person, on the other hand, in connection with the matters as to which such Liabilities or Expenses relate, as well as
any other relevant equitable considerations; provided that in no event shall the Company contribute less than the amount necessary to ensure that all Indemnified Persons, in the aggregate, are not liable for any Liabilities and Expenses in excess
of the amount of commissions and non-accountable expense allowance actually received by Cathay in the Placement. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company on the one hand or Cathay on the other and the parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Company and Cathay agree that it would not be just and equitable if contributions pursuant to this subsection 16.3 were determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this subsection 16.3. For purposes of this paragraph, the relative benefits to the Company, on the one hand, and to Cathay on the other hand, of the matters contemplated by
this Section 16 shall be deemed to be in the same proportion as: (a) the total value actually received by the Company in the Placement, whether or not such Placement is consummated, bears to (b) the commissions paid to Cathay under the Placement
Agent Agreement. Notwithstanding the above, no person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of the Securities Act shall be entitled to contribution from a party who was not guilty of fraudulent
misrepresentation.
16.4. Limitation. The Company also agrees that no Indemnified Person shall have any liability (whether direct or indirect, in contract or tort
or otherwise) to the Company for or in connection with advice or services rendered or to be rendered by any Indemnified Person pursuant to this Agreement, the transactions contemplated thereby or any Indemnified Person’s actions or inactions in
connection with any such advice, services or transactions, except to the extent that a court of competent jurisdiction has made a finding that Liabilities (and related Expenses) of the Company have resulted exclusively from such Indemnified
Person’s fraud, bad faith, gross negligence or willful misconduct in connection with any such advice, actions, inactions or services.
| 17. |
Equitable Remedies. Each party to this Agreement acknowledges and agrees that (a) a breach or threatened breach by the Company of any of its obligations under Section 8 or the exclusivity provisions of Section 1 would give rise to irreparable harm to Cathay for which monetary damages would not be an adequate remedy and (b) if a breach or a threatened breach by the Company
of any such obligations occurs, Cathay will, in addition to any and all other rights and remedies that may be available to such party at law, at equity, or otherwise in respect of such breach, be entitled to equitable relief, including a
temporary restraining order, an injunction, specific performance of the terms of Section 8 or the exclusivity provisions of Section 1, as applicable, and any other relief that may be available from a court of competent jurisdiction, without
any requirement to (i) post a bond or other security, or (ii) prove actual damages or that monetary damages will not afford an adequate remedy. Each party to this Agreement agrees that such party shall not oppose or otherwise challenge the
existence of irreparable harm, the appropriateness of equitable relief or the entry by a court of competent jurisdiction of an order granting equitable relief, in either case, consistent with the terms of this Section 17.
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| 18. |
Governing Law; Venue. This Agreement will be deemed to have been made and delivered in the State of New York, U.S., and both the binding provisions of this Agreement and the transactions
contemplated hereby will be governed as to validity, interpretation, construction, effect and in all other respects by the internal laws of the State of New York, without regard to the conflict of laws principles thereof. Each of Cathay and
the Company: (i) agrees that any legal suit, action or proceeding arising out of or relating to this Agreement and/or the transactions contemplated hereby will be instituted exclusively in the courts located in the Borough of Manhattan,
City of New York, County of New York, State 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 jurisdiction of the courts located
in The City of New York, County of New York and State of New York, in any such suit, action or proceeding. Each of Cathay and the Company further agrees to accept and acknowledge service of any and all process which may be served in any
such suit, action or proceeding in such courts and agrees that service of process upon the Company mailed by certified mail to the Company’s address will be deemed in every respect effective service of process upon the Company, in any such
suit, action or proceeding, and service of process upon Cathay mailed by certified mail to Cathay’s address will be deemed in every respect effective service process upon Cathay, in any such suit, action or proceeding. Notwithstanding any
provision of this Agreement to the contrary, the Company agrees that neither Cathay nor its affiliates, and the respective officers, directors, employees, agents and representatives of Cathay, its affiliates and each other person, if any,
controlling Cathay or any of its affiliates, will have any liability (whether direct or indirect, in contract or tort or otherwise) to the Company for or in connection with the engagement and transaction described herein except for any such
liability for losses, claims, damages or liabilities incurred by the Company that are finally judicially determined to have resulted from the fraud, willful negligence, bad faith or gross negligence of such individuals or entities. Cathay
will act under this Agreement as an independent contractor with duties to the Company.
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Miscellaneous. The Company represents and warrants that it has all required power and authority to enter into and carry out the terms and provisions of this Agreement and the execution,
delivery and performance of this Agreement does not breach or conflict with any agreement, document or instrument to which it is a party or bound. The binding provisions of this Agreement are legally binding upon and inure to the benefit of
both the Company and Cathay and their respective assigns, successors, and legal representatives, provided that neither this Agreement nor any right or interest hereunder shall be assignable by the Company or Cathay without the prior written
consent of the other party hereto. If any provision of this Agreement is determined to be invalid or unenforceable in any respect, such determination will not affect such provision in any other respect, and the remainder of the Agreement
shall remain in full force and effect. This Agreement may be executed in counterparts (including electronic counterparts), each of which shall be deemed an original but all of which together shall constitute one and the same instrument. The
undersigned hereby consents to receipt of this Agreement in electronic form and understands and agrees that this Agreement may be signed electronically. Signatures to this Agreement transmitted in electronic form will have the same effect
as physical delivery of a paper document bearing the original signature, and if any signature is delivered electronically evidencing an intent to sign this Agreement, such electronic mail or other electronic transmission shall create a
valid and binding obligation of the undersigned with the same force and effect as if such signature were an original. Execution and delivery of this Agreement by electronic mail or other electronic transmission is legal, valid and binding
for all purposes.
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If you are in agreement with the foregoing, please sign and return to us one copy of this Agreement. This Agreement may be executed in counterparts (including facsimile or .pdf counterparts), each
of which shall be deemed an original but all of which together shall constitute one and the same instrument.
[
Signature Page of Best Efforts Follow-On Offering Placement Agent Agreement Follows]
[Signature Page of WTF Best Efforts Follow-On Offering Placement Agent Agreement]
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Cathay Securities, Inc.
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By:
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Name:
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Shell Li
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Title:
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Chief Executive Officer
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AGREED AND ACCEPTED:
The foregoing accurately sets forth our understanding and agreement with respect to the matters set forth herein.
Exhibit A
See Exhibit 21.1 to the Registration Statement