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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported):
September 7, 2023
Karat Packaging Inc.
(Exact name of registrant as specified in its charter)
Delaware |
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001-40336 |
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83-2237832 |
(State or other jurisdiction
of incorporation) |
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(Commission File Number) |
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(IRS Employer
Identification No.) |
6185 Kimball Avenue, Chino, CA 91708
(Address of principal executive offices) (Zip Code)
(626) 965-8882
Registrant’s telephone number, including
area code:
N/A
(Former name or former address, if changed since
last report.)
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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☐ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12) |
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☐ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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☐ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c)) |
Securities registered pursuant to Section 12(b)
of the Act:
Title of each class |
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Trading Symbol |
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Name of each exchange on which registered |
Common Stock, $0.001 par value per share |
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KRT |
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The Nasdaq Stock Market LLC |
Indicate by check mark whether the registrant
is an emerging growth company as defined in in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of
the Securities Exchange Act of 1934 (§240.12b -2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by checkmark
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 13(a) of the Exchange Act.
Item
1.01. Entry into a Material Definitive Agreement.
On September
7, 2023, Karat Packaging Inc. (the “Company”) entered into an underwriting agreement (the “Underwriting Agreement”)
with Lake Street Capital Markets, LLC, as the underwriter (the “Underwriter”), relating to the secondary offering of 1,000,000
shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”) by certain selling stockholders,
at a public offering price of $21.00 per share (the “Offering”). Under the terms of the Underwriting Agreement, a selling
stockholder granted the Underwriter a 30-day option to purchase up to an additional 150,000 shares of Common Stock from such selling stockholder.
The Offering was made pursuant to the Company’s shelf registration statement on Form S-3 (File No. 333-268397) (the “Registration
Statement”), which became effective on November 28, 2022, including the related prospectus, dated November 28, 2022, as supplemented
by the prospectus supplement dated September 7, 2023. The Underwriting Agreement is attached hereto as Exhibit 1.1 and is incorporated
herein by reference. The foregoing description of the material terms of the Underwriting Agreement does not purport to be complete and
is qualified in its entirety by reference to the terms of the Underwriting Agreement.
A copy of the legal opinion
relating to the legality of the offer and sale of Common Stock in the Offering is attached hereto as Exhibit 5.1 and is incorporated by
reference into the Registration Statement.
Item
8.01. Other Events.
On
September 7, 2023, the Company issued press releases announcing the commencement of
the secondary offering and the pricing of the secondary offering. Copies of the press releases are attached hereto as Exhibits 99.1 and
99.2 and are incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
The following exhibits are furnished herewith:
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Date: September 12, 2023 |
KARAT PACKAGING INC. |
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By: |
/s/ Jian Guo |
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Jian Guo |
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Chief Financial Officer |
Exhibit 1.1
Execution Version
KARAT PACKAGING INC.
1,000,000 shares of common stock, par value $0.001 per share
Underwriting Agreement
September 7, 2023
Lake Street Capital Markets, LLC
920 Second Avenue South, Suite 700
Minneapolis, Minnesota 55402
Ladies and Gentlemen:
Certain stockholders of Karat
Packaging Inc., a Delaware corporation (the “Company”), listed in Schedule 2 hereto (the “Selling Stockholders”)
propose to sell to Lake Street Capital Markets, LLC in its capacity as underwriter (the “Underwriter”), an aggregate
of 1,000,000 shares of common stock, par value $0.001 per share (the “Common Stock”), of the Company (the “Underwritten
Shares”) and, at the option of the Underwriter, up to an additional 150,000 shares of Common Stock (the “Option Shares”);
provided, that the Option Shares to be sold to the Underwriter, if any, shall be sold by Marvin Cheng (“Mr. Cheng”),
who is one of the Selling Stockholders. The Underwritten Shares and the Option Shares are herein referred to as the “Shares.”
The shares of Common Stock to be outstanding after giving effect to the sale of the Shares are referred to herein as the “Stock.”
The Company and the Selling
Stockholders hereby confirm their respective agreements with the Underwriter concerning the purchase and sale of the Shares, as follows:
1. Registration
Statement. The Company has prepared and filed with the Securities and Exchange Commission (the “Commission”) under
the Securities Act of 1933, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Securities
Act”), a registration statement (File No. 333-268397), including a prospectus, relating to the Shares. Such registration statement,
as amended at the time it became effective, including the information, if any, deemed pursuant to Rule 430A, 430B or 430C under the Securities
Act to be part of the registration statement at the time of its effectiveness (“Rule 430 Information”), is referred
to herein as the “Registration Statement”; and as used herein, the term “Preliminary Prospectus”
means each prospectus included in such registration statement (and any amendments thereto) before effectiveness, any prospectus filed
with the Commission pursuant to Rule 424(a) under the Securities Act and the prospectus included in the Registration Statement at the
time of its effectiveness that omits Rule 430 Information, and the term “Prospectus” means the prospectus in the form
first used (or made available upon request of purchasers pursuant to Rule 173 under the Securities Act) in connection with confirmation
of sales of the Shares. If the Company has filed an abbreviated registration statement pursuant to Rule 462(b) under the Securities Act
(the “Rule 462 Registration Statement”), then any reference herein to the term “Registration Statement”
shall be deemed to include such Rule 462 Registration Statement. Any reference in this underwriting agreement (this “Agreement”)
to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 under the Securities Act, as of the effective date of the Registration Statement
or the date of such Preliminary Prospectus or the Prospectus, as the case may be, and any reference to “amend,” “amendment”
or “supplement” with respect to the Registration Statement, any Preliminary Prospectus or the Prospectus shall be deemed
to refer to and include any documents filed after such date under the Securities Exchange Act of 1934, as amended, and the rules and regulations
of the Commission thereunder (collectively, the “Exchange Act”) that are deemed to be incorporated by reference therein.
Capitalized terms used but not defined herein shall have the meanings given to such terms in the Registration Statement and the Prospectus.
At or prior to the Applicable
Time (as defined below), the Company had prepared the following information (collectively with the pricing information set forth on Annex
A, the “Pricing Disclosure Package”): a Preliminary Prospectus filed on September 7, 2023 and each “free-writing
prospectus” (as defined pursuant to Rule 405 under the Securities Act) listed on Annex A hereto.
“Applicable Time”
means 7:00 P.M., New York City time, on September 7, 2023.
2. Purchase
of the Shares.
(a) Each
of the Selling Stockholders agrees, severally and not jointly, to sell the Underwritten Shares to the Underwriter as provided in this
Agreement, and the Underwriter, on the basis of the representations, warranties and agreements set forth herein and subject to the conditions
set forth herein, agrees to purchase at a price per share of $20.265 (the “Purchase Price”) from the Selling Stockholders
the number of Underwritten Shares set forth opposite the Underwriter’s name in Schedule 1 hereto.
In addition, Mr. Cheng agrees
to sell the Option Shares to the Underwriter as provided in this Agreement, and the Underwriter, on the basis of the representations,
warranties and agreements set forth herein and subject to the conditions set forth herein, shall have the option to purchase from Mr.
Cheng the Option Shares at the Purchase Price less an amount per share equal to any dividends or distributions declared by the Company
and payable on the Underwritten Shares but not payable on the Option Shares.
The Underwriter may exercise
the option to purchase Option Shares at any time in whole, or from time to time in part, on or before the thirtieth day following the
date of the Prospectus, by written notice from the Underwriter to Mr. Cheng and the Company. Such notice shall set forth the aggregate
number of Option Shares as to which the option is being exercised and the date and time when the Option Shares are to be delivered and
paid for, which may be the same date and time as the Closing Date (as hereinafter defined) but shall not be earlier than the Closing Date
nor later than the tenth full business day (as hereinafter defined) after the date of such notice. Any such notice shall be given at least
two business days prior to the date and time of delivery specified therein.
(b) The
Selling Stockholders understand that the Underwriter intends to make a public offering of the Shares, and initially to offer the Shares
on the terms set forth in the Pricing Disclosure Package. The Selling Stockholders, severally and not jointly, acknowledge and agree that
the Underwriter may offer and sell Shares to or through any affiliate of an Underwriter.
(c) Payment
for the Shares shall be made by wire transfer in immediately available funds to the account specified by each Selling Stockholder to the
Underwriter in the case of the Underwritten Shares, at the offices of Faegre Drinker Biddle Reath LLP, 2200 Wells Fargo Center, 90 South
7th Street, Minneapolis, Minnesota 55402 at 10:00 A.M., New York City time, on September 12, 2023, or at such other time or place on the
same or such other date, not later than the fifth business day thereafter, as the Underwriter, the Company and each Selling Stockholder
may agree upon in writing or, in the case of the Option Shares, on the date and at the time and place specified by the Underwriter in
the written notice of the Underwriter’s election to purchase such Option Shares. The time and date of such payment for the Underwritten
Shares is referred to herein as the “Closing Date,” and the time and date for such payment for the Option Shares, if
other than the Closing Date, is herein referred to as the “Additional Closing Date.”
Payment for the Shares to
be purchased on the Closing Date or the Additional Closing Date, as the case may be, shall be made against delivery to the Underwriter
of the Shares to be purchased, with any transfer taxes payable in connection with the sale of such Shares duly paid by the Selling Stockholders.
Delivery of the Shares shall be made through the facilities of The Depository Trust Company (“DTC”) unless the Underwriter
shall otherwise instruct. The certificates for the Shares, if any, will be made available for inspection and packaging by the Underwriter
at the office of DTC or its designated custodian not later than 1:00 P.M., New York City time, on the business day prior to the Closing
Date or the Additional Closing Date, as the case may be.
(d) Each
of the Company and the Selling Stockholders, severally and not jointly, acknowledges and agrees that the Underwriter is acting solely
in the capacity of an arm’s-length contractual counterparty to the Company and the Selling Stockholders with respect to the offering
of Shares contemplated hereby (including in connection with determining the terms of the offering) and not as a financial advisor or a
fiduciary to, or an agent of, the Company, the Selling Stockholders or any other person. Additionally, the Underwriter is not advising
the Company, the Selling Stockholders or any other person as to any legal, tax, investment, accounting or regulatory matters in any jurisdiction.
The Company and the Selling Stockholders shall consult with their own advisors concerning such matters and each shall be responsible for
making its own independent investigation and appraisal of the transactions contemplated hereby, and the Underwriter shall not have any
responsibility or liability to the Company or the Selling Stockholders with respect thereto. Any review by the Underwriter of the Company,
the transactions contemplated hereby or other matters relating to such transactions will be performed solely for the benefit of the Underwriter
and shall not be on behalf of the Company or the Selling Stockholders. Moreover, the Selling Stockholders acknowledge and agree, severally
and not jointly, that, although the Underwriter may be required or choose to provide the Selling Stockholders with certain Regulation
Best Interest and Form CRS disclosures in connection with the offering, the Underwriter is not making a recommendation to the Selling
Stockholders to participate in the offering, enter into a “lock-up” agreement, or sell any Shares at the price determined
in the offering, and nothing set forth in such disclosures is intended to suggest that the Underwriter is making such a recommendation.
3. Representations
and Warranties of the Company. The Company represents and warrants to the Underwriter that:
(a) Preliminary
Prospectus. No order preventing or suspending the use of any Preliminary Prospectus has been issued by the Commission, and each Preliminary
Prospectus included in the Pricing Disclosure Package, at the time of filing thereof, complied in all material respects with the Securities
Act, and no Preliminary Prospectus, at the time of filing thereof, contained any untrue statement of a material fact or omitted to state
a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading;
provided that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon
and in conformity with information relating to the Underwriter furnished to the Company in writing by the Underwriter expressly for use
in any Preliminary Prospectus, it being understood and agreed that the only such information furnished by any Underwriter consists of
the information described as such in Section 9(b) hereof.
(b) Pricing
Disclosure Package. The Pricing Disclosure Package as of the Applicable Time did not, and as of the Closing Date and as of the Additional
Closing Date, as the case may be, will not, contain any untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided
that the Company makes no representation or warranty with respect to any statements or omissions made in reliance upon and in conformity
with information relating to any Underwriter furnished to the Company in writing by the Underwriter expressly for use in such Pricing
Disclosure Package, it being understood and agreed that the only such information furnished by any Underwriter consists of the information
described as such in Section 9(b) hereof. No statement of material fact included in the Prospectus has been omitted from the Pricing Disclosure
Package and no statement of material fact included in the Pricing Disclosure Package that is required to be included in the Prospectus
has been omitted therefrom.
(c) Issuer
Free Writing Prospectus. Other than the Registration Statement, the Preliminary Prospectus and the Prospectus, the Company (including
its agents and representatives, other than the Underwriter in its capacity as such) has not prepared, made, used, authorized, approved
or referred to and will not prepare, make, use, authorize, approve or refer to any “written communication” (as defined in
Rule 405 under the Securities Act) that constitutes an offer to sell or solicitation of an offer to buy the Shares (each such communication
by the Company or its agents and representatives (other than a communication referred to in clause (i) below) an “Issuer Free Writing
Prospectus”) other than (i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the Securities Act or
Rule 134 under the Securities Act or (ii) the documents listed on Annex A hereto, each electronic road show and any other written communications
approved in writing in advance by the Underwriter, such approval not to be unreasonably withheld or delayed. Each such Issuer Free Writing
Prospectus complies in all material respects with the Securities Act, has been or will be (within the time period specified in Rule 433)
filed in accordance with the Securities Act (to the extent required thereby) and does not conflict with the information contained in the
Registration Statement or the Pricing Disclosure Package, and, when taken together with the Preliminary Prospectus filed prior to the
first use of such Issuer Free Writing Prospectus, did not, and as of the Closing Date and as of the Additional Closing Date, as the case
may be, will not, contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading; provided that the Company makes no representation
or warranty with respect to any statements or omissions made in each such Issuer Free Writing Prospectus or Preliminary Prospectus in
reliance upon and in conformity with information relating to the Underwriter furnished to the Company in writing by the Underwriter expressly
for use in such Issuer Free Writing Prospectus or Preliminary Prospectus, it being understood and agreed that the only such information
furnished by the Underwriter consists of the information described as such in Section 9(b) hereof.
(d) Registration
Statement and Prospectus. The Registration Statement has been declared effective by the Commission. No order suspending the effectiveness
of the Registration Statement has been issued by the Commission, and no proceeding for that purpose or pursuant to Section 8A of the Securities
Act against the Company or related to the offering of the Shares has been initiated or, to the knowledge of the Company, threatened by
the Commission; as of the applicable effective date of the Registration Statement and any post-effective amendment thereto, the Registration
Statement and any such post-effective amendment complied and will comply in all material respects with the applicable requirements of
the Securities Act, and did not and will not contain any untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary in order to make the statements therein not misleading; and as of the date of the Prospectus and any
amendment or supplement thereto and as of the Closing Date and as of the Additional Closing Date, as the case may be, the Prospectus will
comply in all material respects with the applicable requirements of the Securities Act and will not contain any untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under
which they were made, not misleading; provided that the Company makes no representation or warranty with respect to any statements
or omissions made in reliance upon and in conformity with information relating to any Underwriter furnished to the Company in writing
by the Underwriter expressly for use in the Registration Statement and the Prospectus and any amendment or supplement thereto, it being
understood and agreed that the only such information furnished by any Underwriter consists of the information described as such in Section
9(b) hereof.
(e) Incorporated
Documents. The documents incorporated by reference in the Registration Statement, the Prospectus and the Pricing Disclosure Package,
when they were filed with the Commission conformed in all material respects to the requirements of the Exchange Act, and, at such time
of filing, none of such documents contained any untrue statement of a material fact or omitted to state a material fact necessary to make
the statements therein, in the 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 Prospectus or the Pricing Disclosure Package, when such documents are
filed with the Commission, will conform in all material respects to the requirements of the Exchange Act 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 the light of the circumstances
under which they were made, not misleading.
(f) Financial
Statements. The financial statements (including the related notes thereto) of the Company and its consolidated subsidiaries included
or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus comply in all material respects
with the applicable requirements of the Securities Act and the Exchange Act, as applicable, and present fairly in all material respects
the financial position of the Company and its consolidated subsidiaries as of the dates indicated and the results of their operations
and the changes in their cash flows for the periods specified; such financial statements have been prepared in conformity with generally
accepted accounting principles (“GAAP”) in the United States applied on a consistent basis throughout the periods covered
thereby, except in the case of unaudited financial statements, which are subject to normal year-end adjustments and do not contain certain
footnotes as permitted by the applicable rules of the Commission, and any supporting schedules included or incorporated by reference in
the Registration Statement present fairly in all material respects the information required to be stated therein; the other financial
information included or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus has
been derived from the accounting records of the Company and its consolidated subsidiaries and presents fairly in all material respects
the information shown thereby; and all disclosures included or incorporated by reference in the Registration Statement, the Pricing Disclosure
Package and the Prospectus regarding “non-GAAP financial measures” (as such term is defined by the rules and regulations of
the Commission) comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Securities Act, to the extent applicable.
(g) No
Material Adverse Change. Since the date of the most recent financial statements of the Company included or incorporated by reference
in the Registration Statement, the Pricing Disclosure Package and the Prospectus, (i) there has not been any change in the capital stock
(other than the issuance of shares of Common Stock upon exercise of stock options and warrants described as outstanding in, and the grant
of options and awards under existing equity incentive plans described in, the Registration Statement, the Pricing Disclosure Package and
the Prospectus), short-term debt or long-term debt of the Company or any of its subsidiaries, or any dividend or distribution of any kind
declared, set aside for payment, paid or made by the Company on any class of capital stock, or any material adverse change, or any development
that would reasonably be expected to result in a material adverse change, in or affecting the business, properties, management, financial
position, stockholders’ equity, results of operations or prospects of the Company and its subsidiaries taken as a whole; (ii) neither
the Company nor any of its subsidiaries has entered into any transaction or agreement (whether or not in the ordinary course of business)
that is material to the Company and its subsidiaries taken as a whole or incurred any liability or obligation, direct or contingent, that
is material to the Company and its subsidiaries taken as a whole; and (iii) neither the Company nor any of its subsidiaries has sustained
any loss or interference with its business that is material to the Company and its subsidiaries taken as a whole and that is either from
fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor disturbance or dispute or any action,
order or decree of any court or arbitrator or governmental or regulatory authority, except in each case as otherwise disclosed in the
Registration Statement, the Pricing Disclosure Package and the Prospectus.
(h) Organization
and Good Standing. The Company and each of its subsidiaries have been duly organized and are validly existing and in good standing
under the laws of their respective jurisdictions of organization, are duly qualified to do business and are in good standing in each jurisdiction
in which their respective ownership or lease of property or the conduct of their respective businesses requires such qualification, and
have all power and authority necessary to own or hold their respective properties and to conduct the businesses in which they are engaged,
except where the failure to be so qualified or in good standing or have such power or authority would not, individually or in the aggregate,
have a material adverse effect on the business, properties, management, financial position, stockholders’ equity, results of operations
or prospects of the Company and its subsidiaries taken as a whole or on the performance by the Company of its obligations under this Agreement
(a “Material Adverse Effect”). The Company does not own or control, directly or indirectly, any corporation, association
or other entity other than the subsidiaries listed in Exhibit 21 to the Company’s annual report on Form 10-K for the year ended
December 31, 2022.
(i) Capitalization.
The Company has an authorized capitalization as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus;
all the outstanding shares of capital stock of the Company (including the Shares to be sold by the Selling Stockholder) have been duly
and validly authorized and issued and are fully paid and non-assessable and are not subject to any pre-emptive or similar rights; except
as described in or expressly contemplated by the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are
no outstanding rights (including, without limitation, pre-emptive rights), warrants or options to acquire, or instruments convertible
into or exchangeable for, any shares of capital stock or other equity interest in the Company or any of its subsidiaries, or any contract,
commitment, agreement, understanding or arrangement of any kind relating to the issuance of any capital stock of the Company or any such
subsidiary, any such convertible or exchangeable securities or any such rights, warrants or options; the capital stock of the Company
conforms in all material respects to the description thereof contained in the Registration Statement, the Pricing Disclosure Package and
the Prospectus; and all the outstanding shares of capital stock or other equity interests of each subsidiary owned, directly or indirectly,
by the Company have been duly and validly authorized and issued, are fully paid and non-assessable and are owned directly or indirectly
by the Company, free and clear of any lien, charge, encumbrance, security interest, restriction on voting or transfer or any other claim
of any third party.
(j) Stock
Options; Restricted Stock Units. With respect to the stock options (the “Stock Options”) and Restricted Stock Units
(“RSUs”) granted pursuant to the stock-based compensation plan of the Company and its subsidiaries (the “Company
Incentive Plan”), (i) each Stock Option intended to qualify as an “incentive stock option” under Section 422 of
the Code (as defined below) so qualifies, (ii) each grant of a Stock Option or RSU was duly authorized no later than the date on which
the grant of such Stock Option or RSU was by its terms to be effective (the “Grant Date”) by all necessary corporate
action, including, as applicable, approval by the board of directors of the Company (or a duly constituted and authorized committee thereof)
and any required stockholder approval by the necessary number of votes or written consents, and the award agreement governing such grant
(if any) was duly executed and delivered by each party thereto, (iii) each such grant was made in all material respects in accordance
with the terms of the Company Incentive Plan, the Exchange Act and all other applicable laws and regulatory rules or requirements, including
the rules of the Nasdaq Global Select Market (the “Nasdaq”) and any other exchange on which Company securities are
traded, and (iv) each such grant was properly accounted for in accordance with GAAP in the financial statements (including the related
notes) of the Company and disclosed in the Company’s filings with the Commission in accordance with the Exchange Act and all other
applicable laws. The Company has not knowingly granted, and there is no and has been no policy or practice of the Company of granting,
Stock Options or RSUs prior to, or otherwise coordinating the grant of Stock Options or RSUs with, the release or other public announcement
of material information regarding the Company or its subsidiaries or their results of operations or prospects.
(k) Due
Authorization. The Company has full right, power and authority to execute and deliver this Agreement and to perform its obligations
hereunder; and all action required to be taken for the due and proper authorization, execution and delivery by it of this Agreement and
the consummation by it of the transactions contemplated hereby has been duly and validly taken.
(l) Underwriting
Agreement. This Agreement has been duly authorized, executed and delivered by the Company.
(m) Description
of the Underwriting Agreement. This Agreement conforms in all material respects to the description thereof contained in the Registration
Statement, the Pricing Disclosure Package and the Prospectus.
(n) No
Violation or Default. Neither the Company nor any of its subsidiaries is (i) in violation of its charter or by-laws or similar organizational
documents; (ii) in default, and no event has occurred that, with notice or lapse of time or both, would constitute such a default, in
the due performance or observance of any term, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement
or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries
is bound or to which any property or asset of the Company or any of its subsidiaries is subject; or (iii) in violation of any law or statute
or any judgment, order, rule or regulation of any court or arbitrator or governmental or regulatory authority, except, in the case of
clauses (ii) and (iii) above, for any such default or violation that would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect.
(o) No
Conflicts. The execution, delivery and performance by the Company of this Agreement and the consummation of the transactions contemplated
by this Agreement or the Pricing Disclosure Package and the Prospectus will not (i) conflict with or result in a breach or violation of
any of the terms or provisions of, or constitute a default under, result in the termination, modification or acceleration of, or result
in the creation or imposition of any lien, charge or encumbrance upon any property, right or asset of the Company or any of its subsidiaries
pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any property, right or asset of the Company
or any of its subsidiaries is subject, (ii) result in any violation of the provisions of the charter or by-laws or similar organizational
documents of the Company or any of its subsidiaries or (iii) result in the violation of any law or statute or any judgment, order, rule
or regulation of any court or arbitrator or governmental or regulatory authority having jurisdiction over the Company, except, in the
case of clauses (i) and (iii) above, for any such conflict, breach, violation, default, lien, charge or encumbrance that would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(p) No
Consents Required. No consent, approval, authorization, order, registration or qualification of or with any court or arbitrator or
governmental or regulatory authority is required for the execution, delivery and performance by the Company of this Agreement and the
consummation of the transactions contemplated by this Agreement, except for the registration of the Shares under the Securities Act and
such consents, approvals, authorizations, orders and registrations or qualifications as may be required by the Financial Industry Regulatory
Authority, Inc. (“FINRA”) and under applicable state securities laws in connection with the purchase and distribution
of the Shares by the Underwriter.
(q) Legal
Proceedings. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no legal,
governmental or regulatory investigations, actions, demands, claims, suits, arbitrations, inquiries or proceedings (“Actions”)
pending to which the Company or any of its subsidiaries is or may reasonably be expected to become a party or to which any property of
the Company or any of its subsidiaries is or may be the subject that, individually or in the aggregate, if determined adversely to the
Company or any of its subsidiaries, would reasonably be expected to have a Material Adverse Effect; to the knowledge of the Company, no
such Actions are threatened or contemplated by any governmental or regulatory authority or threatened by others; and (i) there are no
current or pending Actions that are required under the Securities Act to be described in the Registration Statement, the Pricing Disclosure
Package or the Prospectus that are not so described in the Registration Statement, the Pricing Disclosure Package and the Prospectus and
(ii) there are no statutes, regulations or contracts or other documents that are required under the Securities Act to be filed as exhibits
to the Registration Statement or described in the Registration Statement, the Pricing Disclosure Package or the Prospectus that are not
so filed as exhibits to the Registration Statement or described in the Registration Statement, the Pricing Disclosure Package and the
Prospectus.
(r) Independent
Accountants. Each of PricewaterhouseCoopers LLP and BDO USA, LLP, who have certified certain financial statements of the Company and
its subsidiaries, is an independent registered public accounting firm with respect to the Company and its subsidiaries within the applicable
rules and regulations adopted by the Commission and the Public Company Accounting Oversight Board (United States) and as required by the
Securities Act.
(s) Title
to Real and Personal Property. The Company and its subsidiaries have good and marketable title in fee simple to, or have valid rights
to lease or otherwise use, all items of real and personal property that are material to the respective businesses of the Company and its
subsidiaries, in each case free and clear of all liens, encumbrances, claims and defects and imperfections of title except those that
(i) do not materially interfere with the use made and proposed to be made of such property by the Company and its subsidiaries or (ii)
would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect.
(t) Intellectual
Property. Except as would not reasonably be expected, individually or in the aggregate, to have a Material Adverse Effect, (i) the
Company and its subsidiaries own or have valid, enforceable and adequate rights to use all (A) patents, (B) trademarks, service marks,
trade names, trade dress, domain names and other source indicators, and all goodwill associated with the foregoing, (C) social media identifiers
and accounts, (D) copyrights and copyrightable works, (E) inventions, software, technology, know-how, trade secrets, systems, procedures
and other proprietary or confidential information and (F) all other worldwide intellectual property, industrial property and similar proprietary
rights of any kind or nature (including all registrations and applications for registration of, any of the foregoing) (collectively, “Intellectual
Property”) as used in, or otherwise necessary for, the conduct of their respective businesses as described in the Registration
Statement, the Disclosure Package and the Prospectus; (ii) the Company’s and its subsidiaries’ conduct of their respective
businesses does not infringe, misappropriate or otherwise violate any Intellectual Property rights of any person or entity; (iii) the
Company and its subsidiaries have not received any written notice of, nor to the knowledge of the Company are there any facts that would
form the basis for, any action, suit, proceeding or claim (A) of infringement, misappropriation or other violation by the Company or any
of its subsidiaries of the Intellectual Property rights of any person or entity, (B) challenging the Company’s or any of its subsidiaries’
rights in or to any Intellectual Property owned by or licensed to the Company or any of its subsidiaries, or (C) challenging the ownership,
validity, scope or enforceability of any Intellectual Property owned by or exclusively licensed to the Company or any of its subsidiaries;
(iv) to the knowledge of the Company, the Intellectual Property owned by or exclusively licensed to the Company and its subsidiaries is
not being infringed, misappropriated or otherwise violated by any person or entity; (v) none of the Intellectual Property owned by (and
to the knowledge of the Company, none of the Intellectual Property exclusively licensed to) the Company and its subsidiaries has been
adjudged invalid or unenforceable, and to the knowledge of the Company, all such Intellectual Property is valid, subsisting and enforceable;
(vi) all Intellectual Property owned by the Company of its subsidiaries is owned solely and exclusively by the Company or its subsidiaries,
free and clear of all liens, encumbrances, defects and other restrictions (other than non-exclusive rights granted to third parties in
the ordinary course of business); (vii) each employee and contractor engaged in the development of Intellectual Property on behalf of
the Company or any subsidiary of the Company has executed an invention assignment agreement whereby such employee or contractor presently
assigns all of their rights, title and interest in and to such Intellectual Property to the Company or the applicable subsidiary (or such
rights vest in the Company or the applicable subsidiary by operation of law), and, to the knowledge of the Company, no such agreement
has been breached or violated in any material respect; and (viii) the Company and its subsidiaries take, and have taken, commercially
reasonable steps in accordance with customary industry practice to maintain the confidentiality of all material Intellectual Property,
the value of which to the Company or any of its subsidiaries is contingent upon maintaining the confidentiality thereof and, to the knowledge
of the Company, no such Intellectual Property has been disclosed other than to employees, representatives, and agents of the Company or
any of its subsidiaries, all of whom are bound by written confidentiality agreements (or substantially equivalent professional obligations
of confidentiality).
(u) No
Undisclosed Relationships. No relationship, direct or indirect, exists between or among the Company or any of its subsidiaries, on
the one hand, and the directors, officers, stockholders, customers, suppliers or other affiliates of the Company or any of its subsidiaries,
on the other, that is required by the Securities Act to be described in each of the Registration Statement and the Prospectus and that
is not so described in such documents and in the Pricing Disclosure Package.
(v) Investment
Company Act. The Company is not and, after giving effect to the offering and sale of the Shares and the application of the proceeds
thereof as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, will not be required to register
as an “investment company” or an entity “controlled” by an “investment company” within the meaning
of the Investment Company Act of 1940, as amended, and the rules and regulations of the Commission thereunder (collectively, the “Investment
Company Act”).
(w) Taxes.
The Company and its subsidiaries have paid all federal, state, local and foreign taxes and filed all tax returns required to be paid or
filed through the date hereof, except, in each case, to the extent the failure to do so would not reasonably be expected to have a Material
Adverse Effect; and there is no tax deficiency that has been, or would reasonably be expected to be, asserted against the Company or any
of its subsidiaries or any of their respective properties or assets except to the extent such deficiency would not reasonably be expected
to have a Material Adverse Effect. The charges, accruals and reserves on the books of the Company in respect of any income and corporation
tax liability for any years not finally determined are, in conformity with GAAP, adequate to meet any assessments or re-assessments for
additional income tax for any years not finally determined, except to the extent of any inadequacies that would not reasonably be expected
to result in a Material Adverse Effect.
(x) Licenses
and Permits. The Company and its subsidiaries possess all licenses, sub-licenses, certificates, permits and other authorizations issued
by, and have made all declarations and filings with, the appropriate federal, state, local or foreign governmental or regulatory authorities
that are necessary for the ownership or lease of their respective properties or the conduct of their respective businesses as described
in each of the Registration Statement, the Pricing Disclosure Package and the Prospectus, except where the failure to possess or make
the same would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; neither the Company nor
any of its subsidiaries has received notice of any revocation or modification of any such license, sub-license, certificate, permit or
authorization or has any reason to believe that any such license, sub-license, certificate, permit or authorization will not be renewed
in the ordinary course, except where such revocations, modifications, or failures to renew would not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect.
(y) No
Labor Disputes. No labor disturbance by or dispute with employees of the Company or any of its subsidiaries exists or, to the knowledge
of the Company, is contemplated or threatened, and the Company is not aware of any existing or imminent labor disturbance by, or dispute
with, the employees of any of its or its subsidiaries’ principal suppliers, contractors or customers, except as would not reasonably
be expected to have a Material Adverse Effect. Neither the Company nor any of its subsidiaries has received any notice of cancellation
or termination with respect to any collective bargaining agreement to which it is a party.
(z) Certain
Environmental Matters. (i) The Company and its subsidiaries (a) are in compliance with all applicable federal, state, local and foreign
laws (including common law), regulations, judgments, decrees, orders and other legally enforceable requirements relating to pollution
or protection of the environment, natural resources or human health and safety (to the extent protection of human health and safety also
relates to exposure to hazardous or toxic substances) (collectively, “Environmental Laws”), (b) have received and are
in compliance with all permits, licenses, or other authorizations or approvals required of them under any Environmental Laws to conduct
their respective businesses, and (c) have not received written notice of any violation of or liability under any Environmental Laws; except
in the case of each of each of (a) and (b) and (c) above, for any such matter as would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect; and (ii) there are no proceedings that are pending, or that are known to be contemplated,
against the Company or any of its subsidiaries under any Environmental Laws in which a governmental entity is also a party, other than
such proceedings regarding which it is reasonably believed no monetary sanctions of $300,000 or more will be imposed.
(aa) Compliance with ERISA.
(i) Each employee benefit plan, within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended
(“ERISA”), for which the Company or any member of its “Controlled Group” (defined as any entity,
whether or not incorporated, that is under common control with the Company within the meaning of Section 4001(a)(14) of ERISA or any entity
that would be regarded as a single employer with the Company under Section 414(b),(c),(m) or (o) of the Internal Revenue Code of 1986,
as amended (the “Code”)) would have any liability (each, a “Plan”) has been maintained in compliance
with its terms and the requirements of any applicable statutes, orders, rules and regulations, including but not limited to ERISA and
the Code; (ii) no prohibited transaction, within the meaning of Section 406 of ERISA or Section 4975 of the Code, has occurred with respect
to any Plan, excluding transactions effected pursuant to a statutory or administrative exemption; (iii) for each Plan that is subject
to the funding rules of Section 412 of the Code or Section 302 of ERISA, no Plan has failed (whether or not waived), or is reasonably
expected to fail, to satisfy the minimum funding standards (within the meaning of Section 302 of ERISA or Section 412 of the Code) applicable
to such Plan; (iv) no Plan is, or is reasonably expected to be, in “at risk status” (within the meaning of Section 303(i)
of ERISA) and no Plan that is a “multiemployer plan” within the meaning of Section 4001(a)(3) of ERISA is in “endangered
status” or “critical status” (within the meaning of Sections 304 and 305 of ERISA) (v) the fair market value of the
assets of each Plan that is required to be funded exceeds the present value of all benefits accrued under such Plan (determined based
on those assumptions used to fund such Plan); (vi) no “reportable event” (within the meaning of Section 4043(c) of ERISA and
the regulations promulgated thereunder) has occurred or is reasonably expected to occur; (vii) each Plan that is intended to be qualified
under Section 401(a) of the Code is so qualified, and to the knowledge of the Company, nothing has occurred, whether by action or by failure
to act, which would cause the loss of such qualification; (viii) neither the Company nor any member of the Controlled Group has incurred,
nor reasonably expects to incur, any liability under Title IV of ERISA (other than contributions to the Plan or premiums to the Pension
Benefit Guarantee Corporation, in the ordinary course and without default) in respect of a Plan (including a “multiemployer plan”
within the meaning of Section 4001(a)(3) of ERISA); and (ix) none of the following events has occurred or is reasonably likely to occur:
(A) a material increase in the aggregate amount of contributions required to be made to all Plans by the Company or its Controlled Group
affiliates in the current fiscal year of the Company and its Controlled Group affiliates compared to the amount of such contributions
made in the Company’s and its Controlled Group affiliates’ most recently completed fiscal year; or (B) a material increase
in the Company and its subsidiaries’ “accumulated post-retirement benefit obligations” (within the meaning of Accounting
Standards Codification Topic 715-60) compared to the amount of such obligations in the Company and its subsidiaries’ most recently
completed fiscal year, except in each case with respect to the events or conditions set forth in (i) through (ix) hereof, as would not,
individually or in the aggregate, have a Material Adverse Effect.
(bb) Disclosure Controls.
Except as described in the Registration Statement, the Pricing Disclosure Package or the Prospectus, the Company and its subsidiaries
maintain an effective system of “disclosure controls and procedures” (as defined in Rule 13a-15(e) of the Exchange Act) that
complies with the requirements of the Exchange Act and that has been designed to ensure that information required to be disclosed by the
Company in reports that 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, including controls and procedures designed to ensure that such information is accumulated
and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure. The Company
and its subsidiaries have carried out evaluations of the effectiveness of their disclosure controls and procedures as required by Rule
13a-15 of the Exchange Act.
(cc) Accounting Controls.
The Company and its subsidiaries maintain systems of “internal control over financial reporting” (as defined in Rule 13a-15(f)
of the Exchange Act) that are designed to comply with the requirements of the Exchange Act and have been designed by, or under the supervision
of, their respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable
assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with GAAP. The Company and its subsidiaries maintain 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; (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 and
(v) interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration Statement, the
Prospectus and the Pricing Disclosure Package fairly presents the information called for in all material respects and is prepared in accordance
with the Commission’s rules and guidelines applicable thereto. Based on the Company’s most recent evaluation of its internal
controls over financial reporting pursuant to Rule 13a-15(c) of the Exchange Act, except as disclosed in the Registration Statement, the
Pricing Disclosure Package and the Prospectus, there are no material weaknesses in the Company’s internal controls over financial
reporting. The Company’s auditors and the Audit Committee of the Board of Directors of the Company have been advised of: (i) all
significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting that are known
to the Company’s management and which have adversely affected or are reasonably likely to adversely affect the Company’s ability
to record, process, summarize and report financial information; and (ii) any fraud known to the Company’s management, whether or
not material, that involves management or other employees who have a significant role in the Company’s internal controls over financial
reporting.
(dd) eXtensible Business
Reporting Language. The interactive data in eXtensible Business Reporting Language included or incorporated by reference in the Registration
Statement fairly presents the information called for in all material respects and has been prepared in accordance with the Commission’s
rules and guidelines applicable thereto.
(ee) Insurance. The
Company and its subsidiaries have insurance covering their respective properties, operations, personnel and businesses, including business
interruption insurance, which insurance is in amounts and insures against such losses and risks as the Company reasonably believes are
adequate to protect the Company and its subsidiaries and their respective businesses; and neither the Company nor any of its subsidiaries
has (i) received notice from any insurer or agent of such insurer that capital improvements or other expenditures are required or necessary
to be made in order to continue such insurance or (ii) 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 at reasonable cost from similar insurers as may be necessary
to continue its business.
(ff) Cybersecurity; Data
Protection. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the Company
and its subsidiaries’ information technology assets and equipment, computers, systems, networks, hardware, software, websites, applications,
data and databases (collectively, “IT Systems”) are adequate for, and operate and perform in all material respects
required in connection with, the operation of the business of the Company and its subsidiaries as currently conducted and as proposed
to be conducted in the Registration Statement, the Disclosure Package, and the Prospectus, free and clear of all material bugs, errors,
defects, Trojan horses, time bombs, back doors, drop dead devices, malware and other corruptants. The Company and its subsidiaries have
established, implemented and maintained commercially reasonable and appropriate controls, policies, procedures, and technological safeguards
designed to maintain and protect their material confidential information and the integrity, continuous operation, redundancy and security
of all IT Systems and material data (including all personal, personally identifiable, household, sensitive, confidential or regulated
data or information (“Company Data”)) used in connection with their businesses, in compliance with all applicable laws
and regulatory standards in all material respects. To the knowledge of the Company, there have been no material breaches, violations,
outages, security incidents or unauthorized uses of or accesses to any IT Systems or Company Data. The Company and its subsidiaries own
or have a valid right to access and use all IT Systems and Company Data, and have complied in all material respects and are presently
in material compliance with all applicable laws and statutes, judgments, rules and regulations of any court or other governmental authority,
binding industry standards, internal and external policies and notices, contractual obligations and any other legal obligations, in each
case relating to the collection, use, transfer, import, export, storage, protection, disposal, disclosure or other processing by or on
behalf of the Company or any of its subsidiaries of Company Data (“Data Security Obligations”). Neither the Company
nor any of its subsidiaries have received any notification of or complaint regarding, or otherwise have knowledge of any facts that would
indicate, any material non-compliance by the Company or any of its subsidiaries with any Data Security Obligation. There is no action,
suit, investigation or proceeding against the Company or any of its subsidiaries by or before any court or governmental agency, authority
or body pending or, to the knowledge of the Company, threatened, against the Company or any of its subsidiaries alleging material non-compliance
with any Data Security Obligations by the Company or any of its subsidiaries.
(gg) No Unlawful Payments.
Neither the Company nor any of its subsidiaries nor any director or officer of the Company or any of its subsidiaries nor, to the knowledge
of the Company, any employee, agent, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries
has (i) used any corporate funds for any unlawful contribution, gift, entertainment or other unlawful expense relating to political activity;
(ii) made or taken an act in furtherance of an offer, promise or authorization of any direct or indirect unlawful payment or benefit to
any foreign or domestic government official or employee, including of any government-owned or controlled entity or of a public international
organization, or any person acting in an official capacity for or on behalf of any of the foregoing, or any political party or party official
or candidate for political office; (iii) violated or is in violation of any provision of the Foreign Corrupt Practices Act of 1977, as
amended, or any applicable law or regulation implementing the OECD Convention on Combating Bribery of Foreign Public Officials in International
Business Transactions, or committed an offence under the Bribery Act 2010 of the United Kingdom or any other applicable anti-bribery or
anti-corruption law; or (iv) made, offered, agreed, requested or taken an act in furtherance of any unlawful bribe or other unlawful benefit,
including, without limitation, any rebate, payoff, influence payment, kickback or other unlawful or improper payment or benefit. The Company
and its subsidiaries have instituted, maintained and enforced, and will continue to maintain and enforce policies and procedures designed
to promote and ensure compliance with all applicable anti-bribery and anti-corruption laws.
(hh) Compliance with Anti-Money
Laundering Laws. The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable
financial recordkeeping and reporting requirements, including those of the Currency and Foreign Transactions Reporting Act of 1970, as
amended, the applicable money laundering statutes of all jurisdictions where the Company or any of its subsidiaries conducts business,
the rules and regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any
governmental agency (collectively, the “Anti-Money Laundering Laws”) and no action, suit or proceeding by or before
any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to
the Anti-Money Laundering Laws is pending or, to the knowledge of the Company, threatened.
(ii) No
Conflicts with Sanctions Laws. Neither the Company nor any of its subsidiaries, directors, or officers, nor, to the knowledge of the
Company, any employee, agent, affiliate or other person associated with or acting on behalf of the Company or any of its subsidiaries
is currently the subject or the target of any sanctions administered or enforced by the U.S. government, (including, without limitation,
the Office of Foreign Assets Control of the U.S. Department of the Treasury (OFAC) or the U.S. Department of State and including, without
limitation, the designation as a “specially designated national” or “blocked person”), the United Nations Security
Council (UNSC), the European Union, His Majesty’s Treasury (HMT) or other relevant sanctions authority (collectively, “Sanctions”),
nor is the Company or any of its subsidiaries located, organized or resident in a country or territory that is the subject or target of
Sanctions, including, without limitation, the so-called Donetsk People’s Republic, the so-called Luhansk People’s Republic
or any other Covered Region of Ukraine identified pursuant to Executive Order 14065, the Crimea region of Ukraine, Cuba, Iran, North Korea
and Syria (each, a “Sanctioned Country”); and the Company will not directly or indirectly use the proceeds of the offering
of the Shares hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other
person or entity (i) to fund or facilitate any activities of or business with any person that, at the time of such funding or facilitation,
is the subject or target of Sanctions, (ii) to fund or facilitate any activities of or business in any Sanctioned Country or (iii) in
any other manner that will result in a violation by any person (including any person participating in the transaction, whether as underwriter,
advisor, investor or otherwise) of Sanctions. For the past five years, the Company and its subsidiaries have not knowingly engaged in
and are not now knowingly engaged in any dealings or transactions with any person that at the time of the dealing or transaction is or
was the subject or the target of Sanctions or with any Sanctioned Country.
(jj) No Restrictions on
Subsidiaries. No subsidiary of the Company is currently prohibited, directly or indirectly, under any agreement or other instrument
to which it is a party or is subject, from paying any dividends to the Company, from making any other distribution on such subsidiary’s
capital stock or similar ownership interest, from repaying to the Company any loans or advances to such subsidiary from the Company or
from transferring any of such subsidiary’s properties or assets to the Company or any other subsidiary of the Company.
(kk) No Broker’s
Fees. Neither the Company nor any of its subsidiaries is a party to any contract, agreement or understanding with any person (other
than this Agreement) that would give rise to a valid claim against any of them or any Underwriter for a brokerage commission, finder’s
fee or like payment in connection with the offering and sale of the Shares.
(ll) No Registration Rights.
Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, no person has the right to require
the Company or any of its subsidiaries to register any securities for sale under the Securities Act by reason of the filing of the Registration
Statement with the Commission or the sale of the Shares to be sold by the Selling Stockholders hereunder.
(mm) No Stabilization.
Neither the Company nor any of its subsidiaries or affiliates has taken, directly or indirectly, any action designed to or that would
reasonably be expected to cause or result in any stabilization or manipulation of the price of the Shares.
(nn) Margin Rules.
Neither the issuance, sale and delivery of the Shares nor the application of the proceeds thereof by the Company as described in each
of the Registration Statement, the Pricing Disclosure Package and the Prospectus will violate Regulation T, U or X of the Board of Governors
of the Federal Reserve System or any other regulation of such Board of Governors.
(oo) Forward-Looking
Statements. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange
Act) included or incorporated by reference in any of the Registration Statement, the Pricing Disclosure Package or the Prospectus has
been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.
(pp) Statistical and Market
Data. Nothing has come to the attention of the Company that has caused the Company to believe that the statistical and market-related
data included or incorporated by reference in each of the Registration Statement, the Pricing Disclosure Package and the Prospectus is
not based on or derived from sources that are reliable and accurate in all material respects.
(qq) Sarbanes-Oxley Act.
There is and has been no failure on the part of the Company or, to the Company’s knowledge, any of the Company’s directors
or officers, in their capacities as such, to comply with any applicable provision of the Sarbanes-Oxley Act of 2002, as amended and the
rules and regulations promulgated in connection therewith (the “Sarbanes-Oxley Act”), including Section 402 related
to loans and Sections 302 and 906 related to certifications.
(rr) Status under the
Securities Act. At the time of filing the Registration Statement and any post-effective amendment thereto, at the earliest time thereafter
that the Company or any offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) under the Securities
Act) of the Shares and at the date hereof, the Company was not and is not an “ineligible issuer,” as defined in Rule 405 under
the Securities Act.
(ss) No Ratings. Except
as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are (and prior to the Closing Date,
will be) no debt securities, convertible securities or preferred stock issued or guaranteed by the Company or any of its subsidiaries
that are rated by a “nationally recognized statistical rating organization,” as such term is defined in Section 3(a)(62) under
the Exchange Act.
4. Representations
and Warranties of the Selling Stockholders. The Selling Stockholders, severally and not jointly, represent and warrant to the Underwriter
and the Company that:
(a) Required
Consents; Authority. The registration under the Securities Act of the Shares, such consents, approvals, authorizations and orders
as may be required under any state securities, blue sky or antifraud laws or FINRA in connection with the purchase and distribution of
the Shares by the Underwriter and such consents, approvals, authorizations or orders as would not adversely affect in any material respect
such Selling Stockholder’s ability to perform its obligations hereunder, all consents, approvals, authorizations and orders necessary
for the execution and delivery by such Selling Stockholder of this Agreement, and for the sale and delivery of the Shares to be sold by
such Selling Stockholder hereunder, have been obtained; and such Selling Stockholder has full right, power and authority to enter into
this Agreement, and to sell, assign, transfer and deliver the Shares to be sold by such Selling Stockholder hereunder; this Agreement
has been duly authorized, executed and delivered by such Selling Stockholder.
(b) No
Conflicts. The execution, delivery and performance by such Selling Stockholder of this Agreement, the sale of the Shares to be sold
by such Selling Stockholder and the consummation by such Selling Stockholder of the transactions contemplated herein or therein will not
(i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, result in the
termination, modification or acceleration of, or result in the creation or imposition of any lien, charge or encumbrance upon any property,
right or asset of such Selling Stockholder pursuant to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument
to which such Selling Stockholder is a party or by which such Selling Stockholder is bound or to which any of the property, right or asset
of such Selling Stockholder is subject, (ii) result in any violation of the provisions of the charter or bylaws or similar organizational
documents of such Selling Stockholder or (iii) result in the violation of any law or statute or any judgment, order, rule or regulation
of any court or arbitrator or governmental or regulatory agency having jurisdiction over such Selling Stockholder or the property of such
Selling Stockholder, except in the cases of clause (i) and (iii), as would not, individually or in the aggregate, adversely affect in
any material respect such Selling Stockholder’s ability to perform its obligations hereunder.
(c) Title
to Shares. Such Selling Stockholder has good and valid title to the Shares to be sold at the Closing Date or the Additional Closing
Date, as the case may be, by such Selling Stockholder hereunder, free and clear of all liens, encumbrances, equities or adverse claims;
such Selling Stockholder will have, immediately prior to the Closing Date or the Additional Closing Date, as the case may be, good and
valid title to the Shares to be sold at the Closing Date or the Additional Closing Date, as the case may be, by the Selling Stockholder,
free and clear of all liens, encumbrances, equities or adverse claims; and, upon delivery of the certificates representing such Shares
and payment therefor pursuant hereto, good and valid title to such Shares, free and clear of all liens, encumbrances, equities or adverse
claims, will pass to the Underwriter.
(d) No
Stabilization. Such Selling Stockholder has not taken and will not take, directly or indirectly, any action designed to or that could
reasonably be expected to cause or result in any stabilization or manipulation of the price of the Shares.
(e) Pricing
Disclosure Package. The Pricing Disclosure Package, at the Applicable Time did not, and as of the Closing Date and as of the Additional
Closing Date, as the case may be, will not, contain any untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that such
Selling Stockholder’s representation under this section shall only apply to any untrue statement of a material fact or omission
to state a material fact made in reliance upon, and in conformity with, information relating to such Selling Stockholder furnished to
the Company in writing by or on behalf of such Selling Stockholder expressly for use in the Pricing Disclosure Package (or any amendment
or supplement thereto), it being understood and agreed that the only such information furnished by such Selling Stockholder is (i) the
name, address and number of shares of Common Stock owned by such Selling Stockholder before and after the offering, and (ii) the other
information with respect to such Selling Stockholder that appears in the table (and corresponding footnotes) under the caption “Selling
Stockholders,” in each case, in the Registration Statement, the Pricing Disclosure Package, the Prospectus or in any Issuer Free
Writing Prospectus (the “Selling Stockholder Information”).
(f) Issuer
Free Writing Prospectus. Other than the Registration Statement, the Preliminary Prospectus and the Prospectus, such Selling Stockholder
(including its agents and representatives, other than the Underwriter in its capacity as such) has not prepared, made, used, authorized,
approved or referred to and will not prepare, make, use, authorize, approve or refer to any Issuer Free Writing Prospectus other than
(i) any document not constituting a prospectus pursuant to Section 2(a)(10)(a) of the Securities Act or Rule 134 under the Securities
Act or (ii) the documents listed on Annex A or Annex B hereto, each electronic road show and any other written communications approved
in writing in advance by the Company and the Underwriter.
(g) Registration
Statement and Prospectus. As of the applicable effective date of the Registration Statement and any post-effective amendment thereto,
the Registration Statement and any such post-effective amendment did not and will not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary in order to make the statements therein not misleading; and
as of the date of the Prospectus and any amendment or supplement thereto and as of the Closing Date and as of the Additional Closing Date,
as the case may be, the Prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that such
Selling Stockholder’s representation under this section shall only apply to any untrue statement of a material fact or omission
to state a material fact made in reliance upon, and in conformity with, the Selling Stockholder Information.
(h) Material
Information. As of the date hereof and as of the Closing Date and as of the Additional Closing Date, as the case may be, the sale
of the Shares by such Selling Stockholder is not and will not be prompted by any material information concerning the Company that is not
set forth in the Registration Statement, the Pricing Disclosure Package or the Prospectus.
(i) Beneficial
Holder. Immediately prior to the Closing Date and as of the Additional Closing Date, as the case may be, such Selling Stockholder
will be the beneficial or record holder of the Shares to be sold by such Selling Stockholder hereunder with full dispositive power thereover,
and holds, and will hold, such Shares free and clear of all liens, encumbrances, equities or claims; and, upon delivery of such Shares
and payment therefor pursuant hereto, assuming that the Underwriter has no notice of any adverse claims (within the meaning of Section
8-105 of the New York Uniform Commercial Code as in effect in the State of New York from time to time (the “UCC”))
to such Shares, the Underwriter will acquire a valid security entitlement (within the meaning of Section 8-102(a)(17) of the UCC) to such
Shares purchased by the Underwriter, and no action (whether framed in conversion, replevin, constructive trust, equitable lien or other
theory) based on an adverse claim (within the meaning of Section 8-105 of the UCC) to such security entitlement may be asserted against
the Underwriter.
5. Further
Agreements of the Company. The Company covenants and agrees with the Underwriter that:
(a) Required
Filings. The Company will file the final Prospectus with the Commission within the time periods specified by Rule 424(b) and Rule
430A, 430B or 430C under the Securities Act, will file any Issuer Free Writing Prospectus to the extent required by Rule 433 under the
Securities Act; the Company will file promptly all reports and any definitive proxy or information statements required to be filed by
the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus
and for so long as the delivery of a prospectus is required in connection with the offering or sale of the Shares; and the Company will
furnish copies of the Prospectus and each Issuer Free Writing Prospectus (to the extent not previously delivered) to the Underwriter in
New York City prior to 10:00 A.M., New York City time, on the business day next succeeding the date of this Agreement in such quantities
as the Underwriter may reasonably request.
(b) Delivery
of Copies. Upon written request of the Underwriter, the Company will deliver, without charge, (i) to the Underwriter, three signed
copies of the Registration Statement as originally filed and each amendment thereto, in each case including all exhibits and consents
filed therewith and documents incorporated by reference therein; and (ii) to the Underwriter (A) a conformed copy of the Registration
Statement as originally filed and each amendment thereto (without exhibits) and (B) during the Prospectus Delivery Period (as defined
below), as many copies of the Prospectus (including all amendments and supplements thereto and documents incorporated by reference therein
and each Issuer Free Writing Prospectus) as the Underwriter may reasonably request. As used herein, the term “Prospectus Delivery
Period” means such period of time after the first date of the public offering of the Shares as in the opinion of counsel for
the Underwriter a prospectus relating to the Shares is required by law to be delivered (or required to be delivered but for Rule 172 under
the Securities Act) in connection with sales of the Shares by the Underwriter or dealer.
(c) Amendments
or Supplements, Issuer Free Writing Prospectuses. Before making, preparing, using, authorizing, approving, referring to or filing
any Issuer Free Writing Prospectus, and before filing any amendment or supplement to the Registration Statement, the Pricing Disclosure
Package or the Prospectus, whether before or after the time that the Registration Statement becomes effective, the Company will furnish
to the Underwriter and counsel for the Underwriter a copy of the proposed Issuer Free Writing Prospectus, amendment or supplement for
review and will not make, prepare, use, authorize, approve, refer to or file any such Issuer Free Writing Prospectus or file any such
proposed amendment or supplement to which the Underwriter reasonably objects.
(d) Notice
to the Underwriter and Selling Stockholders. During the Prospectus Delivery Period, the Company will advise the Underwriter and each
Selling Stockholder promptly, and confirm such advice in writing, (i) when the Registration Statement has become effective; (ii) when
any amendment to the Registration Statement has been filed or becomes effective; (iii) when any supplement to the Pricing Disclosure Package,
the Prospectus, or any Issuer Free Writing Prospectus or any amendment to the Prospectus has been filed or distributed; (iv) of any request
by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or the receipt of any
comments from the Commission relating to the Registration Statement or any other request by the Commission for any additional information;
(v) of the issuance by the Commission or any other governmental or regulatory authority of any order suspending the effectiveness of the
Registration Statement or preventing or suspending the use of any Preliminary Prospectus, any of the Pricing Disclosure Package, or the
Prospectus or the initiation or threatening of any proceeding for that purpose or pursuant to Section 8A of the Securities Act; (vi) of
the occurrence of any event or development within the Prospectus Delivery Period as a result of which the Prospectus, any of the Pricing
Disclosure Package, or any Issuer Free Writing Prospectus as then amended or supplemented would include any untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing when
the Prospectus, the Pricing Disclosure Package, or any such Issuer Free Writing Prospectus is delivered to a purchaser, not misleading;
and (vii) of the receipt by the Company of any notice with respect to any suspension of the qualification of the Shares for offer and
sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and the Company will use its reasonable
best efforts to prevent the issuance of any such order suspending the effectiveness of the Registration Statement, preventing or suspending
the use of any Preliminary Prospectus, any of the Pricing Disclosure Package or the Prospectus or suspending any such qualification of
the Shares and, if any such order is issued, will use its reasonable best efforts to obtain as soon as possible the withdrawal thereof.
(e) Ongoing
Compliance. (1) If during the Prospectus Delivery Period (i) any event or development shall occur or condition shall exist as a result
of which the Prospectus as then amended or supplemented would include 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 existing when the Prospectus is delivered to
a purchaser, not misleading or (ii) it is necessary to amend or supplement the Prospectus to comply with law, the Company will promptly
notify the Underwriter thereof and forthwith prepare and, subject to paragraph (c) above, file with the Commission and furnish to the
Underwriter and to such dealers as the Underwriter may designate such amendments or supplements to the Prospectus (or any document to
be filed with the Commission and incorporated by reference therein) as may be necessary so that the statements in the Prospectus as so
amended or supplemented (or any document to be filed with the Commission and incorporated by reference therein) will not, in the light
of the circumstances existing when the Prospectus is delivered to a purchaser, be misleading or so that the Prospectus will comply with
law and (2) if at any time prior to the Closing Date (i) any event or development shall occur or condition shall exist as a result of
which the Pricing Disclosure Package as then amended or supplemented would include 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 existing when the Pricing
Disclosure Package is delivered to a purchaser, not misleading or (ii) it is necessary to amend or supplement the Pricing Disclosure Package
to comply with law, the Company will promptly notify the Underwriter thereof and forthwith prepare and, subject to paragraph (c) above,
file with the Commission (to the extent required) and furnish to the Underwriter and to such dealers as the Underwriter may designate
such amendments or supplements to the Pricing Disclosure Package (or any document to be filed with the Commission and incorporated by
reference therein) as may be necessary so that the statements in the Pricing Disclosure Package as so amended or supplemented will not,
in the light of the circumstances existing when the Pricing Disclosure Package is delivered to a purchaser, be misleading or so that the
Pricing Disclosure Package will comply with law.
(f) Blue
Sky Compliance. The Company will qualify the Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions
as the Underwriter shall reasonably request and will continue such qualifications in effect so long as required for distribution of the
Shares; provided that the Company shall not be required to (i) qualify as a foreign corporation or other entity or as a dealer
in securities in any such jurisdiction where it would not otherwise be required to so qualify, (ii) file any general consent to service
of process in any such jurisdiction or (iii) subject itself to taxation in any such jurisdiction if it is not otherwise so subject.
(g) Earning
Statement. The Company will make generally available to its security holders and the Underwriter as soon as reasonably practicable
an earning statement that satisfies the provisions of Section 11(a) of the Securities Act and Rule 158 of the Commission promulgated thereunder
covering a period of at least twelve months beginning with the first fiscal quarter of the Company occurring after the “effective
date” (as defined in Rule 158) of the Registration Statement; provided that the Company will be deemed to comply with such requirement
by filing such earnings statements on the Commission’s Electronic Data Gathering Analysis, and Retrieval (“EDGAR”) system.
(h) Clear
Market. For a period of 120 days after the date of the Prospectus (the “Restricted Period”), the Company will not
(i) offer, pledge, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant any
option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, or submit to, or file with, the
Commission a registration statement under the Securities Act relating to, any shares of Stock or any securities convertible into or exercisable
or exchangeable for Stock, or publicly disclose the intention to undertake any of the foregoing, or (ii) enter into any swap or other
agreement that transfers, in whole or in part, any of the economic consequences of ownership of the Stock or any such other securities,
whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Stock or such other securities, in
cash or otherwise, without the prior written consent of the Underwriter, other than the Shares to be sold hereunder.
The restrictions described
above do not apply to (i) the issuance of shares of Common Stock or securities convertible into or exercisable for shares of Common Stock
pursuant to the conversion or exchange of convertible or exchangeable securities or the exercise of warrants or options (including net
exercise) or the issuance of shares of Common Stock underlying restricted stock units (“RSUs”) or performance stock units
(“PSUs”) (including net settlement), in each case outstanding on the date of this Agreement and described in the Prospectus;
(ii) grants of stock options, stock awards, restricted stock, RSUs, PSUs, or any other equity awards and the issuance of shares of Common
Stock or securities convertible into or exercisable or exchangeable for shares of Common Stock (whether upon the exercise of stock options
or otherwise) to the Company’s employees, officers, directors, advisors, or consultants pursuant to the terms of an equity compensation
plan in effect as of the Closing Date and described in the Prospectus; provided that, in each case, such recipients who are directors
or executive officers have delivered a lock-up agreement to the Underwriter substantially in the form of Exhibit A hereto; (iii)
the filing of any registration statement on Form S-8 relating to securities granted or to be granted pursuant to any plan in effect on
the date of this Agreement and described in the Prospectus or any assumed benefit plan pursuant to an acquisition or similar strategic
transaction; and (iv) the issuance of shares of Common Stock or securities convertible into or exercisable for shares of Common Stock
in connection with the Company entering into an agreement providing for the acquisition by the Company of the securities, business, or
other assets of another person or entity or pursuant to an employee benefit plan assumed by the Company in connection with such acquisition,
whether entered into during or prior to the Restricted Period; provided that the total number of shares of Common Stock issued
pursuant to this clause (iv) shall not exceed 10% of the total number of shares of the Company’s Common Stock issued and outstanding
immediately following the completion of the transactions contemplated by this Agreement (determined on a fully diluted basis and as adjusted
for stock splits, stock dividends and other similar events after the date hereof); provided, further, that the recipients
of any shares of Common Stock or securities convertible into or exercisable for shares of Common Stock issued pursuant to this clause
(iv) during the Restricted Period shall enter into an agreement substantially in the form of Exhibit A hereto with respect to the
remaining portion of the Restricted Period on or prior to the date of such issuance.
(i) No
Stabilization. Neither the Company nor its subsidiaries or affiliates will take, directly or indirectly, any action designed to or
that would reasonably be expected to cause or result in any stabilization or manipulation of the price of the Stock.
(j) Exchange
Listing. The Company will use its reasonable best efforts to maintain the listing of the Shares on Nasdaq.
(k) Reports.
For a period of two years from the date hereof, the Company will furnish to the Underwriter, as soon as they are available, copies of
all reports or other communications (financial or other) furnished to holders of the Shares, and copies of any reports and financial statements
furnished to or filed with the Commission or any national securities exchange or automatic quotation system; provided the Company
will be deemed to have furnished such reports and financial statements to the Underwriter to the extent they are filed on EDGAR.
(l) Record
Retention. The Company will, pursuant to reasonable procedures developed in good faith, retain copies of each Issuer Free Writing
Prospectus that is not filed with the Commission in accordance with Rule 433 under the Securities Act.
6. Further
Agreements of the Selling Stockholder. Each Selling Stockholder covenants and agrees, severally and not jointly, with the Underwriter
that:
(a) No
Stabilization. It will not take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result
in any stabilization or manipulation of the price of the Stock.
(b) Tax
Form. It will deliver to the Underwriter prior to or at the Closing Date a properly completed and executed United States Treasury
Department Form W-9 (or other applicable form or statement specified by the Treasury Department regulations in lieu thereof) in order
to facilitate the Underwriter’s documentation of their compliance with the reporting and withholding provisions of the Tax Equity
and Fiscal Responsibility Act of 1982 with respect to the transactions herein contemplated.
(c) Use
of Proceeds. It will not directly or indirectly use the proceeds of the offering of the Shares hereunder, or lend, contribute or otherwise
make available such proceeds to a subsidiary, joint venture partner or other person or entity (i) to fund or facilitate any activities
of or business with any person that, at the time of such funding or facilitation, is the subject of target of Sanctions, (ii) to fund
or facilitate any activities of or business in any Sanctioned Country or (iii) in any other manner that will result in a violation by
any person (including any person participating in the transaction, whether as underwriter, advisor, investor or otherwise) of Sanctions.
7. Certain
Agreements of the Underwriter. The Underwriter hereby represents and agrees that:
(a) It
has not and will not use, authorize use of, refer to or participate in the planning for use of, any “free writing prospectus,”
as defined in Rule 405 under the Securities Act (which term includes use of any written information furnished to the Commission by the
Company and not incorporated by reference into the Registration Statement and any press release issued by the Company) other than (i)
a free writing prospectus that contains no “issuer information” (as defined in Rule 433(h)(2) under the Securities Act) that
was not included (including through incorporation by reference) in the Preliminary Prospectus or a previously filed Issuer Free Writing
Prospectus, (ii) any Issuer Free Writing Prospectus listed on Annex A or prepared pursuant to Section 3(c) or Section 5(c) above
(including any electronic road show), or (iii) any free writing prospectus prepared by the Underwriter and approved by the Company in
advance in writing (each such free writing prospectus referred to in clauses (i) or (iii), an “Underwriter Free Writing Prospectus”).
(b) It
has not and will not, without the prior written consent of the Company, use any free writing prospectus that contains the final terms
of the Shares unless such terms have previously been included in a free writing prospectus filed with the Commission; provided that
the Underwriter may use a term sheet substantially in the form of Annex B hereto without the consent of the Company; provided
further that any Underwriter using such term sheet shall notify the Company, and provide a copy of such term sheet to the Company,
prior to, or substantially concurrently with, the first use of such term sheet.
(c) It
is not subject to any pending proceeding under Section 8A of the Securities Act with respect to the offering (and will promptly notify
the Company and the Selling Stockholders if any such proceeding against it is initiated during the Prospectus Delivery Period).
8. Conditions
of Underwriter’s Obligations. The obligation of the Underwriter to purchase the Underwritten Shares on the Closing Date or the
Option Shares on the Additional Closing Date, as the case may be, as provided herein is subject to the performance by the Company and
each Selling Stockholder of their respective covenants and other obligations hereunder and to the following additional conditions:
(a) Registration
Compliance; No Stop Order. No order suspending the effectiveness of the Registration Statement shall be in effect, and no proceeding
for such purpose or pursuant to Section 8A under the Securities Act shall be pending before or threatened by the Commission; the Prospectus
and each Issuer Free Writing Prospectus shall have been timely filed with the Commission under the Securities Act (in the case of an Issuer
Free Writing Prospectus, to the extent required by Rule 433 under the Securities Act) and in accordance with Section 5(a) hereof; and
all requests by the Commission for additional information shall have been complied with to the reasonable satisfaction of the Underwriter.
(b) Representations
and Warranties. The respective representations and warranties of the Company and such Selling Stockholder contained herein shall be
true and correct on the date hereof and on and as of the Closing Date or the Additional Closing Date, as the case may be; and the statements
of the Company and its officers and such Selling Stockholder and its officers made in any certificates delivered pursuant to this Agreement
shall be true and correct on and as of the Closing Date or the Additional Closing Date, as the case may be.
(c) No
Downgrade. Subsequent to the earlier of (A) the Applicable Time and (B) the execution and delivery of this Agreement, (i) no downgrading
shall have occurred in the rating accorded any debt securities, convertible securities or preferred stock issued, or guaranteed by, the
Company or any of its subsidiaries by any “nationally recognized statistical rating organization,” as such term is defined
under Section 3(a)(62) under the Exchange Act and (ii) no such organization shall have publicly announced that it has under surveillance
or review, or has changed its outlook with respect to, its rating of any such debt securities or preferred stock issued or guaranteed
by the Company or any of its subsidiaries (other than an announcement with positive implications of a possible upgrading).
(d) No
Material Adverse Change. No event or condition of a type described in Section 3(h) hereof shall have occurred or shall exist, which
event or condition is not described in the Pricing Disclosure Package (excluding any amendment or supplement thereto) and the Prospectus
(excluding any amendment or supplement thereto) and the effect of which in the judgment of the Underwriter makes it impracticable or inadvisable
to proceed with the offering, sale or delivery of the Shares on the Closing Date or the Additional Closing Date, as the case may be, on
the terms and in the manner contemplated by this Agreement, the Pricing Disclosure Package and the Prospectus.
(e) Officer’s
Certificate. The Underwriter shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be,
(x) a certificate of the chief financial officer or chief accounting officer of the Company and one additional senior executive officer
of the Company who is satisfactory to the Underwriter (i) confirming that such officers have carefully reviewed the Registration Statement,
the Pricing Disclosure Package and the Prospectus and, to the knowledge of such officers, the representations of the Company set forth
in Sections 3(b) and 3(d) hereof are true and correct, (ii) confirming that the other representations and warranties of the Company in
this Agreement are true and correct and that the Company has complied with all agreements and satisfied all conditions on its part to
be performed or satisfied hereunder at or prior to the Closing Date or the Additional Closing Date, as the case may be, and (iii) to the
effect set forth in paragraphs (a), (c) and (d) above and (y) a certificate of such Selling Stockholder, in form and substance reasonably
satisfactory to the Underwriter, (A) confirming that the representations of such Selling Stockholder set forth in Sections 4(e), 4(f)
and 4(g) hereof are true and correct and (B) confirming that the other representations and warranties of such Selling Stockholder in this
Agreement are true and correct in all material respects and that such Selling Stockholder has complied in all material respects with all
agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to such Closing Date.
(f) Comfort
Letters and CFO Certificate. (i) On the date of this Agreement and on the Closing Date or the Additional Closing Date, as the case
may be, each of PricewaterhouseCoopers LLP and BDO USA, LLP shall have furnished to the Underwriter, at the request of the Company, letters,
dated the respective dates of delivery thereof and addressed to the Underwriter, in form and substance reasonably satisfactory to the
Underwriter, containing statements and information of the type customarily included in accountants’ “comfort letters”
to underwriters with respect to the financial statements and certain financial information contained or incorporated by reference in each
of the Registration Statement, the Pricing Disclosure Package and the Prospectus; provided, that the letter delivered on the Closing
Date or the Additional Closing Date, as the case may be, shall use a “cut-off” date no more than two business days prior to
such Closing Date or such Additional Closing Date, as the case may be.
(ii) On the date of
this Agreement and on the Closing Date or the Additional Closing Date, as the case may be, the Company shall have furnished to the Underwriter
a certificate, dated the respective dates of delivery thereof and addressed to the Underwriter, of its chief financial officer with respect
to certain financial data contained in the Pricing Disclosure Package and the Prospectus, providing “management comfort” with
respect to such information, in form and substance reasonably satisfactory to the Underwriter.
(g) Opinion
and 10b-5 Statement of Counsel for the Company. Akerman LLP, counsel for the Company, shall have furnished to the Underwriter, at
the request of the Company, its written opinion and 10b-5 statement, dated the Closing Date or the Additional Closing Date, as the case
may be, and addressed to the Underwriter, in form and substance reasonably satisfactory to the Underwriter.
(h) Opinion
of Counsel for the Selling Stockholder. Akerman LLP, counsel for the Selling Stockholders, shall have furnished to the Underwriter,
at the request of the Selling Stockholders, their written opinion, dated the Closing Date or the Additional Closing Date, as the case
may be, and addressed to the Underwriter, in form and substance reasonably satisfactory to the Underwriter.
(i) Opinion
and 10b-5 Statement of Counsel for the Underwriter. The Underwriter shall have received on and as of the Closing Date or the Additional
Closing Date, as the case may be, an opinion and 10b-5 statement, addressed to the Underwriter, of Faegre Drinker Biddle & Reath LLP,
counsel for the Underwriter, with respect to such matters as the Underwriter may reasonably request, and such counsel shall have received
such documents and information as they may reasonably request to enable them to pass upon such matters.
(j) No
Legal Impediment to Sale. No action shall have been taken and no statute, rule, regulation or order shall have been enacted, adopted
or issued by any federal, state or foreign governmental or regulatory authority that would, as of the Closing Date or the Additional Closing
Date, as the case may be, prevent the sale of the Shares; and no injunction or order of any federal, state or foreign court shall have
been issued that would, as of the Closing Date or the Additional Closing Date, as the case may be, prevent the sale of the Shares.
(k) Good
Standing. The Underwriter shall have received on and as of the Closing Date or the Additional Closing Date, as the case may be, satisfactory
evidence of the good standing of the Company and its subsidiaries in their respective jurisdictions of organization and their good standing
in such other jurisdictions as the Underwriter may reasonably request, in each case in writing or any standard form of telecommunication
from the appropriate governmental authorities of such jurisdictions.
(l) Exchange
Listing. If required, the Company shall have filed a Listing of Additional Shares Notification Form with respect to the Shares with
Nasdaq and shall have received no objection thereto from Nasdaq.
(m) Lock-up
Agreements. The “lock-up” agreements, each substantially in the form of Exhibit A hereto, between you and each
Selling Stockholder, all executive officers and directors of the Company relating to sales and certain other dispositions of shares of
Stock or certain other securities, delivered to you on or before the date hereof, shall be in full force and effect on the Closing Date
or the Additional Closing Date, as the case may be.
(n) Additional
Documents. On or prior to the Closing Date or the Additional Closing Date, as the case may be, the Company and the Selling Stockholders
shall have furnished to the Underwriter such further certificates and documents as the Underwriter may reasonably request.
All opinions, letters, certificates
and evidence mentioned above or elsewhere in this Agreement shall be deemed to be in compliance with the provisions hereof only if they
are in form and substance reasonably satisfactory to counsel for the Underwriter.
9. Indemnification
and Contribution.
(a) Indemnification
of the Underwriter by the Company. The Company agrees to indemnify and hold harmless the Underwriter, its affiliates, directors and
officers and each person, if any, who controls the Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all losses, claims, damages and liabilities (including, without limitation, reasonably incurred
and documented legal fees and other reasonably incurred and documented expenses incurred in connection with any suit, action or proceeding
or any claim asserted, as such documented fees and expenses are incurred), joint or several, that arise out of, or are based upon, (i)
any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement or caused by any omission
or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein,
not misleading, or (ii) any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment
or supplement thereto), any Preliminary Prospectus, any Issuer Free Writing Prospectus, any “issuer information” filed or
required to be filed pursuant to Rule 433(d) under the Securities Act, any road show as defined in Rule 433(h) under the Securities Act
(a “road show”) or any Pricing Disclosure Package (including any Pricing Disclosure Package that has subsequently been
amended), or caused by any omission or alleged omission to state therein a material fact necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading, in each case except insofar as such losses, claims, damages
or liabilities arise out of, or are based upon, any untrue statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with any information relating to any Underwriter furnished to the Company in writing by the Underwriter expressly
for use therein, it being understood and agreed that the only such information furnished by any Underwriter consists of the information
described as such in paragraph (b) below.
(b) Indemnification
of the Underwriter by the Selling Stockholders. Each Selling Stockholder, severally and not jointly, hereunder agrees to indemnify
and hold harmless the Underwriter, its affiliates, directors and officers and each person, if any, who controls the Underwriter within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph
(a) above; provided, however, that each Selling Stockholder’s agreement to indemnify and hold harmless hereunder shall
only apply insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity with the Selling Stockholder Information. The liability of
each Selling Stockholder under this Section 9(b) shall be limited to an amount equal to the aggregate gross proceeds (after underwriting
discounts and commissions but before deducting other expenses) received by each Selling Stockholder.
(c) Indemnification
of the Company and the Selling Stockholders. The Underwriter agrees, severally and not jointly, to indemnify and hold harmless the
Company, its directors, its officers who signed the Registration Statement and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act and each Selling Stockholder to the same extent as the indemnity
set forth in paragraph (a) above, but only with respect to any losses, claims, damages or liabilities that arise out of, or are based
upon, any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with any information
relating to the Underwriter furnished to the Company in writing by the Underwriter expressly for use in the Registration Statement, the
Prospectus (or any amendment or supplement thereto), any Preliminary Prospectus, any Issuer Free Writing Prospectus, any road show or
any Pricing Disclosure Package (including any Pricing Disclosure Package that has subsequently been amended), it being understood and
agreed upon that the only such information furnished by the Underwriter consists of the following information in the Prospectus furnished
on behalf of the Underwriter: paragraphs twelve, thirteen and the first sentence of paragraph fourteen under the caption “Underwriting.”
(d) Notice
and Procedures. If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be
brought or asserted against any person in respect of which indemnification may be sought pursuant to the preceding paragraphs of this
Section 9, such person (the “Indemnified Person”) shall promptly notify the person against whom such indemnification
may be sought (the “Indemnifying Person”) in writing; provided that the failure to notify the Indemnifying Person
shall not relieve it from any liability that it may have under the preceding paragraphs of this Section 9 except to the extent that it
has been materially prejudiced (through the forfeiture of substantive rights or defenses) by such failure; and provided, further,
that the failure to notify the Indemnifying Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise
than under the preceding paragraphs of this Section 9. If any such proceeding shall be brought or asserted against an Indemnified Person
and it shall have notified the Indemnifying Person thereof, the Indemnifying Person shall retain counsel reasonably satisfactory to the
Indemnified Person (who shall not, without the consent of the Indemnified Person, be counsel to the Indemnifying Person) to represent
the Indemnified Person and any others entitled to indemnification pursuant to this Section that the Indemnifying Person may designate
in such proceeding and shall pay the reasonably incurred and documented fees and expenses in such proceeding and shall pay the reasonably
incurred and documented fees and expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified
Person shall have the right to retain its own counsel, but the documented fees and expenses of such counsel shall be at the expense of
such Indemnified Person unless (i) the Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii)
the Indemnifying Person has failed within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii)
the Indemnified Person shall have reasonably concluded that there may be legal defenses available to it that are different from or in
addition to those available to the Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties)
include both the Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. It is understood and agreed that the Indemnifying Person shall not, in connection
with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all such reasonably incurred and documented fees and expenses
shall be paid or reimbursed as they are incurred. Any such separate firm for the Underwriter, its affiliates, directors and officers and
any control persons of the Underwriter shall be designated in writing by the Underwriter and any such separate firm for the Company, its
directors, its officers who signed the Registration Statement and any control persons of the Company shall be designated in writing by
the Company and any such separate firm for such Selling Stockholder shall be designated in writing by such Selling Stockholder. The Indemnifying
Person shall not be liable for any settlement of any proceeding effected without its written consent, but if settled with such consent,
the Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement.
Notwithstanding the foregoing sentence, if at any time an Indemnified Person shall have requested that an Indemnifying Person reimburse
the Indemnified Person for reasonably incurred and documented fees and expenses of counsel as contemplated by this paragraph, the Indemnifying
Person shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into
more than 30 days after receipt by the Indemnifying Person of such request and (ii) the Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of such settlement. No Indemnifying Person shall, without the
written consent of the Indemnified Person, effect any settlement of any pending or threatened proceeding in respect of which any Indemnified
Person is or could have been a party and indemnification could have been sought hereunder by such Indemnified Person, unless such settlement
(x) includes an unconditional release of such Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person,
from all liability on claims that are the subject matter of such proceeding and (y) does not include any statement as to or any admission
of fault, culpability or a failure to act by or on behalf of any Indemnified Person.
(e) Contribution.
If the indemnification provided for in paragraphs (a), (b) or (c) above is unavailable to an Indemnified Person or insufficient in respect
of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such paragraph, in lieu of indemnifying
such Indemnified Person thereunder, shall contribute to the amount paid or payable by such Indemnified Person as a result of such losses,
claims, damages or liabilities (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the
Selling Stockholders, on the one hand, and the Underwriter on the other, from the offering of the Shares or (ii) if the allocation provided
by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) but also the relative fault of the Company and the Selling Stockholders, on the one hand, and the Underwriter on the
other, in connection with the statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other
relevant equitable considerations. The relative benefits received by the Company and the Selling Stockholders, on the one hand, and the
Underwriter on the other, shall be deemed to be in the same respective proportions as the net proceeds (before deducting expenses) received
by the Selling Stockholders from the sale of the Shares and the total underwriting discounts and commissions received by the Underwriter
in connection therewith, in each case as set forth in the table on the cover of the Prospectus, bear to the aggregate offering price of
the Shares. The relative fault of the Company and the Selling Stockholders, on the one hand, and the Underwriter on the other, shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the Company and the Selling Stockholders or by the Underwriter and
the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission.
(f) Limitation
on Liability. The Company, the Selling Stockholders and the Underwriter agree that it would not be just and equitable if contribution
pursuant to paragraph (e) above were determined by pro rata allocation (even if the Selling Stockholders or Underwriter were treated
as one entity for such purpose) or by any other method of allocation that does not take account of the equitable considerations referred
to in paragraph (e) above. The amount paid or payable by an Indemnified Person as a result of the losses, claims, damages and liabilities
referred to in paragraph (e) above shall be deemed to include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred and documented by such Indemnified Person in connection with any such action or claim. Notwithstanding the provisions
of paragraphs (e) and (f), (i) in no event shall the Underwriter be required to contribute any amount in excess of the amount by which
the total underwriting discounts and commissions received by the Underwriter with respect to the offering of the Shares exceeds the amount
of any damages that the Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission and (ii) in no event shall the Selling Stockholders be required to contribute any amount in excess of the amount by
which the aggregate proceeds (after deducting any underwriting discounts and commissions received by the Underwriter but before deducting
any expenses of the Company or the Selling Stockholder) from the Shares sold by the Selling Stockholders exceed the amount of any damages
that the Selling Stockholders have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
(g) Non-Exclusive
Remedies. The remedies provided for in this Section 9 are not exclusive and shall not limit any rights or remedies which may otherwise
be available to any Indemnified Person at law or in equity.
10. Effectiveness
of Agreement. This Agreement shall become effective as of the date first written above.
11. Termination.
This Agreement may be terminated in the absolute discretion of the Underwriter, by notice to the Company and the Selling Stockholders,
if after the execution and delivery of this Agreement and on or prior to the Closing Date or, in the case of the Option Shares, prior
to the Additional Closing Date (i) trading generally shall have been suspended or materially limited on or by any of the New York Stock
Exchange or The Nasdaq Stock Market; (ii) trading of any securities issued or guaranteed by the Company shall have been suspended on any
exchange or in any over-the-counter market; (iii) a general moratorium on commercial banking activities shall have been declared by federal
or New York State authorities; or (iv) there shall have occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis, either within or outside the United States, that, in the judgment of the Underwriter, is material and
adverse and makes it impracticable or inadvisable to proceed with the offering, sale or delivery of the Shares on the Closing Date or
the Additional Closing Date, as the case may be, on the terms and in the manner contemplated by this Agreement, the Pricing Disclosure
Package and the Prospectus.
12. Payment
of Expenses. Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated,
the Company will pay or cause to be paid all costs and expenses incident to the performance of its obligations hereunder, including without
limitation, (i) the costs incident to the authorization, issuance, sale, preparation and delivery of the Shares and any taxes payable
in that connection (to the extent any such taxes have not already been paid by the Selling Stockholder); (ii) the costs incident to the
preparation, printing and filing under the Securities Act of the Registration Statement, the Preliminary Prospectus, any Issuer Free Writing
Prospectus, any Pricing Disclosure Package and the Prospectus (including all exhibits, amendments and supplements thereto) and the distribution
thereof; (iii) the fees and expenses of the Company’s counsel and independent accountants; (iv) the fees and expenses incurred in
connection with the registration or qualification and determination of eligibility for investment of the Shares under the laws of such
jurisdictions as the Underwriter may designate and the preparation, printing and distribution of a Blue Sky Memorandum (including the
related fees and expenses of counsel for the Underwriter); (v) the cost of preparing stock certificates, if any; (vi) the costs and charges
of any transfer agent and any registrar; (vii) all expenses and application fees incurred in connection with any filing with, and clearance
of the offering by FINRA; (viii) all out-of-pocket expenses of the Underwriter (including, but not limited to, fees and disbursements
of the Underwriter’s counsel and the Underwriter’s reasonable travel, database, printing, postage, facsimile and telephone
expenses) incurred in connection with the Underwriter’s investigation of the Company, preparing to market and marketing the Shares,
the sale of the Shares or in contemplation of performing its obligations hereunder, which shall not exceed $100,000 in the aggregate;
(ix) all expenses and application fees related to the listing of the Shares on Nasdaq and (x) the expenses of the Selling Stockholder.
The Selling Stockholders shall pay the underwriting discounts and commissions attributable to the sale of the Shares to the Underwriter.
13. Persons
Entitled to Benefit of Agreement. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective
successors and the officers and directors and any controlling persons referred to herein, and the affiliates of the Underwriter referred
to in Section 9 hereof. Nothing in this Agreement is intended or shall be construed to give any other person any legal or equitable right,
remedy or claim under or in respect of this Agreement or any provision contained herein. No purchaser of Shares from the Underwriter shall
be deemed to be a successor merely by reason of such purchase.
14. Survival.
The respective indemnities, rights of contribution, representations, warranties and agreements of the Company, the Selling Stockholders
and the Underwriter contained in this Agreement or made by or on behalf of the Company, the Selling Stockholders or the Underwriter pursuant
to this Agreement or any certificate delivered pursuant hereto shall survive the delivery of and payment for the Shares and shall remain
in full force and effect, regardless of any termination of this Agreement or any investigation made by or on behalf of the Company, the
Selling Stockholders or the Underwriter or the directors, officers, controlling persons or affiliates referred to in Section 9 hereof.
15. Certain
Defined Terms. For purposes of this Agreement, (a) except where otherwise expressly provided, the term “affiliate”
has the meaning set forth in Rule 405 under the Securities Act; (b) the term “business day” means any day other than
a day on which banks are permitted or required to be closed in New York City; and (c) the term “subsidiary” has the
meaning set forth in Rule 405 under the Securities Act.
16. Compliance
with USA Patriot Act. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October
26, 2001)), the Underwriter is required to obtain, verify and record information that identifies its clients, including the Company and
the Selling Stockholder, which information may include the name and address of its clients, as well as other information that will allow
the Underwriter to properly identify its clients.
17. Miscellaneous.
(a) Notices.
All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted
and confirmed by any standard form of telecommunication. Notices to the Underwriter shall be given to Faegre Drinker Biddle & Reath
LLP, 2200 Wells Fargo Center, 90 South 7th Street, Minneapolis, Minnesota 55402, Attention: Jonathan R. Zimmerman. Notices to the Company
shall be given to it at Karat Packaging Inc., 6185 Kimball Avenue, Chino, California 91708, Attention: Alan Yu and Jian Guo, with copies
to Akerman LLP, 601 W. 5th Street, 3rd Floor, Los Angeles, California, 90071, Attention Mark Y. Liu and Christina
C. Russo.
(b) Governing
Law. This Agreement and any claim, controversy or dispute arising under or related to this Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
(c) Submission
to Jurisdiction. Each party hereto hereby submits to the exclusive jurisdiction of the U.S. federal and New York state courts in the
Borough of Manhattan in The City of New York in any suit or proceeding arising out of or relating to this Agreement or the transactions
contemplated hereby. Each party hereto waives any objection which it may now or hereafter have to the laying of venue of any such suit
or proceeding in such courts. Each party hereto agrees that final judgment in any such suit, action or proceeding brought in such court
shall be conclusive and binding upon such party and may be enforced in any court to the jurisdiction of which such party is subject by
a suit upon such judgment.
(d) Waiver
of Jury Trial. Each of the parties hereto hereby waives any right to trial by jury in any suit or proceeding arising out of or relating
to this Agreement.
(e) Recognition
of the U.S. Special Resolution Regimes.
(i) In the event that
any Underwriter that is a Covered Entity becomes subject to a proceeding under a U.S. Special Resolution Regime, the transfer from the
Underwriter of this Agreement, and any interest and obligation in or under this Agreement, will be effective to the same extent as the
transfer would be effective under the U.S. Special Resolution Regime if this Agreement, and any such interest and obligation, were governed
by the laws of the United States or a state of the United States.
(ii) In the event
that any Underwriter that is a Covered Entity or a BHC Act Affiliate of the Underwriter becomes subject to a proceeding under a U.S. Special
Resolution Regime, Default Rights under this Agreement that may be exercised against the Underwriter
are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime
if this Agreement were governed by the laws of the United States or a state of the United States.
As used in this Section 18(e):
“BHC Act Affiliate”
has the meaning assigned to the term “affiliate” in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).
“Covered Entity”
means any of the following:
(i) a “covered
entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
(ii) a “covered
bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 47.3(b); or
(iii) a “covered
FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Default Right”
has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as
applicable.
“U.S. Special Resolution
Regime” means each of (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder and (ii) Title II of
the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.
(f) Counterparts.
This Agreement may be signed in counterparts (which may include counterparts delivered by any standard form of telecommunication), each
of which shall be an original and all of which together shall constitute one and the same instrument. Delivery of a signature page hereto
by facsimile transmission or by other electronic transmission (including a “.pdf” or “.tif” file) shall be as
effective as delivery of a manually executed counterpart hereof.
(g) Amendments
or Waivers. No amendment or waiver of any provision of this Agreement, nor any consent or approval to any departure therefrom, shall
in any event be effective unless the same shall be in writing and signed by the parties hereto.
(h) Headings.
The headings herein are included for convenience of reference only and are not intended to be part of, or to affect the meaning or interpretation
of, this Agreement.
[Signature Page Follows]
If the foregoing is in accordance
with your understanding, please indicate your acceptance of this Agreement by signing in the space provided below.
Very truly yours,
KARAT PACKAGING INC. |
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By: |
/s/ Jian Guo |
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Name: |
Jian Guo |
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Title: |
Chief Financial Officer |
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ALAN YU |
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By: |
/s/ Alan Yu |
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MARVIN CHENG |
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By: |
/s/ Marvin Cheng |
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Accepted: As of the date first written above
LAKE STREET CAPITAL MARKETS, LLC |
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By: |
/s/ Michael Townley |
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Name: |
Michael Townley |
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Title: |
Head of Investment Banking |
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Schedule 1
Underwriter | |
Number of Shares | |
Lake Street Capital Markets, LLC | |
| 1,000,000 | |
Total | |
| 1,000,000 | |
Schedule 2
Selling Stockholder | |
Number of Shares | |
Alan Yu | |
| 500,000 | |
Marvin Cheng | |
| 500,000 | |
Total | |
| 1,000,000 | |
Annex A
a. | Pricing Disclosure Package |
None.
b. | Pricing Information Provided Orally by Underwriter |
Public Offering Price: $21.00
Number of Underwritten Shares:
1,000,000
Number of Option Shares:
150,000
Annex B
Pricing Term Sheet
None.
Exhibit A
FORM OF LOCK-UP AGREEMENT
[●], 2023
LAKE STREET CAPITAL MARKETS, LLC
920 Second Avenue South, Suite 700
Minneapolis, Minnesota 55402
Re: |
Karat Packaging Inc. — Public Offering |
Ladies and Gentlemen:
The undersigned understands
that you, as underwriter (the “Underwriter”), propose to enter into an underwriting agreement (the “Underwriting Agreement”)
with Karat Packaging Inc., a Delaware corporation (the “Company”) and the selling stockholders named therein, providing for
the public offering (the “Public Offering”) by the Underwriter, of common stock, par value $0.001 per share (the “Common
Stock”), of the Company (the “Securities”). Capitalized terms used herein and not otherwise defined shall have the meanings
set forth in the Underwriting Agreement.
In consideration of the Underwriter’s
agreement to purchase and make the Public Offering of the Securities, and for other good and valuable consideration receipt of which is
hereby acknowledged, the undersigned hereby agrees that, without the prior written consent of the Underwriter, the undersigned will not,
and will not cause any direct or indirect affiliate to, during the period beginning on the date of the final prospectus supplement relating
to the Public Offering (the “Prospectus”) and ending at the close of business [60][120]1
days after the date of the Prospectus (such period, the “Restricted Period”), (1) offer, pledge, sell, contract to sell, sell
any option or contract to purchase, purchase any option or contract to sell, grant any option, right or warrant to purchase, lend, or
otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable
or exchangeable for Common Stock (including without limitation, Common Stock or such other securities which may be deemed to be beneficially
owned by the undersigned in accordance with the rules and regulations of the Securities and Exchange Commission and securities which may
be issued upon exercise of a stock option or warrant) (collectively with the Common Stock, the “Lock-Up Securities”), (2)
enter into any hedging, swap or other agreement or transaction that transfers, in whole or in part, any of the economic consequences of
ownership of the Lock-Up Securities, whether any such transaction described in clause (1) or (2) above is to be settled by delivery of
Lock-Up Securities, in cash or otherwise, (3) make any demand for or exercise any right with respect to the registration of any Lock-Up
Securities, or (4) publicly disclose the intention to do any of the foregoing. The undersigned acknowledges and agrees that the foregoing
precludes the undersigned from engaging in any hedging or other transactions or arrangements (including, without limitation, any short
sale or the purchase or sale of, or entry into, any put or call option, or combination thereof, forward, swap or any other derivative
transaction or instrument, however described or defined) designed or intended, or which could reasonably be expected to lead to or result
in, a sale or disposition or transfer (whether by the undersigned or any other person) of any economic consequences of ownership, in whole
or in part, directly or indirectly, of any Lock-Up Securities, whether any such transaction or arrangement (or instrument provided for
thereunder) would be settled by delivery of Lock-Up Securities, in cash or otherwise. The undersigned further confirms that it has furnished
the Underwriter with the details of any transaction the undersigned, or any of its affiliates, is a party to as of the date hereof, which
transaction would have been restricted by this Letter Agreement (the “Letter Agreement”) if it had been entered into by the
undersigned during the Restricted Period.
1 | 120 days for Alan Yu and Marvin Cheng. 60 days for all other
D&Os. |
Notwithstanding the foregoing,
the undersigned may:
(a) transfer or dispose of
the undersigned’s Lock-Up Securities:
(i) as a bona fide gift or
gifts, or for bona fide estate planning purposes,
(ii) by will or intestacy,
(iii) to any immediate family
member of the undersigned or to any trust for the direct or indirect benefit of the undersigned or the immediate family of the undersigned,
or if the undersigned is a trust, to a trustor or beneficiary of the trust or to the estate of a beneficiary of such trust (for purposes
of this Letter Agreement, “immediate family” shall mean any relationship by blood, current or former marriage, domestic partnership
or adoption, not more remote than first cousin),
(iv) to a corporation, partnership,
limited liability company or other entity of which the undersigned or the immediate family of the undersigned are the legal and beneficial
owner of all of the outstanding equity securities or similar interests,
(v) to a nominee or custodian
of a person or entity to whom a disposition or transfer would be permissible under clauses (i) through (iv) above,
(vi) if the undersigned is
a corporation, partnership, limited liability company, trust or other business entity, (A) to another corporation, partnership, limited
liability company, trust or other business entity that is an affiliate (as defined in Rule 405 promulgated under the Securities Act of
1933, as amended) of the undersigned, or to any investment fund or other entity controlling, controlled by, managing or managed by or
under common control with the undersigned or affiliates of the undersigned (including, for the avoidance of doubt, where the undersigned
is a partnership, to its general partner or a successor partnership or fund, or any other funds managed by such partnership), or (B) as
part of a distribution to members, partners, shareholders or other equityholders of the undersigned,
(vii) by operation of law,
such as pursuant to a qualified domestic order, divorce settlement, divorce decree or separation agreement, or related court order,
(viii) to the Company from
an employee of the Company upon death, disability or termination of employment, in each case, of such employee,
(ix) as part of a sale of
the undersigned’s Lock-Up Securities acquired in the Public Offering and any transaction with respect to shares of Common Stock
acquired in open market transactions after the completion of the Public Offering,
(x) to the Company in connection
with the vesting, settlement, or exercise of restricted stock units, options, warrants or other rights to purchase shares of Common Stock
(including, in each case, by way of “net” or “cashless” exercise), including for the payment of exercise price
and tax and remittance payments due as a result of the vesting, settlement, or exercise of such restricted stock units, options, warrants
or rights, provided that any such shares of Common Stock received upon such exercise, vesting or settlement (other than such shares as
are transferred or surrendered to the Company in connection with such vesting, settlement or exercise event) shall be subject to the terms
of this Letter Agreement, and provided further that any such restricted stock units, options, warrants or rights are held by the undersigned
pursuant to an agreement or equity awards granted under a stock incentive plan or other equity award plan, each such agreement or plan
which is described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, or
(xi) pursuant to a bona fide
third-party tender offer, merger, consolidation or other similar transaction that is approved by the Board of Directors of the Company
and made to all holders of the Company’s capital stock involving a Change of Control (as defined below) of the Company (for purposes
hereof, “Change of Control” shall mean the transfer (whether by tender offer, merger, consolidation or other similar transaction),
in one transaction or a series of related transactions, to a person or group of affiliated persons (other than the Underwriter pursuant
to the Public Offering), of shares of capital stock if, after such transfer, such person or group of affiliated persons would hold more
than 75% of the outstanding voting securities of the Company (or the surviving entity)); provided that in the event that such tender offer,
merger, consolidation or other similar transaction is not completed, the undersigned’s Lock-Up Securities shall remain subject to
the provisions of this Letter Agreement;
provided that (A)
in the case of any transfer or distribution pursuant to clauses (a)(i), (ii), (iii), (iv), (v) and (vi), such transfer shall not involve
a disposition for value, (B) in the case of any transfer or distribution pursuant to clauses (a)(i), (ii), (iii), (iv), (v), (vi) and
(vii), each donee, devisee, transferee or distributee shall execute and deliver to the Underwriter a lock-up letter in the form of this
Letter Agreement, (C) in the case of any transfer or distribution pursuant to clause (a)(ii), (iii), (iv), (v), (vi) and (ix), no filing
by any party (donor, donee, devisee, transferor, transferee, distributer or distributee) under the Exchange Act, or other public announcement
reporting a reduction in beneficial ownership of shares of Common Stock shall be required or shall be made voluntarily in connection with
such transfer or distribution (other than a filing on a Form 5 made after the expiration of the Restricted Period referred to above) and
(D) in the case of any transfer or distribution pursuant to clauses (a)(i), (vii), (viii) and (x) it shall be a condition to such transfer
that no public filing, report or announcement shall be voluntarily made and if any filing under Section 16(a) of the Exchange Act, or
other public filing, report or announcement reporting a reduction in beneficial ownership of shares of Common Stock in connection with
such transfer or distribution shall be legally required during the Restricted Period, such filing, report or announcement shall clearly
indicate in the footnotes thereto the nature and conditions of such transfer;
(b) exercise outstanding
options, settle restricted stock units or other equity awards or exercise outstanding warrants pursuant to plans described in the Registration
Statement, the Pricing Disclosure Package and the Prospectus; provided that any Lock-up Securities received upon such exercise, vesting
or settlement shall be subject to the terms of this Letter Agreement; provided that if the undersigned is required to make any
filing under Section 16(a) of the Exchange Act, or other public filing, report or announcement during the Restricted Period, the undersigned
shall clearly indicate in the footnotes thereto that the filing relates to the circumstances described in this clause and that the shares
of Common Stock received upon the exercise or settlement, as applicable, of the stock option, warrant or restricted stock unit or other
right or vesting event are subject to this Letter Agreement, and no public filing, report or announcement shall be voluntarily made; and
(c) establish trading plans
pursuant to Rule 10b5-1 under the Exchange Act for the transfer of shares of Lock-Up Securities (each such plan, a “Trading Plan”);
provided that (1) such Trading Plans do not provide for the transfer of Lock-Up Securities during the Restricted Period and (2) no filing
by any party under the Exchange Act or other public announcement shall be required or made voluntarily in connection with such Trading
Plan during the Restricted Period in contravention of this Lock-Up Agreement.
If the undersigned is not
a natural person, the undersigned represents and warrants that no single natural person, entity or “group” (within the meaning
of Section 13(d)(3) of the Exchange Act) other than a natural person, entity or “group” (as described above) that has executed
a Letter Agreement in substantially the same form as this Letter Agreement, beneficially owns, directly or indirectly, 50% or more of
the common equity interests, or 50% or more of the voting power, in the undersigned.
In furtherance of the foregoing,
the Company, and any duly appointed transfer agent for the registration or transfer of the securities described herein, are hereby authorized
to decline to make any transfer of securities if such transfer would constitute a violation or breach of this Letter Agreement.
The undersigned hereby represents
and warrants that the undersigned has full power and authority to enter into this Letter Agreement. All authority herein conferred or
agreed to be conferred and any obligations of the undersigned shall be binding upon the successors, assigns, heirs or personal representatives
of the undersigned.
The undersigned acknowledges
and agrees that the Underwriter has not provided any recommendation or investment advice nor has the Underwriter solicited any action
from the undersigned with respect to the Public Offering of the Securities and the undersigned has consulted its own legal, accounting,
financial, regulatory and tax advisors to the extent deemed appropriate. The undersigned further acknowledges and agrees that, although
the Underwriter may be required or choose to provide certain Regulation Best Interest and Form CRS disclosures to you in connection with
the Public Offering, the Underwriter is not making a recommendation to you to enter into this Letter Agreement and nothing set forth in
such disclosures is intended to suggest that the Underwriter is making such a recommendation.
The undersigned understands
that, (i) if the Underwriting Agreement does not become effective by October 31, 2023, (ii) if the Underwriting Agreement (other than
the provisions thereof which survive termination) shall terminate or be terminated prior to payment for and delivery of the Common Stock
to be sold thereunder, (iii) the Company notifies the Underwriter in writing prior to the execution of the Underwriting Agreement that
it does not intend to proceed with the Public Offering, or (iv) prior to payment for the Securities, the Registration Statement is withdrawn
prior to the execution of the Underwriting Agreement, the Letter Agreement shall automatically terminate and be of no further force or
effect and undersigned shall be released from all obligations under this Letter Agreement. The undersigned understands that the Underwriter
is entering into the Underwriting Agreement and proceeding with the Public Offering in reliance upon this Letter Agreement.
The undersigned hereby consents
to receipt of this Letter Agreement in electronic form and understands and agrees that this Letter Agreement may be signed electronically.
In the event that any signature is delivered by facsimile transmission, electronic mail, or otherwise by electronic transmission (including
any electronic signature complying with the U.S. federal ESIGN Act of 2000, e.g., www.docusign.com) evidencing an intent to sign
this Letter Agreement, such facsimile transmission, 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 Letter
Agreement by facsimile transmission, electronic mail or other electronic transmission is legal, valid and binding for all purposes.
[Signature page follows]
This Letter Agreement and
any claim, controversy or dispute arising under or related to this Letter Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
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Very truly yours, |
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Exhibit 5.1
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Akerman LLP
201 East Las Olas Boulevard
Suite 1800
Fort Lauderdale, FL 33301
T: 954 463 2700
F: 954 463 2224 |
September 12, 2023
Karat Packaging Inc.
6185 Kimball Avenue
Chino, California
| Re: | Registration Statement on Form
S-3, Registration No. 333-268397 |
Ladies and Gentlemen:
This opinion is being
furnished in connection with the filing, with the Securities and Exchange Commission (the “Commission”) on
November 15, 2022, under the Securities Act of 1933, as amended (the “Securities Act”), of the Registration
Statement on Form S-3 (File No. 333- 268397) (the “Registration Statement”) of Karat Packaging Inc. (the
“Company”) in connection with the registration under the Securities Act of the resale of 1,150,000 shares
(including up to 150,000 additional shares issuable upon the exercise of an option granted to the underwriters by an executive officer of the Company (the “Selling Stockholders”)) of the Company’s common stock, $0.001 par
value per share (the “Shares”). We have been advised by you that the Shares are to be sold as described in the
Registration Statement, the Prospectus, dated September 7, 2023 (the “Prospectus”), and the Underwriting
Agreement (the “Underwriting Agreement”), dated as of September 7, 2023, by and among the Company, the Selling
Stockholders and Lake Street Capital Markets, LLC. This opinion is being furnished in accordance with the requirements of Item
601(b)(5) of Regulation S-K under the Securities Act.
For purposes of this opinion,
we have examined and relied upon the Registration Statement, the Prospectus, the Underwriting Agreement and such documents, records, certificates,
and other instruments as we have deemed necessary. In such examination we have assumed (i) the authenticity of original documents and
the genuineness of all signatures; (ii) the conformity to the originals of all documents submitted to us as copies; (iii) the truth, accuracy,
and completeness of the information, representations and warranties contained in the records, documents, instruments and certificates
we have reviewed; and (iv) all Shares will be offered and sold in compliance with applicable Federal and state securities laws and in
the manner stated in the Registration Statement and the Prospectus.
Based upon and subject to the
foregoing, we are of the opinion that the Shares offered by the Selling Stockholders in accordance with the Underwriting Agreement were validly issued, fully paid and nonassessable.
The foregoing opinion is limited
to the Delaware General Corporation Law. We neither express nor imply any obligation with respect to any other law or the laws of any
other jurisdiction or of the United States. For purposes of this opinion, we assume that the Shares were re-sold in compliance with
all applicable state securities or blue sky laws.
akerman.com
Karat Packaging Inc.
September 12, 2023
Page 2
We assume no obligation to supplement
this opinion letter if any applicable law changes after the date hereof or if we become aware of any fact that might change the opinions
expressed herein after the date hereof.
This opinion letter is furnished
in connection with the filing of the Registration Statement and may not be relied upon for any other purpose without our prior written
consent in each instance. Further, no portion of this opinion letter may be quoted, circulated or referred to in any other document for
any other purpose without our prior written consent.
We hereby consent to your filing
this opinion as an exhibit to the Registration Statement and to the use of our name therein and in the Prospectus under the caption “Legal
Matters.” In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section
7 of the Securities Act or the Rules and Regulations of the Commission issued thereunder.
Very truly yours,
/s/ Akerman LLP
AKERMAN LLP
Exhibit 99.1
Karat Packaging Inc. Announces Proposed Secondary
Offering of Common Stock
CHINO, Calif. – September 7, 2023
– Karat Packaging Inc. (Nasdaq: KRT) (“Karat” or the “Company”), a specialty distributor and manufacturer
of disposable foodservice products and related items, today announced the commencement of a proposed public offering of Karat’s
common stock by certain members of the Company’s management team (the “Selling Stockholders”). The Selling Stockholders
will also grant the underwriter a 30-day option to purchase up to an additional 15% of the shares
of Karat’s common stock offered in the offering from the Selling Stockholders.
Karat is not offering any shares of its common
stock in this offering and will not receive any proceeds from the sale of shares by the Selling Stockholders.
Lake Street Capital Markets, LLC is acting as
sole book-running manager for the proposed offering.
The offering of these securities is being made
pursuant to a shelf registration statement on Form S-3 (File No. 333-268397), which was filed with the U.S. Securities and Exchange Commission
(the “SEC”) on November 15, 2022 and declared effective on November 28, 2022. The offering will be made only by means of a
prospectus supplement and an accompanying prospectus. A copy of the prospectus and prospectus supplement relating to the offering may
be obtained, when available, by visiting the SEC’s website at www.sec.gov. Alternatively, copies of the prospectus and prospectus
supplement relating to the offering may be obtained by contacting: Lake Street Capital Markets, LLC, Attn: Syndicate Department, 920 Second
Avenue South, Suite 700, Minneapolis, MN 55402, by calling (612) 326-1305, or by emailing syndicate@lakestreetcm.com.
This press release shall not constitute an offer
to sell or a solicitation of an offer to buy these securities, nor shall there be any offer or sale of these securities in any state or
jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities
laws of any such state or jurisdiction.
About Karat Packaging Inc.
Karat Packaging Inc. is a specialty distributor
and manufacturer of a wide range of disposable foodservice products and related items, primarily used by national and regional restaurants
and in foodservice settings throughout the United States. Its products include food and take-out containers, bags, tableware, cups, lids,
cutlery, straws, specialty beverage ingredients, equipment, gloves and other products. The company’s eco-friendly Karat Earth®
line offers quality, sustainably focused products that are made from renewable resources. Karat Packaging also offers customized
solutions, including new product development and design, printing, and logistics services.
Forward Looking Statements
Statements made in this release that are not statements
of historical or current facts are “forward-looking statements” within the meaning of the Private Securities Litigation Reform
Act of 1995, including, but not limited to, statements regarding the proposed offering. We caution readers that forward-looking statements
are predictions based on our current expectations about future events, and are subject to risks and uncertainties. Such risks and
uncertainties may cause actual results to differ materially from those anticipated in the forward-looking statements. Our actual
results, performance, or achievements could differ materially from those expressed or implied by the forward-looking statements as a result
of a number of factors, including the risks discussed under the heading “Risk Factors” discussed under the caption “Item
1A. Risk Factors” in Part I of our most recent Annual Report on Form 10-K or any updates discussed under the caption “Item
1A. Risk Factors” in Part II of our Quarterly Reports on Form 10-Q and in our other filings with the Securities and Exchange Commission.
The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information,
future events or otherwise that occur after that date, except as required by law.
# # #
Investor Relations and Media Contact
PondelWilkinson Inc.
Judy Lin or Roger Pondel
310-279-5980
IR@karatpackaging.com
Exhibit 99.2
Karat Packaging Inc. Announces Pricing of Secondary
Offering of Common Stock
CHINO, Calif. – September 7, 2023
– Karat Packaging Inc. (Nasdaq: KRT) (“Karat” or the “Company”), a specialty distributor and manufacturer
of disposable foodservice products and related items, today announced the pricing of its previously announced underwritten secondary offering
of 1,000,000 shares of Karat’s common stock by certain members of the Company’s management team (collectively, the “Selling
Stockholders”) at a price of $21.00 per share. The underwriter has been granted a 30-day option to purchase up to an additional
150,000 shares of Karat’s common stock from a Selling Stockholder. The offering is expected to close on September 12, 2023, subject
to the satisfaction of customary closing conditions. The Company will not receive any proceeds from the sale of shares by the Selling
Stockholders.
Lake Street Capital Markets, LLC is acting as
sole book-running manager for the offering.
The offering of these securities is being made
pursuant to a shelf registration statement on Form S-3 (File No. 333-268397), which was filed with the U.S. Securities and Exchange Commission
(the “SEC”) on November 15, 2022 and declared effective on November 28, 2022. The offering is being made only by means of
a prospectus supplement and an accompanying prospectus. A copy of the prospectus and prospectus supplement related to the offering may
be obtained, when available, by visiting the SEC’s website at www.sec.gov. Alternatively, copies of the prospectus and prospectus
supplement relating to the offering may be obtained by contacting: Lake Street Capital Markets, LLC, Attn: Syndicate Department, 920 Second
Avenue South, Suite 700, Minneapolis, MN 55402, by calling (612) 326-1305, or by emailing syndicate@lakestreetcm.com.
This press release shall not constitute an offer
to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which
such offer, solicitation, or sale would be unlawful prior to registration or qualification under the securities laws of any such state
or jurisdiction.
About Karat Packaging Inc.
Karat Packaging Inc. is a specialty distributor
and manufacturer of a wide range of disposable foodservice products and related items, primarily used by national and regional restaurants
and in foodservice settings throughout the United States. Its products include food and take-out containers, bags, tableware, cups, lids,
cutlery, straws, specialty beverage ingredients, equipment, gloves and other products. The company’s eco-friendly Karat Earth®
line offers quality, sustainably focused products that are made from renewable resources. Karat Packaging also offers customized
solutions, including new product development and design, printing, and logistics services.
Forward Looking Statements
Statements
made in this release that are not statements of historical or current facts are “forward-looking statements” within the meaning
of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements regarding the proposed offering. We
caution readers that forward-looking statements are predictions based on our current expectations about future events, and are subject
to risks and uncertainties. Such risks and uncertainties may cause actual results to differ materially from those anticipated in
the forward-looking statements. Our actual results, performance, or achievements could differ materially from those expressed or
implied by the forward-looking statements as a result of a number of factors, including the risks discussed under the heading “Risk
Factors” discussed under the caption “Item 1A. Risk Factors” in Part I of our most recent Annual Report on Form 10-K
or any updates discussed under the caption “Item 1A. Risk Factors” in Part II of our Quarterly Reports on Form 10-Q and in
our other filings with the Securities and Exchange Commission. The Company undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise that occur after that date, except as required by law.
# # #
Investor Relations and Media Contact
PondelWilkinson Inc.
Judy Lin or Roger Pondel
310-279-5980
IR@karatpackaging.com
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