Prospectus Supplement
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Filed Pursuant to Rule 424(b)(5)
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(To Prospectus Dated January 19, 2021)
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Registration No. 333-252230
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CALCULATION OF REGISTRATION
FEE
Title of Each Class of Securities
to be Registered
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Amount
to be Registered
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|
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Proposed Maximum
Offering Price
Per Unit(1)
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|
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Proposed Maximum
Aggregate Offering
Price(1)
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|
|
Amount of
Registration
Fee(1)
|
|
Common Stock, par value $0.001 per share
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|
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80,396,000
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|
|
$
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3.375
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|
|
$
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271,336,500
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|
|
$
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29,602.82
|
|
(1)
|
Estimated solely for the purpose
of calculating the registration fee. Pursuant to Rule 457(c) under the Securities Act of 1933, as amended, the proposed maximum offering
price per share is based on the average of the high and low sale prices of the registrant’s Common Stock on the New York Stock
Exchange, Inc. on June 10, 2021.
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PROSPECTUS SUPPLEMENT
Ideanomics, Inc.
80,396,000 Shares
Common Stock
We entered into a Standby
Equity Distribution Agreement (the “SEDA”), with YA II PN, Ltd., a Cayman Islands exempt limited partnership (“YA”)
on June 11, 2021 for the offer and sale of up to 80,396,000 shares of our common stock, par value $0.001 per share (the “shares”),
offered by this prospectus supplement and the accompanying prospectus. The Company will be able to sell up to 80,396,000 shares of its
common stock at the Company’s request any time during the 36 months following the date of the SEDA. The SEDA has been approved by
the Ideanomics shareholders. The shares would be purchased pursuant to the SEDA at 96% or 95% of the Market Price (as defined below) and
would be subject to certain limitations, including that YA could not purchase any shares that would result in it owning more than 4.99%
of our common stock. “Market Price” shall mean the lowest daily VWAP (as defined below) of the Company’s common stock
during the 2 or 5 consecutive trading days commencing on the trading day following the date the Company submits an advance notice to YA.
“VWAP” means, for any trading day, the daily volume weighted average price of the Company’s common stock for
such date on the principal market as reported by Bloomberg L.P. during regular trading hours.
This prospectus supplement
and the accompanying prospectus also cover the sale of these shares by YA to the public. Though we have been advised by YA, and
YA represents in the SEDA, that YA is purchasing the shares for its own account, for investment purposes in which it takes investment
risk (including, without limitation, the risk of loss), and without any view or intention to distribute such shares in violation of the
Securities Act or any other applicable securities laws, the SEC may take the position that YA may be deemed an “underwriter”
within the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended (the “Securities Act”) and any profits
on the sales of shares of our common stock by YA and any discounts, commissions or concessions received by YA is deemed to be underwriting
discounts and commissions under the Securities Act. For additional information on the methods of sale that may be used by YA,
see the section entitled “Plan of Distribution” on page S-13.
Our Common Stock is listed
on the Nasdaq Capital Market under the symbol “IDEX”. On June 10, 2021, the closing price of our Common Stock was $3.15 per
share. As of the date of this prospectus, none of the other securities that we may offer by this prospectus is listed on any national
securities exchange or automated quotation system.
The securities
offered by this prospectus involve a high degree of risk. See “Risk Factors” beginning on page S- 10 of this prospectus
supplement and in the documents we incorporate by reference into this prospectus supplement and the accompanying prospectus.
Neither the Securities
and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus
is truthful or complete. Any representation to the contrary is a criminal offense.
This prospectus supplement is dated June 11, 2021.
Table of Contents
You should rely only on the information contained
or incorporated by reference in this prospectus supplement and the accompanying prospectus. We have not authorized anyone to provide you
with information different from that contained or incorporated by reference into this prospectus. If any person does provide you with
information that differs from what is contained or incorporated by reference in this prospectus, you should not rely on it. No dealer,
salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You should
assume that the information contained in this prospectus supplement and the accompanying prospectus is accurate only as of the date on
the front of the document and that any information contained in any document we have incorporated by reference is accurate only as of
the date of the document incorporated by reference, regardless of the time of delivery of this prospectus supplement, the accompanying
prospectus or any sale of a security. These documents are not an offer to sell or a solicitation of an offer to buy these securities by
anyone in any jurisdiction in which such offer or solicitation is not authorized, or in which the person is not qualified to do so or
to any person to whom it is unlawful to make such offer or solicitation.
ABOUT THIS PROSPECTUS SUPPLEMENT
This prospectus supplement and the accompanying
prospectus are part of a “shelf” registration statement on Form S-3 (File No. 333-252230) that we filed with the Securities
and Exchange Commission (the “SEC” or the “Commission”) on January 19, 2021. Under this shelf registration process,
we may, from time to time, sell any combination of the securities described in the accompanying prospectus in one or more offerings.
This prospectus supplement
provides specific details regarding the issuance of up to 80,396,000 shares of our common stock pursuant to the SEDA. To the extent there
is a conflict between the information contained in this prospectus supplement and accompanying prospectus, you should rely on the information
in this prospectus supplement. Generally, when we refer to this prospectus supplement, we are referring to both parts of this document
combined together with all documents incorporated by reference. This prospectus supplement, the accompanying prospectus and the documents
we incorporate by reference herein and therein include important information about us and our common stock, and other information you
should know before investing. You should read this prospectus supplement, the accompanying prospectus and the documents incorporated by
reference in this prospectus supplement and the accompanying prospectus before making an investment decision. You should also read and
consider the information in the documents referred to in the sections of this prospectus supplement entitled “Where You Can Find
More Information” and “Incorporation of Certain Documents by Reference.”
This document is in two parts.
The first part is this prospectus supplement, which describes the specific terms of this offering and also adds to and updates information
contained in the accompanying prospectus and the documents incorporated by reference into this prospectus supplement and the accompanying
prospectus. The second part is the accompanying prospectus, which gives more general information about the shares of our common stock
and other securities we may offer from time to time under our shelf registration statement, some of which does not apply to the common
stock offered by this prospectus supplement.
You should rely only on
the information contained in or incorporated by reference into this prospectus supplement or contained in or incorporated by
reference into the accompanying prospectus to which we have referred you. We have not authorized anyone to provide you with
information that is different. If anyone provides you with different or inconsistent information, you should not rely on it. The
information contained in, or incorporated by reference into, this prospectus supplement and contained in, or incorporated by
reference into, the accompanying prospectus is accurate only as of the respective dates thereof, regardless of the time of delivery
of this prospectus supplement and the accompanying prospectus or of any sale of securities.
We are offering to sell, and
are seeking offers to buy, the shares of common stock only in jurisdictions where such offers and sales are permitted. The distribution
of this prospectus supplement and the accompanying prospectus and the offering of the shares of common stock in certain states or jurisdictions
or to certain persons within such states and jurisdictions may be restricted by law. Persons outside the United States who come into possession
of this prospectus supplement and the accompanying prospectus must inform themselves about and observe any restrictions relating to the
offering of the shares of common stock and the distribution of this prospectus supplement and the accompanying prospectus outside the
United States. This prospectus supplement and the accompanying prospectus do not constitute, and may not be used in connection with, an
offer to sell, or a solicitation of an offer to buy, any securities offered by this prospectus supplement and the accompanying prospectus
by any person in any state or jurisdiction in which it is unlawful for such person to make such an offer or solicitation. Unless the context
otherwise requires, references to “we,” “our,” “us,” “IDEX” or the “Company”
in this prospectus mean Ideanomics, Inc., a Nevada corporation, on a consolidated basis with its wholly-owned subsidiaries, as applicable.
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS
This prospectus supplement
and the documents and information incorporated by reference in this prospectus supplement include forward-looking statements within the
meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”). These statements are based on our management’s beliefs and assumptions and on information currently available to our
management. Such forward-looking statements include those that express plans, anticipation, intent, contingency, goals, targets or future
development and/or otherwise are not statements of historical fact.
All statements in this prospectus
supplement and the documents and information incorporated by reference in this prospectus supplement that are not historical facts are
forward-looking statements. We may, in some cases, use terms such as “anticipates,” “believes,” “could,”
“estimates,” “expects,” “intends,” “may,” “plans,” “potential,”
“predicts,” “projects,” “should,” “will,” “would” or similar expressions or
the negative of such items that convey uncertainty of future events or outcomes to identify forward-looking statements.
Forward-looking statements
are made based on management’s beliefs, estimates and opinions on the date the statements are made and we undertake no obligation
to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as may be required
by applicable law. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee
future results, levels of activity, performance or achievements.
PROSPECTUS SUPPLEMENT SUMMARY
Overview
Ideanomics, Inc. (“Ideanomics” or
the “Company”) (Nasdaq: IDEX) was incorporated in the State of Nevada on October 19, 2004. From 2010 through 2017, our primary
business activities were providing premium content video on demand (“VOD”) services, with primary operations in the PRC, through
our subsidiaries and variable interest entities (“VIEs”) under the brand name You-on-Demand (“YOD.”) We closed
the YOD business during 2019.
Starting in early 2017, the Company transitioned
its business model to become a next-generation financial technology (“fintech”) company. The Company built a network of businesses,
operating principally in the trading of petroleum products and electronic components that the Company believed had significant potential
to recognize benefits from blockchain and artificial intelligence (“AI”) technologies including enhancing operations, addressing
cost inefficiencies, improving documentation and standardization, unlocking asset value and improving customer engagement. During 2018,
the Company ceased operations in the petroleum products and electronic components trading businesses and disposed of the businesses during
2019. As we looked to deploy fintech solutions in late 2018 and into 2019, we identified a unique opportunity in the Chinese Electric
Vehicle (“EV”) industry to facilitate large scale conversion of fleet vehicles from internal combustion engines to EV. This
led us to establish our Mobile Energy Global (“MEG”) business unit. Fintech continues to be a sector of interest to us as
we look to invest in and develop businesses that can improve the financial services industry, particularly as it relates to deploying
blockchain and AI technologies.
Principal Products or Services and Their Markets
Overview
Ideanomics Mobility
Ideanomics Mobility is driving EV adoption by
assembling a synergistic ecosystem of subsidiaries and investments across the 3 key pillars of EV: Vehicles, Charging, and Energy. These
three pillars provide the foundation for Ideanomics Mobility’s planned offering of unique business solutions such as Charging as
a Service (“CaaS”) and Vehicle as a Service (“VaaS.”)
Each operating company within Ideanomics Mobility
offers its own unique products and participates in a shared services ecosystem fulfilling Ideanomics’ Sales-to-Financing-to-Charging
(“S2F2C”) model, with centralized supply chain operations and marketing expertise designed to accelerate growth and business
opportunities across the group.
The combination of products from within its subsidiaries
and investments, coupled with Ideanomics Mobility’s shared services, will provide the Company with the opportunity to bring to market
unique business solutions intended to drive commercial fleet electrification such as Charging-as-a-Service and Vehicle-as-a-Service. These
solutions offer fleet operators an opportunity to benefit from an OpEx-driven model which lowers the barrier to entry for the adoption
of zero emissions fleets.
The Company believes that the EV market is poised
for rapid growth. Bloomberg NEF estimates that global commercial EV sales will reach 1.2 million units in 2023. The global EV charging
infrastructure market is expected to grow at a compound annual growth rate of 33.4% from 2021 to 2028 to $144.97 billion. President Biden’s
administration is supportive of EV with a goal to achieve a 100% clean-energy economy and states such as California have accelerated timelines
to phase out internal combustion engine (“ICE”) vehicles.
Ideanomics Mobility’s mission is to leverage
its ecosystem of synergistic operating companies to generate efficiencies and increase business opportunities across the group. With a
diverse commercial EV product offering, the company plans to use EV and EV battery sales and financing solutions to attract commercial
fleet operators that will generate large scale demand for energy. The Company operates as an end-to-end solutions provider for the procurement,
financing, charging and energy management needs for fleet operators of commercial EV. Ideanomics Mobility focuses on commercial EV rather
than passenger personal EV, as commercial EV is on an accelerated adoption path when compared to consumer EV adoption – which is
expected to take between ten to fifteen years. We focus on four distinct commercial vehicle types with supporting income streams: 1) Closed-area
heavy commercial, in sectors such as Mining, Airports, and Sea Ports 2) Last-mile delivery light commercial 3) Buses and Coaches 4) Taxis.
The vehicle financing solutions (such as purchase or leasing) would generate fee-based revenues whereas the charging and energy management
would yield recurring revenue streams.
Ideanomics Mobility’s revenues are generated
from its S2F2C operating model. The Company’s planned EV revenues will come from the sale of EVs under our Medici Motor Works and
Treeletrik brands outside of the China and within China through our MEG operating units sale of other manufacturers vehicles and batteries.
The Company’s presence in the China market
creates a deep knowledge of the logistics and supply chain for the manufacture of EVs, batteries and related components; this in turn
enables the sourcing of high quality components at competitive prices for the Company’s operations outside of China.
Within the Ideanomics Mobility business unit there
are four operating companies:
Mobile Energy Global (“MEG”)
The Company’s MEG business operates in China
where government clean air regulations and subsidy programs provide a strong impetus for the adoption of commercial EV. The Company competes
in China using its S2F2C. Using this model the Company helps the customer find the best vehicle for its needs and earns fees for every
completed sale; revenue is derived from the spread between group buying of vehicles and price sold, fees for the arrangement of financing,
and payments from subsequent charging and energy management.
Tree Technologies Sdn. Bhd. (“Tree Technologies”)
Tree Technologies is headquartered in Kuala Lumpur,
Malaysia and through its Treeletrik brand sells EV bikes, scooters, and batteries throughout the ASEAN region. Two-wheel bikes and scooters
form a large part of the transport infrastructure in the ASEAN region; according to Deloitte Consulting, there were 13.7 million motor
bikes sold in the six major ASEAN countries in 2019. Environmental regulations in the ASEAN region help accelerate the adoption of EV
bikes. The Company has also started to import Treeletrik brand EV bikes into the United States.
Medici Motor Works
Medici Motor Works plans to sell its own brand
vehicles in the United States, Latin America and Europe. Presently, the Company is working with manufacturers based in China to design
and build trucks, buses and closed-area vehicles for mining, airports and seaports.
Solectrac, Inc. (“Solectrac”)
On October 21, 2020 the Company acquired 15%,
and on November 23, 2020 the Company subsequently increased its ownership to 24% in California-based Solectrac, Inc. Solectrac develops,
assembles and distributes 100% battery-powered electric tractors—an alternative to diesel tractors—for agriculture and utility
operations.
According to Research And Markets, the global
agricultural tractor market is currently valued at $75 billion, with the North American agricultural tractor market expected to reach
$20 billion by 2023. The largest segment for agricultural tractors is the below-40HP segment, where Solectrac's initial three models address
the broad needs of the market. Its tractors are specifically designed to serve the needs of community-based farms, vineyards, orchards,
equestrian arenas, greenhouses, and hobby farms.
Founded in 2012 to take electric tractors into
commercial production, Solectrac was incorporated as a California Benefit Corp in 2019. It has received grants from the Indian U.S. Science
and Technology Fund and the National Science Foundation. In 2020, Solectrac received the World Alliance Solar Impulse Efficient Solutions
label from the Solar Impulse Foundation. The label was awarded for being one of the one thousand most efficient and profitable solutions
that can transition society to being economically viable while being environmentally sustainable.
Recent Developments Since December 31, 2020
Since December 31, 2020 the Company has completed
a number of transactions that have expanded the scope of the Company’s EV activities.
U.S. Hybrid
On
June 10, 2021, Ideanomics, Inc. (“Ideanomics”) acquired U.S. Hybrid Corporation (“US Hybrid.”) Founded in 1999,
and headquartered in Torrance, California, U.S. Hybrid has been providing innovative solutions including components, drive trains, and
fuel cells to medium and heavy-duty commercial fleet operators. U.S. Hybrid designs, manufactures, and markets integrated power conversion
systems for battery electric, fuel cell, and hybrid vehicles, as well as systems for renewable energy generation and storage. The company
has been leading the clean-tech revolution by offering integrated power conversion components and integrated motor drives, motors and
controllers, distributed energy management systems, and DC-DC boost converters - equipment that is vital to the growth of the broader
EV industry. In addition to its relationships with leading original equipment manufacturers, U.S. Hybrid has delivered projects for the
private and public sectors, including the defense industry and governmental customers.
U.S. Hybrid
has reliably demonstrated proven powertrain technology, along with DC-DC converters which possess high efficiency ratings and fast dynamic
response capabilities. U.S. Hybrid enjoys long-term commercial relationships in various industries including Commercial, Defense and Aerospace,
and Transit/Municipal for its battery electric vehicle, fuel cell energy, and hybrid platforms.
The acquisition
of U.S. Hybrid brings to Ideanomics the application of U.S.-built technology, for use in its own vehicles, and significantly extends the
company's capabilities in zero-emission transportation. U.S. Hybrid will continue to service its existing customer base, and Ideanomics
will assist them in scaling their business operations within the Ideanomics Mobility business division. U.S. Hybrid operates from locations
in California, Connecticut, and Massachusetts.
WAVE
On January 15, 2021 acquired 100% of privately
held Wireless Advanced Vehicle Electrification, Inc. ("WAVE.")
Founded in 2011, and headquartered in Salt Lake
City, Utah, WAVE is a leading provider of inductive (wireless) charging solutions for medium and heavy-duty EVs. Embedded in roadways
and depot facilities, the WAVE system automatically charges vehicles during scheduled stops. The hands-free WAVE system eliminates battery
range limitations and enables fleets to achieve driving ranges that match that of internal combustion engines.
Deployed since 2012, WAVE has demonstrated the
capability to develop and integrate high-power charging systems into heavy-duty EVs from leading commercial EV manufacturers. With commercially
available wireless charging systems up to 250kW and higher power systems in development, WAVE provides custom fleet solutions for mass
transit, logistics, airport and campus shuttles, drayage fleets, and off-road vehicles at ports and industrial sites.
Wireless charging systems offer several compelling
benefits over plug-in-based charging systems, including reduced maintenance, improved health and safety, and expedited energy connection
and are important to the deployment of autonomous driving vehicles. Furthermore, wireless in-route charging enables greater route lengths
or smaller batteries while also maintaining battery life, thereby reducing costs for fleet operators. WAVE customers include what is currently
the largest EV bus system in the U.S., the Antelope Valley Transit Authority, and its partnerships include Kenworth, Gillig, BYD, Complete
Coach Works and the Department of Energy.
Energica Motor Company, S.P.A. (“Energica”)
On March 3, 2021 the Company purchased 20% of
Energica, the world's leading manufacturer of high-performance electric motorcycles and the sole manufacturer of the FIM Enel MotoE™
World Cup. Energica has combined zero emission EV technology with the pedigree of high-performance mobility synonymous with Italy’s
Motor Valley to create a range of exceptional products for the high-performance motorcycle market. To support its products, it has developed
proprietary EV battery and DC fast-charging in-house that has applications and synergies with Ideanomics’ broader interests in the
global EV sector.
Silk EV Cayman LP (“Silk”)
On January 28, 2021, the Company invested $15.0
million in Silk EV via a promissory note. Silk is an Italian engineering and design services company that has recently partnered with
FAW to form a new company (Silk-FAW) to produce fully electric, luxury vehicles for the Chinese and Global auto markets. Silk-FAW has
exclusive rights to develop Hongqi-S brand high-end electric sports cars. The Hongqi brand is the most well-known luxury auto brand in
China. Silk-FAW vehicles are being designed in Italy’s Motor Valley and is attracting talent from the luxury and high-performance
auto market. Partnering with Silk provides access to Silk-FAW’s Innovation Centers providing us insight into technological advancements
and all best-in-breed technology evaluated at those centers to support the development of high-performance sportscars (battery tech, power
management systems, high performance motors.)
Ideanomics Capital
Ideanomics Capital is the Company's fintech business
unit, which focuses on leveraging technology and innovation to improve efficiency, transparency, and profitability for the financial services
industry.
Technology Metals Market Limited (“TM2”)
TM2 is a London based digital commodities issuance
and trading platform for technology metals. It connects institutional investors, proprietary traders and retail investors with metals
suppliers – miners, refiners, recyclers and mints. The platform focuses specifically on new metals that currently don’t have
an active trading marketplace, such as rhodium, lithium, cobalt, rhenium, etc. The Company’s ownership interest in TM2 provides
valuable data and insight into the global technology metals market, which is critical to the future of the Cleantech and EV industries.
TM2 connects both pillars of Cleantech and Fintech. The types of metals and materials traded on the TM2 platform are critical to Cleantech
(for EV battery production, energy storage systems, solar cells, etc.,) while the Fintech platform is innovative in representing these
commodities which do not exist on traditional exchanges.
On January 28, 2021, the Company entered into
a simple agreement for future equity with TM2 pursuant to which Ideanomics invested $2.1 million. This investment is a follow-on investment
further the Company’s prior investment of $1.2 million in stock-based consideration in December 2019.
Delaware Board of Trade (“DBOT”)
The Delaware Board of Trade (“DBOT”)
is a broker dealer that also operates an Alternative Trading System (“ATS,”) presently DBOT is not trading; the business remains
in full regulatory compliance. Recent developments have pointed to increased recognition of digital securities’ relevance in regulated
global capital markets. As well, regulatory easing of certain restrictions such as the threshold for private securities (Reg A+), along
with good demand for products such as pre-IPO issuance, provide good tailwind for the broker dealers business. The Company has filed a
continuing membership application for private placement activities in the primary markets. The Company believes that growing demand for
private placements, along with increased attention in digital securities, provide a favorable environment for DBOT’s future growth.
Timios
On January 8, 2021 the Company acquired 100% of
privately-held Timios Holdings Corp. ("Timios.") Timios, a nationwide title and escrow services provider, which has been expanding
in recent years through offering innovative and freedom-of-choice-friendly solutions for real estate transactions. The products include
residential and commercial title insurance, closing and settlement services, as well as specialized offerings for the mortgage process
industry.
Ideanomics expects that Timios will become one
of the cornerstones of Ideanomics Capital. Timios combines difficult to obtain local and state licenses, a knowledgeable and experienced
team, and a scalable platform to deliver best-in-class services through both centralized processing and localized branch networks. Ideanomics
will assist Timios in scaling its business in various ways, including referring client acquisitions and product innovation.
Founded in 2008 by real estate industry veteran
Trevor Stoffer, Timios' vision is to bring transparency to real estate transactions. The company offers title and settlement, appraisal
management, and real-estate-owned (“REO”) title and closing services in 44 states and currently serves more than 280 national
and regional clients.
Non-Core Assets
The Company has identified a number of business
units that it considers non-core and is evaluating strategies for divesting these assets. The non-core assets are Grapevine, a marketing
and ecommerce platform focused on influencer marketing, and FinTech Village a 58-acre development site in West Hartford, Connecticut.
On January 28, 2021, the Company’s Board
of Directors accepted an offer of $2.75 million for Fintech Village, and subsequently signed a non-binding sale contract on March 15,
2021. The Company believes that Fintech Village met the criteria for held for sale classification on January 28, 2021.
Sources and Availability of Raw Materials
The Company’s Tree Technologies business
located in Malaysia and its WAVE business located in Utah, United States, (acquired in the first quarter of 2021 – see Recent Developments
section) assemble and manufacture motor bikes and inductive charging systems respectively. These businesses depend on a ready supply of
components that are sourced domestically and internationally and any interruption to the supply of components could have an adverse impact
on the Company’s results. The Company’s suppliers that manufacture EVs and batteries depend on a ready supply of raw materials
and components, consequently a shortage of raw materials or components could adversely impact their manufacturing process and, potentially,
impact the Company’s revenues as it may not be able to complete orders that it had received. The Company may also be adversely impacted
if global logistic and supply chains are interrupted.
Seasonality
The Company expects that orders and sales will
be influenced by the amount and timing of budgeted expenditure by its customers. Typically, the Company would expect to see higher sales
at the start of the year when companies start executing on their capital programs and at the end of the year when companies are spending
any surplus or uncommitted budget before the new budget cycle commences. The Company’s operating businesses are in the early stage
of their development and consequently do not have sufficient trading histories to project seasonal buying patterns with any degree of
confidence.
Working Capital Requirements
As the Company expands its business the need for
working capital will continue to grow. From time to time the Company’s MEG operating division in China has the opportunity to purchase
a large number of vehicles at a favorable price, the terms of the purchase contract frequently require the Company to pay some or all
of the cost in advance of the delivery of the vehicles with the resultant need to commit material amounts of working capital. The Company’s
Tree Technologies subsidiary requires working capital to support the assembly of EV motor bikes and scooters for the ASEAN market. The
Company acquired WAVE and Solectrac in the first quarter of 2021 (see the Recent Developments section), both of these businesses will
require working capital to fund the purchase of components for the assembly of wireless charging systems and electric tractors, respectively.
The Company will continue to raise both debt and equity capital to support the working capital needs of these businesses and its U.S.
Head Office functions.
Trade marks, Patents and Licenses
The Company’s Intelligenta business operates
under a license granted by Seasail Ventures Limited (“Seasail.”) The license does not have a stated term.
Customer Concentration
The Company is in the process of building out
its Ideanomics Mobility unit and has not yet reached a stage of development where the loss of any single customer would have a material
adverse effect on the Company.
Reliance on Government Contracts
The Company does not contract directly with the
government of the PRC, however it does have investments, partnerships and agreements with the State Own Entities (“SOE”) described
above. Additionally, the rate at which commercial fleets convert to EV is heavily influenced by federal and provincial policies in the
PRC as they relate to clean air and adoption of EV technology. Consequently, the Company’s results may be adversely impacted by
changes in regulations in the PRC.
Competitive Business Conditions, Competitive Position in the Industry
and Methods of Competition
Ideanomics Mobility
Purchasers of commercial vehicles have the choice
between traditional ICE vehicles and EVs and this is likely to continue for at least the next five years and possibly longer. The most
important drivers for the development of the commercial fleet EV market are federal and provincial regulations relating to clean air and
electronic vehicles including subsidies and incentives to help owners of fleets of commercial vehicles to convert from combustion engines
to EV. The speed at which fleet operators convert to EV is highly correlated with government regulations, targets and related subsidies
and incentives. If the governments, or municipalities, change the regulations, targets, incentives or subsidies then the rate at which
fleet operators convert their vehicles to EV could slow down which in turn may lead to lower revenues for the Company. Additionally, the
rate, and form in which, the commercial fleet EV market develops is dependent upon technological developments in battery and charging
systems; deployment of the charging infrastructure to support widespread commercial EV use and the development
of new financing and lending structures that address the different collateral and resale values of the battery and vehicle versus internal
combustion engine vehicles.
In addition to its directly owned operations the
Company operates through a network of investment arrangements, partnerships and formal and informal alliances; consequently, its competitive
position could be adversely impacted if one of the members of the alliance was not able to meet the demand for its products, decides not
to continue to cooperate with the Company, or goes out of business.
Ideanomics Capital
The Company’s Ideanomics Capital business
unit operates in sectors that are undergoing rapid change.
DBOT is a broker dealer that also operates an
ATS. In April 2020 the Company ceased trading OTC equities, terminated the employees assigned to DBOT and the services needed to operate
the business. The Company has continued to maintain DBOT’s regulatory licenses and required regulatory capital. The Company has
applied for regulatory approval to broker digital securities and tokens, this is a nascent market which the Company believes has good
long-term potential.
Preferred Stock
The Company has a multi-tiered capital structure
that includes Series A Preferred Stock.
Ranking. With respect to rights
upon liquidation, winding-up or dissolution, the Series A Preferred Stock ranks senior to our common stock and pari passu with
any other series of our preferred stock established by our board of directors.
Voting. The holders of the Series A
Preferred Stock are entitled to ten (10) votes for each one (1) share of common stock that is issuable upon conversion of a
share of Series A Preferred Stock (each of the 7,000,000 shares of Series A Preferred Stock is convertible into 0.1333333 shares
of Common Stock, or a total of 9,333,330 votes). Except as required by law, all shares of Series A Preferred Stock and all shares
of common stock shall vote together as a single class.
Conversion. Each share of Series A
Preferred Stock is convertible, at any time at the option of the holder, into ten (10) fully paid and nonassessable shares of common
stock, subject to adjustment as provided in the Certificate of Designation.
Dividends. The Series A Preferred
Stock is only entitled to receive dividends when and if declared by our board of directors.
Liquidation. Upon the occurrence
of a liquidation event, the holders of the Series A Preferred Stock then outstanding will be entitled to receive, out of the assets
of the Company available for distribution to its stockholders, an amount equal to $0.50 per share, as may be adjusted from time to time,
plus all accrued, but unpaid dividends, before any payment shall be made or any assets distributed to the holders of common stock or any
other class or series of stock issued by the Company not designated as ranking senior to or pari passu with the Series A Preferred
Stock in respect of the right to participate in distributions or payments upon a liquidation event. For purposes of the Certificate of
Designation, a “liquidation event” means any liquidation, dissolution or winding up of the Company, either voluntary or involuntary,
and upon the election of the holders of a majority of the then outstanding Series A Preferred Stock shall be deemed to be occasioned
by, or to include, (i) the acquisition of the Company by another entity by means of any transaction or series of related transactions
(including, without limitation, any reorganization, merger, consolidation, or other transaction in which control of the Company is transferred,
but, excluding any merger effected exclusively for the purpose of changing the domicile of the Company) unless the Company’s stockholders
of record as constituted immediately prior to such acquisition or sale will, immediately after such acquisition or sale (by virtue of
securities issued as consideration for the Company’s acquisition or sale or otherwise) hold at least 50% of the voting power of
the surviving or acquiring entity or (ii) a sale of all or substantially all of the assets of the Company.
Corporate Information
Ideanomics, Inc. (formerly China Broadband, Inc.,
Seven Stars Cloud Group, Inc. and WeCast) was incorporated in Nevada on October 19, 2004 pursuant to a reorganization of a California
entity formed in 1988. Prior to January 2007 we were a blank check shell company. On January 23, 2007, we acquired CB Cayman,
which at the time was a party to the cooperation agreement with our PRC-based WFOE, in a reverse acquisition transaction. Our principal
executive offices are located at 1441 Broadway, Suite 5116, New York, NY 10018, and our telephone number is (212) 206-1216. Our
corporate website address is www.ideanomics.com. Information contained on or accessible through our website is not a
part of this prospectus supplement, and the inclusion of our website address in this prospectus supplement is an inactive textual reference
only.
RISK FACTORS
Investing in our securities involves a high
degree of risk. Before making an investment decision, you should consider carefully the risks, uncertainties and other factors described
in our most recent Annual Report on Form 10-K, as supplemented and updated by subsequent quarterly reports on Form 10-Q and
current reports on Form 8-K that we have filed or will file with the Commission, which are incorporated by reference into this prospectus
supplement and accompanying prospectus. In addition to carefully reading the risk factors described in our most recent Annual Report on
Form 10-K, as supplemented and updated by subsequent quarterly reports on Form 10-Q and current reports on Form 8-K that
we have filed or will file with the Commission, you should carefully consider the following additional risk factors.
Risks Related to this Offering
We have broad discretion in the use of the net proceeds of this
offering and may not use them effectively.
We intend to use the net proceeds
from this offering for general corporate purposes, which may include the repayment of outstanding debt and investment and acquisition
activities. However, our management will have broad discretion in the application of the net proceeds from this offering and could spend
the proceeds in ways that do not improve our results of operations or enhance the value of our common stock. The failure by management
to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the
price of our common stock to decline and delay the development of our product candidates.
You may experience future dilution as a result of this or future
equity offerings, and the issuance and sale of common stock hereunder may depress our stock price.
Shares issued pursuant to
the SEDA will have a dilutive impact on our existing shareholders. In order to raise additional capital, we may in the future offer additional
shares of our common stock or other securities convertible into or exchangeable for our common stock at prices that may not be the same
as the price per share in this offering. We may sell shares or other securities in any other offering at a price per share that is less
than the price per share paid by investors in this offering, and investors purchasing shares or other securities in the future could have
rights superior to existing stockholders. The price per share at which we sell additional shares of our common stock, or securities convertible
or exchangeable into common stock, in future transactions may be higher or lower than the price per share paid by investors in this offering.
Additionally, such sales could cause the market price of our common stock to decline. If we obtain funds through a credit facility or
through the issuance of debt or preferred securities, these securities would likely have rights senior to your rights as a common shareholder,
which could impair the value of our common stock.
We have never paid dividends on our capital stock and we do not
anticipate paying dividends in the foreseeable future.
We have never paid dividends
on any of our capital stock and currently intend to retain any future earnings to fund the growth of our business. Any determination to
pay dividends in the future will be at the discretion of our board of directors and will depend on our financial condition, operating
results, capital requirements, general business conditions and other factors that our board of directors may deem relevant. As a result,
capital appreciation, if any, of our common stock will be the sole source of gain for the foreseeable future.
Sales of a substantial number of shares of our common stock in
the public market could cause our stock price to fall.
Sales of a substantial number
of shares of our common stock in the public market or the perception that these sales might occur could depress the market price of our
common stock and could impair our ability to raise capital through the sale of additional equity securities. We are unable to predict
the effect that sales may have on the prevailing market price of our common stock. In addition, the sale of substantial amounts of our
common stock could adversely impact its price. The sale or the availability for sale of a large number of shares of our common stock in
the public market could cause the price of our common stock to decline.
It is not possible to predict the actual number of shares we
will sell under the SEDA, or the gross proceeds resulting from those sales.
Subject to certain limitations in the SEDA and
compliance with applicable law, we have the discretion to deliver a placement notice to the sales agent at any time throughout the term
of the SEDA. The number of shares that are sold through the sales agent after delivering a placement notice will fluctuate based on a
number of factors, including the market price of the common stock during the sales period, the limits we set with the sales agent in any
applicable placement notice, and the demand for our common stock during the sales period. Because the price per share of each share sold
will fluctuate during the sales period, it is not currently possible to predict the number of shares that will be sold or the gross proceeds
to be raised in connection with those sales, if any.
Our common stock may become the target of a “short
squeeze.”
In 2021, the securities of several companies have
increasingly experienced significant and extreme volatility in stock price due to short sellers of common stock and buy-and-hold decisions
of longer investors, resulting in what is sometimes described as a “short squeeze.” Short squeezes have caused extreme volatility
in those companies and in the market and have led to the price per share of those companies to trade at a significantly inflated rate
that is disconnected from the underlying value of the company. Sharp rises in a company’s stock price may force traders in a short
position to buy the shares to avoid even greater losses. Many investors who have purchased shares in those companies at an inflated rate
face the risk of losing a significant portion of their original investment as the price per share has declined steadily as interest in
those shares have abated. We may be a target of a short squeeze, and investors may lose a significant portion or all of their investment
if they purchase our shares at a rate that is significantly disconnected from our underlying value.
Risks Related to Our Business
Investing in our securities
involves a high degree of risk. Before making an investment decision, you should consider carefully the risks, uncertainties and other
factors described in our most recent Annual Report on Form 10-K, as supplemented and updated by subsequent quarterly reports on Form 10-Q
and current reports on Form 8-K that we have filed or will file with the SEC, which are incorporated by reference into this prospectus
supplement.
Our business, affairs, prospects,
assets, financial condition, results of operations and cash flows could be materially and adversely affected by these risks. For more
information about our SEC filings, please see “Where You Can Find More Information.”
We are currently, and may in the future
be, subject to substantial litigation, investigations and proceedings that could cause us to incur significant legal expenses and result
in harm to our business.
The Company and certain of
its former officers and directors are defendants in a purported class action captioned Rudani v. Ideanomics, Inc., et al, pending
in the United States District Court for the Southern District of New York against the Company. The Amended Complaint alleges
violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934. Among other things, the Amended Complaint alleges
purported misstatements made by the Company in 2017 and 2018. The Company and certain of its current and former officers and directors
are also defendants in a consolidated purported securities class action captioned In Re Ideanomics, Inc. Securities Litigation,
pending in the United States District Court for the Southern District of New York, which alleges violations of Section 10(b) and 20(a)
of the Securities Exchange Act of 1934 arising from certain purported misstatements by the Company beginning in March 2020 regarding its
MEG division. The Company is also a nominal defendant, and certain of its former officers
and directors are named as defendants, in a consolidated shareholder derivative action pending in
the United States District Court for the Southern District of New York, captioned In re Ideanomics, Inc. Derivative Litigation
which alleges violations of violations of Section 14(a) of the Securities Exchange Act of 1934, breach of fiduciary duties, unjust enrichment,
abuse of control, gross mismanagement, and corporate waste and seeks monetary damages and other relief on behalf of the Company. The Company
is also a nominal defendant, and certain of its former officers and directors are named as defendants, in a shareholder derivative action pending in
the United States District Court for the District of Nevada, captioned Zare v. Wu, et al., 20-cv-608, which alleges breach of fiduciary
duties, gross mismanagement, and contribution against certain defendants under Section 10(b) and 21D of the Securities Exchange Act of
1934. While the Company believes that these lawsuits are without merit and plans to vigorously defend itself against these
claims, there can be no assurance that the Company will prevail in the lawsuits. The Company cannot currently estimate the possible loss
or range of losses, if any, that it may experience in connection with these litigations.
Shareholder
Class Actions and Derivative Litigation
On July 19,
2019, a purported class action, now captioned Rudani v. Ideanomics, et al. Inc., was filed in the United States District Court
for the Southern District of New York against the Company and certain of its current and former officers and directors. The Amended Complaint
alleges violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934. Among other things, the Amended Complaint alleges
purported misstatements made by the Company in 2017 and 2018.
On June 28,
2020, a purported securities class action, captioned Lundy v. Ideanomics et al. Inc., was filed in the United State District Court
for the Southern District of New York against the Company and certain current officers and directors of the Company. Additionally, on
July 7, 2020, a purported securities class action captioned Kim v. Ideanomics, et al, was filed in the Southern District of New
York against the Company and certain current officers and directors of the Company. Both cases alleged violations of Section 10(b) and
20(a) of the Securities Exchange Act of 1934 arising from certain purported misstatements by the Company beginning in March 2020 regarding
its MEG division. On November 4, 2020, the Lundy and Kim actions were consolidated and is now titled “In re Ideanomics,
Inc. Securities Litigation.” In December 2020, the Court appointed Rene Aghajanian as lead plaintiff and an amended complaint
was filed in February 2021, alleging violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 arising from certain
purported misstatements by the Company beginning in March 2020 regarding its MEG division.
On July 10,
2020, the Company was named as a nominal defendant, and certain of its former officers and directors were named as defendants, in a shareholder
derivative action filed in the United States District Court for the Southern District of New York, captioned Toorani v. Ideanomics,
et al., 1:20-cv-05333. The Complaint alleges violations of Section 14(a) of the Securities Exchange Act of 1934, breach of fiduciary
duties, unjust enrichment, abuse of control, gross mismanagement, and corporate waste and seeks monetary damages and other relief on
behalf of the Company. Additionally, on September 11, 2020, the Company was named as a nominal defendant, and certain of its former officers
and directors were named as defendants, in a shareholder derivative action filed in the United States District Court for the Southern
District of New York, captioned Elleisy, Jr. v. Ideanomics, et al, 20-cv-5333, alleging violations and allegations similar to
the Toorani litigation. On October 10, 2020, the Court in the Elleisy and Toorani, consolidated these two actions.
Additionally, on October 27, 2020, the Company was named as a nominal defendant, and certain of its former officers and directors were
named as defendants, in a shareholder derivative action filed in the United States District Court for the District of Nevada, captioned
Zare v. Ideanomics, et al, 20-cv-608, alleging violations and allegations similar to the Toorani and Elleisy litigation.
As previously
disclosed, there was a mediation scheduled for April 21 and 22, 2021 for the above-referenced filed civil actions. In the Rudani
action, the parties reached a settlement in principle, subject to finalizing a settlement agreement and approval of the Court, for $5,000,000.
As to the shareholder derivative cases, the parties have advised the Court in the Southern District of New York that the parties
are currently engaged in a dialogue pertaining to settlement. As to the action titled In re Ideanomics, Inc. Securities Litigation
pending in the Southern District of New York, the defendants filed a motion to dismiss on May 6, 2021. While the Company believes
that these actions are without merit, there can be no assurance that the Company will prevail in the pending lawsuits. The Company cannot
currently estimate the possible loss or range of losses, if any, that it may experience in connection with the pending and unresolved
litigations.
As previously reported, ,
the Company is subject to an SEC investigation and continues to respond to various information and document requests from the SEC. The
Company is fully cooperating with the SEC’s requests and cannot predict the outcome of the investigation.
We are exposed to potential
liabilities and reputational risk associated with litigation, regulatory proceedings and government investigations and enforcement actions.
In addition, we are obligated to indemnify and advance expenses to certain individuals involved in certain of these proceedings. Further,
volatility in our stock price may also make us vulnerable to future class action litigation. Any
adverse judgment in or settlement of any pending or any future litigation or investigation could result in payments, fines and penalties
that could adversely affect our business, results of operations and financial condition. Regardless of the merits of the claims and the
outcome, legal proceedings have resulted in, and may continue to result in, significant legal fees and expenses, diversion of management’s
time and other resources, and adverse publicity. Such proceedings could also adversely affect our business, results of operations and
financial condition.
Our results of operations in the future
could be adversely impacted by the COVID-19 pandemic, and the duration and extent to which it will impact our results of operations remain
uncertain.
In December 2019, a
novel strain of coronavirus, termed COVID-19, was reported to have surfaced in Wuhan, China, which has and is continuing to spread
throughout China and other parts of the world, including the United States. In March 2020 the World Health Organization
characterized the outbreak as a “pandemic”, and the pandemic has been declared a National Emergency by the United States
Government. The growth of the COVID-19 pandemic has created significant
volatility and uncertainty and economic disruption. The extent to which the COVID-19 pandemic impacts our business, operations,
financial results and financial condition will depend on numerous evolving factors that are uncertain and cannot be predicted,
including: an economic downturn that could affect demand for electric vehicle
supply equipment and related services; the duration and scope of the pandemic; government, business and individuals’
actions taken in response; the effect on our partners, customers and the demand for our services and products; disruptions to the
global supply chain; our ability to sell and provide our services and products, including as a result of travel restrictions and
people working from home; disruptions to our operations resulting from the illness of any of our employees; restrictions or
disruptions to transportation, including reduced availability of ground or air transport; the ability of our customers to pay for
our services and products; and any closures of our, our partners’, our suppliers’ and our customers’ facilities.
In addition, the impact of COVID-19 on macroeconomic conditions may impact the proper functioning of financial and capital markets,
foreign currency exchange rates, commodity and energy prices, and interest rates. Any of these events could amplify the other risks
and uncertainties described in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and could
materially adversely affect our business, financial condition, results of operations and/or stock price.
Our business, affairs, prospects,
assets, financial condition, results of operations and cash flows could be materially and adversely affected by these risks. For more
information about our SEC filings, please see “Where You Can Find More Information.”
USE OF PROCEEDS
We intend to use the net proceeds
from the sale of the securities under this prospectus supplement, if any, for general corporate purposes, including for general working
capital purposes, which may include the repayment of outstanding debt and investment and acquisition activities.
DESCRIPTION OF SECURITIES WE ARE OFFERING
The material terms and provisions
of our common stock are described under the caption “Description of Common Stock” on page 14 of the accompanying prospectus.
PLAN OF DISTRIBUTION
On June 11, 2021, we entered
into the SEDA with YA. The SEDA provides that, upon the terms and subject to the conditions set forth therein, YA is committed to
purchase up to 80,396,000 shares of our common stock over a 36 month commitment period. From time to time, and at our sole discretion,
we may present YA with advance notices to purchase shares of our common stock. The SEDA has been approved by the Ideanomics shareholders.
The shares would be purchased pursuant to the SEDA at 96% or 95% of the Market Price (as defined below) and would be subject to certain
limitations, including that YA could not purchase any shares that would result in it owning more than 4.99% of our common stock. “Market
Price” shall mean the lowest daily VWAP (as defined below) of the Company’s common stock during the 2 or 5 consecutive trading
days commencing on the trading day following the date the Company submits an advance notice to YA. “VWAP” means, for
any trading day, the daily volume weighted average price of the Company’s common stock for such date on the principal market as
reported by Bloomberg L.P. during regular trading hours. Each advance notice may be for an amount not to exceed 1,750,000 shares of common
stock unless otherwise agreed to by the parties.
Delivery of the shares against
payment therefor in respect of each advance notice shall be settled not later than the second trading day following each sale pursuant
to the SEDA, or on such earlier date as we and YA may mutually agree. In connection with any advance notice, if any portion of an
advance would cause the beneficial ownership of our then outstanding common stock by YA to exceed 4.99%, then such portion shall automatically
be deemed to be withdrawn by us with no further action required by us. We may terminate the SEDA upon fifteen trading days of prior
notice to YA, provided that there are no advances outstanding and we have paid to YA all amounts then due.
In addition to our issuance
of common stock to YA pursuant to the SEDA, this prospectus supplement also covers the resale of those shares from time to time by YA
to the public. Though we have been advised by YA, and YA represents in the SEDA, that YA is purchasing the shares for its own account,
for investment purposes in which it takes investment risk (including, without limitation, the risk of loss), and without any view or intention
to distribute such shares in violation of the Securities Act or any other applicable securities laws, the SEC may take the position that
YA may be deemed an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act. We have agreed in the
SEDA to provide customary indemnification to YA. It is possible that our shares may be sold by YA in one or more of the following manners:
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ordinary brokerage transactions and transactions in which the broker solicits purchasers;
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a block trade in which the broker or dealer so engaged will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;
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to a broker-dealer as principal and resale by the broker-dealer for its account; or
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a combination of any such methods of sale.
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YA has agreed that, during the term of the SEDA,
neither YA or its affiliates will engage in any short sales or hedging transactions with respect to our common stock, provided that upon
receipt of an advance notice YA may sell shares that it is obligated to purchase under such advance notice prior to taking possession
of such shares.
YA and any unaffiliated broker-dealer will be
subject to liability under the federal securities laws and must comply with the requirements of the Exchange Act, including without limitation,
Rule 10b-5 and Regulation M under the Exchange Act. These rules and regulations may limit the timing of purchases and sales
of common stock by YA or any unaffiliated broker-dealer. Under these rules and regulations, YA and any unaffiliated broker-dealer:
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may not engage in any stabilization activity in connection with our securities;
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must furnish each broker which offers shares of our common stock covered by the prospectus supplement and accompanying prospectus that are a part of our Registration Statement with the number of copies of such prospectus supplement and accompanying prospectus which are required by each broker; and
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may not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Exchange Act.
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These restrictions may affect the marketability of the common shares by YA and any unaffiliated broker-dealer.
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LEGAL MATTERS
Certain legal matters with
respect to the validity of the issuance of the securities offered hereby have been passed upon for us by Sherman Howard LLC, Las Vegas,
Nevada.
EXPERTS
The consolidated balance sheets
of Ideanomics, Inc. as of December 31, 2020 and 2019, and the related consolidated statements of operations, comprehensive loss,
equity, and cash flows for each of the two years in the period ended December 31, 2020, and related notes (collectively referred
to as the “financial statements”), have been audited by B F Borgers CPA PC, independent registered public accounting firm,
as stated in their report, which includes explanatory paragraphs as to the Company’s ability to continue as a going concern, which
is incorporated herein by reference. Such financial statements have been incorporated herein by reference in reliance on the report of
such firm given upon their authority as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly
and special reports, along with other information with the Commission. Our SEC filings are available to the public over the Internet at
the SEC’s website at http://www.sec.gov. You may also read and copy any document we file at the SEC’s Public Reference Room
at 100 F Street, NE, Washington, D.C. 20549. Please call the Commission at 1-800-SEC-0330 for further information on the Public Reference
Room.
This prospectus supplement
is part of a registration statement on Form S-3 that we filed with the Commission to register the securities offered hereby under
the Securities Act of 1933, as amended. This prospectus supplement does not contain all of the information included in the registration
statement, including certain exhibits and schedules. You may obtain the registration statement and exhibits to the registration statement
from the Commission at the address listed above or from the Commission’s internet site.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
This prospectus supplement
is part of a registration statement filed with the SEC. The SEC allows us to “incorporate by reference” into this prospectus
supplement the information that we file with them, which means that we can disclose important information to you by referring you to those
documents. The information incorporated by reference is considered to be part of this prospectus supplement, and information that we file
later with the SEC will automatically update and supersede this information. The following documents are incorporated by reference and
made a part of this prospectus supplement (other than with respect to information furnished under Item 2.02 or Item 7.01 of
any Form 8-K and exhibits furnished on such form that are related to such items unless such Form 8-K expressly provides to the
contrary):
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our Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 31, 2021;1;
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our Quarterly Report on Form 10-Q for the quarter ended March 31, 2021 filed with the SEC on May 17, 2021; ;
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our Current Report on Form 8-K filed with the SEC on April
1, 2021, April
5, 2021, April
6, 2021, April
14, 2021, April
26, 2021, May
14, 2021, May
18, 2021, and June 11, 2021;
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the description of our common stock which is registered under Section 12 of the Exchange Act, in our registration statement on Form 8-A, filed on May 29, 2012, including any amendment or reports filed for the purposes of updating this description; and
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all reports and other documents subsequently filed by us pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this prospectus supplement and prior to the termination of this offering.
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We also incorporate by reference
any future filings (other than information furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits furnished on
such form that are related to such items unless such Form 8-K expressly provides to the contrary) made with the SEC pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act, including those made after the date of the initial filing of the registration statement of
which this prospectus supplement is a part and prior to effectiveness of such registration statement, until we file a post-effective amendment
that indicates the termination of the offering of the common stock made by this prospectus supplement and will become a part of this prospectus
supplement from the date that such documents are filed with the SEC. Information in such future filings updates and supplements the information
provided in this prospectus supplement. Any statements in any such future filings will automatically be deemed to modify and supersede
any information in any document we previously filed with the SEC that is incorporated or deemed to be incorporated herein by reference
to the extent that statements in the later filed document modify or replace such earlier statements.
Notwithstanding the foregoing,
information furnished under Items 2.02 and 7.01 of any Current Report on Form 8-K, including the related exhibits, is not incorporated
by reference in this prospectus supplement.
The information about us contained
in this prospectus supplement should be read together with the information in the documents incorporated by reference. You may request
a copy of any or all of these filings, at no cost, by writing or telephoning us at 1441 Broadway, Suite 5116, New York, NY 10018, phone
number (212) 206-1216.
PROSPECTUS
Ideanomics, Inc.
Common Stock
Preferred Stock
Warrants
Subscription Rights
Debt Securities
Units
We may from time to
time, in one or more offerings at prices and on terms that we will determine at the time of each offering, sell common stock, preferred
stock, warrants, or a combination of these securities, or units, for an indeterminate initial offering price. This prospectus describes
the general manner in which our securities may be offered using this prospectus. Each time we offer and sell securities, we will
provide you with a prospectus supplement that will contain specific information about the terms of that offering. Any prospectus
supplement may also add, update, or change information contained in this prospectus. You should carefully read this prospectus
and the applicable prospectus supplement as well as the documents incorporated or deemed to be incorporated by reference in this
prospectus before you purchase any of the securities offered hereby.
This prospectus may
not be used to offer and sell securities unless accompanied by a prospectus supplement.
Our Common Stock
is listed on the Nasdaq Capital Market under the symbol “IDEX”. On January 15, 2021, the closing price of our
Common Stock was $3.18 per share. As of the date of this prospectus, none of the other securities that we may offer by this
prospectus is listed on any national securities exchange or automated quotation system.
The securities
offered by this prospectus involve a high degree of risk. See “Risk Factors” beginning on page 13, in addition
to Risk Factors contained in the applicable prospectus supplement.
Neither the Securities
and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
We may offer the securities
directly or through agents or to or through underwriters or dealers. If any agents or underwriters are involved in the sale of
the securities their names, and any applicable purchase price, fee, commission or discount arrangement between or among them,
will be set forth, or will be calculable from the information set forth, in an accompanying prospectus supplement. We can sell
the securities through agents, underwriters or dealers only with delivery of a prospectus supplement describing the method and
terms of the offering of such securities. See “Plan of Distribution.”
This prospectus is dated January 19, 2021
Table of Contents
You should rely
only on the information contained or incorporated by reference in this prospectus or any prospectus supplement. We have not authorized
anyone to provide you with information different from that contained or incorporated by reference into this prospectus. If any
person does provide you with information that differs from what is contained or incorporated by reference in this prospectus,
you should not rely on it. No dealer, salesperson or other person is authorized to give any information or to represent anything
not contained in this prospectus. You should assume that the information contained in this prospectus or any prospectus supplement
is accurate only as of the date on the front of the document and that any information contained in any document we have incorporated
by reference is accurate only as of the date of the document incorporated by reference, regardless of the time of delivery of
this prospectus or any prospectus supplement or any sale of a security. These documents are not an offer to sell or a solicitation
of an offer to buy these securities by anyone in any jurisdiction in which such offer or solicitation is not authorized, or in
which the person is not qualified to do so or to any person to whom it is unlawful to make such offer or solicitation.
ABOUT THIS PROSPECTUS
This prospectus is
part of a registration statement that we filed with the Securities and Exchange Commission, or SEC, using a “shelf”
registration process. Under this shelf registration process, we may sell any combination of the securities described in this prospectus
in one or more offerings. This prospectus describes the general manner in which our securities may be offered by this prospectus.
Each time we sell securities, we will provide a prospectus supplement that will contain specific information about the terms of
that offering. The prospectus supplement may also add, update or change information contained in this prospectus or in documents
incorporated by reference in this prospectus. The prospectus supplement that contains specific information about the terms of the
securities being offered may also include a discussion of certain U.S. Federal income tax consequences and any risk factors or
other special considerations applicable to those securities. To the extent that any statement that we make in a prospectus supplement
is inconsistent with statements made in this prospectus or in documents incorporated by reference in this prospectus, you should
rely on the information in the prospectus supplement. You should carefully read both this prospectus and any prospectus supplement
together with the additional information described under “Where You Can Find More Information” before buying any securities
in this offering.
Unless the context
otherwise requires, references to “we,” “our,” “us,” “IDEX” or the “Company”
in this prospectus mean Ideanomics, Inc., a Delaware corporation, on a consolidated basis with its wholly-owned subsidiaries,
as applicable.
CAUTIONARY STATEMENT
REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and
the documents and information incorporated by reference in this prospectus include forward-looking statements within the meaning
of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange
Act of 1934, as amended, or the Exchange Act. These statements are based on our management’s beliefs and assumptions and
on information currently available to our management. Such forward-looking statements include those that express plans, anticipation,
intent, contingency, goals, targets or future development and/or otherwise are not statements of historical fact.
All statements in
this prospectus and the documents and information incorporated by reference in this prospectus that are not historical facts are
forward-looking statements. We may, in some cases, use terms such as “anticipates,” “believes,” “could,”
“estimates,” “expects,” “intends,” “may,” “plans,” “potential,”
“predicts,” “projects,” “should,” “will,” “would” or similar expressions
or the negative of such items that convey uncertainty of future events or outcomes to identify forward-looking statements.
Forward-looking statements
are made based on management’s beliefs, estimates and opinions on the date the statements are made and we undertake no obligation
to update forward-looking statements if these beliefs, estimates and opinions or other circumstances should change, except as
may be required by applicable law. Although we believe that the expectations reflected in the forward-looking statements are reasonable,
we cannot guarantee future results, levels of activity, performance or achievements.
ABOUT
IDEANOMICS
Overview
Ideanomics, Inc. (Nasdaq: IDEX) was incorporated
in the State of Nevada on October 19, 2004. From 2010 through 2017, our primary business activities were providing premium content
video on demand (“VOD”) services, with primary operations in the PRC, through our subsidiaries and variable interest
entities under the brand name You-on-Demand (“YOD”). We closed the YOD business during 2019.
Starting in early 2017, the Company transitioned
its business model to become a next-generation financial technology (“fintech”) company. The Company built a network
of businesses, operating principally in the trading of petroleum products and electronic component that the Company believed had
significant potential to recognize benefits from blockchain and AI technologies including, for example, enhancing operations,
addressing cost inefficiencies, improving documentation and standardization, unlocking asset value and improving customer engagement.
During 2018 the Company ceased operations in the petroleum products and electronic components trading businesses and disposed
of the businesses during 2019. Fintech continues to be a priority for us as we look to invest in and develop businesses that can
improve the financial services industry, particularly as it relates to deploying blockchain and AI technologies. As we looked
to deploy fintech solutions in late 2018 and into 2019, we found a unique opportunity in the Chinese Electric Vehicle (EV) industry
to facilitate large scale conversion of fleet vehicles from internal combustion engines to EV. This led us to establish our Mobile
Energy Global (MEG) business unit.
Recent Developments
On
December 28, 2020, the Company through its Mobile Energy Group and its Contracting Entity Qingdao Chengyang Medici Zhixing New
Energy Automobile Co., Ltd. (“Qingdao Chengyang Midici”), have entered into an automobile sales contract, effective
December 28, 2020 (the “Sales Agreement”) and a four party payment agreement, effective December 28, 2020 (the “Payment
Agreement” and, with the Sales Agreement, the “Agreements”), with Meihao Travel (Hangzhou) Automobile Technology
Co., Ltd. (“Meihao Chuxing”), a joint venture of BYD (HK) Co. Ltd and Didi Chuxing, to purchase and pay for an initial
2,000 units of the model BYD D1 electric vehicle. Under the terms of the Agreements, among other things, (i) the purchase price
per vehicle is RMB 112,000, and the total contract price is RMB 224,000,000, including 13% VAT tax; and (ii) Ideanomics and Qingdao
Chengyang Midici are obligated to pay RMB 22,400,000 as a down payment, subject to certain conditions. The Agreements are written
in the Chinese language and are governed by the law of the People’s Republic of China.
On January 8, 2020, the
Company acquired 100% of the outstanding capital stock of Timios Holding Corp. for approximately $40,000,000 subject to customary purchase
price adjustments including an agreement that Ideanomics increase the consideration by the amount of cash Timios leaves in the business.
Timios provides title and escrow services for real estate transactions.
On January 15, 2021, the Company acquired
100% of privately held Wireless Advanced Vehicle Electrification, Inc. (“WAVE”) for an aggregate purchase price of $50,000,000
in a combination of $15,000,000 of cash and $35,000,000 worth of Ideanomics stock as consideration, subject to customary purchase price
adjustments. WAVE is a provider of wireless charging solutions for medium and heavy-duty electric vehicles. Ideanomics agreed to fund
$25,000,000 in growth capital to WAVE over the course of the two years following closing. Pursuant to the acquisition of WAVE, the Company
agreed to three earnouts that could result in an additional payment of up to $30,000,000 to the sellers based upon: (i) revenue and gross
profit margin metrics in calendar year 2021; (ii) revenue and gross profit margin metrics in calendar year 2022 and (iii) revenue and
gross profit margin metrics for 2021 and 2022 collectively. Ideanomics has also agreed to a performance and retention plan for
the benefit of certain WAVE’s employees which could result in up to $10,000,000 paid to such employees if certain gross revenue
targets and certain gross profit margins are achieved for 2021 and 2022.
Principal Products or Services and
their Markets
The Company operates in one segment which
has two business units, the Mobile Energy Global and Ideanomics Capital.
Mobile Energy Group (MEG)
MEG’s mission is to use EV and EV
battery sales and financing to attract commercial fleet operators that will generate large scale demand for energy, Energy Storage
Systems (ESS) and Energy Management Contracts (EMC). Additionally, MEG will become a key player in the supply chain of crucial
metals required for EV batteries, which are the center piece of mobile energy. The
MEG business operates as an end-to-end solutions provider for the procurement, financing, charging and energy management needs
for fleet operators of commercial Electronic Vehicles (EV). MEG operates through a series of joint ventures with the leading companies
in the commercial EV space, principally in China, and earns fees for every transaction completed based on the spread for group
buying of vehicles and fees derived from the arrangement of financing and energy management such as commercial purchasing of pre-paid
electricity credits. MEG focuses on commercial EV rather than passenger personal EV, as commercial EV is on an accelerated adoption
path when compared to consumer EV adoption – which is expected to take between ten to fifteen years. We focus on four distinct
commercial vehicles types with supporting income streams: 1) Closed-area heavy commercial, in areas such as Mining, Airports, and
Sea Ports; 2) Last-mile delivery light commercial; 3) Buses and Coaches; 4) Taxis. The purchase and financing of vehicles provides
for one-time fees and the charging and energy management provides for recurring revenue streams.
In May 2019, the Company signed an agreement
with iUnicorn (also known as Shenma Zhuanche) to form a strategic joint venture (“JV”) that will focus on green finance
and integrated marketing services for new energy taxi vehicles as part of Ideanomics’ Mobile Energy Group (“MEG”).
The Company agreed to contribute advisory and sales resources which include arranging ABS-based auto financing with its bank partners,
and will have 50.01% ownership interest in the JV and will have control of the board. iUnicorn, which will own 49.99% of the JV,
agreed to contribute its vehicles sales orders in Sichuan province. The JV will generate revenues from commissions on vehicle
sales order and ABS fees related to the financing, which will vary accordingly to manufacturer and vehicle model.
In July 2019 the Company made an equity
investment in Glory Connection Snd. Bhd, (Glory) a vehicle manufacturer located in Malaysia. Glory’s principal operating
entity is Tree Manufacturing which holds the only license granted so far to a domestic entity for the manufacture of electric
vehicles in Malaysia and is in the process of setting up its manufacturing and assembly capabilities.
In September 2019, the Company entered
into a revenue sharing agreement with First Auto Loan, one of the leading taxi finance companies in the PRC under which the Company’s
MEG business unit would assist First Auto secure a funding pool for taxi finance and in return MEG will receive a commission on
each loan written by First Auto Loan. The funding pool is led by Dasheng Licheng Lease Financing with additional funding provided
by a consortium of large Chinese insurance companies.
The Company has preferred purchasing agreements
with a number of EV manufacturers including Jianghuai Automobile Group Co. (frequently known as JAC), Geely Auto Group and Beijing
Foton Motor Company and EV battery manufacturers including Contemporary Amperex Technology (frequently known as CATL) and Yinlong
Energy Co Ltd. Under the terms of these preferred purchasing agreements the Company receives preferred pricing and volume discounts
for EV and EV batteries purchased through these partners.
In November 2019, the Company announced
an agreement with China’s Yunnan province under the terms of which Yunnan, in its capacity as the PRC’s province responsible
for China’s Belt and Road initiative in the ASEAN countries, will make an investment into the Company’s Malaysian
headquartered Tree Technologies subsidiary. The terms of this investment are under negotiation.
The Company has entered into a sales referral
agreement with Zhitong 3000 (Zhitong) an operator of a SaaS platform for the management of commercial truck fleets. This agreement
will enable to Zhitong to broaden the services offered to its customers by providing access to MEG’s vehicle purchasing
and financing platform. MEG will earn its normal fees for any business transacted by customers of Zhitong on the MEG platform.
In September 2019, the company entered
into a framework agreement with the China National Petroleum Corporation Nanjing (PetroChina), one of the world largest oil companies.
The Company and PetroChina will negotiate an agreement under which the Company will earn a commission for each charge at a EV
fast charging station financed by investment from the Company’s EV financing consortium which includes Three Georges, Tianda
Energy, Ding Fang and Palcan Energy.
In August 2018, the Company entered into
an agreement with National Transport Capacity (NTC) (also known as National Transport of Shenzhen) under which the Company receives
an origination fee for any ABS transactions for assets that NTC originates through its platform.
In August 2019 the Company entered into
a joint venture agreement with Golden Concord Holdings Limited (GCL) thru which GCL took a 49.9% equity interest in logistical
vehicle unit of the Company’s MEG subsidiary. As consideration for the 49.9% interest, GCL made an exclusive commitment
to introduce sales of 500,000 EVs to MEG over three years. The transaction includes performance criteria with share-based claw
back formula in the event that GCL does not meet its committed targets.
In December 2019 the Company purchased
a controlling interest in Tree Technologies Sdn Bhd (“Tree Technologies”) a company that holds the distribution license
for the EV’s manufactured by Glory’s Tree Manufacturing subsidiary. In addition to the distribution license, Tree
Technologies has a 99 year lease on 250 acres of vacant land zoned for industrial development in the Gebeng Industrial Area adjacent
to Kuantan Port. Kuantan
is the capital city of the state of Pahang on the east coast of Peninsular Malaysia. The Company intends to develop this
land and lease it to Tree Manufacturing for the manufacture of EVs.
Ideanomics Capital
The Company’s Ideanomics Capital
business unit consists of the Delaware Board of Trade (DBOT) and Intelligenta.
The Delaware Board of Trade is a broker
dealer that also operates an Alternative Trading System (ATS) focused on the trading of traditional OTC securities. The Company
purchased DBOT in July 2019 and has been implementing a new trading platform to improve its competitive position in the trading
of traditional OTC securities and provide enhanced functionality to allow for the trading of digital securities when all necessary
regulatory approvals have been obtained.
In the third quarter of
2020 the Company sold its loss making EKAR ETF for a de minimis amount, this sale eliminated approximately $0.4 million of annual
operating expense.
Intelligenta (formerly BDCG)
Intelligenta is a pre-revenue company
focused on delivering AI driven solutions for the financial services industry. Intelligenta has a license from BBD to adapt BBD’s
solutions for use in the US market.
Between December 2017 and April 2018,
we formed BBD Digital Capital Group Ltd., a New York corporation (“BDCG”), as a joint venture with management partner
Seasail, an affiliate of Big Business Data (“BBD”). In April 2019 the Company rebranded the name BDCG to Intelligenta.
We hold approximately 60% of the equity interest of Inteligenta and have the power to appoint three of the five directors of the
board of Intelligenta. Intelligenta focuses on developing AI-driven financial data services as well as building transactional
platforms for index, futures and derivative trading, for both global commodity and energy clients. Planned financial data services
also include risk management solutions, platforms for trading derivatives and indices, and debt and credit product offerings,
with the primary objective being enhancing trading and risk management strategies.
We believe we can leverage Intelligenta’s
AI services for the creation of financial products, risk ratings and indexing, and selection and recommendation systems on behalf
of key stakeholders. By using AI technology to analyze the digital securitized assets we intend to develop, we aim to elevate
not only the quality of the financial product, but also interactions among stakeholders. We also intend to design the digital
securitized assets we develop to have data attributes that can be integrated into Intelligenta’s approach for processing
financial data.
FinTalk
In September 2018, we entered into an agreement
for the acquisition of FinTalk, a secure mobile messaging, collaboration and information services platform that delivers encrypted
text and media messaging, with high performance large file transfer capabilities. The company has determined through analysis that
the technology is rapidly changing and the cost of maintaining this does not justify further investment.
Blockchain And AI Technologies
The Company considers deploying blockchain
& AI technologies, where appropriate, to be an important part of its strategy of building new businesses and disrupting established
businesses and processes. The Company does not develop proprietary blockchain or AI technologies, the company will license the
necessary technology.
Non-Core Assets
The company has identified a number of
business units that it considers non-core and is evaluating strategies for divesting these assets. The non-core assets are Grapevine,
a marketing and ecommerce platform focused on influencer marketing, and FinTech Village a 58-acre development site in West Hartford,
Connecticut.
Sources and availability of raw materials
The Company does not directly manufacture
any products, consequently it is not dependent on a reliable source of materials to operate its business. However, the Company’s
partners that manufacture EVs and batteries do depend on a ready supply of raw materials and consequently a shortage of raw materials
would adversely impact their manufacturing process and, potentially, indirectly impact the Company’s revenues as it may
not be able to complete orders that it had received.
Seasonality
The Company’s MEG division operates
in the market for fleet sales of commercial EVs and the Company expects that orders and sales will be influenced by the amount
and timing of budgeted expenditure by its customers. Typically, the Company would expect to see higher sales at the start of the
year when companies start executing on their capital programs and at the end of the year when companies are spending any surplus
or uncommitted budget before the new budget cycle commences. The Company’s MEG division is building out its network and
has not generated sufficient orders to allow it to establish with any degree of certainty an expected pattern of seasonality.
Working Capital requirements
The Company’s MEG division is still
in the development stage and its business model continues to evolve, however, management does not believe that the MEG divisions
anticipated business model will require substantial amounts of working capital as it does not anticipate holding material amounts
of inventory or offering customers extended payment terms. The Company’s Tree Technologies subsidiary will require substantial
amounts of investment to build out its distribution business. It is the Company’s intention to fund this with borrowings
secured against Tree Technologies assets, however the Company may need to fund all, or a material portion of the investment if
the Tree Technologies is not able to raise the required capital to set-up and operate the business. The Company will continue
to raise funds to support its US based Head Office functions and its US based operating subsidiaries until such time as the operations
become cash flow positive.
Trade marks, patents and licenses
The Company’s Intelligenta business
operates under a license granted by Seasail Ventures. The license does not have a stated term.
Customer Concentration
The Company is in the process of building
out its Mobile Energy Group subsidiary and has not yet reached a stage of development where the loss of any single customer would
have a material adverse effect on the Company.
Reliance on government contracts
The Company does not contract directly
with the government of the PRC, however it does have joint ventures, partnerships and agreements with the State Own Entities (SOE)
described above. Additionally, the rate at which commercial fleets convert to EV is heavily influenced by federal and provincial
policies in the PRC as they relate to clean air and adoption of EV technology. Consequently, the Company’s results may be
adversely impacted by changes in regulations in the PRC.
Competitive business conditions, competitive
position in the industry and methods of competition
Mobile Energy Group
The Company’s MEG business unit
is focused on the PRC and the ASEAN Region. The most important drivers for the development of the commercial fleet EV market in
the PRC are federal and provincial regulations relating to clean air and electronic vehicles including subsidies and incentives
to help owners of fleets of commercial vehicles to convert from combustion engines to EV. The government of the PRC has a stated
policy of converting all taxis and buses to EV by the end of 2022. The speed at which fleet operators convert to EV is highly
correlated with government regulations, targets and related subsidies and incentives. If the government of the PRC, or a municipality,
changes the regulations, targets, incentives or subsidies then the rate at which fleet operators convert their vehicles to EV
could slow down which in turn may lead to lower revenues for the Company. Additionally, the rate, and form in which, the commercial
fleet EV market develops is dependent upon the development of new financing and lending structures that address the different
collateral and resale values of the battery and vehicle. For vehicles with Internal Combustion Engines the power source, i.e.
the engine, and the car body are one integrated unit, however EVs are designed with the intention of the battery being easily
removed from the vehicle to enable fast recharging through “swapping’ of batteries. Additionally, the EV market is
still developing and there is a very limited history of resale values for lenders to use when calculating resale values when evaluating
a financing application.
The Company operates through a network
of joint ventures, partnerships and formal and informal alliances; consequently, its competitive position could be adversely impacted
if one of the members of the alliance was not able to meet the demand for its products or goes out of business.
Ideanomics Capital
The Company’s Ideanomics Capital
business unit operates in sectors that are undergoing rapid change.
The Delaware Board of Trade is a broker
dealer that also operates an Alternative Trading System for the trading of OTC equities, this is market which is undergoing rapid
change as retail focused stock brokers introduce zero commission trading for their clients and the industry continues to consolidates
as large financial firms acquire national stock brokers. These changes make for a very difficult competitive environment. The
Company has applied for regulatory approval to broker digital securities and tokens, this is a nascent market which the Company
believes has good long term potential.
Intelligenta is developing a platform
for AI driven decision making and risk management for financial data. The company is developing proof of concepts.
Preferred Stock
The Company has a multi-tiered capital
structure that includes Series A Preferred Stock.
Ranking. With respect to
rights upon liquidation, winding-up or dissolution, the Series A Preferred Stock ranks senior to our common stock and pari
passu with any other series of our preferred stock established by our board of directors.
Voting. The holders of the
Series A Preferred Stock are entitled to ten (10) votes for each one (1) share of common stock that is issuable
upon conversion of a share of Series A Preferred Stock (each of the 7,000,000 shares of Series A Preferred Stock is
convertible into 0.1333333 shares of Common Stock, or a total of 9,333,330 votes). Except as required by law, all shares of Series A
Preferred Stock and all shares of common stock shall vote together as a single class.
Conversion. Each share of
Series A Preferred Stock is convertible, at any time at the option of the holder, into ten (10) fully paid and nonassessable
shares of common stock, subject to adjustment as provided in the Certificate of Designation.
Dividends. The Series A
Preferred Stock is only entitled to receive dividends when and if declared by our board of directors.
Liquidation. Upon the occurrence
of a liquidation event, the holders of the Series A Preferred Stock then outstanding will be entitled to receive, out of
the assets of the Company available for distribution to its stockholders, an amount equal to $0.50 per share, as may be adjusted
from time to time, plus all accrued, but unpaid dividends, before any payment shall be made or any assets distributed to the holders
of common stock or any other class or series of stock issued by the Company not designated as ranking senior to or pari passu
with the Series A Preferred Stock in respect of the right to participate in distributions or payments upon a liquidation
event. For purposes of the Certificate of Designation, a “liquidation event” means any liquidation, dissolution or
winding up of the Company, either voluntary or involuntary, and upon the election of the holders of a majority of the then outstanding
Series A Preferred Stock shall be deemed to be occasioned by, or to include, (i) the acquisition of the Company by another
entity by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger,
consolidation, or other transaction in which control of the Company is transferred, but, excluding any merger effected exclusively
for the purpose of changing the domicile of the Company) unless the Company’s stockholders of record as constituted immediately
prior to such acquisition or sale will, immediately after such acquisition or sale (by virtue of securities issued as consideration
for the Company’s acquisition or sale or otherwise) hold at least 50% of the voting power of the surviving or acquiring
entity or (ii) a sale of all or substantially all of the assets of the Company.
CORPORATE
INFORMATION
Ideanomics, Inc. (formerly China Broadband, Inc.,
Seven Stars Cloud Group, Inc. and WeCast) was incorporated in Nevada on October 19, 2004 pursuant to a reorganization
of a California entity formed in 1988. Prior to January 2007 we were a blank check shell company. On January 23, 2007,
we acquired CB Cayman, which at the time was a party to the cooperation agreement with our PRC-based WFOE, in a reverse acquisition
transaction. Our principal executive offices are located at 1441 Broadway, Suite 5116, New York, NY 10018, and our telephone number
is (212) 206-1216. Our corporate website address is www.ideanomics.com. Information contained on or accessible through
our website is not a part of this prospectus, and the inclusion of our website address in this prospectus is an inactive textual
reference only.
RISK FACTORS
Investing in our securities
involves a high degree of risk. Before making an investment decision, you should consider carefully the risks, uncertainties and
other factors described in our most recent Annual Report on Form 10-K, as supplemented and updated by subsequent quarterly
reports on Form 10-Q and current reports on Form 8-K that we have filed or will file with the SEC, which are incorporated
by reference into this prospectus.
Our business, affairs,
prospects, assets, financial condition, results of operations and cash flows could be materially and adversely affected by these
risks. For more information about our SEC filings, please see “Where You Can Find More Information.”
We are currently, and may in the
future be, subject to substantial litigation, investigations and proceedings that could cause us to incur significant legal expenses
and result in harm to our business.
The Company and certain
of its former officers and directors are defendants in a purported class action captioned Rudani v. Ideanomics, Inc., et al, pending
in the United States District Court for the Southern District of New York against the Company. The Amended Complaint
alleges violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934. Among other things, the Amended Complaint
alleges purported misstatements made by the Company in 2017 and 2018. The Company and certain of its current and former
officers and directors are also defendants in a consolidated purported securities class action captioned In Re Ideanomics, Inc.
Securities Litigation, pending in the United States District Court for the Southern District of New York, which alleges violations
of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 arising from certain purported misstatements by the Company
beginning in March 2020 regarding its MEG division. The Company is also a nominal
defendant, and certain of its former officers and directors are named as defendants, in a consolidated shareholder derivative action pending in
the United States District Court for the Southern District of New York, captioned In re Ideanomics, Inc. Derivative Litigation
which alleges violations of violations of Section 14(a) of the Securities Exchange Act of 1934, breach of fiduciary duties, unjust
enrichment, abuse of control, gross mismanagement, and corporate waste and seeks monetary damages and other relief on behalf of
the Company. The Company is also a nominal defendant, and certain of its former officers and directors are named as defendants,
in a shareholder derivative action pending in
the United States District Court for the District of Nevada, captioned Zare v. Wu, et al., 20-cv-608, which alleges breach of
fiduciary duties, gross mismanagement, and contribution against certain defendants under Section 10(b) and 21D of the Securities
Exchange Act of 1934. While the Company believes that these lawsuits are without merit and plans to vigorously defend itself
against these claims, there can be no assurance that the Company will prevail in the lawsuits. The Company cannot currently estimate
the possible loss or range of losses, if any, that it may experience in connection with these litigations.
As disclosed in the
Company’s Form 10-Q filed with the Securities and Exchange Commission on November 9, 2020, the Company is subject to an
SEC investigation. The company is cooperating with the SEC’s investigation and cannot predict the outcome of the investigation.
We are exposed to potential
liabilities and reputational risk associated with litigation, regulatory proceedings and government investigations and enforcement
actions. In addition, we are obligated to indemnify and advance expenses to certain individuals involved in certain of these proceedings.
Further, volatility in our stock price may also make us vulnerable to future class action litigation. Any
adverse judgment in or settlement of any pending or any future litigation or investigation could result in payments, fines and
penalties that could adversely affect our business, results of operations and financial condition. Regardless of the merits of
the claims and the outcome, legal proceedings have resulted in, and may continue to result in, significant legal fees and expenses,
diversion of management’s time and other resources, and adverse publicity. Such proceedings could also adversely affect our
business, results of operations and financial condition.
Our results of
operations in the future could be adversely impacted by the COVID-19 pandemic, and the duration and extent to which it will impact
our results of operations remain uncertain.
In December 2019,
a novel strain of coronavirus, termed COVID-19, was reported to have surfaced in Wuhan, China, which has and is continuing to spread
throughout China and other parts of the world, including the United States. In March 2020 the World Health Organization characterized
the outbreak as a “pandemic”, and the pandemic has been declared a National Emergency by the United States Government.
The growth of the COVID-19 pandemic has created significant volatility and uncertainty
and economic disruption. The extent to which the COVID-19 pandemic impacts our business, operations, financial results and financial
condition will depend on numerous evolving factors that are uncertain and cannot be predicted, including: an
economic downturn that could affect demand for electric vehicle supply equipment and related services; the duration and
scope of the pandemic; government, business and individuals’ actions taken in response; the effect on our partners, customers
and the demand for our services and products; disruptions to the global supply chain; our ability to sell and provide our services
and products, including as a result of travel restrictions and people working from home; disruptions to our operations resulting
from the illness of any of our employees; restrictions or disruptions to transportation, including reduced availability of ground
or air transport; the ability of our customers to pay for our services and products; and any closures of our, our partners’,
our suppliers’ and our customers’ facilities. In addition, the impact of COVID-19 on macroeconomic conditions may impact
the proper functioning of financial and capital markets, foreign currency exchange rates, commodity and energy prices, and interest
rates. Any of these events could amplify the other risks and uncertainties described in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2019 and could materially adversely affect our business, financial condition, results of
operations and/or stock price.
Our business, affairs,
prospects, assets, financial condition, results of operations and cash flows could be materially and adversely affected by these
risks. For more information about our SEC filings, please see “Where You Can Find More Information.”
USE OF PROCEEDS
Unless otherwise indicated
in a prospectus supplement, we intend to use the net proceeds from the sale of the securities under this prospectus for general
corporate purposes, including for general working capital purposes, which may include the repayment of outstanding debt.
DESCRIPTION
OF CAPITAL STOCK
Description of Common Stock
We are authorized
to issue up to 1,500,000,000 shares of common stock, par value $0.001 per share. Each outstanding share of common stock entitles
the holder thereof to one vote per share on all matters. Our bylaws provide that elections for directors shall be by a plurality
of votes. Stockholders do not have preemptive rights to purchase shares in any future issuance of our common stock. Upon our liquidation,
dissolution or winding up, and after payment of creditors and preferred stockholders, if any, our assets will be divided pro-rata
on a share-for-share basis among the holders of the shares of common stock.
The holders of shares
of our common stock are entitled to dividends out of funds legally available when and as declared by our board of directors. Our
board of directors has never declared a dividend and does not anticipate declaring a dividend in the foreseeable future. Should
we decide in the future to pay dividends, as a holding company, our ability to do so and meet other obligations depends upon the
receipt of dividends or other payments from our operating subsidiary and other holdings and investments. In addition, our operating
subsidiary, from time to time, may be subject to restrictions on its ability to make distributions to us, including as a result
of restrictive covenants in loan agreements, restrictions on the conversion of local currency into U.S. dollars or other hard
currency and other regulatory restrictions. In the event of our liquidation, dissolution or winding up, holders of our common
stock are entitled to receive, ratably, the net assets available to stockholders after payment of all creditors.
All of the issued
and outstanding shares of our common stock are duly authorized, validly issued, fully paid and non-assessable. To the extent that
additional shares of our common stock are issued, the relative interests of existing stockholders will be diluted.
Description of
Preferred Stock
We are authorized
to issue up to 50,000,000 shares of preferred stock, par value $0.001 per share, in one or more classes or series within a class
as may be determined by our board of directors, who may establish, from time to time, the number of shares to be included in each
class or series, may fix the designation, powers, preferences and rights of the shares of each such class or series and any qualifications,
limitations or restrictions thereof as shall be stated and expressed in the resolution or
resolutions providing for the issuance of such stock adopted from time to time by the board of directors. Any preferred
stock so issued by the board of directors may rank senior to the common stock with respect to the payment of dividends or amounts
upon liquidation, dissolution or winding up of us, or both or have voting or conversion rights that could adversely affect the
voting power or other rights of the holders of common stock. Moreover, under certain circumstances, the issuance of preferred
stock or the existence of the unissued preferred stock might tend to discourage or render more difficult a merger or other change
of control.
A prospectus supplement
relating to any series of preferred stock being offered will include specific terms relating to the offering. Such prospectus
supplement will include:
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the
title and stated or par value of the preferred stock;
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the
number of shares of the preferred stock offered, the liquidation preference per share
and the offering price of the preferred stock;
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the
dividend rate(s), period(s) and/or payment date(s) or method(s) of calculation
thereof applicable to the preferred stock;
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whether
dividends shall be cumulative or non-cumulative and, if cumulative, the date from which
dividends on the preferred stock shall accumulate;
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provisions for a sinking fund, if any, for the preferred stock;
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voting rights of the preferred stock;
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provisions for redemption, if applicable, of the preferred stock;
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any
listing of the preferred stock on any securities exchange;
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the
terms and conditions, if applicable, upon which the preferred stock will be convertible
into our common stock, including the conversion price or the manner of calculating the
conversion price and conversion period;
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if appropriate,
a discussion of Federal income tax consequences applicable to the preferred stock;
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any
other specific terms, preferences, rights, limitations or restrictions of the preferred
stock.
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The terms, if any,
on which the preferred stock may be convertible into or exchangeable for our common stock will also be stated in the preferred
stock prospectus supplement. The terms will include provisions as to whether conversion or exchange is mandatory, at the option
of the holder or at our option, and may include provisions pursuant to which the number of shares of our common stock to be received
by the holders of preferred stock would be subject to adjustment.
Series A Preferred Stock
On July 30, 2010,
we filed a Certificate of Designation with the Secretary of State of Nevada establishing a new series of our preferred stock designated
as “Series A Preferred Stock.” A summary of the Certificate of Designation is set forth below:
Ranking. With
respect to rights upon liquidation, winding-up or dissolution, the Series A Preferred Stock ranks senior to our common stock
and pari passu with any other series of our preferred stock established by our board of directors.
Voting. The
holders of the Series A Preferred Stock are entitled to ten (10) votes for each one (1) share of common stock that
is issuable upon conversion of a share of Series A Preferred Stock. Except as required by law, all shares of Series A
Preferred Stock and all shares of common stock shall vote together as a single class.
Conversion. Each
share of Series A Preferred Stock is convertible, at any time at the option of the holder, into ten (10) fully paid
and nonassessable shares of common stock, subject to adjustment as provided in the Certificate of Designation.
Dividends. The
Series A Preferred Stock is only entitled to receive dividends when and if declared by our board of directors.
Liquidation. Upon
the occurrence of a liquidation event, the holders of the Series A Preferred Stock then outstanding will be entitled to receive,
out of the assets of the Company available for distribution to its stockholders, an amount equal to $0.50 per share, as may be
adjusted from time to time, plus all accrued, but unpaid dividends, before any payment shall be made or any assets distributed
to the holders of common stock or any other class or series of stock issued by the Company not designated as ranking senior to
or pari passu with the Series A Preferred Stock in respect of the right to participate in distributions or payments
upon a liquidation event. For purposes of the Certificate of Designation, a “liquidation event” means any liquidation,
dissolution or winding up of the Company, either voluntary or involuntary, and upon the election of the holders of a majority
of the then outstanding Series A Preferred Stock shall be deemed to be occasioned by, or to include, (i) the acquisition
of the Company by another entity by means of any transaction or series of related transactions (including, without limitation,
any reorganization, merger, consolidation, or other transaction in which control of the Company is transferred, but, excluding
any merger effected exclusively for the purpose of changing the domicile of the Company) unless the Company’s stockholders
of record as constituted immediately prior to such acquisition or sale will, immediately after such acquisition or sale (by virtue
of securities issued as consideration for the Company’s acquisition or sale or otherwise) hold at least 50% of the voting
power of the surviving or acquiring entity or (ii) a sale of all or substantially all of the assets of the Company.
DESCRIPTION OF
WARRANTS
We may issue warrants
for the purchase of preferred stock or common stock. Warrants may be issued independently or together with any preferred stock
or common stock, and may be attached to or separate from any offered securities. Each series of warrants will be issued under
a separate warrant agreement to be entered into between a warrant agent specified in the agreement and us. The warrant agent will
act solely as our agent in connection with the warrants of that series and will not assume any obligation or relationship of agency
or trust for or with any holders or beneficial owners of warrants. This summary of some provisions of the warrants is not complete.
You should refer to the warrant agreement, including the forms of warrant certificate representing the warrants, relating to the
specific warrants being offered for the complete terms of the warrant agreement and the warrants. The warrant agreement, together
with the terms of the warrant certificate and warrants, will be filed with the SEC in connection with the offering of the specific
warrants.
The applicable prospectus
supplement will describe the following terms, where applicable, of the warrants in respect of which this prospectus is being delivered:
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the
title of the warrants;
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the
aggregate number of the warrants;
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the
price or prices at which the warrants will be issued;
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the
designation, amount and terms of the offered securities purchasable upon exercise of
the warrants;
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if
applicable, the date on and after which the warrants and the offered securities purchasable
upon exercise of the warrants will be separately transferable;
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the
terms of the securities purchasable upon exercise of such warrants and the procedures
and conditions relating to the exercise of such warrants;
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any
provisions for adjustment of the number or amount of securities receivable upon exercise
of the warrants or the exercise price of the warrants;
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the
price or prices at which and currency or currencies in which the offered securities purchasable
upon exercise of the warrants may be purchased;
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the
date on which the right to exercise the warrants shall commence and the date on which
the right shall expire;
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the
minimum or maximum amount of the warrants that may be exercised at any one time;
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information
with respect to book-entry procedures, if any;
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if appropriate,
a discussion of Federal income tax consequences; and
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any
other material terms of the warrants, including terms, procedures and limitations relating
to the exchange and exercise of the warrants.
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Warrants for the purchase
of common stock or preferred stock will be offered and exercisable for U.S. dollars only. Warrants will be issued in registered
form only.
Upon receipt of payment
and the warrant certificate properly completed and duly executed at the corporate trust office of the warrant agent or any other
office indicated in the applicable prospectus supplement, we will, as soon as practicable, forward the purchased securities. If
less than all of the warrants represented by the warrant certificate are exercised, a new warrant certificate will be issued for
the remaining warrants.
Prior to the exercise
of any warrants to purchase preferred stock or common stock, holders of the warrants will not have any of the rights of holders
of the common stock or preferred stock purchasable upon exercise, including in the case of warrants for the purchase of common
stock or preferred stock, the right to vote or to receive any payments of dividends on the preferred stock or common stock purchasable
upon exercise.
DESCRIPTION
OF SUBSCRIPTION RIGHTS
We may issue subscription
rights to purchase our common stock and/or preferred stock. These subscription rights may be issued independently or together
with any other security offered hereby and may or may not be transferable by the shareholder receiving the subscription rights
in such offering. In connection with any offering of subscription rights, we may enter into a standby arrangement with one or
more underwriters or other purchasers pursuant to which the underwriters or other purchasers may be required to purchase any securities
remaining unsubscribed for after such offering.
The prospectus supplement
relating to any subscription rights we offer, if any, will, to the extent applicable, include specific terms relating to the offering,
including some or all of the following:
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the price, if any, for the subscription rights;
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the exercise price payable for each share of common stock and/or
preferred stock upon the exercise of the subscription rights;
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the number of subscription rights to be issued to each shareholder;
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the number and terms of the shares of common stock and/or shares
of preferred stock which may be purchased per each subscription right;
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the extent to which the subscription rights are transferable;
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any other terms of the subscription rights,
including the terms, procedures and limitations relating to the exchange and exercise of the subscription rights;
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the date on which the right to exercise the subscription rights
shall commence, and the date on which the subscription rights shall expire;
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the extent to which the subscription rights may include an over-subscription
privilege with respect to unsubscribed securities; and
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if applicable, the material terms of any standby
underwriting or purchase arrangement which may be entered into by us in connection with the offering of subscription rights.
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The description in
the applicable prospectus supplement of any subscription rights we offer will not necessarily be complete and will be qualified
in its entirety by reference to the applicable subscription right agreement, which will be filed with the SEC if we offer subscription
rights. For more information on how you can obtain copies of the applicable subscription right agreement if we offer subscription
rights, see “Where You Can Find More Information” and “Incorporation of Certain Information by Reference.”
We urge you to read the applicable subscription right agreement and any applicable prospectus supplement in their entirety.
DESCRIPTION
OF DEBT SECURITIES
We may issue debt
securities from time to time, in one or more series, as senior, subordinated debt and/or convertible debt. While the terms we
have summarized below will apply generally to any debt securities that we may offer under this prospectus, we will describe the
particular terms of any debt securities that we may offer in more detail in the applicable prospectus supplement. The terms of
any debt securities offered under a prospectus supplement may differ from the terms described below. Unless the context requires
otherwise, whenever we refer to the indenture, we also are referring to any supplemental indentures that specify the terms of
a particular series of debt securities.
We will issue the
debt securities under the indenture that we will enter into with the trustee named in the indenture. The indenture will be qualified
under the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”). We have filed the form of indenture
as an exhibit to the registration statement of which this prospectus is a part, and supplemental indentures and forms of debt
securities containing the terms of the debt securities being offered will be filed as exhibits to the registration statement of
which this prospectus is a part or will be incorporated by reference from reports that we file with the SEC.
The following summary
of material provisions of the debt securities and the indenture is subject to, and qualified in its entirety by reference to,
all of the provisions of the indenture applicable to a particular series of debt securities. We urge you to read the applicable
prospectus supplements and any related free writing prospectuses related to the debt securities that we may offer under this prospectus,
as well as the complete indenture that contains the terms of the debt securities.
General
The indenture does
not limit the amount of debt securities that we may issue. It provides that we may issue debt securities up to the principal amount
that we may authorize and may be in any currency or currency unit that we may designate. Except for the limitations on consolidation,
merger and sale of all or substantially all of our assets contained in the indenture, the terms of the indenture do not contain
any covenants or other provisions designed to give holders of any debt securities protection against changes in our operations,
financial condition or transactions involving us.
We may issue the debt
securities issued under the indenture as “discount securities,” which means they may be sold at a discount below their
stated principal amount. These debt securities, as well as other debt securities that are not issued at a discount, may be issued
with “original issue discount,” or OID, for U.S. federal income tax purposes because of interest payment and other
characteristics or terms of the debt securities. Material U.S. federal income tax considerations applicable to debt securities
issued with OID will be described in more detail in any applicable prospectus supplement.
We will describe in
the applicable prospectus supplement the terms of the series of debt securities being offered, including:
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the title of the series of debt securities;
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any limit upon the aggregate principal amount that may be issued;
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the maturity date or dates;
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the form of the debt securities of the series;
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whether or not the debt securities will be secured or unsecured,
and the terms of any secured debt;
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whether the debt securities rank as senior
debt, senior subordinated debt, subordinated debt or any combination thereof, and the terms of any subordination;
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if the price (expressed as a percentage of
the aggregate principal amount thereof) at which such debt securities will be issued is a price other than the principal amount
thereof, the portion of the principal amount thereof payable upon declaration of acceleration of the maturity thereof, or
if applicable, the portion of the principal amount of such debt securities that is convertible into another security or the
method by which any such portion shall be determined;
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the interest rate or rates, which may be fixed
or variable, or the method for determining the rate and the date interest will begin to accrue, the dates interest will be
payable and the regular record dates for interest payment dates or the method for determining such dates;
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our right, if any, to defer payment of interest and the maximum
length of any such deferral period;
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if applicable, the date or dates after which,
or the period or periods during which, and the price or prices at which, we may, at our option, redeem the series of debt
securities pursuant to any optional or provisional redemption provisions and the terms of those redemption provisions;
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the date or dates, if any, on which, and the
price or prices at which we are obligated, pursuant to any mandatory sinking fund or analogous fund provisions or otherwise,
to redeem, or at the holder’s option to purchase, the series of debt securities and the currency or currency unit in
which the debt securities are payable;
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the denominations in which we will issue the series of debt securities,
if other than denominations of $1,000 and any integral multiple thereof;
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any and all terms, if applicable, relating
to any auction or remarketing of the debt securities of that series and any security for our obligations with respect to such
debt securities and any other terms which may be advisable in connection with the marketing of debt securities of that series;
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whether the debt securities of the series shall be issued in whole
or in part in the form of a global security or securities;
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the terms and conditions, if any, upon which such global security
or securities may be exchanged in whole or in part for other individual securities, and the depositary for such global security
or securities;
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if applicable, the provisions relating to conversion
or exchange of any debt securities of the series and the terms and conditions upon which such debt securities will be so convertible
or exchangeable, including the conversion or exchange price, as applicable, or how it will be calculated and may be adjusted,
any mandatory or optional (at our option or the holders’ option) conversion or exchange features, the applicable conversion
or exchange period and the manner of settlement for any conversion or exchange;
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if other than the full principal amount thereof,
the portion of the principal amount of debt securities of the series which shall be payable upon declaration of acceleration
of the maturity thereof;
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additions to or changes in the covenants applicable
to the particular debt securities being issued, including, among others, the consolidation, merger or sale covenant;
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additions to or changes in the events of default
with respect to the securities and any change in the right of the trustee or the holders to declare the principal, premium,
if any, and interest, if any, with respect to such securities to be due and payable;
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additions to or changes in or deletions of
the provisions relating to covenant defeasance and legal defeasance;
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additions to or changes in the provisions relating
to satisfaction and discharge of the indenture;
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additions to or changes in the provisions relating
to the modification of the indenture both with and without the consent of holders of debt securities issued under the indenture;
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the currency of payment of debt securities
if other than U.S. dollars and the manner of determining the equivalent amount in U.S. dollars;
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whether interest will be payable in cash or
additional debt securities at our or the holders’ option and the terms and conditions upon which the election may be
made;
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the terms and conditions, if any, upon which
we will pay amounts in addition to the stated interest, premium, if any and principal amounts of the debt securities of the
series to any holder that is not a “United States person” for federal tax purposes;
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any restrictions on transfer, sale or assignment
of the debt securities of the series; and
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any other specific terms, preferences, rights
or limitations of, or restrictions on, the debt securities, any other additions or changes in the provisions of the indenture,
and any terms that may be required by us or advisable under applicable laws or regulations.
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Conversion or Exchange Rights
We will set forth
in the applicable prospectus supplement the terms on which a series of debt securities may be convertible into or exchangeable
for our common stock or our other securities. We will include provisions as to settlement upon conversion or exchange and whether
conversion or exchange is mandatory, at the option of the holder or at our option. We may include provisions pursuant to which
the number of shares of our common stock or our other securities that the holders of the series of debt securities receive would
be subject to adjustment.
Consolidation, Merger or Sale
Unless we provide
otherwise in the prospectus supplement applicable to a particular series of debt securities, the indenture will not contain any
covenant that restricts our ability to merge or consolidate, or sell, convey, transfer or otherwise dispose of our assets as an
entirety or substantially as an entirety. However, any successor to or acquirer of such assets (other than a subsidiary of ours)
must assume all of our obligations under the indenture or the debt securities, as appropriate.
Events of Default under the Indenture
Unless we provide
otherwise in the prospectus supplement applicable to a particular series of debt securities, the following are events of default
under the indenture with respect to any series of debt securities that we may issue:
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if we fail to pay any installment of interest
on any series of debt securities, as and when the same shall become due and payable, and such default continues for a period
of 90 days; provided, however, that a valid extension of an interest payment period by us in accordance with the terms
of any indenture supplemental thereto shall not constitute a default in the payment of interest for this purpose;
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if we fail to pay the principal of, or premium,
if any, on any series of debt securities as and when the same shall become due and payable whether at maturity, upon redemption,
by declaration or otherwise, or in any payment required by any sinking or analogous fund established with respect to such
series; provided, however, that a valid extension of the maturity of such debt securities in accordance with the terms of
any indenture supplemental thereto shall not constitute a default in the payment of principal or premium, if any;
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if we fail to observe or perform any other
covenant or agreement contained in the debt securities or the indenture, other than a covenant specifically relating to another
series of debt securities, and our failure continues for 90 days after we receive written notice of such failure, requiring
the same to be remedied and stating that such is a notice of default thereunder, from the trustee or holders of at least 25%
in aggregate principal amount of the outstanding debt securities of the applicable series; and
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if specified events of bankruptcy, insolvency
or reorganization occur.
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If an event of default
with respect to debt securities of any series occurs and is continuing, other than an event of default specified in the last bullet
point above, the trustee or the holders of at least 25% in aggregate principal amount of the outstanding debt securities of that
series, by notice to us in writing, and to the trustee if notice is given by such holders, may declare the unpaid principal of,
premium, if any, and accrued interest, if any, due and payable immediately. If an event of default specified in the last bullet
point above occurs with respect to us, the principal amount of and accrued interest, if any, of each issue of debt securities
then outstanding shall be due and payable without any notice or other action on the part of the trustee or any holder.
The holders of a majority
in principal amount of the outstanding debt securities of an affected series may waive any default or event of default with respect
to the series and its consequences, except defaults or events of default regarding payment of principal, premium, if any, or interest,
unless we have cured the default or event of default in accordance with the indenture. Any waiver shall cure the default or event
of default.
Subject to the terms
of the indenture, if an event of default under an indenture shall occur and be continuing, the trustee will be under no obligation
to exercise any of its rights or powers under such indenture at the request or direction of any of the holders of the applicable
series of debt securities, unless such holders have offered the trustee reasonable indemnity. The holders of a majority in principal
amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with respect
to the debt securities of that series, provided that:
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the direction so given by the holder is not
in conflict with any law or the applicable indenture; and
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subject to its duties under the Trust Indenture
Act, the trustee need not take any action that might involve it in personal liability or might be unduly prejudicial to the
holders not involved in the proceeding.
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A holder of the debt
securities of any series will have the right to institute a proceeding under the indenture or to appoint a receiver or trustee,
or to seek other remedies only if:
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the holder has given written notice to the
trustee of a continuing event of default with respect to that series;
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the holders of at least 25% in aggregate principal
amount of the outstanding debt securities of that series have made written request,
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such
holders have offered to the trustee indemnity satisfactory to it against the costs, expenses
and liabilities to be incurred by the trustee in compliance with the request; and
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the trustee does not institute the proceeding,
and does not receive from the holders of a majority in aggregate principal amount of the outstanding debt securities of that
series other conflicting directions within 90 days after the notice, request and offer.
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These limitations
do not apply to a suit instituted by a holder of debt securities if we default in the payment of the principal, premium, if any,
or interest on, the debt securities.
We will periodically
file statements with the trustee regarding our compliance with specified covenants in the indenture.
Modification of Indenture; Waiver
We and the trustee
may change an indenture without the consent of any holders with respect to specific matters:
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to cure any ambiguity, defect or inconsistency
in the indenture or in the debt securities of any series;
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to comply with the provisions described above
under “Description of Debt Securities—Consolidation, Merger or Sale;”
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to provide for uncertificated debt securities
in addition to or in place of certificated debt securities;
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to add to our covenants, restrictions, conditions
or provisions such new covenants, restrictions, conditions or provisions for the benefit of the holders of all or any series
of debt securities, to make the occurrence, or the occurrence and the continuance, of a default in any such additional covenants,
restrictions, conditions or provisions an event of default or to surrender any right or power conferred upon us in the indenture;
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to add to, delete from or revise the conditions,
limitations, and restrictions on the authorized amount, terms, or purposes of issue, authentication and delivery of debt securities,
as set forth in the indenture;
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to make any change that does not adversely
affect the interests of any holder of debt securities of any series in any material respect;
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to provide for the issuance of and establish
the form and terms and conditions of the debt securities of any series as provided above under “Description of Debt
Securities—General” to establish the form of any certifications required to be furnished pursuant to the terms
of the indenture or any series of debt securities, or to add to the rights of the holders of any series of debt securities;
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to evidence and provide for the acceptance
of appointment under any indenture by a successor trustee; or
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to comply with any requirements of the SEC
in connection with the qualification of any indenture under the Trust Indenture Act.
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In addition, under
the indenture, the rights of holders of a series of debt securities may be changed by us and the trustee with the written consent
of the holders of at least a majority in aggregate principal amount of the outstanding debt securities of each series that is
affected. However, unless we provide otherwise in the prospectus supplement applicable to a particular series of debt securities,
we and the trustee may make the following changes only with the consent of each holder of any outstanding debt securities affected:
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extending the fixed maturity of any debt securities
of any series;
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reducing the principal amount, reducing the
rate of or extending the time of payment of interest, or reducing any premium payable upon the redemption of any series of
any debt securities; or
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reducing the percentage of debt securities,
the holders of which are required to consent to any amendment, supplement, modification or waiver.
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Discharge
The indenture provides
that we can elect to be discharged from our obligations with respect to one or more series of debt securities, except for specified
obligations, including obligations to:
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register the transfer or exchange of debt securities
of the series;
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replace stolen, lost or mutilated debt securities
of the series;
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pay principal of and premium and interest on
any debt securities of the series;
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maintain paying agencies;
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hold monies for payment in trust;
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recover excess money held by the trustee;
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compensate and indemnify the trustee; and
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appoint any successor trustee.
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In order to exercise
our rights to be discharged, we must deposit with the trustee money or government obligations sufficient to pay all the principal
of, any premium, if any, and interest on, the debt securities of the series on the dates payments are due.
Form, Exchange and Transfer
We will issue the
debt securities of each series only in fully registered form without coupons and, unless we provide otherwise in the applicable
prospectus supplement, in denominations of $1,000 and any integral multiple thereof. The indenture provides that we may issue
debt securities of a series in temporary or permanent global form and as book-entry securities that will be deposited with, or
on behalf of, a depositary named by us and identified in the applicable prospectus supplement with respect to that series. To
the extent the debt securities of a series are issued in global form and as book-entry, a description of terms relating to any
book entry securities will be set forth in the applicable prospectus supplement.
At the option of the
holder, subject to the terms of the indenture and the limitations applicable to global securities described in the applicable
prospectus supplement, the holder of the debt securities of any series can exchange the debt securities for other debt securities
of the same series, in any authorized denomination and of like tenor and aggregate principal amount.
Subject to the terms
of the indenture and the limitations applicable to global securities set forth in the applicable prospectus supplement, holders
of the debt securities may present the debt securities for exchange or for registration of transfer, duly endorsed or with the
form of transfer endorsed thereon duly executed if so required by us or the security registrar, at the office of the security
registrar or at the office of any transfer agent designated by us for this purpose. Unless otherwise provided in the debt securities
that the holder presents for transfer or exchange, we will impose no service charge for any registration of transfer or exchange,
but we may require payment of any taxes or other governmental charges.
We will name in the
applicable prospectus supplement the security registrar, and any transfer agent in addition to the security registrar, that we
initially designate for any debt securities. We may at any time designate additional transfer agents or rescind the designation
of any transfer agent or approve a change in the office through which any transfer agent acts, except that we will be required
to maintain a transfer agent in each place of payment for the debt securities of each series.
If we elect to redeem
the debt securities of any series, we will not be required to:
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issue, register the transfer of, or exchange
any debt securities of that series during a period beginning at the opening of business 15 days before the day of mailing
of a notice of redemption of any debt securities that may be selected for redemption and ending at the close of business on
the day of the mailing; or
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register the transfer of or exchange any debt
securities so selected for redemption, in whole or in part, except the unredeemed portion of any debt securities we are redeeming
in part.
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Information Concerning the Trustee
The trustee, other
than during the occurrence and continuance of an event of default under an indenture, undertakes to perform only those duties
as are specifically set forth in the applicable indenture. Upon an event of default under an indenture, the trustee must use the
same degree of care as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision,
the trustee is under no obligation to exercise any of the powers given it by the indenture at the request of any holder of debt
securities, unless it is offered reasonable security and indemnity against the costs, expenses and liabilities that it might incur.
Payment and Paying Agents
Unless we otherwise
indicate in the applicable prospectus supplement, we will make payment of the interest on any debt securities on any interest
payment date to the person in whose name the debt securities, or one or more predecessor securities, are registered at the close
of business on the regular record date for the interest.
We will pay principal
of and any premium and interest on the debt securities of a particular series at the office of the paying agents designated by
us, except that unless we otherwise indicate in the applicable prospectus supplement, we will make interest payments by check
that we will mail to the holder or by wire transfer to certain holders. Unless we otherwise indicate in the applicable prospectus
supplement, we will designate the corporate trust office of the trustee as our sole paying agent for payments with respect to
debt securities of each series. We will name in the applicable prospectus supplement any other paying agents that we initially
designate for the debt securities of a particular series. We will maintain a paying agent in each place of payment for the debt
securities of a particular series.
All money we pay to
a paying agent or the trustee for the payment of the principal of or any premium or interest on any debt securities that remains
unclaimed at the end of two years after such principal, premium or interest has become due and payable will be repaid to us, and
the holder of the debt security thereafter may look only to us for payment thereof.
Governing Law
The indenture and
the debt securities will be governed by and construed in accordance with the internal laws of the State of New York, except to
the extent that the Trust Indenture Act is applicable.
DESCRIPTION OF
UNITS
As specified in the
applicable prospectus supplement, we may issue units consisting of one or more of the other securities described in this prospectus.
The applicable prospectus
supplement will specify the following terms of any units in respect of which this prospectus is being delivered:
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the
terms of the units and of any of the common stock, preferred stock and warrants comprising
the units, including whether and under what circumstances the securities comprising the
units may be traded separately;
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a
description of the terms of any unit agreement governing the units; and
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a description of the provisions for the payment,
settlement, transfer or exchange of the units.
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PLAN OF DISTRIBUTION
We may sell the securities
offered through this prospectus (i) to or through underwriters or dealers, (ii) directly to purchasers, including our
affiliates, (iii) through agents, or (iv) through a combination of any these methods. The securities may be distributed
at a fixed price or prices, which may be changed, market prices prevailing at the time of sale, prices related to the prevailing
market prices, or negotiated prices. The prospectus supplement will include the following information:
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the
terms of the offering;
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the
names of any underwriters or agents;
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the
name or names of any managing underwriter or underwriters;
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the
purchase price of the securities;
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any
over-allotment options under which underwriters may purchase additional securities from
us;
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the
net proceeds from the sale of the securities
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any
delayed delivery arrangements
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any
underwriting discounts, commissions and other items constituting underwriters’
compensation;
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any
initial public offering price;
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any
discounts or concessions allowed or reallowed or paid to dealers;
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any
commissions paid to agents; and
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any
securities exchange or market on which the securities may be listed.
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Sale
Through Underwriters or Dealers
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Only underwriters
named in the prospectus supplement are underwriters of the securities offered by the prospectus supplement.
If underwriters are
used in the sale, the underwriters will acquire the securities for their own account, including through underwriting, purchase,
security lending or repurchase agreements with us. The underwriters may resell the securities from time to time in one or more
transactions, including negotiated transactions. Underwriters may sell the securities in order to facilitate transactions in any
of our other securities (described in this prospectus or otherwise), including other public or private transactions and short
sales. Underwriters may offer securities to the public either through underwriting syndicates represented by one or more managing
underwriters or directly by one or more firms acting as underwriters. Unless otherwise indicated in the prospectus supplement,
the obligations of the underwriters to purchase the securities will be subject to certain conditions, and the underwriters will
be obligated to purchase all the offered securities if they purchase any of them. The underwriters may change from time to time
any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers.
If dealers are used
in the sale of securities offered through this prospectus, we will sell the securities to them as principals. They may then resell
those securities to the public at varying prices determined by the dealers at the time of resale. The prospectus supplement will
include the names of the dealers and the terms of the transaction.
Direct Sales and Sales Through Agents
We may sell the securities
offered through this prospectus directly. In this case, no underwriters or agents would be involved. Such securities may also
be sold through agents designated from time to time. The prospectus supplement will name any agent involved in the offer or sale
of the offered securities and will describe any commissions payable to the agent. Unless otherwise indicated in the prospectus
supplement, any agent will agree to use its reasonable best efforts to solicit purchases for the period of its appointment.
We may sell the securities
directly to institutional investors or others who may be deemed to be underwriters within the meaning of the Securities Act with
respect to any sale of those securities. The terms of any such sales will be described in the prospectus supplement.
Delayed Delivery Contracts
If the prospectus
supplement indicates, we may authorize agents, underwriters or dealers to solicit offers from certain types of institutions to
purchase securities at the public offering price under delayed delivery contracts. These contracts would provide for payment and
delivery on a specified date in the future. The contracts would be subject only to those conditions described in the prospectus
supplement. The applicable prospectus supplement will describe the commission payable for solicitation of those contracts.
Continuous Offering Program
Without limiting the
generality of the foregoing, we may enter into a continuous offering program equity distribution agreement with a broker-dealer,
also known as an At-the-Market offering, or “ATM”, under which we may offer and sell shares of our common stock from
time to time through a broker-dealer as our sales agent. If we enter into such a program, sales of the shares of common stock,
if any, will be made by means of ordinary brokers’ transactions at market prices on the securities exchange or quotation
or trading service on which such securities may be listed, quoted or traded at the time of sale, block transactions and such other
transactions as agreed upon by us and the broker-dealer. Under the terms of such a program, we also may sell shares of common
stock to the broker-dealer, as principal for its own account at a price agreed upon at the time of sale. If we sell shares of
common stock to such broker-dealer as principal, we will enter into a separate terms agreement with such broker-dealer, and we
will describe this agreement in a separate prospectus supplement or pricing supplement.
Market Making, Stabilization and Other Transactions
All securities we
offer, other than shares of our Common Stock, will be new issues of securities with no established trading market. Any underwriters
may make a market in these securities, but will not be obligated to do so and may discontinue any market making at any time without
notice. Any shares of our Common Stock sold pursuant to a prospectus supplement will be quoted on the OTC Markets Group Inc.’s
OTCQB tier. We may apply to list any other securities sold pursuant to a prospectus supplement but we are not obligated to do
so. Therefore, no assurance can be given as to whether an active trading market will develop for the offered securities. We cannot
guarantee the liquidity of the trading markets for any securities.
Any underwriter may
also engage in stabilizing transactions, syndicate covering transactions and penalty bids in accordance with Rule 104 under
the Securities Exchange Act. Stabilizing transactions involve bids to purchase the underlying security in the open market for
the purpose of pegging, fixing or maintaining the price of the securities. Syndicate covering transactions involve purchases of
the securities in the open market after the distribution has been completed in order to cover syndicate short positions.
Penalty bids permit
the underwriters to reclaim a selling concession from a syndicate member when the securities originally sold by the syndicate
member are purchased in a syndicate covering transaction to cover syndicate short positions. Stabilizing transactions, syndicate
covering transactions and penalty bids may cause the price of the securities to be higher than it would be in the absence of the
transactions. The underwriters may, if they commence these transactions, discontinue them at any time.
General Information
Agents, underwriters,
and dealers may be entitled, under agreements entered into with us, to indemnification by us against certain liabilities, including
liabilities under the Securities Act. Our agents, underwriters, and dealers, or their affiliates, may be customers of, engage
in transactions with or perform services for us, in the ordinary course of business.
LEGAL MATTERS
Legal matters relating
to the issuance of the securities offered by this prospectus will be passed upon for us by Sherman & Howard L.L.C., Las Vegas,
Nevada.
EXPERTS
The consolidated balance
sheets of Ideanomics, Inc. as of December 31, 2019 and 2018, and the related consolidated statements of operations, comprehensive
loss, equity, and cash flows for each of the two years in the period ended December 31, 2019, and related notes (collectively
referred to as the “financial statements”), have been audited by B F Borgers CPA PC, independent registered public
accounting firm, as stated in their report, which includes explanatory paragraphs as to the Company’s ability to continue
as a going concern and emphasis of a matter, which is incorporated herein by reference. Such financial statements have been incorporated
herein by reference in reliance on the report of such firm given upon their authority as experts in accounting and auditing.
WHERE YOU CAN FIND
MORE INFORMATION
We file annual, quarterly
and special reports, along with other information with the SEC. Our SEC filings are available to the public over the Internet
at the SEC’s website at http://www.sec.gov. You may also read and copy any document we file at the SEC’s Public Reference
Room at 100 F Street, NE, Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the Public
Reference Room.
This prospectus is
part of a registration statement on Form S-3 that we filed with the SEC to register the securities offered hereby under the
Securities Act of 1933, as amended. This prospectus does not contain all of the information included in the registration statement,
including certain exhibits and schedules. You may obtain the registration statement and exhibits to the registration statement
from the SEC at the address listed above or from the SEC’s internet site.
INCORPORATION OF
CERTAIN DOCUMENTS BY REFERENCE
This prospectus is
part of a registration statement filed with the SEC. The SEC allows us to “incorporate by reference” into this prospectus
the information that we file with them, which means that we can disclose important information to you by referring you to those
documents. The information incorporated by reference is considered to be part of this prospectus, and information that we file
later with the SEC will automatically update and supersede this information. The following documents are incorporated by reference
and made a part of this prospectus (other than with respect to information furnished under Item 2.02 or Item 7.01 of any Form 8-K
and exhibits furnished on such form that are related to such items unless such Form 8-K expressly provides to the contrary):
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our Current Report on Form 8-K filed with the SEC on January 2,
2020, January 7,
2020, January 10,
2020, January 29,
2020, January 29,
2020, February 6, 2020, March 17, 2020, April 6, 2020, May 13, 2020, May 20, 2020, May 22, 2020, June 5, 2020, June
9, 2020, June 24,
2020; August 11, 2020, September
10, 2020, October 26,
2020, November 9,
2020, November 12,
2020, December 3,
2020, December 18,
2020, December 22,
2020, December 29, 2020, December 31, 2020, January 8, 2021 and
January 8, 2021;
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the
description of our common stock which is registered under Section 12 of the Exchange
Act, in our registration statement on Form 8-A,
filed on May 29, 2012, including any amendment or reports filed for the purposes
of updating this description; and
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all
reports and other documents subsequently filed by us pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act after the date of this prospectus and prior to
the termination of this offering.
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We also incorporate
by reference any future filings (other than information furnished under Item 2.02 or Item 7.01 of Form 8-K and
exhibits furnished on such form that are related to such items unless such Form 8-K expressly provides to the contrary) made
with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act, including those made after the date
of the initial filing of the registration statement of which this prospectus is a part and prior to effectiveness of such registration
statement, until we file a post-effective amendment that indicates the termination of the offering of the common stock made by
this prospectus and will become a part of this prospectus from the date that such documents are filed with the SEC. Information
in such future filings updates and supplements the information provided in this prospectus. Any statements in any such future
filings will automatically be deemed to modify and supersede any information in any document we previously filed with the SEC
that is incorporated or deemed to be incorporated herein by reference to the extent that statements in the later filed document
modify or replace such earlier statements.
Notwithstanding the
foregoing, information furnished under Items 2.02 and 7.01 of any Current Report on Form 8-K, including the related exhibits,
is not incorporated by reference in this prospectus.
The information about
us contained in this prospectus should be read together with the information in the documents incorporated by reference. You may
request a copy of any or all of these filings, at no cost, by writing or telephoning us at 55 Broadway, 19th Floor,
New York, NY 10006, phone number (212) 206-1216.
Up to $150,000,000
Common Stock
Ideanomics, Inc.
Prospectus Supplement
February 26, 2021
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