Item
1.01. Entry into a Material Definitive Agreement.
On
January 14, 2021, IT Tech Packaging, Inc. (the “Company”) agreed to sell to certain institutional investors
who executed a securities purchase agreement dated as of January 14, 2021 (the “Purchase Agreement”) and to
certain other investors who did not execute the Purchase Agreement but relied solely on the Company’s prospectus dated January
14, 2021 contained in the Registration Statement (as defined below), an aggregate of 26,181,818 shares (the “Shares”)
of common stock, par value $0.001 (the “Common Stock”) and 26,181,818 warrants (the “Warrants”)
to purchase up to 26,181,818 shares of the Common Stock (the “Warrant Shares” and collectively with the Shares
and the Warrants, the “Securities”) in a best-efforts public offering for gross proceeds of approximately $14.4
million (the “Offering”). The purchase price for each share of Common Stock and the corresponding Warrant sold
in the Offering was $0.55.
The
Warrants are exercisable commencing on January 20, 2021 at an exercise price of $0.55 and will expire on January 20, 2026.. In
the event of a stock split, stock dividend, combination, subsequent right offering or reclassification of the outstanding shares
of Common Stock, the exercise price and the number of shares issuable upon exercise of the Warrants shall be proportionately adjusted.
The
Company agreed not to enter into any subsequent issuance of Common Stock from January 14, 2021 until thirty (30) days after the
closing of the Offering.
Concurrently
with the execution of the Purchase Agreement, certain officers and directors and 5% shareholders of the Company entered into lock-up
agreements (the “Lock-Up Agreements”) pursuant to which they have agreed, among other things, not to sell or
dispose of any shares of Common Stock which are or will be beneficially owned by them for ninety (90) days following the closing
of the Offering.
The
Company entered into a placement agency agreement dated January 14, 2021 (the “Placement Agency Agreement’)
with Maxim Group LLC, as placement agent (the “Placement Agent”), pursuant to which the Placement Agent agreed
to act as the placement agent in connection with the Offering. The Company agreed to pay the Placement Agent an aggregate
fee equal to 7.0% of the gross proceeds raised in the Offering. The Company also agreed to reimburse the Placement Agent for certain
expenses, including for fees and expenses related to legal expenses limited to $65,000.
The
Securities were offered by the Company pursuant to effective registration statements on Form S-1 (File No. 333-251562 and File
No. 333- 252112), which became effective on January 14, 2021 (the “Registration Statement”). The Company currently
intends to use the net proceeds from the Offering for general corporate and working capital purposes. The Offering was consummated
on January 20, 2021.
A
copy of the Placement Agency Agreement, the form of the Purchase Agreement, the form of the Lock-up Agreement, and the form of
Warrant are attached hereto as Exhibits 10.1, 10.2, 10.3, and 4.1, respectively, and are incorporated herein by reference. The
foregoing summaries of the terms of the Placement Agency Agreement, the Purchase Agreement, the Lock-up Agreement and the Warrants
are subject to, and qualified in their entirety by, such documents.
On
January 14, 2021, the Company issued a press release announcing the Offering. A copy of the press release is attached hereto as
Exhibit 99.1 and is incorporated herein by reference.