Item
1.01
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Entry into a Material Definitive Agreement.
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On
November 20, 2020, Ocean Power Technologies, Inc. (the “Company”) filed a shelf registration statement on Form S-3
(the “Registration Statement”) with the U.S. Securities and Exchange Commission (the “SEC”), pursuant
to which the Company may offer and sell, at its option, securities having an aggregate offering price of up to $100,000,000. On
the same date, the Company entered into a three-year sales agreement with A.G.P./Alliance Global Partners (“A.G.P.”),
pursuant to which the Company may offer and sell from time to time over that three-year period shares (the “Shares”)
of its common stock, par value $0.001 per share (the “Common Stock”), to or through A.G.P., as sales agent (the
“Sales Agreement”), in an “at the market offering” (as defined in Rule 415(a)(4) under the Securities
Act of 1933, as amended) of the Shares (the “ATM Offering”). The Company will use the net proceeds from the sale
of its Common Stock to build additional products and solutions to meet market demand, further advance the development of new products
and solutions, engage in corporate development and merger and acquisition activities, for working capital needs, capital expenditures,
repayment or refinancing of indebtedness, acquisitions, repurchases and redemptions of securities and for other general corporate
purposes. The Registration Statement includes a base prospectus (the “Base Prospectus”) and a sales agreement
prospectus relating to the ATM Offering, specifically relating to the sale of the Shares under the Sales Agreement (the “ATM
Prospectus,” and collectively with the Base Prospectus, the “Prospectus”) both of which form part of the Registration
Statement. The $50,000,000 of Common Stock that may be offered, issued and sold under the ATM Prospectus is included in
the $100,000,000 of securities that may be offered, issued and sold by us under the Base Prospectus. The $50,000,000 of Common
Stock that may be offered, issued and sold under the ATM Prospectus is included in the $100,000,000 of securities that may be
offered, issued and sold by us under the Base Prospectus. No Shares may be sold under the Prospectus until the Registration
Statement has been declared effective by the SEC.
Shares
may be sold through the ATM Prospectus by any method deemed to be an “at the market offering.” Under the Sales Agreement,
A.G.P. will also be able to sell shares of Common Stock by any other method permitted by law, including in negotiated transactions
with the Company’s prior written consent. Upon delivery of a placement notice and subject to the terms and conditions of
the Sales Agreement, A.G.P. is required to use its commercially reasonable efforts consistent with its normal trading and sales
practices, applicable state and federal law, rules and regulations, and the rules of The Nasdaq Capital Market to sell the Shares
from time to time based upon the Company’s instructions, including any price, time or size limits specified by the Company.
A.G.P. is not under any obligation to purchase any of the Shares on a principal basis pursuant to the Sales Agreement, except
as otherwise agreed by A.G.P. and the Company in writing and expressly set forth in a placement notice. A.G.P.’s obligations
to sell the Shares under the Sales Agreement are subject to satisfaction of certain conditions, including customary closing conditions.
The Company is not obligated to make any sales of Shares under the Sales Agreement and any determination by the Company to do
so will be dependent, among other things, on market conditions and the Company’s capital raising needs.
The
Company will pay A.G.P. commissions for its services in acting as its sales agent in the sale of the Shares pursuant to the Sales
Agreement. A.G.P. is entitled to compensation at a fixed commission rate of 3.25% of the aggregate gross proceeds from the sale
of the Shares on the Company’s behalf pursuant to the Sales Agreement. The Sales Agreement contains representations, warranties
and covenants that are customary for transactions of this type. In addition, the Company has provided A.G.P. with customary indemnification
and contribution rights. The Company has also agreed to reimburse A.G.P. for certain specified expenses, including the expenses
of counsel to A.G.P. The offering of the Shares pursuant to the Sales Agreement will terminate upon the termination of the Sales
Agreement by A.G.P. or the Company, as permitted therein.
The
foregoing description of the Sales Agreement is qualified in its entirety by reference to the full text of the Sales Agreement,
which is attached as an exhibit to the Registration Statement as Exhibit 10.1 and is incorporated herein in its entirety by reference.
This
Current Report on Form 8-K shall not constitute an offer to sell or the solicitation of an offer to buy any shares under the Sales
Agreement, nor shall there be any sale of such shares in any state in which such offer, solicitation or sale would be unlawful
prior to registration or qualification under the securities laws of any such state.