As
filed with the Securities and Exchange Commission on January 15, 2021
Registration
No. 333-___________
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
Verb
Technology Company, Inc.
(Exact
name of registrant as specified in its charter)
Nevada
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90-1118043
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(State
or jurisdiction of
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(I.R.S.
Employer
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incorporation
or organization)
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Identification
No.)
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782
South Auto Mall Drive
American
Fork, Utah 84003
(855)
250-2300
(Address,
including zip code and telephone number,
including
area code, of registrant’s principal executive offices)
Rory
J. Cutaia
Chairman
of the Board, Chief Executive Officer, President, and Secretary
782
South Auto Mall Drive
American
Fork, Utah 84003
(855)
250-2300
(Name
including zip code and telephone number,
including
area code, of agent for service)
Copies
of all correspondence to:
Larry
A. Cerutti, Esq.
Dean
Longfield, Esq.
Troutman
Pepper Hamilton Sanders LLP
5
Park Plaza, Suite 1400
Irvine,
California 92614
(949)
622-2700 / (949) 622-2739 (fax)
Approximate
date of commencement of proposed sale to the public: From time to time after this Registration Statement becomes effective.
If
the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please
check the following box: [ ]
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check
the following box. [X]
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the
following box and list the Securities Act registration statement number of the earlier effective registration statement for the
same offering. [ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If
this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become
effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. [ ]
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register
additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following
box. [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large
accelerated filer
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[ ]
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Accelerated
filer
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[ ]
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Non-accelerated
filer
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[X]
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Smaller
reporting company
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[X]
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Emerging
growth company
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[ ]
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If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. [ ]
CALCULATION
OF REGISTRATION FEE
Title
of each class
of securities to be registered
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Amount
to
be
registered(1)(2)
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Proposed
maximum
offering
price
per security(3)
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Proposed
maximum
aggregate
offering
price(3)(4)
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Amount
of
registration
fee(5)
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Common Stock, par value $0.001
per share
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-
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-
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-
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-
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Preferred Stock, par value $0.001
per share
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-
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-
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-
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-
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Debt Securities
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-
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-
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-
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-
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Warrants
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-
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-
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-
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-
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Subscription
Rights
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-
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-
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-
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-
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Units
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-
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-
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-
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-
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Total
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-
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$
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75,000,000
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$
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8,182.50
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(1)
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The
securities registered hereunder include such indeterminate number of (a) shares of common stock, (b) shares of preferred stock,
(c) debt securities, (d) warrants to purchase common stock, preferred stock or debt securities of the registrant, (e) subscription
rights to purchase common stock, preferred stock or debt securities of the registrant, and (f) units consisting of some or
all of these securities, as may be sold from time to time by the registrant. There are also being registered hereunder an
indeterminate number of shares of common stock and preferred stock as shall be issuable upon conversion, exchange or exercise
of any securities that provide for such issuance.
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(2)
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Pursuant
to Rule 416 under the Securities Act of 1933, as amended, or the Securities Act, this registration statement shall also cover
any additional shares of the registrant’s securities that become issuable by reason of any share splits, share dividends
or similar transactions.
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(3)
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Calculated
pursuant to Rule 457(o) under the Securities Act, based on the proposed maximum aggregate offering price. The proposed maximum
offering price per security and proposed maximum aggregate offering price per class of security will be determined from time
to time by the registrant in connection with the issuance by the registrant of the securities registered hereunder and is
not specified as to each class of security pursuant to General Instruction II.D. of Form S-3 under the Securities Act. Separate
consideration may or may not be received for securities that are issuable on exercise, conversion or exchange of other securities,
or that are issued in units.
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(4)
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Estimated
solely for the purpose of calculating the registration fee. Subject to Rule 462(b) under the Securities Act, the aggregate
maximum offering price of all securities issued by the registrant pursuant to this registration statement will not exceed
$75,000,000.
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(5)
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The
registration fee is calculated in accordance with Rule 457(o) under the Securities Act.
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The
registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until
the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective
on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
The
information contained in this preliminary prospectus is not complete and may be changed. These securities may not be sold until
the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not
an offer to sell nor does it seek an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.
PROSPECTUS
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SUBJECT
TO COMPLETION
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DATED
JANUARY 15, 2021
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$75,000,000
Common
Stock
Preferred
Stock
Debt
Securities
Warrants
Subscription
Rights
Units
We
may offer and sell up to $75,000,000 in the aggregate of the securities identified above from time to time in one or more offerings.
This prospectus provides you with a general description of the securities.
Each
time we offer and sell securities, we will provide a supplement to this prospectus that contains specific information about the
offering and the amounts, prices and terms of the securities. The supplement may also add, update or change information contained
in this prospectus with respect to that offering. You should carefully read this prospectus and the applicable prospectus supplement
before you invest in any of our securities.
We
may offer and sell the securities described in this prospectus and any prospectus supplement to or through one or more underwriters,
dealers and agents, or directly to purchasers, or through a combination of these methods. If any underwriters, dealers or agents
are involved in the sale of any 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 the applicable prospectus
supplement. See the sections of this prospectus entitled “About this Prospectus” and “Plan of Distribution”
for more information. No securities may be sold without delivery of this prospectus and the applicable prospectus supplement describing
the method and terms of the offering of such securities.
INVESTING
IN OUR SECURITIES INVOLVES RISKS. SEE THE “RISK FACTORS” ON PAGE 1 OF THIS PROSPECTUS AND ANY SIMILAR SECTION
CONTAINED IN THE APPLICABLE PROSPECTUS SUPPLEMENT CONCERNING FACTORS YOU SHOULD CONSIDER BEFORE INVESTING IN OUR SECURITIES.
Our
common stock is listed on The Nasdaq Capital Market under the symbol “VERB.” On January 14, 2021 the last reported
sale price of our common stock on The Nasdaq Capital Market was $1.88 per share.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus or the accompanying prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
The
date of this prospectus is ,
2021.
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the U.S. Securities and Exchange Commission, or the SEC, using
a “shelf” registration process. By using a shelf registration statement, we may sell securities from time to time
and in one or more offerings up to a total dollar amount of $75,000,000 as described in this prospectus.
This
prospectus provides you only with a general description of the securities that we may offer. Each time that we offer and sell
securities, we will provide a prospectus supplement to this prospectus that contains specific information about the securities
being offered and sold and the specific terms of that offering. We may also authorize one or more free writing prospectuses to
be provided to you that may contain material information relating to these offerings. The prospectus supplement or free writing
prospectus may also add, update or change information contained in this prospectus with respect to that offering. If there is
any inconsistency between the information in this prospectus and the applicable prospectus supplement or free writing prospectus,
you should rely on the prospectus supplement or free writing prospectus, as applicable. Before purchasing any securities, you
should carefully read both this prospectus and the applicable prospectus supplement (and any applicable free writing prospectuses),
together with the additional information described under the heading “Where You Can Find More Information.”
We
have not authorized anyone to provide you with any information or to make any representations other than those contained in, or
incorporated by reference in, this prospectus, any applicable prospectus supplement or any free writing prospectuses prepared
by or on behalf of us or to which we have referred you. We take no responsibility for, and can provide no assurance as to the
reliability of, any other information that others may give you. We will not make an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and the applicable
prospectus supplement to this prospectus is accurate only as of the date on its respective cover, that the information appearing
in any applicable free writing prospectus is accurate only as of the date of that free writing prospectus, and that any information
incorporated by reference is accurate only as of the date of the document incorporated by reference, unless we indicate otherwise.
Our business, financial condition, results of operations and prospects may have changed since those dates.
When
we refer to “Verb,” “we,” “our,” “us” and the “Company” in this prospectus,
we mean Verb Technology Company, Inc., and its consolidated subsidiaries unless otherwise specified. When we refer to “you,”
we mean the potential holders of the applicable series of securities.
ABOUT
VERB TECHNOLOGY COMPANY, INC.
Overview
We are a Software-as-a-Service
applications platform developer. Our platform is comprised of a suite of interactive video-based sales enablement business software
products marketed on a subscription basis. Our applications, available in both mobile and desktop versions, are offered as a fully
integrated suite, as well as on a standalone basis, and include verbCRM, our white-labelled Customer Relationship Management
(“CRM”) application for large sales-based enterprises; verbTEAMS, our CRM application for small and medium
sized businesses and solopreneurs; verbLEARN, our Learning Management System application, and verbLIVE, our Live Stream eCommerce
application.
Our suite of applications
can be distinguished from other sales enablement applications because our applications utilize our proprietary interactive video
technology as the primary means of communication between sales and marketing professionals and their customers and prospects.
Moreover, the proprietary data collection and analytics capabilities of our applications inform our users in real time, on their
devices, when and for how long their prospects have watched a video, how many times such prospects watched it, and what they clicked-on,
which allows our users to focus their time and efforts on ‘hot leads’ or interested prospects rather than on those
that have not seen such video or otherwise expressed interest in such content. Users can create their hot lead lists by using
familiar, intuitive ‘swipe left/swipe right’ on-screen navigation. Our clients report that these capabilities provide
for a much more efficient and effective sales process, resulting in increased sales conversion rates. We developed the proprietary
patent-pending interactive video technology, as well as several other patent-issued and patent-pending technologies that serve
as the unique foundation for all of our platform applications
Corporate
Information
We
are a Nevada corporation. Our principal executive/administrative offices are located at 782 South Auto Mall Drive, American Fork,
Utah 84003, and our telephone number is (855) 250-2300. Our website address is https://www.verb.tech/. Information on or
accessed through our website is not incorporated into this prospectus and is not a part of this prospectus.
RISK
FACTORS
Investing
in our securities involves a high degree of risk. Before making an investment decision or acquiring any offered securities pursuant
to this prospectus, you should carefully consider the specific factors discussed under the heading “Risk Factors”
in the applicable prospectus supplement, together with all of the other information contained or incorporated by reference in
the prospectus supplement or appearing or incorporated by reference in this prospectus, in light of your particular investment
objectives and financial circumstances. You should also consider the risks, uncertainties, and assumptions discussed under the
heading “Risk Factors” included in our most recent Annual Report on Form 10-K, as revised or supplemented by our subsequent
Quarterly Reports on Form 10-Q, or our Current Reports on Form 8-K that we have filed with the SEC, all of which are incorporated
herein by reference, and which may be amended, supplemented, or superseded from time to time by other reports we file with the
SEC in the future. Moreover, the risks so described are not the only risks we face. Additional risks not presently known to us
or that we currently perceive as immaterial may ultimately prove more significant than expected and impair our business operations.
Any of these risks could adversely affect our business, financial condition, results of operations, and prospects. The trading
price of our securities could decline due to any of these risks and you may lose all or part of your investment. This prospectus
and the incorporated documents also contain forward-looking statements that involve risks and uncertainties.
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus, any prospectus supplement, and the documents incorporated by reference into this prospectus contain certain “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, and the Private Securities Litigation Reform Act
of 1995 with respect to our business, financial condition, liquidity, and results of operations. These forward-looking statements
are not historical facts but rather are plans and predictions based on current expectations, estimates, and projections about
our industry, our beliefs, and assumptions. We use words such as “may,” “will,” “could,” “should,”
“anticipate,” “expect,” “intend,” “project,” “plan,” “believe,”
“seek,” “estimate,” “assume,” and variations of these words and similar expressions to identify
forward-looking statements. Statements in this prospectus and the other documents incorporated by reference that are not historical
facts are hereby identified as “forward-looking statements” for the purpose of the safe harbor provided by Section
21E of the Exchange Act and Section 27A of the Securities Act. These statements are not guarantees of future performance and are
subject to certain risks, uncertainties, and other factors, some of which are beyond our control, are difficult to predict and
could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. These risks
and uncertainties include those described in the section above entitled “Risk Factors,” in our Annual Report on Form
10-K for the fiscal year ended December 31, 2019, our subsequent Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 2020, June 30, 2020, and September 30, 2020, and the risks detailed from time to time on our future reports filed with
the SEC.
You
should not place undue reliance on these forward-looking statements because the matters they describe are subject to certain risks,
uncertainties, and assumptions that are difficult to predict. The forward-looking statements contained in this prospectus or any
prospectus supplement are made as of the date of this prospectus or, in the case of any accompanying prospectus supplement or
documents incorporated by reference, the date of any such document. Over time, our actual results, performance, or achievements
may differ from those expressed or implied by our forward-looking statements, and such difference might be significant and materially
adverse to our security holders. Except as required by law, we undertake no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events, or otherwise. We have identified some of the important factors
that could cause future events to differ from our current expectations and they are described in this prospectus under the captions
“Risk Factors,” and as well as in our most recent Annual Report on Form 10-K and any subsequently filed Quarterly
Reports on Form 10-Q, and in other documents that we may file with the SEC, all of which you should review carefully. Please consider
our forward-looking statements in light of those risks as you read this prospectus and any prospectus supplement.
USE
OF PROCEEDS
Except
as set forth in any accompanying prospectus supplement, we intend to use the net proceeds from the sale of any securities offered
under this prospectus for general corporate purposes unless the applicable prospectus supplement provides otherwise. General corporate
purposes may include, and are not limited to, research and development costs, the acquisition or licensing of other businesses,
products or product candidates, working capital and capital expenditures.
We
may temporarily invest the net proceeds in a variety of capital preservation instruments, including investment grade instruments,
certificates of deposit or direct or guaranteed obligations of the U.S. government, or may hold such proceeds as cash, until they
are used for their stated purpose. We have not determined the amount of net proceeds to be used specifically for such purposes.
As a result, management will retain broad discretion over the allocation of net proceeds.
DESCRIPTION
OF CAPITAL STOCK
The
following is a summary of all material characteristics of our capital stock as set forth in our Articles of Incorporation, as
amended, or Articles of Incorporation, and our Amended and Restated Bylaws, or Bylaws. The summary does not purport to be complete
and is qualified in its entirety by reference to our Articles of Incorporation and our Bylaws, and to the provisions of the Nevada
Revised Statutes, or the NRS. We encourage you to review complete copies of our Articles of Incorporation and our Bylaws. You
can obtain copies of these documents by following the directions outlined in “Where You Can Find More Information”
and “Incorporation of Certain Information by Reference” elsewhere in this prospectus.
Authorized
Capital Stock
Our
authorized capital stock consists of 200,000,000 shares of common stock, $0.0001 par value per share, and 15,000,000 shares of
preferred stock, $0.0001 par value per share, of which 6,000 shares have been designated Series A Preferred Stock. As of January
14, 2021, we had 48,392,483 shares of common stock outstanding and 1,856 shares of Series A Preferred Stock outstanding.
Common
Stock
All
outstanding shares of our common stock are fully paid and nonassessable. The following summarizes the rights of holders of our
common stock:
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a
holder of common stock is entitled to one vote per share on all matters to be voted upon generally by the stockholders and
are not entitled to cumulative voting for the election of directors;
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subject
to preferences that may apply to shares of preferred stock outstanding, the holders of common stock are entitled to receive
lawful dividends as may be declared by our board of directors;
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upon
our liquidation, dissolution or winding up, the holders of shares of common stock are entitled to receive a pro rata portion
of all our assets remaining for distribution after satisfaction of all our liabilities and the payment of any liquidation
preference of any outstanding preferred stock;
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there
are no redemption or sinking fund provisions applicable to our common stock; and
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there
are no preemptive, subscription or conversion rights applicable to our common stock.
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Preferred
Stock
All
of the preferred stock authorized in our articles of incorporation is undesignated. Our board of directors is authorized, without
further approval from our stockholders, to create one or more series of preferred stock, and to designate the rights, privileges,
preferences, restrictions, and limitations of any given series of preferred stock. Accordingly, our board of directors may, without
stockholder approval, issue shares of preferred stock with dividend, liquidation, conversion, voting, or other rights that could
adversely affect the voting power or other rights of the holders of our common stock. The issuance of preferred stock could have
the effect of restricting dividends payable to holders of our common stock, diluting the voting power of our common stock, impairing
the liquidation rights of our common stock, or delaying or preventing a change in control of us, all without further action by
our stockholders. The following is a summary of the terms and conditions of the Series A Preferred Stock.
Series
A Preferred Stock
The
rights and preferences of the Series A Preferred Stock are outlined below.
Rank
and Liquidation Preference
Shares
of Series A Preferred Stock rank prior to our common stock as to distribution of assets upon liquidation events, which include
a liquidation, dissolution or winding up of our company, whether voluntary or involuntary. The liquidation preference of each
share of Series A Preferred Stock is equal to $1,000.00, or the Stated Value, plus any accrued but unpaid dividends on the Series
A Preferred Stock and any other fees or liquidated damages then due and owing under the Certificate of Designation of Rights,
Preferences, and Restrictions of Series A Convertible Preferred Stock, or the Certificate of Designations. If the assets are insufficient
to pay in full such amounts, then the entire assets to be distributed to the holders of our Series A Preferred Stock shall be
distributed pro rata among the holders of our Series A Preferred Stock in accordance with the respective amounts that would be
payable on such shares if all amounts payable thereon were paid in full.
Dividend
Rights
The
holders of Series A Preferred Stock are entitled to receive lawful dividends as may be declared by our board of directors.
Optional
Conversion Rights
Each share of Series
A Preferred Stock is convertible at the option of the holder into shares of our common stock at any time. Each share of Series
A Preferred Stock is convertible into the number of shares of common stock as calculated by dividing the Stated Value of such
share of Series A Preferred Stock by the conversion price. The conversion price was initially $1.55 per share of Series
A Preferred Stock, which conversion price was subsequently adjusted to $1.10 per share and is subject to further
adjustment; therefore, each share of Series A Preferred Stock was initially convertible into approximately 645 shares of common
stock and after adjustment of the conversion price to $1.10 per share, each share of Series A convertible stock is now convertible
into approximately 909 shares of common stock, which number is equal to the quotient of the Stated Value of the Series A Preferred
Stock of $1,000.00 divided by the conversion price of $1.10 per share of Series A Preferred Stock. No fractional shares or scrip
representing fractional shares are to be issued upon conversion of the Series A Preferred Stock. As to any fraction of share that
the holder of Series A Preferred Stock would otherwise be entitled to purchase upon conversion, we shall, at our election, either
pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the conversion price,
or round up to the next whole share.
The
holders of Series A Preferred Stock cannot convert the Series A Preferred Stock if, after giving effect to the conversion, the
number of shares of our common stock beneficially held by the holder (together with such holder’s affiliates) would be in
excess of 4.99% (or, upon election by a holder prior to the issuance of any shares, 9.99% of the number of shares of our common
stock issued and outstanding immediately after giving effect to the issuance of any shares of common stock issuance upon conversion
of the Series A Preferred Stock held by the holder).
We
are also prevented from issuing shares of our common stock upon conversion of the Series A Preferred Stock or exercise of the
August Warrants (as defined below), which, when aggregated with any shares of our common stock issued on or after the issuance
date and prior to such conversion date or exercise date, as applicable (i) in connection with any conversion of the Series A Preferred
Stock issued pursuant to that certain securities purchase agreement entered into on August 14, 2019 by and among us and the investors
thereto, or SPA, (ii) in connection with the exercise of any August Warrants issued pursuant to the SPA, and (iii) in connection
with the exercise of any warrants issued to any registered broker-dealer as a fee in connection with the issuance of the securities
pursuant to the SPA, would exceed 4,459,725 shares of common stock, or 19.99% Cap. This prohibition will terminate upon
the approval by our stockholders of a release from such 19.99% Cap.
Mandatory
Conversion Rights
In
the event the closing price on The Nasdaq Capital Market is 100% greater than the then-base conversion price on each trading day
for any twenty trading days during a consecutive thirty trading day period, we may, within one trading day after the later of
stockholder approval to issue a number of shares of common stock in excess of the 19.99% Cap and the date that the conversion
shares registration statement filed by us with the SEC declared effective, notify each holder of Series A Preferred Stock that
all or part of such holder’s Series A Preferred Stock, plus all liquidated damages and other amounts due, were converted
into shares of common stock. Any mandatory conversion will be made into the number of shares of common stock determined on the
same basis as the optional conversion rights above.
Conversion
Price Adjustments
The
conversion price of the Series A Preferred Stock is subject to certain customary adjustments, including upon certain subsequent
equity sales and rights offerings. The conversion price is also subject to downward adjustments if we issue shares of our common
stock or securities convertible into or exercisable for shares of common stock, other than specified excluded securities, at per
share prices less than the then-base conversion price. In this event, the conversion price shall be reduced to then-base conversion
price.
The
conversion price is also subject to adjustment if we issue rights, options, or warrants to holders of common stock entitling them
to subscribe for or purchase shares of common stock at a price per share that is lower than the volume weighted average price
on the date for determination of stockholders entitled to receive such rights, option, or warrants. In this event, the conversion
price shall be multiplied by a fraction of which the denominator is the number of shares of common stock outstanding on the date
of issuance of such rights, options, or warrants plus the number of additional shares of common stock offered for subscription
or purchase, and the numerator shall be the number of shares of common stock outstanding on the date of issuance of such rights,
options, or warrants plus the number of shares that the aggregate offering price of the total number of shares so offered would
purchase at such volume weighted average price.
If
we distribute to holders of common stock evidences of our indebtedness or assets, including cash and cash dividends, or rights
or warrants to subscribe for or purchase any security, subject to certain limitations, then the conversion price shall be adjusted
by multiplying the conversion price then in effect immediately prior to the record date fixed for determination of stockholders
entitled to receive such distribution by a fraction of which the denominator shall be the volume weighted average price determined
as of the record date, and of which the numerator shall be the volume weighted average price on such record date less the then
fair market value at such record date of the portion of such assets or evidence of indebtedness or rights or warrants so distributed
applicable to one outstanding share of our common stock as determined by our board of directors in good faith.
In
the event of a Fundamental Transaction (as defined below) while the Series A Preferred Stock is outstanding, holders of Series
A Preferred Stock shall have the right to receive, for each share of common stock issuable upon conversion of the shares of our
Series A Preferred Stock that would have been issuable upon such conversion immediately prior to the occurrence of such Fundamental
Transaction, the number of shares of common stock of the successor or acquiring corporation or of us, if we are the surviving
corporation, and any additional consideration receivable as a result of the Fundamental Transaction by a holder of the number
of shares of common stock for which the Series A Preferred Stock is convertible immediately prior to such Fundamental Transaction.
A “Fundamental Transaction” is defined as any time while the Series A Preferred Stock is outstanding (a) we, directly
or indirectly, in one or more related transactions shall effect any merger or consolidation of us with or into another person,
(b) we, directly or indirectly, effect any sale, lease, license, assignment, transfer, conveyance, or other disposition of all
or substantially all of our assets in one or a series of related transactions, (c) any, direct or indirect, purchase offer, tender
offer, or exchange offer (whether by us or another person) is completed pursuant to which holders of our common stock are permitted
to sell, tender, or exchange their shares for other securities, cash, or property and has been accepted by the holders of a majority
of the outstanding common stock, (d) we, directly or indirectly, in one or more related transactions effect any reclassification,
reorganization or recapitalization of our common stock or any compulsory share exchange, pursuant to which the common stock is
effectively converted into or exchanged for other securities, cash or property, or (e) we, directly or indirectly, in one or more
related transactions consummate a stock or share purchase agreement or other business combination (including, without limitation,
a reorganization, recapitalization, spin-off, or scheme of arrangement) with another person, whereby such other person acquires
more than 50% of the outstanding shares of common stock (not including any shares of common stock held by the other person or
other persons making or party to, or associated or affiliated with the other persons making or party to, such stock or share purchase
agreement or other business combination).
Voting
Rights and Protective Provisions
The
holders of Series A Preferred Stock have no voting rights. However, we cannot, without the affirmative vote of the holders of
a majority of the then-outstanding shares of Series A Preferred Stock:
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authorize
or create any class of stock ranking as to dividends, redemption, or distribution of assets upon a liquidation senior to,
or otherwise pari passu with, the Series A Preferred Stock;
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amend
our articles of incorporation, or other charter documents in any manner that materially and adversely affects any rights of
the holders;
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increase
the number of authorized shares of Series A Preferred Stock; or
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enter
into any agreement with respect to any of the foregoing.
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As
long as any shares of Series A Preferred Stock are outstanding, unless the holders of at least 75% in Stated Value of the then-outstanding
shares of Series A Preferred Stock have otherwise given prior written consent, we cannot, directly or indirectly:
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other
than permitted indebtedness, as long as 25% of the then-outstanding shares of Series A Preferred Stock issued pursuant to
the SPA are then outstanding, enter into, create, incur, assume, guarantee, or suffer to exist any indebtedness for borrowed
money of any kind that is or may be senior to the Series A Preferred Stock in dividend rights or liquidation preference, including,
but not limited to, a guarantee, on or with respect to any of our property or assets now owned or hereafter acquired or any
interest therein of any income or profits therefrom;
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other
than permitted liens, enter into, create, incur, assume, or suffer to exist any liens of any kind, on or with respect to any
of our property or assets now owned or hereafter acquired or any interest therein or any income or profits therefrom;
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amend
our charter documents, including, without limitation, our articles of incorporation and bylaws, in any manner that materially
and adversely affects any rights of the holder;
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repay,
repurchase, or offer to repay, repurchase, or otherwise acquire more than a de minimis number of shares of our common stock,
common stock equivalents or junior securities, other than as to (a) the conversion shares or warrant shares as permitted under
the transaction documents and (b) repurchases of common stock or common stock equivalents of departing officers and directors,
provided that such repurchases shall not exceed an aggregate of $100,000 for all officers and directors for so long as the
Series A Preferred Stock is outstanding;
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pay
cash dividends or distributions on junior securities;
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enter
into any transaction with any affiliate of us that would be required to be disclosed in any public filing with the SEC, unless
such transaction is made on an arm’s length basis and expressly approved by a majority of the disinterested directors
of us (even if less than a quorum otherwise required for board approval); or
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enter
into any agreement with respect to the foregoing.
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Reservation
of Shares
We
initially were required to reserve 3,245,162 shares of common stock for issuance upon conversion of shares of Series A Preferred
Stock and are required to maintain a sufficient number of reserved shares of common stock to allow for the conversion of all shares
of Series A Preferred Stock.
Undesignated
Preferred Stock
The
ability to authorize undesignated preferred stock makes it possible for our board of directors to issue preferred stock with voting
or other rights or preferences that could impede the success of any attempt to acquire us. These and other provisions may have
the effect of deferring hostile takeovers or delaying changes in control or management of us.
Anti-Takeover
Effects of Nevada Law and Our Articles of Incorporation and Bylaws
Some
provisions of Nevada law, our articles of incorporation, and our bylaws contain provisions that could make the following transactions
more difficult: an acquisition of us by means of a tender offer; an acquisition of us by means of a proxy contest or otherwise;
or the removal of our incumbent officers and directors. It is possible that these provisions could make it more difficult to accomplish
or could deter transactions that stockholders may otherwise consider to be in their best interest or in our best interests, including
transactions that provide for payment of a premium over the market price for our shares.
These
provisions, summarized below, are intended to discourage coercive takeover practices and inadequate takeover bids. These provisions
are also designed to encourage persons seeking to acquire control of us to first negotiate with our board of directors. We believe
that the benefits of the increased protection of our potential ability to negotiate with the proponent of an unfriendly or unsolicited
proposal to acquire or restructure us outweigh the disadvantages of discouraging these proposals because negotiation of these
proposals could result in an improvement of their terms.
Undesignated
Preferred Stock. The ability of our board of directors, without action by the stockholders, to issue up to 14,994,000 shares
of preferred stock, which was previously authorized but remain undesignated, other than the Series A Preferred Stock, with voting
or other rights or preferences as designated by our board of directors could impede the success of any attempt to change control
of us. These and other provisions may have the effect of deferring hostile takeovers or delaying changes in control or management
of us.
Stockholder
Meetings. Our bylaws provide that a special meeting of stockholders may be called only by our president, by all of the directors
provided that there are no more than three directors, or if more than three, by any three directors, or by the holder of a majority
of our capital stock.
Stockholder
Action by Written Consent. Our bylaws allow for any action that may be taken at any annual or special meeting of the stockholders
to be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, is signed
by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or
take such action at a meeting at which all shares entitled to vote thereon were present and voted.
Stockholders
Not Entitled to Cumulative Voting. Our bylaws do not permit stockholders to cumulate their votes in the election of directors.
Accordingly, the holders of a majority of the outstanding shares of our common stock entitled to vote in any election of directors
can elect all of the directors standing for election, if they choose, other than any directors that holders of our preferred stock
may be entitled to elect.
Nevada
Business Combination Statutes. The “business combination” provisions of Sections 78.411 to 78.444, inclusive,
of the NRS, generally prohibit a Nevada corporation with at least 200 stockholders from engaging in various “combination”
transactions with any interested stockholder for a period of two years after the date of the transaction in which the person became
an interested stockholder, unless the transaction is approved by the board of directors prior to the date the interested stockholder
obtained such status or the combination is approved by the board of directors and thereafter is approved at a meeting of the stockholders
by the affirmative vote of stockholders representing at least 60% of the outstanding voting power held by disinterested stockholders,
and extends beyond the expiration of the two-year period, unless:
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the
combination was approved by the board of directors prior to the person becoming an interested stockholder or the transaction
by which the person first became an interested stockholder was approved by the board of directors before the person became
an interested stockholder or the combination is later approved by a majority of the voting power held by disinterested stockholders;
or
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if
the consideration to be paid by the interested stockholder is at least equal to the highest of: (a) the highest price per
share paid by the interested stockholder within the two years immediately preceding the date of the announcement of the combination
or in the transaction in which it became an interested stockholder, whichever is higher, (b) the market value per share of
common stock on the date of announcement of the combination and the date the interested stockholder acquired the shares, whichever
is higher, or (c) for holders of preferred stock, the highest liquidation value of the preferred stock, if it is higher.
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A
“combination” is generally defined to include mergers or consolidations or any sale, lease exchange, mortgage, pledge,
transfer, or other disposition, in one transaction or a series of transactions, with an “interested stockholder” having:
(a) an aggregate market value equal to 5% or more of the aggregate market value of the assets of the corporation, (b) an aggregate
market value equal to 5% or more of the aggregate market value of all outstanding shares of the corporation, (c) 10% or more of
the earning power or net income of the corporation, and (d) certain other transactions with an interested stockholder or an affiliate
or associate of an interested stockholder.
In
general, an “interested stockholder” is a person who, together with affiliates and associates, owns (or within two
years, did own) 10% or more of a corporation’s voting stock. The statute could prohibit or delay mergers or other takeover
or change in control attempts and, accordingly, may discourage attempts to acquire us even though such a transaction may offer
our stockholders the opportunity to sell their stock at a price above the prevailing market price.
Nevada
Control Share Acquisition Statutes. The “control share” provisions of Sections 78.378 to 78.3793, inclusive, of
the NRS apply to “issuing corporations” that are Nevada corporations with at least 200 stockholders, including at
least 100 stockholders of record who are Nevada residents, and that conduct business directly or indirectly in Nevada. The control
share statute prohibits an acquirer, under certain circumstances, from voting its shares of a target corporation’s stock
after crossing certain ownership threshold percentages, unless the acquirer obtains approval of the target corporation’s
disinterested stockholders. The statute specifies three thresholds: one-fifth or more but less than one-third, one-third but less
than a majority, and a majority or more, of the outstanding voting power. Generally, once an acquirer crosses one of the above
thresholds, those shares in an offer or acquisition and acquired within 90 days thereof become “control shares” and
such control shares are deprived of the right to vote until disinterested stockholders restore the right. These provisions also
provide that if control shares are accorded full voting rights and the acquiring person has acquired a majority or more of all
voting power, all other stockholders who do not vote in favor of authorizing voting rights to the control shares are entitled
to demand payment for the fair value of their shares in accordance with statutory procedures established for dissenters’
rights.
A
corporation may elect to not be governed by, or “opt out” of, the control share provisions by making an election in
its articles of incorporation or bylaws, provided that the opt-out election must be in place on the 10th day following the date
an acquiring person has acquired a controlling interest, that is, crossing any of the three thresholds described above. We have
not opted out of the control share statutes, and will be subject to these statutes if we are an “issuing corporation”
as defined in such statutes.
The
effect of the Nevada control share statutes is that the acquiring person, and those acting in association with the acquiring person,
will obtain only such voting rights in the control shares as are conferred by a resolution of the stockholders at an annual or
special meeting. The Nevada control share law, if applicable, could have the effect of discouraging takeovers of us.
Amendment
of Charter Provisions. The amendment of any of the above provisions would require approval by holders of at least a majority
of the total voting power of all of our outstanding voting stock.
The
provisions of Nevada law, our articles of incorporation, and our bylaws could have the effect of discouraging others from attempting
hostile takeovers and, as a consequence, they may also inhibit temporary fluctuations in the market price of our common stock
that often result from actual or rumored hostile takeover attempts. These provisions may also have the effect of preventing changes
in the composition of our board of directors and management. It is possible that these provisions could make it more difficult
to accomplish transactions that stockholders may otherwise deem to be in their best interests.
Outstanding
Warrants
Listed Common
Stock Purchase Warrants
Exercisability.
The warrants are exercisable immediately upon issuance and at any time for the five-year period from the date of issuance. The
warrants will be exercisable, at the option of each holder, in whole or in part, by delivering to us a duly executed exercise
notice accompanied by payment in full for the number of shares of our common stock purchased upon such exercise (except in the
case of a cashless exercise as discussed below).
Cashless
Exercise. In the event that a registration statement covering shares of our common stock underlying the warrants is not available
for the resale of such shares of our common stock underlying the warrants, the holder may, in its sole discretion, exercise the
warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to us upon such exercise
in payment of the aggregate exercise price, elect instead to receive upon such exercise the net number of shares of our common
stock determined according to the formula set forth in the warrant. In no event will we be required to make any cash payments
or net cash settlement to the registered holder in lieu of issuing shares of our common stock underlying the warrants.
Exercise
Price. The initial exercise price per-whole share of our common stock purchasable upon exercise of the warrants is $3.443,
or 110% of the effective offering price. The exercise price is subject to appropriate adjustment in the event of certain stock
dividends and distributions, stock splits stock combinations, reclassifications, or similar events affecting our common stock
and also upon any distribution of assets, including cash, stock, or other property to our stockholders.
Transferability.
Subject to applicable laws, the warrants may be transferred at the option of the holders upon surrender of the warrants together
with the appropriate instruments of transfer.
Exchange
Listing. The warrants are listed on The Nasdaq Capital Market under the symbol “VERBW.” Trading commenced at the
open of the market on April 5, 2019. We cannot provide assurances that a trading market for the warrants will develop or be maintained.
Fundamental
Transaction. If, at any time while the warrants are outstanding, (a) we consolidate or merge with or into another corporation
and we are not the surviving corporation, (b) we sell, lease, license, assign, transfer, convey, or otherwise dispose of all or
substantially all of our assets, (c) any purchase offer, tender offer, or exchange offer (whether by us or another individual
or entity) is completed pursuant to which holders of shares of our common stock are permitted to sell, tender, or exchange their
shares of our common stock for our other securities, cash, or property and has been accepted by the holders of 50% or more of
the outstanding shares of our common stock, (d) we effect any reclassification or recapitalization of shares of our common stock
or any compulsory share exchange pursuant to which the shares of our common stock are converted into or exchanged for other securities,
cash, or property, or (e) we consummate a stock or share purchase agreement or other business combination with another person
or entity whereby such other person or entity acquires more than 50% of the outstanding shares of our common stock, each, a “Common
Stock Purchase Warrant Fundamental Transaction,” then upon any subsequent exercise of the warrants, the holders thereof
will have the right to receive the same amount and kind of securities, cash, or property as it would have been entitled to receive
upon the occurrence of such Common Stock Purchase Warrant Fundamental Transaction if it had been immediately prior to such Common
Stock Purchase Warrant Fundamental Transaction, the holder of the number of warrant shares then issuable upon exercise of the
warrant, and any additional consideration payable as part of the Common Stock Purchase Warrant Fundamental Transaction.
Rights
as a Stockholder. Except as otherwise provided in the warrants or by virtue of such holder’s ownership of shares of
our common stock, the holder of the warrant does not have the rights or privileges of a holder of our common stock, including
any voting rights, until the holder exercises the warrant.
August
2019 Warrants
On
August 14, 2019, we entered into the SPA with certain purchasers named therein, or the Preferred Purchasers, pursuant to which
we agreed to issue and sell to the Preferred Purchasers, in addition to shares of our Series A Preferred Stock, warrants, which
we refer to as the August Warrants, to purchase up to approximately 3.87 million shares of our common stock. We closed the offering
on August 14, 2019 and issued 5,030 shares of Series A Preferred Stock and granted the August Warrants exercisable for up to 3,245,162
shares of common stock in connection therewith. We received gross proceeds equal to $5,030,000.
Exercisability.
The warrants are exercisable from and after six months after the date of issuance and at any time for the five-year period from
the date of issuance. The warrants will be exercisable, at the option of each holder, in whole or in part, by delivering to us
a duly executed exercise notice accompanied by payment in full for the number of shares of our common stock purchased upon such
exercise (except in the case of a cashless exercise as discussed below).
Cashless
Exercise. In the event that a registration statement covering shares of our common stock underlying the warrants is not available
for the resale of such shares of our common stock underlying the warrants, the holder may, in its sole discretion, exercise the
warrant in whole or in part and, in lieu of making the cash payment otherwise contemplated to be made to us upon such exercise
in payment of the aggregate exercise price, elect instead to receive upon such exercise the net number of shares of our common
stock determined according to the formula set forth in the warrant. In no event will we be required to make any cash payments
or net cash settlement to the registered holder in lieu of issuing shares of our common stock underlying the warrants.
Exercise
Price. The initial exercise price per-whole share of our common stock purchasable upon exercise of the warrants was $1.88.
The exercise price is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits,
stock combinations, reclassifications, or similar events affecting our common stock and also upon any distribution of assets,
including cash, stock, or other property to our stockholders. If we or any subsidiary, at any time while the August Warrants are
outstanding, sell or grant any option to purchase, or sell or grant any right to reprice or otherwise dispose of or issue any
common stock or common stock equivalents at an effective price less than the exercise price then in effect, then the exercise
price shall be reduced to the lower exercise price then in effect, subject to adjustment for reverse and forward stock splits,
recapitalizations, and similar transactions and subject to certain exceptions. If we, at any time while the August Warrants are
outstanding, issue rights, options, or warrants to all holders of common stock entitling them to subscribe for or purchase shares
of common stock at a price per share less than the volume weighted average price on the record date mentioned below, then the
exercise price shall be multiplied by a fraction, of which the denominator shall be the number of shares of common stock outstanding
on the date of issuance of such rights, options, or warrants plus the number of additional shares of common stock offered for
subscription or purchase, and of which the numerator shall be the number of shares of common stock outstanding on the date of
issuance of such rights, options, or warrants plus the number of shares that the aggregate offering price of the total number
of shares so offered (assuming receipt by us in full of all consideration payable upon exercise of such rights, options or warrants)
would purchase at such volume weighted average price. Such adjustment shall be made whenever such rights, options, or warrants
are issued, and shall become effective immediately after the record date for the determination of stockholders entitled to receive
such rights, options, or warrants.
Transferability.
Subject to applicable laws, the warrants may be transferred at the option of the holders upon surrender of the warrants together
with the appropriate instruments of transfer.
Exchange
Listing. Our August Warrants are not listed on any securities exchange or other trading system and we do not intend to apply
for listing on any securities exchange or other trading system.
Fundamental
Transaction. If, at any time while the warrants are outstanding, (a) we consolidate or merge with or into another corporation
and we are not the surviving corporation, (b) we sell, lease, license, assign, transfer, convey, or otherwise dispose of all or
substantially all of our assets, (c) any purchase offer, tender offer, or exchange offer (whether by us or another individual
or entity) is completed pursuant to which holders of shares of our common stock are permitted to sell, tender, or exchange their
shares of our common stock for our other securities, cash, or property and has been accepted by the holders of 50% or more of
the outstanding shares of our common stock, (d) we effect any reclassification or recapitalization of shares of our common stock
or any compulsory share exchange pursuant to which the shares of our common stock are converted into or exchanged for other securities,
cash, or property, or (e) we consummate a stock or share purchase agreement or other business combination with another person
or entity whereby such other person or entity acquires more than 50% of the outstanding shares of our common stock, each, an “August
Warrant Fundamental Transaction,” then upon any subsequent exercise of the warrants, the holders thereof will have the right
to receive the same amount and kind of securities, cash, or property as it would have been entitled to receive upon the occurrence
of such August Warrant Fundamental Transaction if it had been immediately prior to such August Warrant Fundamental Transaction,
the holder of the number of warrant shares then issuable upon exercise of the warrant, and any additional consideration payable
as part of the August Warrant Fundamental Transaction. In the event of an August Warrant Fundamental Transaction, we or any successor
entity shall, at the holder’s option, exercisable at any time concurrently with, or within 30 days after, the consummation
of the August Warrant Fundamental Transaction (or, if later, the date of the public announcement of the applicable August Warrant
Fundamental Transaction), purchase the warrant from the holder by paying to the holder an amount of cash equal to the Black Scholes
Value (as defined below) of the remaining unexercised portion of the warrant on the date of the consummation of such August Warrant
Fundamental Transaction. For purposes of the August Warrants, “Black Scholes Value” means the value of the warrant
based on the Black-Scholes Option Pricing Model obtained from the “OV” function on Bloomberg, L.P., or Bloomberg,
determined as of the day of consummation of the applicable August Warrant Fundamental Transaction for pricing purposes and reflecting
(A) a risk-free interest rate corresponding to the U.S. Treasury rate for a period equal to the time between the date of the public
announcement of the applicable August Warrant Fundamental Transaction and the termination date, (B) an expected volatility equal
to the 100-day volatility obtained from the HVT function on Bloomberg (determined utilizing a 365-day annualization factor) as
of the trading day immediately following the public announcement of the applicable August Warrant Fundamental Transaction (but
in no event shall such expected volatility be greater than one hundred percent (100%)), (C) the underlying price per share used
in such calculation shall be the greater of (i) the sum of the price per share being offered in cash, if any, plus the value of
any non-cash consideration, if any, being offered in such August Warrant Fundamental Transaction and (ii) the greater of (x) the
last volume weighted average price immediately prior to the public announcement of such August Warrant Fundamental Transaction
and (y) the last volume weighted average price immediately prior to the consummation of such August Warrant Fundamental Transaction,
and (D) a remaining option time equal to the time between the date of the public announcement of the applicable August Warrant
Fundamental Transaction and the termination date and (E) a zero cost of borrow. The payment of the Black Scholes Value will be
made by wire transfer of immediately available funds within five business days of the holder’s election (or, if later, on
the effective date of the August Warrant Fundamental Transaction).
Rights
as a Stockholder. Except as otherwise provided in the warrants or by virtue of such holder’s ownership of shares of
our common stock, the holder of the warrant does not have the rights or privileges of a holder of our common stock, including
any voting rights, until the holder exercises the warrant.
February
2020 Warrants
In
connection with our private placement of common stock in February 2020, the Preferred Purchasers who, as of February 7, 2020,
continued to own shares of our Series A Preferred Stock (a) waived their respective rights, or the February 2020 Waiver, to participate
in our private placement, and (b) declined to accept the price protection rights to which they otherwise were entitled as holders
of shares of our Series A Preferred Stock. In connection with the February 2020 Waiver, we granted to each of our Preferred Purchasers
who continued to own shares of our Series A Preferred Stock as of February 7, 2020 a five-year common stock purchase warrant,
or February 2020 Warrants, the terms of which are substantially similar to the terms of our August Warrants, with the sole material
differences being the grant date and the $1.55 per-share exercise price. The initial per-share exercise price of our August Warrants
was $1.88 and, by virtue of our private placement, the per-share exercise price was modified to $1.10. Our February 2020
Warrants are not listed on any securities exchange or other trading system and we do not intend to apply for listing on any securities
exchange or other trading system.
As
of January 14, 2021, we had 13,311,251 shares of our common stock underlying outstanding warrants, having a weighted-average exercise
price of approximately $2.49 per share.
SoloFire Exchange Agreement
In connection with
our acquisition of Ascend Certification, LLC, dba SoloFire (“SoloFire”) on September 4, 2020, we entered into an Exchange
Agreement with the prior owners of SoloFire whereby we agreed that on or after March 4, 2021, the prior owners of SoloFire can
exchange their Class B interests in our acquisition subsidiary, Verb Acquisition Co., LLC, for up to an aggregate of 2,642,159
shares of our common stock.
Outstanding
Options and Awards
As
of January 14, 2021, we had 6,228,045 shares of our common stock underlying outstanding stock options, having a weighted-average
exercise price of approximately $1.58 per share, and 2,811,508 restricted stock awards having a weighted-average grant date fair
value of $1.32 issued under our Incentive Plan, respectively.
Choice
of Forum
Our
bylaws provide that, unless we consent in writing to the selection of an alternative forum, the state and federal courts in the
State of Nevada shall be the exclusive forum for any litigation relating to our internal affairs, including, without limitation:
(a) any derivative action brought on behalf of us, (b) any action asserting a claim for breach of fiduciary duty to us or our
stockholders by any current or former officer, director, employee, or agent of us, or (c) any action against us or any current
or former officer, director, employee, or agent of us arising pursuant to any provision of the NRS, the articles of incorporation,
or the bylaws. For the avoidance of doubt, the exclusive forum provision described above does not apply to any claims arising
under the Securities Act or Exchange Act. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits
brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder, and Section 22 of
the Securities Act creates concurrent jurisdiction for federal and state courts over all suits brought to enforce any duty or
liability created by the Securities Act or the rules and regulations thereunder. See “Risk Factors— Risks Related
to an Investment in Our Securities—Our bylaws contain an exclusive forum provision, which could limit our stockholders’
ability to obtain a favorable judicial forum for disputes with us or our directors, officers, employees or agents.”
Transfer
Agent and Registrar
Our
transfer agent and registrar for our common stock is VStock Transfer, LLC, 18 Lafayette Place, Woodmere, New York 11598. Its telephone
number is 855-9VSTOCK.
Quotation
on The Nasdaq Capital Market
Shares
of our common stock are being traded on The Nasdaq Capital Market under the symbol “VERB.” Our common stock purchase
warrants are being traded on The Nasdaq Capital Market under the symbol “VERBW.”
DESCRIPTION
OF DEBT SECURITIES
The
following description, together with the additional information we include in any applicable prospectus supplement or free writing
prospectus, summarizes certain general terms and provisions of the debt securities that we may offer under this prospectus. When
we offer to sell a particular series of debt securities, we will describe the specific terms of the series in a supplement to
this prospectus. We will also indicate in the supplement to what extent the general terms and provisions described in this prospectus
apply to a particular series of debt securities.
We
may issue debt securities either separately, or together with, or upon the conversion or exercise of or in exchange for, other
securities described in this prospectus. Debt securities may be our senior, senior subordinated or subordinated obligations and,
unless otherwise specified in a supplement to this prospectus, the debt securities will be our direct, unsecured obligations and
may be issued in one or more series.
The
debt securities will be issued under an indenture between us and a third party to be identified therein as trustee. We have summarized
select portions of the indenture below. The summary is not complete. The form of the indenture has been filed as an exhibit to
the registration statement and you should read the indenture for provisions that may be important to you. In the summary below,
we have included references to the section numbers of the indenture so that you can easily locate these provisions. Capitalized
terms used in the summary and not defined herein have the meanings specified in the indenture.
We
may offer under this prospectus up to an aggregate principal amount of $75,000,000 in debt securities, or if debt securities are
issued at a discount, or in a foreign currency, foreign currency units or composite currency, the principal amount as may be sold
for an aggregate initial public offering price of up to $75,000,000. Unless otherwise specified in the applicable prospectus supplement,
the debt securities will represent direct, unsecured obligations of the Company and will rank equally with all of our other unsecured
indebtedness.
General
The
terms of each series of debt securities will be established by or pursuant to a resolution of our board of directors and set forth
or determined in the manner provided in a resolution of our board of directors, in an officer’s certificate or by a supplemental
indenture. (Section 2.2) We can issue an unlimited amount of debt securities under the indenture that may be issued in one or
more series. Unless otherwise set forth in a resolution of our board of directors, a supplemental indenture or an officer’s
certificate detailing the adopt of a series of debt securities, all securities in a series shall be identical. Debt securities
may differ between series with respect to any term, provided, that all series of debt securities shall be equally and ratably
entitled to the benefits of the indenture. (Section 2.1)
The
following statements relating to the debt securities and the indenture are summaries, qualified in their entirety by reference
to the detailed provisions of the indenture and the final form indenture as may be filed with a future prospectus supplement.
The
prospectus supplement will set forth, to the extent required, the following terms of the debt securities in respect of which the
prospectus supplement is delivered:
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issue price or prices, expressed as a percentage of the aggregate principal amount of the debt securities;
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interest rate or rates (which may be fixed or variable) or, if applicable, the method used to determine such rate or rates;
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date or dates from which interest, if any, will be payable and any regular record date for the interest payable;
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place or places where principal and, if applicable, premium and interest, is payable;
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the
terms and conditions upon which we may, or the holders may require us to, redeem or repurchase the debt securities;
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the
obligation, if any, of the Company to redeem or repurchase the debt securities of a series pursuant to any sinking fund or
analogous provision or at the option of a holder of the debt securities, and the period or periods within which, the price
or prices at which and the terms and conditions upon which debt securities of a series shall be redeemed or purchased, in
whole or in part, pursuant to such obligation;
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the
denominations in which such debt securities may be issuable, if other than denominations of $1,000 or any integral multiple
of that number;
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whether
the debt securities are to be issuable in the form of certificated securities (as described below) or global securities (as
described below);
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the
portion of principal amount that will be payable upon declaration of acceleration of the maturity date if other than the principal
amount of the debt securities;
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the
currency of denomination;
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the
designation of the currency, currencies or currency units in which payment of principal and, if applicable, premium and interest,
will be made;
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if
payments of principal and, if applicable, premium or interest, on the debt securities are to be made in one or more currencies
or currency units other than the currency of denomination, the manner in which the exchange rate with respect to such payments
will be determined;
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if
amounts of principal and, if applicable, premium and interest may be determined by reference to an index based on a currency
or currencies or by reference to a commodity, commodity index, stock exchange index or financial index, then the manner in
which such amounts will be determined;
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the
provisions, if any, relating to any collateral provided for such debt securities;
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any
addition to or change in the covenants and/or the acceleration provisions described in this prospectus or in the indenture;
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any
events of default, if not otherwise described below under “Defaults and Notice”;
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the
terms and conditions, if any, for conversion into or exchange for shares of our common stock or preferred stock;
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any
depositaries, interest rate calculation agents, exchange rate calculation agents or other agents;
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the
terms and conditions, if any, upon which the debt securities shall be subordinated in right of payment to other indebtedness
of the Company; and
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if
the debt securities of a series, in whole or any specified part, shall be defeasible. (Section 2.2)
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We
may issue debt securities that provide for an amount less than their stated principal amount to be due and payable upon declaration
of acceleration of their maturity pursuant to the terms of the indenture. We will provide you with information on the federal
income tax considerations and other special considerations applicable to any of these debt securities in the applicable prospectus
supplement.
If
we denominate the purchase price of any of the debt securities in a foreign currency or currencies or a foreign currency unit
or units, or if the principal of and any premium and interest on any series of debt securities is payable in a foreign currency
or currencies or a foreign currency unit or units, we will provide you with information on the restrictions, elections, general
tax considerations, specific terms and other information with respect to that issue of debt securities and such foreign currency
or currencies or foreign currency unit or units in the applicable prospectus supplement.
Exchange
and/or Conversion Rights
We
may issue debt securities which can be exchanged for or converted into shares of our common stock or preferred stock. If we do,
we will describe the terms of exchange or conversion in the prospectus supplement relating to these debt securities. (Section
2.2)
Transfer
and Exchange
Each
debt security will be represented by either one or more global securities registered in the name of The Depository Trust Company,
or the Depositary, or a nominee of the Depositary (we will refer to any debt security represented by a global debt security as
a book-entry debt security), or a certificate issued in definitive registered form (we will refer to any debt security represented
by a certificated security as a certificated debt security) as set forth in the applicable prospectus supplement. Except as set
forth under the heading “Global Debt Securities and Book-Entry System” below, book-entry debt securities will not
be issuable in certificated form.
Certificated
Debt Securities
You
may transfer or exchange certificated debt securities in accordance with the terms of the indenture. (Section 2.4) You will not
be charged a service charge for any transfer or exchange of certificated debt securities but may be required to pay an amount
sufficient to cover any tax or other governmental charge payable in connection with such transfer or exchange. (Section 2.7)
You
may effect the transfer of certificated debt securities and the right to receive the principal of, premium and interest on certificated
debt securities only by surrendering the certificate representing those certificated debt securities and either reissuance by
us or the trustee of the certificate to the new holder or the issuance by us or the trustee of a new certificate to the new holder.
(Section 2.7)
Global
Securities
Each
global debt security representing book-entry debt securities will be deposited with, or on behalf of, the Depositary, and registered
in the name of the Depositary or a nominee of the Depositary. Please see “Global Securities.”
No
Protection in the Event of a Change of Control
Unless
we state otherwise in the applicable prospectus supplement, the debt securities will not contain any provisions which may afford
holders of the debt securities protection in the event we have a change in control or in the event of a highly leveraged transaction
(whether or not such transaction results in a change in control) which could adversely affect holders of debt securities.
Covenants
Unless
otherwise indicated in this prospectus or the applicable prospectus supplement, our debt securities may not have the benefit of
any covenant that limits or restricts our business or operations, the pledging of our assets or the incurrence by us of indebtedness.
We will describe in the applicable prospectus supplement any material covenants in respect of a series of debt securities. (Article
4)
Consolidation,
Merger and Sale of Assets
We
may not consolidate with or merge with or into, or sell, assign, convey, transfer, lease or otherwise dispose of all or substantially
all of our properties and assets to any person, or a successor person, unless:
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the
indenture shall remain in full force and effect and either we are the surviving corporation or the successor person (if other
than us) is a corporation organized and validly existing under the laws of any U.S. domestic jurisdiction or a corporation
or comparable legal entity organized under the laws of a foreign jurisdiction and expressly assumes by a supplemental indenture
executed and delivered to the trustee, all of our obligations on the debt securities and under the indenture; and
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immediately
after giving effect to the transaction, no Default or Event of Default, shall have occurred and be continuing. (Section 5.1)
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Defaults
and Notice
Unless
otherwise specified in the resolution of our board of directors, supplemental indenture or officer’s certificate establishing
a series of debt securities, “Event of Default” means with respect to any series of debt securities, any of the following:
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failure
to pay the principal of, or premium, if any, on any debt security when the same becomes due and payable at Maturity, upon
acceleration, redemption or otherwise;
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failure
to make a payment of any interest on any debt security of such series when due and payable, and the default continues for
a period of 30 days;
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failure
to perform or observe any other covenants or agreements in the indenture with respect to the debt securities of the series
or in the Indenture for 60 days after written notice from the trustee or the holders of not less than 25% of the aggregate
principal amount of the debt securities of the series then outstanding, with such notice specifying the default, demanding
that it be remedied and stating that the notice is a “Notice of Default”;
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certain
events relating to our bankruptcy, insolvency or reorganization or the bankruptcy, insolvency or reorganization of a Significant
Subsidiary;
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certain
cross defaults, if and as applicable; and
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any
other Event of Default specified in the resolution of our board of directors, supplemental indenture or officer’s certificate
establishing such series of debt securities. (Section 6.1)
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No
Event of Default with respect to a particular series of debt securities necessarily constitutes an Event of Default with respect
to any other series of debt securities. (Section 6.2) The occurrence of certain Events of Default or an acceleration under the
indenture may constitute an event of default under certain indebtedness of ours or our subsidiary outstanding from time to time.
If
an Event of Default with respect to debt securities of any series at the time outstanding (except as to certain events of bankruptcy,
insolvency or reorganization) occurs and is continuing, then the trustee or the holders of not less than 25% in principal amount
of the outstanding debt securities of that series may, by a notice in writing to us (and to the trustee if given by the holders),
declare to be due and payable immediately the principal of, and accrued and unpaid interest, if any, on, all debt securities of
that series. In the case of an Event of Default resulting from certain events of bankruptcy, insolvency or reorganization, the
principal (or such specified amount) of and accrued and unpaid interest, if any, on all outstanding debt securities will become
and be immediately due and payable without any declaration or other act on the part of the trustee or any holder of outstanding
debt securities. At any time after a declaration of acceleration with respect to debt securities of any series has been made,
but before a judgment or decree for payment of the money due has been obtained by the trustee, the holders of a majority in principal
amount of the outstanding debt securities of that series may rescind and annul the acceleration if all Events of Default, other
than the non-payment of accelerated principal and interest, if any, with respect to debt securities of that series, have been
cured or waived as provided in the indenture and such rescission would not conflict with any judgment or decree. (Section 6.2)
We refer you to the prospectus supplement relating to any series of debt securities that are discount securities for the particular
provisions relating to acceleration of a portion of the principal amount of such discount securities upon the occurrence of an
Event of Default.
The
trustee is entitled to be indemnified by holders of debt securities before proceeding to exercise any trust or power under the
indenture at the request of such holders. (Section 6.6) The holders of at least a majority in aggregate principal amount of the
then outstanding debt securities of any series may direct the time, method and place of conducting any proceedings for any remedy
available to the trustee for such series, or of exercising any trust or power conferred upon the trustee with respect to the debt
securities of such series. (Section 6.5) However, the trustee may decline to follow any such direction that conflicts with law
or the indenture, or that the trustee determines may be unduly prejudicial to the holders of the debt securities of such series
not joining in such direction. (Section 6.5)
No
holder of any debt security of any series will have any right to institute any proceeding or pursue any remedy, with respect to
the indenture or a series of debt securities, unless:
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That
holder has previously given to the trustee written notice of a continuing Event of Default with respect to debt securities
of that series; and
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The
holders of note less than 25% in principal amount of the outstanding debt securities of that series have made written request,
and offered indemnity or security satisfactory to the trustee, to the trustee to institute the proceeding as trustee, and
the trustee has failed to institute the proceeding within 60 days and has not received from the holder of not less than a
majority in principal amount of the outstanding debt securities of that series a direction inconsistent with that request
within such 60 day periods (Section 6.6).
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No
holder of debt securities under the indenture may use the indenture to prejudice the rights of another holder or to obtain a preference
or priority over another holder of debt securities. (Section 6.6)
Notwithstanding
any other provision in the indenture, the holder of any debt security will have an absolute and unconditional right to receive
payment of the principal of, premium and any interest on that debt security on or after the due dates expressed in that debt security
and to institute suit for the enforcement of payment. (Section 6.7)
The
indenture requires us, within 120 days after the end of our fiscal year, to furnish to the trustee a statement as to compliance
with the indenture. (Section 4.4) If a Default or Event of Default occurs and is continuing with respect to the securities of
any series and if it is known to a responsible officer of the trustee, the trustee shall mail to each holder of the securities
of that series notice of a Default or Event of Default within 90 days after it occurs or, if later, after a responsible officer
of the trustee has knowledge of such Default or Event of Default (except if such Default or Event of Default has been validly
cured or waived before the trustee gives such notice). The indenture provides that the trustee may withhold notice to the holders
of debt securities of any series of any Default or Event of Default (except in payment on any debt securities of that series)
with respect to debt securities of that series if the trustee determines in good faith that withholding notice is in the interest
of the holders of those debt securities. (Section 7.5)
Modification
of the Indenture
We
and the trustee may modify, amend or supplement the indenture or the debt securities of any series without the consent of any
holder of any debt security:
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to
comply with covenants in the indenture described above under the heading “Consolidation, Merger and Sale of Assets”;
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to
provide for uncertificated securities in addition to or in place of certificated securities;
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to
provide for certificated debt securities in addition to uncertificated debt securities;
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to
comply with requirements of the SEC in order to effect or maintain the qualification of the indenture under the Trust Indenture
Act;
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to
cure any ambiguity, defect or inconsistency or make any other change to the indenture or the debt securities that does not
materially and adversely affect the rights of any holder of our debt securities under the indenture;
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to
provide for the issuance of and establish the form and terms and conditions of debt securities of any series as permitted
by the indenture; or
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to
effect the appointment of a successor trustee with respect to the debt securities of any series and to add to or change any
of the provisions of the indenture to provide for or facilitate administration by more than one trustee. (Section 8.1)
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We
may also modify or supplement the indenture with the written consent of the holders of at least a majority in principal amount
of the outstanding debt securities of each series affected by the modifications or supplement. The holders of at least a majority
in principal amount of the outstanding debt securities of each such series affected by the modifications or supplement may waive
compliance by us in a particular instance with any provision of the indenture or the debt securities of such affected series of
debt securities without notice to any holder of our debt securities. We may not make any modification or amendment without the
consent of the holders of each affected debt security then outstanding if that amendment will:
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reduce
the amount of debt securities whose holders must consent to an amendment, supplement or waiver;
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reduce
the rate of or change the time for payment of interest (including default interest) on any debt security;
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reduce
the principal of or premium on or change the fixed maturity of any debt security or reduce the amount of, or postpone the
date fixed for, the payment of any sinking fund or analogous obligation with respect to any series of debt securities;
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make
the principal of or premium or interest on any debt security payable in currency other than that stated in the debt security;
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change
the amount or time of any payment required by any debt security, or reduce the premium payable upon any redemption of any
debt securities, or change the time before which no such redemption may be made;
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waive
a default in the payment of the principal of, or interest or premium, if any, on, any debt security (except a rescission of
acceleration of the debt securities of any series by the holders of at least a majority in aggregate principal amount of the
then outstanding debt securities of that series and a waiver of the payment default that resulted from such acceleration);
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waive
a redemption payment with respect to any debt security, or change any of the provisions with respect to the redemption of
any debt securities;
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reduce
the principal amount of discount securities payable upon acceleration of maturity; or
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make
any change to certain provisions of the indenture relating to the rights of holders to institute suit with respect to the
indenture or the debt securities of a series and the modification or supplement of the indenture or the debt securities of
any series requiring the consent of holders of our debt securities. (Section 8.2)
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The
holders of a majority in principal amount of the outstanding debt securities of any series may on behalf of the holders of all
the debt securities of such series waive any past default under the indenture with respect to that series and its consequences,
except a default in the payment of the principal of, premium or any interest on any debt security of that series (Section 6.4);
provided, however, that the holders of a majority in principal amount of the outstanding debt securities of any series may rescind
an acceleration and its consequences, including any related payment default that resulted from the acceleration. (Section 6.2)
Defeasance
of Debt Securities and Certain Covenants in Certain Circumstances
Legal
Defeasance. The indenture provides that, unless otherwise provided by the terms of the applicable series of debt securities,
we may be discharged from any and all obligations in respect of the debt securities of any series (subject to certain exceptions).
We will be so discharged upon the irrevocable deposit with the trustee, in trust, of money and/or U.S. government obligations
or, in the case of debt securities denominated in a single currency other than U.S. Dollars, government obligations of the government
that issued or caused to be issued such currency, that, through the payment of interest and principal in accordance with their
terms, will provide money or U.S. government obligations in an amount sufficient in the opinion of a nationally recognized firm
of independent public accountants or investment bank to pay and discharge each installment of principal, premium and interest
on and any mandatory sinking fund payments in respect of the debt securities of that series on the stated maturity of those payments
in accordance with the terms of the indenture and those debt securities.
This
discharge may occur only if, among other things, we have delivered to the trustee an opinion of counsel stating that we have received
from, or there has been published by, the United States Internal Revenue Service a ruling or, since the date of execution of the
indenture, there has been a change in the applicable United States federal income tax law, in either case to the effect that,
and based thereon such opinion shall confirm that, the holders of the debt securities of that series will not recognize income,
gain or loss for United States federal income tax purposes as a result of the deposit, defeasance and discharge and will be subject
to United States federal income tax on the same amounts and in the same manner and at the same times as would have been the case
if the deposit, defeasance and discharge had not occurred. (Section 8.3)
Defeasance
of Certain Covenants. The indenture provides that, unless otherwise provided by the terms of the applicable series of debt
securities, upon compliance with certain conditions:
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we
may omit to comply with the covenant described under the heading “Consolidation, Merger and Sale of Assets” and
certain other covenants set forth in the indenture, as well as any additional covenants which may be set forth in the applicable
prospectus supplement; and
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any
omission to comply with those covenants will not constitute a Default or an Event of Default with respect to the debt securities
of that series (“covenant defeasance”).
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This
is referred to as covenant defeasance. The conditions include:
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depositing
with the trustee money and/or U.S. government obligations or, in the case of debt securities denominated in a single currency
other than U.S. Dollars, government obligations of the government that issued or caused to be issued such currency, that,
through the payment of interest and principal in accordance with their terms, will provide money in an amount sufficient in
the opinion of a nationally recognized firm of independent public accountants or investment bank to pay and discharge each
installment of principal of, premium and interest on and any mandatory sinking fund payments in respect of the debt securities
of that series on the stated maturity of those payments in accordance with the terms of the indenture and those debt securities;
and
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delivering
to the trustee an opinion of counsel to the effect that the holders of the debt securities of that series will not recognize
income, gain or loss for United States federal income tax purposes as a result of the deposit and related covenant defeasance
and will be subject to United States federal income tax on the same amounts and in the same manner and at the same times as
would have been the case if the deposit and related covenant defeasance had not occurred. (Section 9.3).
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No
Personal Liability of Directors, Officers, Employees or Shareholders
None
of our past, present or future directors, officers, employees or shareholders, as such, will have any liability for any of our
obligations under the debt securities or the indenture or for any claim based on, or in respect or by reason of, such obligations
or their creation. By accepting a debt security, each holder waives and releases all such liability. This waiver and release is
part of the consideration for the issue of the debt securities. However, this waiver and release may not be effective to waive
liabilities under U.S. federal securities laws, and it is the view of the SEC that such a waiver is against public policy. (Section
10.9)
Governing
Law
The
indenture and the debt securities, including any claim or controversy arising out of or relating to the indenture or the securities,
will be governed by the laws of the State of New York. (Section 10.8)
DESCRIPTION
OF WARRANTS
We
may issue warrants to purchase shares of our common stock, preferred stock and/or debt securities in one or more series together
with other securities or separately, as described in each applicable prospectus supplement. Below is a description of certain
general terms and provisions of the warrants that we may offer. Particular terms of the warrants will be described in the applicable
warrant agreements and the applicable prospectus supplement for the warrants.
The
applicable prospectus supplement will contain, where applicable, the following terms of and other information relating to the
warrants:
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the
number of shares of common stock or preferred stock purchasable upon the exercise of warrants to purchase such shares and
the price at which such number of shares may be purchased upon such exercise;
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the
designation, stated value and terms (including, without limitation, liquidation, dividend, conversion and voting rights) of
the series of
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preferred
stock purchasable upon exercise of warrants to purchase preferred stock;
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the
principal amount of debt securities that may be purchased upon exercise of a debt warrant and the exercise price for the warrants,
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which
may be payable in cash, securities or other property;
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the
date, if any, on and after which the warrants and the related debt securities, preferred stock or common stock will be separately
transferable;
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the
terms of any rights to redeem or call the warrants;
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the
date on which the right to exercise the warrants will commence and the date on which the right will expire;
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United
States Federal income tax consequences applicable to the warrants; and
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any
additional terms of the warrants, including terms, procedures, and limitations relating to the exchange, exercise and settlement
of the warrants.
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Holders
of equity warrants will not be entitled:
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to
vote, consent or receive dividends;
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receive
notice as shareholders with respect to any meeting of shareholders for the election of our directors or any other matter;
or
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exercise
any rights as shareholders of Verb.
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Each
warrant will entitle its holder to purchase the principal amount of debt securities or the number of shares of preferred stock
or common stock at the exercise price set forth in, or calculable as set forth in, the applicable prospectus supplement. Unless
we otherwise specify in the applicable prospectus supplement, holders of the warrants may exercise the warrants at any time up
to the specified time on the expiration date that we set forth in the applicable prospectus supplement. After the close of business
on the expiration date, unexercised warrants will become void.
A
holder of warrant certificates may exchange them for new warrant certificates of different denominations, present them for registration
of transfer and exercise them at the corporate trust office of the warrant agent or any other office indicated in the applicable
prospectus supplement. Until any warrants to purchase debt securities are exercised, the holder of the warrants will not have
any rights of holders of the debt securities that can be purchased upon exercise, including any rights to receive payments of
principal, premium or interest on the underlying debt securities or to enforce covenants in the applicable indenture. Until any
warrants to purchase common stock or preferred stock are exercised, the holders of the warrants will not have any rights of holders
of the underlying common stock or preferred stock, including any rights to receive dividends or payments upon any liquidation,
dissolution or winding up on the common stock or preferred stock, if any.
Prospective
purchasers of warrants should be aware that special United States federal income tax, accounting and other considerations may
be applicable to instruments such as warrants. The applicable prospectus supplement will describe such considerations, to the
extent they are material, as they apply generally to purchasers of such warrants.
DESCRIPTION
OF SUBSCRIPTION RIGHTS
We
may issue subscription rights to purchase our common stock, preferred stock or debt securities. These subscription rights may
be offered independently or together with any other security offered hereby and may or may not be transferable by the stockholder
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 our common stock, preferred stock or debt securities upon the exercise of the subscription rights;
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the
number of subscription rights to be issued to each stockholder;
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the
number and terms of our common stock, preferred stock or debt securities 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
or an over-allotment privilege to the extent the securities are fully subscribed; 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
descriptions of the subscription rights in this prospectus and in any prospectus supplement are summaries of the material provisions
of the applicable subscription right agreements. These descriptions do not restate those subscription right agreements in their
entirety and may not contain all the information that you may find useful. We urge you to read the applicable subscription right
agreements because they, and not the summaries, define your rights as holders of the subscription rights. For more information,
please review the forms of the relevant subscription right agreements, which will be filed with the SEC promptly after the offering
of subscription rights and will be available as described in the section of this prospectus captioned “Where You Can Find
More Information.”
GLOBAL
SECURITIES
Unless
we indicate differently in any applicable prospectus supplement, the securities initially will be issued in book-entry form and
represented by one or more global notes or global securities, or, collectively, global securities. The global securities will
be deposited with, or on behalf of, The Depository Trust Company, New York, New York, as depositary, or DTC, and registered in
the name of Cede & Co., the nominee of DTC. Unless and until it is exchanged for individual certificates evidencing securities
under the limited circumstances described below, a global security may not be transferred except as a whole by the depositary
to its nominee or by the nominee to the depositary, or by the depositary or its nominee to a successor depositary or to a nominee
of the successor depositary.
DTC
has advised us that it is:
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a
limited-purpose trust company organized under the New York Banking Law;
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a
“banking organization” within the meaning of the New York Banking Law;
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a
member of the Federal Reserve System;
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a
“clearing corporation” within the meaning of the New York Uniform Commercial Code; and
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a
“clearing agency” registered pursuant to the provisions of Section 17A of the Exchange Act.
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DTC
holds securities that its participants deposit with DTC. DTC also facilitates the settlement among its participants of securities
transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in participants’
accounts, thereby eliminating the need for physical movement of securities certificates. “Direct participants” in
DTC include securities brokers and dealers, including underwriters, banks, trust companies, clearing corporations and other organizations.
DTC is a wholly-owned subsidiary of The Depository Trust & Clearing Corporation, or DTCC. DTCC is the holding company for
DTC, National Securities Clearing Corporation and Fixed Income Clearing Corporation, all of which are registered clearing agencies.
DTCC is owned by the users of its regulated subsidiaries. Access to the DTC system is also available to others, which we sometimes
refer to as indirect participants, that clear through or maintain a custodial relationship with a direct participant, either directly
or indirectly. The rules applicable to DTC and its participants are on file with the SEC.
Purchases
of securities under the DTC system must be made by or through direct participants, which will receive a credit for the securities
on DTC’s records. The ownership interest of the actual purchaser of a security, which we sometimes refer to as a beneficial
owner, is in turn recorded on the direct and indirect participants’ records. Beneficial owners of securities will not receive
written confirmation from DTC of their purchases. However, beneficial owners are expected to receive written confirmations providing
details of their transactions, as well as periodic statements of their holdings, from the direct or indirect participants through
which they purchased securities. Transfers of ownership interests in global securities are to be accomplished by entries made
on the books of participants acting on behalf of beneficial owners. Beneficial owners will not receive certificates representing
their ownership interests in the global securities, except under the limited circumstances described below.
To
facilitate subsequent transfers, all global securities deposited by direct participants with DTC will be registered in the name
of DTC’s partnership nominee, Cede & Co., or such other name as may be requested by an authorized representative of
DTC. The deposit of securities with DTC and their registration in the name of Cede & Co. or such other nominee will not change
the beneficial ownership of the securities. DTC has no knowledge of the actual beneficial owners of the securities. DTC’s
records reflect only the identity of the direct participants to whose accounts the securities are credited, which may or may not
be the beneficial owners. The participants are responsible for keeping account of their holdings on behalf of their customers.
So
long as the securities are in book-entry form, you will receive payments and may transfer securities only through the facilities
of the depositary and its direct and indirect participants. We will maintain an office or agency in the location specified in
the prospectus supplement for the applicable securities, where notices and demands in respect of the securities and the indenture
may be delivered to us and where certificated securities may be surrendered for payment, registration of transfer or exchange.
Conveyance
of notices and other communications by DTC to direct participants, by direct participants to indirect participants and by direct
participants and indirect participants to beneficial owners will be governed by arrangements among them, subject to any legal
requirements in effect from time to time.
Redemption
notices will be sent to DTC. If less than all of the securities of a particular series are being redeemed, DTC’s practice
is to determine by lot the amount of the interest of each direct participant in the securities of such series to be redeemed.
Neither
DTC nor Cede & Co. (or such other DTC nominee) will consent or vote with respect to the securities. Under its usual procedures,
DTC will mail an omnibus proxy to us as soon as possible after the record date. The omnibus proxy assigns the consenting or voting
rights of Cede & Co. to those direct participants to whose accounts the securities of such series are credited on the record
date, identified in a listing attached to the omnibus proxy.
So
long as securities are in book-entry form, we will make payments on those securities to the depositary or its nominee, as the
registered owner of such securities, by wire transfer of immediately available funds. If securities are issued in definitive certificated
form under the limited circumstances described below and unless if otherwise provided in the description of the applicable securities
herein or in the applicable prospectus supplement, we will have the option of making payments by check mailed to the addresses
of the persons entitled to payment or by wire transfer to bank accounts in the United States designated in writing to the applicable
trustee or other designated party at least 15 days before the applicable payment date by the persons entitled to payment, unless
a shorter period is satisfactory to the applicable trustee or other designated party.
Redemption
proceeds, distributions and dividend payments on the securities will be made to Cede & Co., or such other nominee as may be
requested by an authorized representative of DTC. DTC’s practice is to credit direct participants’ accounts upon DTC’s
receipt of funds and corresponding detail information from us on the payment date in accordance with their respective holdings
shown on DTC records. Payments by participants to beneficial owners will be governed by standing instructions and customary practices,
as is the case with securities held for the account of customers in bearer form or registered in “street name.” Those
payments will be the responsibility of participants and not of DTC or us, subject to any statutory or regulatory requirements
in effect from time to time. Payment of redemption proceeds, distributions and dividend payments to Cede & Co., or such other
nominee as may be requested by an authorized representative of DTC, is our responsibility, disbursement of payments to direct
participants is the responsibility of DTC, and disbursement of payments to the beneficial owners is the responsibility of direct
and indirect participants.
Except
under the limited circumstances described below, purchasers of securities will not be entitled to have securities registered in
their names and will not receive physical delivery of securities. Accordingly, each beneficial owner must rely on the procedures
of DTC and its participants to exercise any rights under the securities and the indenture.
The
laws of some jurisdictions may require that some purchasers of securities take physical delivery of securities in definitive form.
Those laws may impair the ability to transfer or pledge beneficial interests in securities.
DTC
may discontinue providing its services as securities depositary with respect to the securities at any time by giving reasonable
notice to us. Under such circumstances, in the event that a successor depositary is not obtained, securities certificates are
required to be printed and delivered.
As
noted above, beneficial owners of a particular series of securities generally will not receive certificates representing their
ownership interests in those securities. However, if:
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DTC
notifies us that it is unwilling or unable to continue as a depositary for the global security or securities representing
such series of securities or if DTC ceases to be a clearing agency registered under the Exchange Act at a time when it is
required to be registered and a successor depositary is not appointed within 90 days of the notification to us or of our becoming
aware of DTC’s ceasing to be so registered, as the case may be;
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we
determine, in our sole discretion, not to have such securities represented by one or more global securities; or
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an
Event of Default has occurred and is continuing with respect to such series of securities, we will prepare and deliver certificates
for such securities in exchange for beneficial interests in the global securities
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we
will prepare and deliver certificates for such securities in exchange for beneficial interests in the global securities. Any beneficial
interest in a global security that is exchangeable under the circumstances described in the preceding sentence will be exchangeable
for securities in definitive certificated form registered in the names that the depositary directs. It is expected that these
directions will be based upon directions received by the depositary from its participants with respect to ownership of beneficial
interests in the global securities.
Euroclear
and Clearstream
If
so provided in the applicable prospectus supplement, you may hold interests in a global security through Clearstream Banking S.A.,
which we refer to as “Clearstream,” or Euroclear Bank S.A./N.V., as operator of the Euroclear System, which we refer
to as “Euroclear,” either directly if you are a participant in Clearstream or Euroclear or indirectly through organizations
which are participants in Clearstream or Euroclear. Clearstream and Euroclear will hold interests on behalf of their respective
participants through customers’ securities accounts in the names of Clearstream and Euroclear, respectively, on the books
of their respective U.S. depositaries, which in turn will hold such interests in customers’ securities accounts in such
depositaries’ names on DTC’s books.
Clearstream
and Euroclear are securities clearance systems in Europe. Clearstream and Euroclear hold securities for their respective participating
organizations and facilitate the clearance and settlement of securities transactions between those participants through electronic
book-entry changes in their accounts, thereby eliminating the need for physical movement of certificates.
Payments,
deliveries, transfers, exchanges, notices and other matters relating to beneficial interests in global securities owned through
Euroclear or Clearstream must comply with the rules and procedures of those systems. Transactions between participants in Euroclear
or Clearstream, on one hand, and other participants in DTC, on the other hand, are also subject to DTC’s rules and procedures.
Investors
will be able to make and receive through Euroclear and Clearstream payments, deliveries, transfers and other transactions involving
any beneficial interests in global securities held through those systems only on days when those systems are open for business.
Those systems may not be open for business on days when banks, brokers and other institutions are open for business in the United
States.
Cross-market
transfers between participants in DTC, on the one hand, and participants in Euroclear or Clearstream, on the other hand, will
be effected through DTC in accordance with the DTC’s rules on behalf of Euroclear or Clearstream, as the case may be, by
their respective U.S. depositaries; however, such cross-market transactions will require delivery of instructions to Euroclear
or Clearstream, as the case may be, by the counterparty in such system in accordance with the rules and procedures and within
the established deadlines (European time) of such system. Euroclear or Clearstream, as the case may be, will, if the transaction
meets its settlement requirements, deliver instructions to its U.S. depositary to take DTC, and making or receiving payment in
accordance with normal procedures for same-day fund settlement. Participants in Euroclear or Clearstream may not deliver instructions
directly to their respective U.S. depositaries.
Due
to time zone differences, the securities accounts of a participant in Euroclear or Clearstream purchasing an interest in a global
security from a direct participant in DTC will be credited, and any such crediting will be reported to the relevant participant
in Euroclear or Clearstream, during the securities settlement processing day (which must be a business day for Euroclear or Clearstream)
immediately following the settlement date of DTC. Cash received in Euroclear or Clearstream as a result of sales of interests
in a global security by or through a participant in Euroclear or Clearstream to a direct participant in DTC will be received with
value on the settlement date of DTC but will be available in the relevant Euroclear or Clearstream cash account only as of the
business day for Euroclear or Clearstream following DTC’s settlement date.
Other
The
information in this section of this prospectus concerning DTC, Clearstream, Euroclear and their respective book-entry systems
has been obtained from sources that we believe to be reliable, but we do not take responsibility for this information. This information
has been provided solely as a matter of convenience. The rules and procedures of DTC, Clearstream and Euroclear are solely within
the control of those organizations and could change at any time. Neither we nor the trustee nor any agent of ours or of the trustee
has any control over those entities and none of us takes any responsibility for their activities. You are urged to contact DTC,
Clearstream and Euroclear or their respective participants directly to discuss those matters. In addition, although we expect
that DTC, Clearstream and Euroclear will perform the foregoing procedures, none of them is under any obligation to perform or
continue to perform such procedures and such procedures may be discontinued at any time. Neither we nor any agent of ours will
have any responsibility for the performance or nonperformance by DTC, Clearstream and Euroclear or their respective participants
of these or any other rules or procedures governing their respective operations.
DESCRIPTION
OF UNITS
Below
is a description of certain general terms and provisions of the units that we may offer. Particular terms of the units will be
described in the applicable unit agreements and the applicable prospectus supplement for the units. We urge you to read the applicable
prospectus supplements related to the units that we sell under this prospectus, as well as the complete unit agreements that contain
the terms of the units.
We
may issue units comprised of our common stock, our preferred stock, debt securities, warrants, rights, purchase contracts, or
any combination of such securities under this prospectus. Units may be issued in one or more series, independently or together
with shares of our common stock, our preferred stock, debt securities, warrants, rights or purchase contracts, and the units may
be attached to or separate from such securities. We may issue units directly or under a unit agreement to be entered into between
us and a unit agent. We will name any unit agent in the applicable prospectus supplement. Any unit agent will act solely as our
agent in connection with the units of a particular series and will not assume any obligation or relationship of agency or trust
for or with any holders or beneficial owners of units. Each unit will be issued so that the holder of the unit is also the holder
of each security included in the unit. Thus, the holder of a unit will have the rights and obligations of a holder of each included
security. We will describe in the applicable prospectus supplement the terms of the series of units, including the following:
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the
designation and terms of the units and of the securities comprising the units, including whether and under what circumstances
those securities may be held or transferred separately;
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the
price or prices at which the units will be issued;
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the
date, if any, on and after which the securities included in the units will be separately transferable;
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any
provisions of the governing unit agreement that differ from those described in this section; and
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any
provisions for the issuance, payment, settlement, transfer, or exchange of the units or of the securities comprising the units.
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PLAN
OF DISTRIBUTION
We
may sell the securities being offered by this prospectus separately or together:
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directly
to purchasers;
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through
agents;
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to
or through underwriters;
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through
dealers;
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in
“at-the-market” offerings (as defined in Rule 415 under the Securities Act);
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through
a block trade in which the broker or dealer engaged to handle the block trade will attempt to sell the securities as agent,
but may position and resell a portion of the block as principal to facilitate the transaction;
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through
a combination of any of these methods of sale; or
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through
any other method permitted by applicable law and described in a prospectus supplement.
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In
addition, we may issue the securities being offered by this prospectus as a dividend or distribution. We may effect the distribution
of the securities from time to time in one or more transactions:
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at
a fixed price or prices, which may be changed from time to time;
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at
market prices prevailing at the times of sale;
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at
prices related to prevailing market prices; or
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at
negotiated prices.
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For
example, we may engage in at-the-market offerings into an existing trading market in accordance with Rule 415(a)(4) under the
Securities Act. We may also sell securities through a rights offering, forward contracts or similar arrangements. In any distribution
of subscription rights to stockholders, if all of the underlying securities are not subscribed for, we may then sell the unsubscribed
securities directly to third parties or may engage the services of one or more underwriters, dealers or agents, including standby
underwriters, to sell the unsubscribed securities to third parties.
The
securities issued and sold under this prospectus will have no established trading market, other than our common stock, which is
listed on The Nasdaq Capital Market. Any shares of our common stock sold pursuant to this prospectus will be eligible for listing
and trading on The Nasdaq Capital Market, subject to official notice of issuance. Any underwriters to whom securities are sold
by us for public offering and sale may make a market in the securities, but the underwriters will not be obligated to do so and
may discontinue any market making at any time without notice. The securities, other than our common stock, may or may not be listed
on a national securities exchange or other trading market.
We
will set forth in a prospectus supplement:
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the
terms of any underwriting or other agreement that we reach relating to sales under this prospectus;
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the
method of distribution of the securities;
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the
names of any agents, underwriters or dealers, including any managing underwriters, used in the offering of securities;
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the
terms of any direct sales, including the terms of any bidding or auction process, or the terms of any other transactions;
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any
delayed delivery obligations to take the securities;
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the
compensation payable to agents, underwriters and dealers, which may be in the form of discounts, concessions or commissions;
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any
activities that may be undertaken by agents, underwriters and dealers to stabilize, maintain or otherwise affect the price
of the securities; and
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any
indemnification and contribution obligations owing to agents, underwriters and dealers.
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If
we sell directly to institutional investors or others, they may be deemed to be underwriters within the meaning of the Securities
Act with respect to any resale of the securities. Unless otherwise indicated in a prospectus supplement, if we sell through an
agent, such agent will be acting on a best efforts basis for the period of its appointment. Any agent may be deemed to be an “underwriter”
of the securities as that term is defined in the Securities Act. If a dealer is used in the sale of the securities, we or an underwriter
will sell securities to the dealer, as principal. The dealer may resell the securities to the public at varying prices to be determined
by the dealer at the time of resale.
To
the extent permitted by and in accordance with Regulation M under the Exchange Act, in connection with an offering an underwriter
may engage in over-allotments, stabilizing transactions, short covering transactions and penalty bids. Over-allotments involve
sales in excess of the offering size, which creates a short position. Stabilizing transactions permit bids to purchase the underlying
security so long as the stabilizing bids do not exceed a specified maximum. Short covering transactions involve purchases of the
securities in the open market after the distribution is completed to cover short positions. Penalty bids permit the underwriters
to reclaim a selling concession from a dealer when the securities originally sold by the dealer are purchased in a covering transaction
to cover short positions. Those activities may cause the price of the securities to be higher than it would be otherwise. If commenced,
the underwriters may discontinue any of the activities at any time.
To
the extent permitted by and in accordance with Regulation M under the Exchange Act, any underwriters who are qualified market
makers on The Nasdaq Capital Market may engage in passive market making transactions in the securities on The Nasdaq Capital Market
during the business day prior to the pricing of an offering, before the commencement of offers or sales of the securities. Passive
market makers must comply with applicable volume and price limitations and must be identified as passive market makers. In general,
a passive market maker must display its bid at a price not in excess of the highest independent bid for such security; if all
independent bids are lowered below the passive market maker’s bid, however, the passive market maker’s bid must then
be lowered when certain purchase limits are exceeded.
The
specific terms of any lock-up provisions in respect of any given offering will be described in the applicable prospectus supplement.
The
underwriters, dealers and agents may engage in transactions with us, or perform services for us, in the ordinary course of business
for which they receive compensation.
No
securities may be sold under this prospectus without delivery, in paper format or in electronic format, or both, of the applicable
prospectus supplement describing the method and terms of the offering.
LEGAL
MATTERS
The
validity of the shares of common stock offered under this prospectus will be passed upon by Troutman Pepper Hamilton Sanders LLP,
Irvine, California. Additional legal matters may be passed upon for us or any underwriters, dealers or agents, by counsel that
we will name in the applicable prospectus supplement. As appropriate, legal counsel representing the underwriters, dealers or
agents will be named in the accompanying prospectus supplement and may opine to certain legal matters.
EXPERTS
The
consolidated financial statements of Verb Technology Company, Inc. as of and for the years ended December 31, 2019 and 2018 appearing
in this prospectus and registration statement of which this prospectus is a part have been audited by Weinberg & Company,
P.A., an independent registered public accounting firm, as stated in its report thereon, included therein, and are included in
reliance upon such report and upon the authority of such firm as experts in accounting and auditing.
WHERE
YOU CAN FIND MORE INFORMATION
We
file quarterly and current reports, proxy statements, and other information with the SEC. The SEC maintains a website that contains
these reports, proxy and information statements, and other information we file electronically with the SEC. Our filings are available
free of charge at the SEC’s website at www.sec.gov.
You
can obtain copies of any of the documents incorporated by reference in this prospectus from us, or as described above, through
the SEC’s website. Documents incorporated by reference are available from us, without charge, excluding all exhibits unless
specifically incorporated by reference in the documents. You may obtain documents incorporated by reference in this prospectus
by writing to us at the following address: 782 South Auto Mall Drive, American Fork, Utah 84003, Attention: Investor Relations,
by emailing us at info@verb.tech, or by calling us at 855.250.2300. We also maintain a section on our website, https://www.verb.tech/investor-relations/sec-filings,
through which you can obtain copies of the documents that we have filed with the SEC. We use our website as a channel of distribution
for material company information. Important information, including financial information, analyst presentations, financial news
releases, and other material information about us is routinely posted on and accessible at https://www.verb.tech. The information
set forth on, or accessible from, our website is not part of this prospectus.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The
SEC allows us to “incorporate by reference” into this prospectus much of the information we file with the SEC, which
means that we can disclose important information to you by referring you to those publicly available documents. The information
that we incorporate by reference into this prospectus is considered to be part of this prospectus. These documents may include
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy statements. You
should read the information incorporated by reference because it is an important part of this prospectus.
This
prospectus incorporates by reference the documents listed below, other than those documents or the portions of those documents
deemed to be furnished and not filed in accordance with SEC rules:
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our
Annual Report on Form 10-K for the fiscal year ended December 31, 2019, filed with the SEC on May 14, 2020;
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our
Amendment No. 1 to our Annual Report on Form 10-K/A for the fiscal year ended December 31, 2019, filed with the SEC on June
4, 2020;
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our
Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020, June 30, 2020, and September 30, 2020, filed with the
SEC on May 15, 2020, August 14, 2019, and November 16, 2020, respectively and our Amendment No. 1 to our Quarterly Report
on Form 10-Q/A for the quarter ended March 31, 2020, filed with the SEC on June 4, 2020;
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our
Definitive Proxy Statement on Schedule 14A, filed with the SEC on September 11, 2020;
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our
Current Reports on Form 8-K filed with the SEC on February 25, 2020, March 23, 2020, March 27, 2020, May 4, 2020, May 14,2020,
July 24, 2020, July 30, 2020, July 31, 2020, August 17, 2020, August 20, 2020, September 10, 2020, October 13, 2020, October
22, 2020, November 17, 2020 and January 6, 2021; and
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the
description of our securities contained in Exhibit 4.17 of our Annual Report on Form 10-K for the fiscal year ended December31,
2019, filed with the SEC on May 14, 2020, including any amendment or report filed for the purpose of updating such description.
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We
also incorporate by reference any future filings (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K
and exhibits filed 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 forms 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 shares of common stock made by
this prospectus and such future filings will become a part of this prospectus from the respective dates that such documents are
filed with the SEC. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein
shall be deemed to be modified or superseded for purposes hereof or of the related prospectus supplement to the extent that a
statement contained herein or in any other subsequently filed document which is also incorporated or deemed to be incorporated
herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this prospectus.
You
may obtain copies of the documents incorporated by reference in this prospectus from us free of charge by requesting them in writing
or by telephone at the following address:
Verb
Technology Company, Inc.
782 South Auto Mall Drive
American Fork, Utah 84003
Attn: Investor Relations
Telephone: (855) 250-2300
$75,000,000
Common
Stock
Preferred
Stock
Debt
Securities
Warrants
Subscription
Rights
Units
PROSPECTUS
,
2021
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution.
The
following table sets forth the various expenses that will be paid by us in connection with the securities being registered. With
the exception of the SEC registration fee, all amounts shown are estimates:
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Amount
to be paid(1)
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SEC Registration Fee
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$
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8,182.50
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Legal Fees and Expenses
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*
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Printing Expenses
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*
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Accounting Fees and Expenses
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*
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Transfer Agent Fees and Expenses
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*
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Miscellaneous Expenses
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*
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TOTAL
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$
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8,182.50
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*
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These
fees are calculated based on the securities offered and the number of issuances and accordingly cannot be estimated at this
time.
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Item
15. Indemnification of Directors and Officers.
We
are a Nevada corporation and generally governed by the Nevada Private Corporations Code, Title 78 of the Nevada Revised Statutes
(“NRS”).
Section
78.138 of the NRS provides that, unless the corporation’s articles of incorporation provide otherwise, a director or officer
will not be individually liable unless it is proven that (i) the director’s or officer’s acts or omissions constituted
a breach of his or her fiduciary duties, and (ii) such breach involved intentional misconduct, fraud, or a knowing violation of
the law.
Section
78.7502 of the NRS permits a company to indemnify its directors and officers against expenses, judgments, fines, and amounts paid
in settlement actually and reasonably incurred in connection with a threatened, pending, or completed action, suit, or proceeding,
if the officer or director (i) is not liable pursuant to Section 78.138 of the NRS, or (ii) acted in good faith and in a manner
the officer or director reasonably believed to be in or not opposed to the best interests of the corporation and, if a criminal
action or proceeding, had no reasonable cause to believe the conduct of the officer or director was unlawful. Section 78.7502
of the NRS also precludes indemnification by the corporation if the officer or director has been adjudged by a court of competent
jurisdiction, after exhaustion of all appeals, to be liable to the corporation or for amounts paid in settlement to the corporation,
unless and only to the extent that the court determines that in view of all the circumstances, the person is fairly and reasonably
entitled to indemnity for such expenses and requires a corporation to indemnify its officers and directors if they have been successful
on the merits or otherwise in defense of any claim, issue, or matter resulting from their service as a director or officer.
Section
78.751 of the NRS permits a Nevada corporation to indemnify its officers and directors against expenses incurred by them in defending
a civil or criminal action, suit, or proceeding as they are incurred and in advance of final disposition thereof, upon determination
by the stockholders, the disinterested board members, or by independent legal counsel. Section 78.751 of the NRS provides that
the articles of incorporation, the bylaws, or an agreement may require a corporation to advance expenses as incurred upon receipt
of an undertaking by or on behalf of the officer or director to repay the amount if it is ultimately determined by a court of
competent jurisdiction that such officer or director is not entitled to be indemnified by the corporation if so provided in the
corporation’s articles of incorporation, bylaws, or other agreement. Section 78.751 of the NRS further permits the corporation
to grant its directors and officers additional rights of indemnification under its articles of incorporation, bylaws, or other
agreement.
Section
78.752 of the NRS provides that a Nevada corporation may purchase and maintain insurance or make other financial arrangements
on behalf of any person who is or was a director, officer, employee, or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee, or agent of another company, partnership, joint venture, trust, or
other enterprise, for any liability asserted against him and liability and expenses incurred by him in his capacity as a director,
officer, employee, or agent, or arising out of his status as such, whether or not the corporation has the authority to indemnify
him against such liability and expenses. We have obtained insurance policies insuring our directors and officers against certain
liabilities they may incur in their capacity as directors and officers. Under such policies, the insurer, on our behalf, may also
pay amounts for which we have granted indemnification to the directors or officers.
The
foregoing discussion of indemnification merely summarizes certain aspects of indemnification provisions and is limited by reference
to the above discussed sections of the NRS.
In
addition, our Articles of Incorporation and our Bylaws generally eliminates director and officer liability or any act or failure
to act in his or her capacity as a director or officer. Our Bylaws provide that we must advance expenses incurred, or reasonably
expected to be incurred, within three (3) months of any proceeding to which the indemnitee was or is a party or is otherwise involved
by reason of the fact that he or she was serving or acting in a covered capacity. An indemnitee is entitled to advances, to the
fullest extent permitted by applicable law, solely upon the execution and delivery to us of an undertaking providing that the
indemnitee agrees to repay the advance to the extent it is ultimately determined that he or she was not entitled to be indemnified
by us under the provisions of the Bylaws, the Articles of Incorporation, or an agreement between us and the indemnitee. Finally,
we entered into Indemnification Agreements with each of our directors and officers that largely mirror the indemnification rights
provided for in our Bylaws.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling
persons pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification
is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by us of expenses incurred or paid by our director, officer, or controlling person
in the successful defense of any action, suit, or proceeding) is asserted by such director, officer, or controlling person in
connection with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. See also the section
entitled “Undertakings” set forth below.
Item
16. Exhibits.
The
exhibits filed with this registration statement or incorporated by reference from other filings are as follows:
3.3
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Certificate
of Change as filed with the Secretary of State of the State of Nevada on October 6, 2014, which was filed as Exhibit 3.3 to
our Current Report on Form 8-K filed with the SEC on October 22, 2014, and is incorporated herein by reference thereto.
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3.4
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Articles
of Merger as filed with the Secretary of State of the State of Nevada on October 6, 2014, which was filed as Exhibit 3.4 to
our Current Report on Form 8-K filed with the SEC on October 22, 2014, and is incorporated herein by reference thereto.
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3.5
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Articles
of Merger as filed with the Secretary of State of the State of Nevada on April 4, 2017, which was filed as Exhibit 3.5 to
our Current Report on Form 8-K filed with the SEC on April 24, 2017, and is incorporated herein by reference thereto.
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3.6
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Certificate
of Correction as filed with the Secretary of State of the State of Nevada on April 17, 2017, which was filed as Exhibit 3.6
to our Current Report on Form 8-K filed with the SEC on April 24, 2017, and is incorporated herein by reference thereto.
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3.7
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Certificate
of Change as filed with the Secretary of State of the State of Nevada on February 1, 2019, which was filed as Exhibit 3.7
to our Annual Report on Form 10-K filed with the SEC on February 7, 2019, and is incorporated herein by reference thereto.
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3.8
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Articles
of Merger as filed with the Secretary of State of the State of Nevada on January 31, 2019, which was filed as Exhibit 3.8
to our Annual Report on Form 10-K filed with the SEC on February 7, 2019, and is incorporated herein by reference thereto.
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3.9
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Certificate
of Correction as filed with the Secretary of State of the State of Nevada on February 22, 2019, which was filed as Exhibit
3.9 to Amendment No. 4 to our Registration Statement on Form S-1 (File No. 333-226840) filed with the SEC on March 14, 2019,
and is incorporated herein by reference thereto.
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3.10
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Articles
of Merger of Sound Concepts, Inc. with and into NF Merger Sub, Inc. as filed with the Utah Division of Corporations and Commercial
Code on April 12, 2019, which was filed as Exhibit 3.10 to our Quarterly Report on Form 10-Q filed with the SEC on May 15,
2019, and is incorporated herein by reference thereto.
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3.11
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Statement
of Merger of Verb Direct, Inc., a Utah corporation with and into NF Acquisition Company, LLC as filed with the Utah Division
of Corporations and Commercial Code on April 12, 2019, which was filed as Exhibit 3.11 to our Quarterly Report on Form 10-Q
filed with the SEC on May 15, 2019, and is incorporated herein by reference thereto.
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3.12
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Certificate
of Withdrawal of Certificate of Designation of Series A Convertible Preferred Stock as filed with the Secretary of State of
the State of Nevada on August 10, 2018, which was filed as Exhibit 4.28 to our Registration Statement on Form S-1 (File No.
333-226840) filed with the SEC on August 14, 2018, and is incorporated herein by reference thereto.
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3.13
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Certificate
of Designation of Rights, Preferences, and Restrictions of Series A Convertible Preferred Stock as filed with the Secretary
of State of the State of Nevada on August 12, 2019, which was filed as Exhibit 3.12 to our Quarterly Report on Form 10-Q filed
with the SEC on August 14, 2019, and is incorporated herein by reference thereto.
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*
To be filed by amendment or incorporated by reference in connection with the offering of the securities.
‡
To be filed in accordance with the requirements of Item 601(b)(25) of Regulation S-K.
Item
17. Undertakings.
(a)
The undersigned registrant hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i)
To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;
(ii)
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered
(if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or
high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
(iii)
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement;
provided,
however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) of this section do not apply if the information required to
be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the
registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in
the registration statement or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration
statement.
(2)
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
(5)
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
(i)
Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as
of the date the filed prospectus was deemed part of and included in the registration statement; and
(ii)
Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance
on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information
required by Section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement
as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale
of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and
any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement
relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement
made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or
deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will,
as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made
in the registration statement or prospectus that was part of the registration statement or made in any such document immediately
prior to such effective date.
(6)
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the undersigned
registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser,
if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant
will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:
(i)
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant
to Rule 424;
(ii)
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred
to by the undersigned registrant;
(iii)
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv)
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(b)
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933,
each filing of the registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(h)
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that
in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment
by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue.
(j)
The undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee
to act under subsection (a) of Section 310 of the Trust Indenture Act (the “Act”) in accordance with the rules and
regulations prescribed by the SEC under section 305(b)(2) of the Act.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in Newport Beach, California, on January 15, 2021.
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VERB
TECHNOLOGY COMPANY, INC.
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By:
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/s/
Rory J. Cutaia
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Rory
J. Cutaia
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Chairman
of the Board, Chief Executive Officer, President, and Secretary (Principal Executive Officer)
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By:
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/s/
Jeffrey R. Clayborne
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Jeffrey
R. Clayborne
Chief
Financial Officer (Principal Financial and Accounting Officer)
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SIGNATURES
AND POWER OF ATTORNEY
KNOW
ALL PERSONS BY THESE PRESENTS, that each individual whose signature appears below constitutes and appoints Rory J. Cutaia, as
his true and lawful attorney-in-fact and agent with full power of substitution, for him and in his name, place and stead, in any
and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, and to
sign any registration statement for the same offering covered by this registration statement that is to be effective on filing
pursuant to Rule 462(b) promulgated under the Securities Act and all post-effective amendments thereto, and to file the same,
with all exhibits thereto and all documents in connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of the, full power and authority to do and perform each and every act and thing requisite
and necessary to be done in and about the premises, as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents or any of them, or his or their substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature
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Title
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Date
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/s/
Rory J. Cutaia
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Chairman
of the Board,
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January
15, 2021
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Rory
J. Cutaia
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Chief
Executive Officer, President, Secretary, and Treasurer (Principal Executive Officer)
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/s/
Jeffrey R. Clayborne
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Chief
Financial Officer
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January
15, 2021
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Jeffrey
R. Clayborne
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(Principal
Financial and Accounting Officer)
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/s/
James P. Geiskopf
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Lead
Director
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January
15, 2021
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James
P. Geiskopf
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/s/
Phillip J. Bond
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Director
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January
15, 2021
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Phillip
J. Bond
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/s/
Kenneth S. Cragun
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Director
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January
15, 2021
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Kenneth
S. Cragun
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/s/
Judith Hammerschmidt
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Director
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January
15, 2021
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Judith
Hammerschmidt
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/s/
Nancy Heinen
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Director
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January
15, 2021
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Nancy
Heinen
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