Filed pursuant to Rule 424(b)(5)

Registration No. 333-235891

 

PROSPECTUS SUPPLEMENT

(to Prospectus dated April 18, 2021)

 

AUDDIA INC.

 

140,186 Shares of Common Stock

 

Up to $10,000,000 of Shares of Common Stock

 

 

This prospectus supplement relates to the issuance and sale of up to ten million dollars ($10,000,000) in shares of the common stock, $0.001 per share (“common stock”), of Auddia Inc., a Delaware corporation (“AUUD” or the “Company”), to White Lion Capital LLC (“White Lion”) pursuant to a purchase agreement (the “White Lion Purchase Agreement”) entered into on November 14, 2022, and 140,186 shares of common stock (the “Commitment Shares”) to be issued to White Lion in consideration for entering into the White Lion Purchase Agreement. White Lion may be an “underwriter” of this offering under the meaning of Section 2(a)(11) of the Securities Act of 1933, as amended.

 

The shares being offered are shares of our Common Stock that we may sell from time to time until December 31, 2023, at our sole discretion, to White Lion under the White Lion Purchase Agreement. See “The Offering” on page S-5 of this prospectus supplement and the “Purchase Agreement with White Lion “ on page S-6 of this prospectus supplement.

 

On the commencement date of the White Lion Purchase Agreement, which is the date of this prospectus supplement, we will issue to White Lion the Commitment Shares.

 

This prospectus supplement and the accompanying prospectus also cover the resale of these shares by White Lion to the public. See “Purchase Agreement with White Lion” for a description of the White Lion Purchase Agreement and additional information regarding White Lion.

 

The purchase price for the shares of common stock offered hereby to White Lion will be based upon formulas set forth in the White Lion Purchase Agreement depending on the type of purchase notice we submit to White Lion from time to time. We will pay the expenses incurred in connection with the issuance of the shares of our common stock, including legal and accounting fees. See “Plan of Distribution”. Our common stock and our Series A Warrants are currently quoted on the Nasdaq Capital Market (“Nasdaq”) under the symbols “AUUD”and “AUUDW” respectively. On November 11, 2022, the closing price as reported on Nasdaq was $1.42 per share for our common stock and $0.3627 for our Series A Warrants.

 

INVESTING IN OUR COMMON STOCK INVOLVES CERTAIN RISKS. SEE “RISK FACTORS” ON PAGE S-7 OF THIS PROSPECTUS SUPPLEMENT AND ON PAGE 4 OF THE ACCOMPANYING PROSPECTUS TO READ ABOUT FACTORS YOU SHOULD CONSIDER BEFORE INVESTING IN OUR COMMON STOCK. YOU SHOULD ALSO REVIEW CAREFULLY THE RISKS AND UNCERTAINTIES DESCRIBED IN OUR ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 2021 OUR QUARTERLY REPORT ON FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2022 AND IN OUR PERIODIC AND CURRENT REPORTS THAT WE FILE WITH THE SECURITIES AND EXCHANGE COMMISSION AFTER THE DATE OF THIS PROSPECTUS SUPPLEMENT, WHICH ARE INCORPORATED BY REFERENCE INTO THIS PROSPECTUS SUPPLEMENT. YOU SHOULD READ THE ENTIRE PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS CAREFULLY BEFORE YOU MAKE YOUR INVESTMENT DECISION.

 

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

 

The date of this Prospectus Supplement is November 15, 2022

 

 

 

     

 

 

TABLE OF CONTENTS

 

PROSPECTUS SUPPLEMENT

 

ABOUT THIS PROSPECTUS SUPPLEMENT S-1
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS S-2
PROSPECTUS SUPPLEMENT SUMMARY S-4
THE OFFERING S-5
PURCHASE AGREEMENT WITH WHITE LION S-6
RISK FACTORS S-7
USE OF PROCEEDS S-9
DILUTION S-10
PLAN OF DISTRIBUTION S-11
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE S-13
WHERE YOU CAN FIND MORE INFORMATION S-14
LEGAL MATTERS S-14
EXPERTS S-14

 

 

 

PROSPECTUS

 

TABLE OF CONTENTS

 

  Page
   
ABOUT THIS PROSPECTUS 1
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS 2
PROSPECTUS SUMMARY 3
RISK FACTORS 4
USE OF PROCEEDS 4
DIVIDEND POLICY 5
PLAN OF DISTRIBUTION 5
DESCRIPTION OF SECURITIES WE MAY OFFER 8
LEGAL MATTERS 16
EXPERTS 16
WHERE YOU CAN FIND ADDITIONAL INFORMATION 16
INCORPORATION OF DOCUMENTS BY REFERENCE 17

 

 

 

  S- i  

 

 

ABOUT THIS PROSPECTUS SUPPLEMENT

 

This document contains two parts. The first part is this prospectus supplement, which describes the terms of this offering of common stock and also adds to and updates information contained in the accompanying prospectus and the documents incorporated or deemed incorporated by reference in this prospectus supplement and the accompanying prospectus. The second part is the accompanying prospectus, which contains a description of our common stock and gives more general information, some of which may not apply to this offering. If there is any inconsistency between the information in this prospectus supplement and the accompanying prospectus, you should rely on this prospectus supplement. Before purchasing any shares of our common stock, you should read carefully both this prospectus supplement and the accompanying prospectus, together with the documents incorporated or deemed incorporated by reference in this prospectus supplement or accompanying prospectus (as described below under the heading “Incorporation of Certain Documents by Reference”), any related free writing prospectus and the additional information described below under the heading “Where You Can Find More Information.”

 

This prospectus supplement and the accompanying prospectus are part of an effective registration statement that we filed with the Securities and Exchange Commission (the “SEC”) using a “shelf” registration process. This prospectus supplement and the accompanying prospectus, which form a part of the registration statement, do not contain all of the information set forth in the registration statement. For further information with respect to us and our common stock, reference is made to the registration statement, including the exhibits to the registration statement and the documents incorporated by reference into the registration statement. Statements contained in this prospectus supplement and the accompanying prospectus as to the contents of any contract or other document referred to in this prospectus supplement and accompanying prospectus are not necessarily complete and, where that contract or other document is an exhibit to the registration statement, we refer you to the full text of the contract or other document filed as an exhibit to the registration statement. The registration statement and the exhibits can be obtained from the SEC as indicated under the heading “Where You Can Find More Information.”

 

You should rely only on the information contained in or incorporated by reference into this prospectus supplement and the accompanying prospectus and the other information to which we refer you. Neither we nor any underwriter, broker-dealer, agent or other person have authorized anyone to provide you with any information other than that contained in or incorporated by reference into this prospectus supplement or the accompanying prospectus. If anyone provides you with different or inconsistent information, you should not rely on it.

 

This prospectus supplement and the accompanying prospectus do not constitute an offer to sell or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to make such an offer or solicitation in that jurisdiction. You should assume that the information appearing in this prospectus supplement and the accompanying prospectus is accurate as of the date on its respective cover, and that any information incorporated by reference in this prospectus supplement or the accompanying prospectus 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.

 

Unless the context indicates otherwise, as used in this prospectus, unless the context otherwise requires, references to “we,” “us,” “our,” “the Company” and “AUUD” refer to Auddia Inc.

 

 

 

 

  S- 1  

 

 

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

 

This prospectus supplement and the accompanying prospectus and the information incorporated by reference in this prospectus supplement and the accompanying prospectus contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements are therefore entitled to the protection of the safe harbor provisions of these laws. These statements may be identified by the use of forward-looking terminology such as “anticipate,” “believe,” “budget,” “contemplate,” “continue,” “could,” “envision,” “estimate,” “expect,” “forecast,” “guidance,” “indicate,” “intend,” “may,” “might,” “outlook,” “plan,” “possibly,” “potential,” “predict,” “probably,” pro-forma,” “project,” “seek,” “should,” “target,” “will,” “would,” “will be,” “will continue” or the negative of or other variation on these words or comparable terminology.

 

We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, these forward-looking statements are only predictions and involve a number of risks and uncertainties, many of which are beyond our control. These and other important factors may cause our actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by these forward-looking statements. Management cautions that the forward-looking statements contained in this prospectus supplement and the information incorporated by reference are not guarantees of future performance, and we cannot assume that such statements will be realized or the forward-looking events and circumstances will occur. The risks, uncertainties and assumptions that could cause actual results to differ materially from those anticipated or implied in our forward-looking statements include, but are not limited to, those set forth in the section entitled “Risk Factors” in the accompanying prospectus and in “Risk Factors” section below.

 

Some of the factors that could cause actual results to differ from our expectations are:

 

  · the early state of the Company’s development;
     
  · the Company’s ability to continue as a going concern;
     
  · the Company’s ability to compete in an unproven market;
     
  · resistance by potential customers to new technologies;
     
  · performance issues with the Company’s products;
     
  · uncertainties related to estimates, assumptions and projections relating to unpaid losses and loss adjustment expenses and other accounting policies;
     
  · reliance on key personnel;
     
  · introduction of competing products by other companies;
     

 

 

 

  S- 2  

 

 

  · inflation and other changes in economic conditions, including changes in the financial markets;
     
  · security breaches and other system disruptions;
     
  · legislative and regulatory developments, especially in the gathering and use of information about private citizens;
     
  · weather conditions and natural disasters (including, but not limited to, the severity and frequency of storms, hurricanes, tornados and hail); and
     
  · acts of war and terrorist activities, among other man-made disasters.

 

Given these risks and uncertainties, you are cautioned not to place undue reliance on any forward-looking statements. The forward-looking statements included or incorporated by reference into this prospectus supplement and in the information incorporated by reference are made only as of the date of this prospectus supplement. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the SEC, we do not undertake and specifically decline any obligation to update or revise any forward-looking statements in this prospectus supplement after we distribute this prospectus supplement, or publicly announce the results of any revisions to any such statements to reflect future events or developments, whether as a result of any new information, future events or otherwise.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  S- 3  

 

 

PROSPECTUS SUPPLEMENT SUMMARY

 

This summary highlights selected information about us and this offering appearing in this prospectus supplement, the accompanying prospectus and the documents incorporated or deemed incorporated by reference herein and therein. This summary may not contain all of the information that you should consider before making an investment decision. You should read carefully the more detailed information included or referred to under the heading “Risk Factors” of this prospectus supplement and the other information included in this prospectus supplement, the accompanying prospectus, the documents incorporated or deemed incorporated by reference herein and therein, including our Annual Report on Form 10-K for the year ended December 31, 2021, before deciding to invest in our common stock.

 

The Company

 

We are a technology company headquartered in Boulder, CO that is reinventing how consumers engage with audio through the development of a proprietary Artificial Intelligence (“AI”) platform for audio and innovative technologies for podcasts. We are leveraging these technologies to bring to market two industry first apps, Faidr (previously known as the Auddia App) and Vodacast.

 

Faidr gives consumers the opportunity to listen to any AM/FM radio station with no commercials while personalizing the listening experience through skips, the insertion of on-demand content and programming of audio routines to customize listening sessions such as a daily commute. The Faidr App represents the first time consumers can access the local content uniquely provided by radio in the commercial free and personalized manner many consumers have come to demand for media consumption.

 

The Company launched all major U.S. radio stations on its Faidr App on February 15, 2022.

 

Vodacast is a podcasting platform that provides a unique suite of tools that helps Podcasters create additional digital content for their podcast episodes as well as plan their episodes, build their brand around their Podcast and monetize their content with new monetization channels. Vodcast also gives users the ability to go deeper into the stories through supplemental, digital content,, comment, and contribute their own content to episode feeds.

 

Both of our offerings address large and rapidly growing audiences. Faidr and Vodacast mobile apps are available today through the iOS and Android app stores.

 

 

 

 

 

  S- 4  

 

 

THE OFFERING

 

The Common Stock offered by us

Up to ten million dollars ($10,000,000) of shares of common stock.

 

140,186 shares of our common stock being issued to White Lion as consideration for its commitment to purchase shares of our common stock under the White Lion Purchase Agreement, or the Commitment Shares. We will not receive any cash proceeds from the issuance of these Commitment Shares.

   
Common stock outstanding before the offering 12,514,763 shares (1)
   
Common Stock to be outstanding after the Offering 19,697,203 shares, which includes 140,186 Commitment Shares and assumes the sale of 7,042,254 shares at a price of $1.42 per share, which was the closing price of our common stock on the Nasdaq Capital Market (“Nasdaq”) on November 11, 2022, for the $10,000,000 of additional shares of our Common Stock we may sell to White Lion from time to time. The actual number of shares issued will vary depending on the sales prices under this offering, but will not be greater than 2,501,700 shares, representing 19.99% of the shares of our common stock outstanding on the date of the White Lion Purchase Agreement, unless, in accordance with applicable Nasdaq rules, we obtain stockholder approval of the issuance of shares of our common stock under the White Lion Purchase Agreement in excess of the Exchange Cap (as defined therein), or the average price of all applicable sales of our common stock to White Lion under the White Lion Purchase Agreement is equal to or greater than the $1.23 Minimum Price (as defined therein).
   
Common Stock Purchase Series A Warrants Outstanding 3,498,898 (2)
   
Risk Factors Investing in our common stock involves certain risks. See “Risk Factors” on page S-7 of this prospectus supplement and on page 4 of the accompanying prospectus.
   
Use of Proceeds Proceeds will be used as described in the “Use of Proceeds” section of this prospectus supplement.
   
Nasdaq Symbol Common Stock AUUD
   
Nasdaq Symbol Warrants AUUDW

 

 

(1) As of November 10, 2022.
(2)

As of November 10, 2022, there are 3,498,898 Series A Warrants outstanding. Each Series A Warrant entitles the holder to purchase one share of common stock. The Warrants have an exercise price of $4.54 per share and expire in February of 2026. No Series A Warrants are being offered as part of this Offering.

 

 

 

 

 

  S- 5  

 

 

PURCHASE AGREEMENT WITH WHITE LION

 

On November 14, 2022, we entered into the White Lion Purchase Agreement with White Lion under which the Company may require White Lion to purchase a maximum of $10,000,000 of common stock (“White Lion Purchase Shares”) over a term that ends on the earliest of December 31, 2023 or (ii) the date on which White Lion shall have made payment for shares of our Company’s equal to the Commitment Amount (the “Commitment Period”).

 

In consideration for the Investor’s execution and delivery of, and performance under the White Lion Purchase Agreement, the Company has issued to White Lion 140,186 shares of common stock (the “Commitment Shares”) as a commitment fee.

 

The White Lion Purchase Agreement provides that, upon the terms and subject to the conditions and limitations set forth in the agreement, the Company has the right, but not the obligation, from time to time, in its sole discretion, to deliver to White Lion a purchase notice (a “White Lion Purchase Notice”) directing White Lion to purchase (each, a “White Lion Purchase”) a specified dollar amount of White Lion Purchase Shares (the “White Lion Purchase Amount”) equal to the lesser of (i) up to thirty percent (30%) of the average daily trading volume of the common stock during the five (5) business days before the date of the Purchase Notice, or (ii) the Investment Limit (described below) divided by the highest closing price of the common stock over the most recent five (5) business days including the purchase date. The Investment Limit is $500,000, subject to increase at the sole discretion of White Lion.

 

The White Lion Purchase Price will be set at ninety-seven percent (97%) of the lowest daily dollar volume-weighted average price for the common stock during the three (3) business days after the date of the White Lion Purchase Notice (the “Valuation Period’). On the last day of the Valuation Period, White Lion will wire the Company an amount equal to the number of shares specified on the White Lion Purchase Notice multiplied by the White Lion Purchase Price.

 

The White Lion Purchase Agreement prohibits the Company from directing White Lion to purchase any shares of common stock if those shares, when combined with all other shares of our common stock then beneficially owned by White Lion and its affiliates, would result in their combined beneficial ownership, at any single point in time, of more than 4.99% of the then total outstanding shares of common stock. Notwithstanding the foregoing, White Lion, in its discretion, may waive this prohibition and purchase up to 19.99% of the then total outstanding shares of the common stock.

 

There are no trading volume requirements or restrictions under the White Lion Purchase Agreement. We will control the timing and amount of any sales of our common stock to White Lion.

 

The Company is not permitted to deliver a White Lion Purchase Notice at any time that an event of default under the White Lion Purchase Agreement has occurred and is continuing.

 

The above description of the White Lion Purchase Agreement is qualified in its entirety by reference to the White Lion Purchase Agreement, which is incorporated by reference into this prospectus supplement.

 

 

 

 

 

  S- 6  

 

 

RISK FACTORS

 

Investing in our securities involves a high degree of risk. You should carefully review the risks and uncertainties discussed in the “Risk Factors” section that is found on page 4 of the accompanying prospectus and the risk factors described below before deciding whether to purchase any common stock being offered under this prospectus supplement/ Each of the risk factors described in this prospectus supplement or in the accompanying prospectus could adversely affect our business, operating results and financial condition, as well as adversely affect the value of an investment in the common stock. The occurrence of any of these risks might cause you to lose all or part of your investment. Moreover, the risks described below are not the only risks we face. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, financial condition, and results of operations. If any of these risks actually occurs, our business, financial condition and results of operations could suffer. In that case, the trading price of our common stock could decline, and you may lose all or part of your investment.

 

Risks related to our financial position and need for additional capital

 

Our auditors have previously expressed substantial doubt about our ability to continue as a going concern, which may hinder our ability to obtain further financing.

 

Our past working capital deficiency, stockholders’ deficit and recurring losses from operations have raised substantial doubt about our ability to continue as a going concern. As a result, our independent registered public accounting firm included an explanatory paragraph in its report on our financial statements for the year ended December 31, 2020 with respect to this uncertainty. The report of our independent registered public accounting firm on our financial statements for the year ended December 31, 2021 did not have such an explanatory paragraph, based upon the receipt of the net proceeds from our February 2021initial public offering and, the July 2021 exercise of our publicly traded Series A Warrants.

 

As of September 30, 2022, our existing cash was only sufficient to fund our current operating plans through December 31, 2022. We recently closed on $2 million of debt financing. However, we will still require additional capital to maintain our operations through the end of 2023. We therefore expect and need to raise additional funds. If we are unable to raise capital when needed or on acceptable terms, we would be forced to delay, reduce or eliminate our technology development and commercialization efforts.

 

We have incurred significant net losses since inception and anticipate that we will continue to incur net losses for the foreseeable future and may never achieve or maintain profitability.

 

Since inception, we have incurred significant net losses. We expect to continue to incur net losses in the near term. Our net losses were $13,478,069 and $4,051,221 for the years ended December 31, 2021 and 2020, respectively. For the year ended December 31, 2021 our cash used in operations was $5,471,545. At September 30, 2022, we had cash and equivalents on hand of $957,130. To date, we have devoted our efforts towards securing financing, building, and evolving our technology platform, marketing our mobile app product for radio stations as well as initiating our marketing efforts for our music player. We expect to continue to incur significant expenses and operating losses for the foreseeable future. We anticipate that our expenses will increase substantially if, and as, we:

 

  · incur costs related to the national launch of our Faidr App and as we continue obtaining market acceptance;
  · recruit and retain podcasters to our Vodacast App and retaining listeners on the platform;
  · continue to develop and improve our technology;
  · effectively addressing any competing technological and market developments;
  · add operational, business development & marketing personnel; and
  · incur legal expenses related to avoiding and defending against intellectual property infringement, misappropriation and other claims

 

 

 

 

  S- 7  

 

 

To become profitable, we must develop and eventually commercialize one or more product candidates, including Faidr and Vodacast, with significant market potential. This will require us to be successful in a range of challenging activities, and our expenses will increase substantially as we seek to bring these products to market. We may never succeed in any or all of these activities and, even if we do, we may never generate revenue that is significant or large enough to achieve profitability. If we do achieve profitability, we may not be able to sustain or increase profitability on a quarterly or annual basis. Our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, develop new products, expand our business or continue our operations. A decline in the value of our Company also could cause stockholders to lose all or part of their investment.

 

We need additional funding, which may not be available on acceptable terms, or at all. Failure to obtain this capital when needed may force us to delay, limit or terminate our product development efforts or other operations.

 

We expect our expenses to increase in connection with our ongoing activities, particularly as we continue to invest in sales, marketing and engineering resources and bring our products to market. Furthermore, we expect to incur additional costs associated with operating as a public company. We need additional funding to complete the development of our full product line and scale products with a demonstrated market fit.

 

Building and scaling technology products is a time-consuming, expensive and uncertain process that takes years to complete, and we may never generate the necessary user experience required to obtain market acceptance and achieve meaningful product sales. In addition, our product candidates, once developed, may not achieve commercial success. The majority of revenue will be derived from or based on sales of products that may not be commercially available for many years, if at all. Accordingly, we will need to continue to rely on revenues from existing products and/or additional financing to achieve our business objectives. Adequate additional financing may not be available to us on acceptable terms, or at all.

 

Sales of our common stock to White Lion may cause substantial dilution to our existing stockholders and the sale of common stock acquired by White Lion could cause the price of our common stock to decline.

 

This prospectus supplement relates to the offering of our common stock with an aggregate amount of up to $10,000,000 that we may issue and sell to White Lion from time to time pursuant to the White Lion Purchase Agreement. It is anticipated that the common stock offered to White Lion in this offering will be sold from time to time during the Commitment Period. The number of shares ultimately offered for sale to White Lion under this prospectus supplement is dependent upon the number of shares we elect to sell to White Lion under the White Lion Purchase Agreement. Depending upon market liquidity at the time, sales into the public markets of shares we issue to White Lion under the White Lion Purchase Agreement may cause the trading price of our common stock to decline.

 

White Lion may ultimately purchase all, some or none of the shares offered hereby. After White Lion has acquired common stock under the White Lion Purchase Agreement, it may sell all, some or none of those shares. Sales to White Lion by us pursuant to the White Lion Purchase Agreement under this prospectus supplement may result in substantial dilution to the interests of other holders of our common stock. The sale of a substantial number of our shares to White Lion in this offering, or anticipation of such sales, could make it more difficult for us to sell equity or equity-related securities in the future at a time and at a price that we might otherwise wish to effect sales. However, we have the right to control the timing and amount of any sales of our shares to White Lion.

 

The extent to which we rely on White Lion as a source of funding will depend on a number of factors, including the prevailing market price of our common stock and the extent to which we are able to secure working capital from other sources.

 

 

 

 

 

 

  S- 8  

 

 

USE OF PROCEEDS

 

We may receive up to $10,000,000 in aggregate gross proceeds under the White Lion Purchase Agreement from sales of our common stock with an aggregate offering amount of $10,000,000 that we may make to White Lion after the date of this prospectus supplement. We estimate that the net proceeds to us from the sale of our common stock to White Lion pursuant to the Purchase Agreement will be up to approximately, but not exceeding, US$10,000,000 over the Commitment Period, assuming that we sell the full amount of the shares that we have the right, but not the obligation, to sell to White Lion under the White Lion Purchase Agreement, and after estimated fees and expenses. We may sell fewer than all of the shares offered by this prospectus supplement, in which case our net offering proceeds will be less. Because we are not obligated to sell any shares of common stock under the White Lion Purchase Agreement, the actual total offering amount and proceeds to us, if any, are not determinable at this time. There can be no assurance that we will receive any proceeds under or fully utilize the White Lion Purchase Agreement. See “Plan of Distribution” elsewhere in this prospectus supplement for more information. 

 

We intend to use the net proceeds from this offering for working capital and general corporate purposes.

 

The foregoing represents our current intentions based upon our present plans and business conditions to use and allocate the net proceeds of this offering. Our management, however, will have significant flexibility and discretion to apply the net proceeds of this offering. If an unforeseen event occurs or business conditions change, we may use the proceeds of this offering differently than as described in this prospectus supplement. Unforeseen events or changed business conditions may result in application of the proceeds of this offering in a manner other than as described in this prospectus supplement.

 

To the extent that the net proceeds we receive from this offering are not immediately applied for the above purposes, we plan to invest the net proceeds in bank deposits. 

 

 

 

  S- 9  

 

 

DILUTION

 

If you invest in our common stock, your interest will be diluted immediately to the extent of the difference between the public offering price per share and the adjusted net tangible book value per share of our common stock after this offering.

 

Our net tangible book value on September 30, 2022 was approximately $625,000, or $0.05 per share. “Net tangible book value” is total assets minus the sum of liabilities and intangible assets. “Net tangible book value per share” is net tangible book value divided by the total number of shares outstanding.

 

After giving effect to the issuance of the 140,186 Commitment Shares, and the sale of up to $10.0 million of Purchase Notice Shares (without giving effect to the Exchange Cap) at an assumed offering price of $1.42 per share, the last reported sale price of our common stock on The Nasdaq Capital Market on November 11, 2022, and after deducting estimated offering expenses payable by us of $75,000, and adjusted to our issuance of $2,200,000 of secured bridge notes for net proceeds of $2,000,000 on November 14, 2022, our net tangible book value as of September 30, 2022 would have been $10,424,206, or $0.53 per share of common stock. This represents an immediate increase in net tangible book value of $0.48 per share to our existing stockholders and an immediate decrease in net tangible book value of $0.89 per share to investors participating in this offering. The following table illustrates this dilution per share to investors participating in this offering:

 

Assumed offering price per share   $ 1.42  
Net tangible book value per share as of September 30, 2022   $ 0.05  
Increase in net tangible book value per common stock to existing investors   $ 0.48  
         
As adjusted net tangible book value per share as of September 30, 2022, after giving effect to this offering, adjusted for issuance of $2.2 million of secured bridge notes on November 14, 2022   $ 0.53  
Net dilution per share to White Lion Capital   $ 0.89  

 

The above discussion and table are based on 12,514,763 shares outstanding as of November 10, 2022, and excludes, as of such date, shares of common stock issuable upon exercise of the outstanding options and warrants.

 

To the extent that any of our outstanding options or warrants are exercised, we grant additional options or other awards under our equity incentive plan or issue additional warrants, or we issue additional common stock in the future, there may be further dilution.

 

  

 

 

 

  S- 10  

 

 

PLAN OF DISTRIBUTION

 

Pursuant to this prospectus supplement, we are offering up to $10,000,000 in shares of our common stock  to White Lion pursuant to the White Lion Purchase Agreement, as well as the 140,186 Commitment Shares previously issued to White Lion as consideration for entry into the White Lion Purchase Agreement. This prospectus supplement also covers the resale of these shares by White Lion to the public.

 

We may, from time to time and at our sole discretion, direct White Lion to purchase shares of our common stock, but the maximum amount of shares that may be sold on any single business day pursuant to a White Lion Purchase Notice generally shall not exceed the lesser of (i) such number of shares as would cause White Lion to beneficially own in excess of 4.99% of the number of our common stock outstanding immediately after giving effect to such issuance and sale, (ii) thirty percent (30%) of the average daily trading volume of the common stock during the five (5) business days before the date of the Purchase Notice, or (iii) the Investment Limit divided by the highest closing price of the common stock over the most recent five (5) business days including the purchase date. The foregoing share amounts and related market prices will be adjusted for any reorganization, recapitalization, non-cash dividend, stock split, reverse stock split or other similar transaction occurring after the date of this prospectus supplement. The purchase price per share is based on the market price of our common stock at the time of sale as computed under the White Lion Purchase Agreement. White Lion may not assign or transfer its rights and obligations under the White Lion Purchase Agreement. See “Purchase Agreement With White Lion.”

 

The shares we may from time to time issue to White Lion under this prospectus supplement, may be sold or distributed from time to time by White Lion, as the selling stockholder, directly to one or more purchasers or through brokers, dealers, or underwriters who may act solely as agents at market prices prevailing at the time of sale, at prices related to the prevailing market prices, at negotiated prices, or at fixed prices, which may be changed. The sale of the shares of our common stock offered by this prospectus supplement could be effected in one or more of the following methods:

 

   ordinary brokers’ transactions;
   transactions involving cross or block trades;
   through brokers, dealers, or underwriters who may act solely as agents;
   “at the market” into an existing market for our common stock;
   in other ways not involving market makers or established business markets, including direct sales to purchasers or sales effected through agents;
   in privately negotiated transactions; or
   any combination of the foregoing.

 

In order to comply withthe securities laws of certain states, if applicable, the shares may be sold only through registered or licensed brokers or dealers. In addition, in certain states, the shares may not be sold unless they have been registered or qualified for sale in the state or an exemption from the state’s registration or qualification requirement is available and complied with.

 

White Lion is an “underwriter” within the meaning of Section 2(a)(11) of the Securities Act. White Lion is not a licensed broker dealer or an affiliate of a licensed broker dealer, and is not a member of the Financial Industry Regulatory Authority.

 

White Lion has informed us that it intends to use one or more registered broker-dealers to effectuate all sales, if any, of our common stock that it may acquire from us pursuant to the White Lion Purchase  Agreement. Such sales will be made at prices and at terms then prevailing or at prices related to the then current market price. Each such registered broker-dealer will be an underwriter within the meaning of Section 2(a)(11) of the Securities Act. White Lion has informed us that each such broker-dealer may receive commissions from White Lion and, if so, such commissions will not exceed customary brokerage commissions.

 

Brokers, dealers, underwriters or agents participating in the distribution of the shares of our common stock offered by this prospectus supplement may receive compensation in the form of commissions, discounts, or concessions from the purchasers, for whom the broker-dealers may act as agent, of the shares sold by the selling stockholder through this prospectus supplement. The compensation paid to any such particular broker-dealer by any such purchasers of shares of our common stock sold by the White Lion may be less than or in excess of customary commissions. Neither we nor the White Lion can presently estimate the amount of compensation that any agent will receive from any purchasers of shares of our common stock sold by White Lion.

 

We know of no existing arrangements between the selling stockholder or any other stockholder, broker, dealer, underwriter or agent relating to the sale or distribution of the shares of our common stock offered by this prospectus supplement.

 

 

  S- 11  

 

 

We may from time to time file with the SEC one or more supplements to this prospectus supplement or amendments to the registration statement of which this prospectus supplement forms a part to amend, supplement or update information contained in this prospectus supplement, including, if and when required under the Securities Act, to disclose certain information relating to a particular sale of shares offered by this prospectus supplement by White Lion, including the names of any brokers, dealers, underwriters or agents participating in the distribution of such shares by the selling stockholder, any compensation paid by White Lion to any such brokers, dealers, underwriters or agents, and any other required information.

 

We estimate that the total expenses for the offering will be approximately $75,000.

 

We have agreed to indemnify White Lion and certain other persons against certain liabilities in connection with the offering of shares of our common stock offered hereby, including liabilities arising under the Securities Act. White Lion has agreed to indemnify us against liabilities under the Securities Act that may arise from certain written information furnished to us by White Lion specifically for use in this prospectus supplement or, if such indemnity is unavailable, to contribute amounts required to be paid in respect of such liabilities.

 

White Lion also agreed that neither it, nor any of its affiliates, would execute any short sales during the period from November 14, 2022 to the end of the Commitment Period.

 

We have advised White Lion that it is required to comply with Regulation M promulgated under the Exchange Act. With certain exceptions, Regulation M precludes White Lion, any affiliated purchasers, and any broker-dealer or other person who participates in the distribution from bidding for or purchasing, or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire distribution is complete. Regulation M also prohibits any bids or purchases made in order to stabilize the price of a security in connection with the distribution of that security. All of the foregoing may affect the marketability of the securities offered by this prospectus supplement.

 

This offering will terminate on the earlier of December 31, 2023 or (ii) the date on which White Lion shall have made payment for shares of our Company’s equal to the Commitment Amount.

 

Our common stock is listed on the Nasdaq and trades under the symbol “AUUD.” The transfer agent of our common stock is VStock Transfer, LLC.

 

 

  S- 12  

 

 

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

 

We are incorporating by reference into this prospectus supplement and the accompanying prospectus the documents listed below that we have filed with the SEC, which means we can disclose important information to you by referring you to those documents. The information incorporated by reference is considered to be a part of this prospectus supplement and the accompanying prospectus. We incorporate by reference:

 

  · Our Annual Report on Form 10-K for the year ended December 31, 2021, filed on February 17, 2022;
     
  · Our Quarterly Reports on Form 10-Q for the quarters ending: September 30, 2022, (filed on November 14, 2022); June 30, 2022 (filed on August 12, 2022); and March 31, 2022 (filed on May 12, 2022);
     
  · Our Current Reports on Form 8-K filed May 23, July 20, August 1, November 3 and November 14, 2022; and
     
  · Our Registration Statement on Form 8-A, filed with the SEC on February 16, 2021, including any amendments or reports filed for the purpose of updating the description of our common stock therein.

 

In addition, we also incorporate by reference into this prospectus supplement and the accompanying prospectus all documents (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on that form which are related to those items) that are filed by us with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act before the termination of the offering of our common stock to which this prospectus supplement and the accompanying prospectus relate, except for any document or portion of such document deemed to be “furnished” and not filed in accordance with SEC rules.

 

The information relating to us contained in this prospectus supplement and the accompanying prospectus does not purport to be comprehensive and should be read together with the information contained in the documents incorporated or deemed to be incorporated by reference into this prospectus supplement and the accompanying prospectus.

 

We will provide to each person, including any beneficial owner, to whom a prospectus supplement and accompanying prospectus is delivered, without charge, upon written or oral request, a copy of any or all of the documents that are incorporated by reference into this prospectus supplement and the accompanying prospectus but not delivered with the prospectus supplement and accompanying prospectus, including exhibits that are specifically incorporated by reference into such documents. You may request a copy of these filings without charge by contacting Auddia Inc. Attention: Investor Relations, 2100 Central Avenue, Suite 200, Boulder, CO 80301, Telephone # (303) 219-9771.

 

Information that we file later with the SEC and that is incorporated by reference in this prospectus supplement will automatically update and supersede information contained in this prospectus supplement and the accompanying prospectus as if that information were included in this prospectus supplement and the accompanying prospectus. That information will become part of this prospectus supplement and the accompanying prospectus from the date the information is filed with the SEC.

 

 

 

  S- 13  

 

 

WHERE YOU CAN FIND MORE INFORMATION

 

We are subject to the informational requirements of the Exchange Act and, accordingly, file periodic reports, proxy statements and other information with the SEC. You can obtain these reports, proxy statements and other information that we file electronically with the SEC on the SEC’s website at www.sec.gov. Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to these reports that are filed or furnished pursuant to Section 13 of the Exchange Act are available on our website at www.aitx.ai, as soon as reasonably practicable after they are electronically filed with the SEC. The information on our website is not part of this prospectus, except to the extent filed with the SEC and specifically incorporated into this prospectus by reference.

 

This prospectus is part of a registration statement that we filed with the SEC under the Securities Act. This prospectus does not contain all of the information presented in the registration statement and its exhibits in accordance with SEC rules. Our descriptions in this prospectus of the provisions of documents filed as exhibits to the registration statement or otherwise filed with the SEC are only summaries of the terms of those documents and are not intended to be comprehensive. For a complete description of the content of the documents, you should obtain copies of the full document.

 

LEGAL MATTERS

 

Certain legal matters in connection with the offering and the validity of the securities offered by this prospectus supplement and accompanying prospectus will be passed upon by Carroll Legal LLC, Denver, Colorado.

 

EXPERTS

 

Our balance sheets at December 31, 2021 and 2020 and the related statement of operations, changes in stockholders’ equity (deficit) and cash flows for the years ended December 31, 2021 and 2020, incorporated in this prospectus by reference, have been audited by Daszkal Bolton LLP, independent registered public accounting firm, with respect thereto, and has been so included in reliance upon the report of such firm given on their authority as experts in accounting and auditing.

 

 

 

 

 

  S- 14  

 

 

PROSPECTUS

 

AUDDIA INC.

 

$50,000,000

 

COMMON STOCK

PREFERRED STOCK

WARRANTS

SUBSCRIPTION RIGHTS

DEBT SECURITIES

UNITS

 

We may offer and sell from time to time, in one or more series, any one of the following securities of our company, for total gross proceeds of up to $50,000,000:

 

  · common stock;
  · preferred stock;
  · warrants to purchase common stock, preferred stock, debt securities, other securities or any combination of those securities;
  · subscription rights to purchase common stock, preferred stock, debt securities, other securities or any combination of those securities;
  · secured or unsecured debt securities consisting of notes, debentures or other evidences of indebtedness which may be senior debt securities, senior subordinated debt securities or subordinated debt securities, each of which may be convertible into equity securities; or
  · units comprised of, or other combinations of, the foregoing securities.

 

We may offer and sell these securities separately or together, in one or more series or classes and in amounts, at prices and on terms described in one or more offerings. We may offer securities through underwriting syndicates managed or co-managed by one or more underwriters or dealers, through agents or directly to purchasers. The prospectus supplement for each offering of securities will describe in detail the plan of distribution for that offering. For general information about the distribution of securities offered, please see “Plan of Distribution” in this prospectus.

 

Each time our securities are offered, we will provide a prospectus supplement containing more specific information about the particular offering and attach it to this prospectus. The prospectus supplements may also add, update or change information contained in this prospectus.

 

This prospectus may not be used to offer or sell securities without a prospectus supplement which includes a description of the method and terms of this offering.

 

Our common stock is quoted on the Nasdaq Capital Market under the symbol “AUUD.” The last reported sale price of our common stock on the Nasdaq Capital Market on April 8, 2022 was $2.05 per share. The aggregate market value of our outstanding common stock held by non-affiliates is $18,380,130 based on 12,514,763 shares of outstanding common stock, of which 8,965,917 shares are held by non-affiliates, and a per share price of $2.05, which was the closing sale price of our common stock as quoted on the Nasdaq Capital Market on April 8, 2022.

 

Our Series A Warrants are quoted on the Nasdaq Capital Market under the symbol “AUUDW.” The last reported sale price of our Series A warrants on the Nasdaq Capital Market on April 8, 2022 was $0.60 per warrant.

 

Pursuant to General Instruction I.B.6 of Form S-3, in no event will we sell securities pursuant to this prospectus with a value of more than one-third of the aggregate market value of our common stock held by non-affiliates in any twelve-month period, so long as the aggregate market value of our common stock held by non-affiliates is less than $75,000,000. In the event that subsequent to the date of this prospectus, the aggregate market value of our outstanding common stock held by non-affiliates equals or exceeds $75,000,000, then the one-third limitation on sales shall not apply to additional sales made pursuant to this prospectus. We have not offered any securities pursuant to General Instruction I.B.6 of Form S-3 during the twelve calendar months prior to and including the date of this prospectus.

 

If we decide to seek a listing of any preferred stock, purchase contracts, warrants, subscriptions rights, depositary shares, debt securities or units offered by this prospectus, the related prospectus supplement will disclose the exchange or market on which the securities will be listed, if any, or where we have made an application for listing, if any.

 

Investing in our securities is highly speculative and involves a significant degree of risk. See “Risk Factors” beginning on page 5 and the risk factors in our most recent Annual Report on Form 10-K, which is incorporated by reference herein, as well as in any other recently filed quarterly or current reports and, if any, in the relevant prospectus supplement. We urge you to carefully read this prospectus and the accompanying prospectus supplement, together with the documents we incorporate by reference, describing the terms of these securities before investing.

 

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

 

The date of this prospectus is April 18, 2022

 

     

 

 

 

TABLE OF CONTENTS

 

  Page
   
About This Prospectus 1
Cautionary Statement Regarding Forward-Looking Statements 2
Prospectus Summary 3
Risk Factors 4
Use of Proceeds 4
Dividend Policy 5
Plan of Distribution 5
Description of Securities We May Offer 8
Legal Matters 16
Experts 16
Where You Can Find Additional Information 16
Incorporation of Documents By Reference 17

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

     

 

 

ABOUT THIS PROSPECTUS

 

This prospectus is part of a registration statement on Form S-3 that we filed with the Securities and Exchange Commission, or SEC, utilizing a “shelf” registration process. Under this shelf registration process, we may offer and sell, either individually or in combination, in one or more offerings, any of the securities described in this prospectus, for total gross proceeds of up to $50,000,000. This prospectus provides you with a general description of the securities we may offer. Each time we offer securities under this prospectus, we will provide a prospectus supplement to this prospectus that will contain more specific information about the 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 and any related free writing prospectus that we may authorize to be provided to you may also add, update or change any of the information contained in this prospectus or in the documents that we have incorporated by reference into this prospectus.

 

We urge you to read carefully this prospectus, any applicable prospectus supplement and any free writing prospectuses we have authorized for use in connection with a specific offering, together with the information incorporated herein by reference as described under the heading “Incorporation of Documents by Reference,” before investing in any of the securities being offered. You should rely only on the information contained in, or incorporated by reference into, this prospectus and any applicable prospectus supplement, along with the information contained in any free writing prospectuses we have authorized for use in connection with a specific offering. We have not authorized anyone to provide you with different or additional information. This prospectus is an offer to sell only the securities offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so.

 

The information appearing in this prospectus, any applicable prospectus supplement or any related free writing prospectus is accurate only as of the date on the front of the document and any information we have incorporated by reference is accurate only as of the date of the document incorporated by reference, regardless of the time of delivery of this prospectus, any applicable prospectus supplement or any related free writing prospectus, or any sale of a security.

 

This prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described below under the section entitled “Where You Can Find Additional Information.”

 

This prospectus contains, or incorporates by reference, trademarks, tradenames, service marks and service names of Auddia Inc.

 

 

 

 

 

 

 

  1  

 

 

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

 

This prospectus and any accompanying prospectus or prospectus supplement and the documents incorporated by reference herein and therein may contain forward looking statements that involve significant risks and uncertainties. All statements other than statements of historical fact contained in this prospectus and any accompanying prospectus supplement and the documents incorporated by reference herein, including statements regarding future events, our future financial performance, business strategy, and plans and objectives of management for future operations, are forward-looking statements. We have attempted to identify forward-looking statements by terminology including “anticipates,” “believes,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predicts,” “should,” or “will” or the negative of these terms or other comparable terminology. Although we do not make forward looking statements unless we believe we have a reasonable basis for doing so, we cannot guarantee their accuracy. These statements are only predictions and involve known and unknown risks, uncertainties and other factors, including the risks outlined under “Risk Factors” or elsewhere in this prospectus and the documents incorporated by reference herein, which may cause our or our industry’s actual results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Moreover, we operate in a highly regulated, very competitive, and rapidly changing environment. New risks emerge from time to time and it is not possible for us to predict all risk factors, nor can we address the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause our actual results to differ materially from those contained in any forward-looking statements.

 

We have based these forward-looking statements largely on our current expectations and assumptions about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short term and long term business operations, and financial needs. These forward-looking statements are subject to certain risks and uncertainties that could cause our actual results to differ materially from those reflected in the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those discussed in this prospectus, and in particular, the risks discussed below and under the heading “Risk Factors” and those discussed in other documents we file with the SEC which are incorporated by reference herein. This prospectus, and any accompanying prospectus or prospectus supplement, should be read in conjunction with the consolidated financial statements for the fiscal years ended December 31, 2021 and 2020 and related notes, which are incorporated by reference herein.

 

We undertake no obligation to revise or publicly release the results of any revision to these forward-looking statements, except as required by law. In light of the significant risks, uncertainties and assumptions that accompany forward-looking statements, the forward-looking events and circumstances discussed in this prospectus and any accompanying prospectus or prospectus supplement may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statement.

 

You should not place undue reliance on any forward-looking statement, each of which applies only as of the date of this prospectus, or any accompanying prospectus or any prospectus supplement. Except as required by law, we undertake no obligation to update or revise publicly any of the forward-looking statements after the date of this prospectus to conform our statements to actual results or changed expectations.

 

Any forward-looking statement you read in this prospectus, any accompanying prospectus, or any prospectus supplement or any document incorporated by reference reflects our current views with respect to future events and is subject to these and other risks, uncertainties and assumptions relating to our operations, operating results, growth strategy and liquidity. You should not place undue reliance on these forward-looking statements because such statements speak only as to the date when made. We assume no obligation to publicly update or revise these forward-looking statements for any reason, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future, except as otherwise required by applicable law. You are advised, however, to consult any further disclosures we make on related subjects in our reports on Forms 10-Q, 8-K and 10-K filed with the SEC. You should understand that it is not possible to predict or identify all risk factors. Consequently, you should not consider any such list to be a complete set of all potential risks or uncertainties.

 

 

 

 

 

 

  2  

 

 

PROSPECTUS SUMMARY

 

This summary highlights selected information contained elsewhere in this prospectus. This summary does not contain all the information that you should consider before investing in our Company. You should carefully read the entire prospectus, including all documents incorporated by reference herein. In particular, attention should be directed to our “Risk Factors,” “Information With Respect to the Company,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the financial statements and related notes thereto contained herein or otherwise incorporated by reference hereto, before making an investment decision.

 

As used herein, and any amendment or supplement hereto, unless otherwise indicated, “we,” “us,” “our,” the “Company,” or “Auddia” means Auddia Inc.

 

Overview

 

We are a technology company headquartered in Boulder, CO that is reinventing how consumers engage with audio through the development of a proprietary Artificial Intelligence (“AI”) platform for audio and innovative technologies for podcasts. We are leveraging these technologies to bring to market two industry first apps, Faidr (previously known as the Auddia App) and Vodacast.

 

Faidr gives consumers the opportunity to listen to any AM/FM radio station with no commercials while personalizing the listening experience through skips, the insertion of on-demand content and programming of audio routines to customize listening sessions such as a daily commute. The Faidr App represents the first time consumers can access the local content uniquely provided by radio in the commercial free and personalized manner many consumers have come to demand for media consumption.

 

The Company launched all major U.S. radio stations on its Faidr App on February 15, 2022.

 

Vodacast is a podcasting platform that provides a unique suite of tools that helps Podcasters create additional digital content for their podcast episodes as well as plan their episodes, build their brand around their Podcast and monetize their content with new monetization channels. Vodcast also gives users the ability to go deeper into the stories through supplemental, digital content,, comment, and contribute their own content to episode feeds.

 

Both of our offerings address large and rapidly growing audiences. Faidr and Vodacast mobile apps are available today through the iOS and Android app stores.

 

Emerging Growth Company under the JOBS Act

 

As a company with less than $1.07 billion in revenue during our last fiscal year, we qualify as an “emerging growth company” under the Jumpstart Our Business Startups Act of 2012, or the JOBS Act. As an emerging growth company, we have elected to take advantage of reduced reporting requirements and are relieved of certain other significant requirements that are otherwise generally applicable to public companies. As an emerging growth company:

 

  · We may present only two years of audited financial statements and only two years of related Management’s Discussion and Analysis of Financial Condition and Results of Operations;
     
  · We are exempt from the requirement to obtain an attestation and report from our auditors on whether we maintained effective internal control over financial reporting under the Sarbanes-Oxley Act;

 

 

 

  3  

 

 

 

  · We are permitted to provide less extensive disclosure about our executive compensation arrangements; and
     
  · We are not required to give our stockholders non-binding advisory votes on executive compensation or golden parachute arrangements.

 

We may take advantage of these provisions until December 31, 2026 (the last day of the fiscal year following the fifth anniversary of our initial public offering) if we continue to be an emerging growth company. We would cease to be an emerging growth company if we have more than $1.07 billion in annual revenue, have more than $700 million in market value of our shares held by non-affiliates or issue more than $1.0 billion of non-convertible debt over a three-year period. We may choose to take advantage of some but not all of these reduced burdens. We have elected to provide two years of audited financial statements. Additionally, we have elected to take advantage of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act of 1933, as amended, or the Securities Act, for complying with new or revised accounting standards that have different effective dates for public and private companies until the earlier of the date we (i) are no longer an emerging growth company or (ii) affirmatively and irrevocably opt out of the extended transition period provided in Section 7(a)(2)(B) of the Securities Act.

 

Corporate Information

 

Our principal executive offices are located at 2100 Central Avenue, Suite 200, Boulder, Colorado 80301, and our telephone number is (303) 219-9771, and our Internet website address is https://www.auddiainc.com. The information on our website is not a part of, or incorporated in, this prospectus. 

 

RISK FACTORS

 

Investing in our securities is highly speculative and involves a high degree of risk. Before deciding whether to invest in our securities, you should carefully consider the risk factors we describe in any accompanying prospectus or any future prospectus supplement, as well as in any related free writing prospectus for a specific offering of securities, and the risk factors incorporated by reference into this prospectus, any accompanying prospectus or such prospectus supplement. You should also carefully consider other information contained and incorporated by reference in this prospectus and any applicable prospectus supplement, including our financial statements and the related notes thereto incorporated by reference in this prospectus. The risks and uncertainties described in the applicable prospectus supplement and our other filings with the SEC incorporated by reference herein are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently consider immaterial may also adversely affect us. If any of the described risks occur, our business, financial condition or results of operations could be materially harmed. In such case, the value of our securities could decline and you may lose all or part of your investment.

 

USE OF PROCEEDS

 

Unless otherwise indicated in a prospectus supplement, we intend to use the net proceeds from these sales for general corporate purposes, which includes, without limitation, continuing to build out the Faidr and Vodacast platforms, expanding our sales and marketing efforts, research and development expenses, sales and support staff, and software development. The amounts and timing of these expenditures will depend on numerous factors, including the development of our current business initiatives.

 

 

 

 

 

  4  

 

 

DIVIDEND POLICY

 

We have never paid or declared any cash dividends on our common stock, and we do not anticipate paying any cash dividends on our common stock in the foreseeable future. We intend to retain all available funds and any future earnings to fund the development and expansion of our business. Any future determination to pay dividends will be at the discretion of our board of directors and will depend upon a number of factors, including our results of operations, financial condition, future prospects, contractual restrictions, restrictions imposed by applicable law and other factors our board of directors deems relevant. Our future ability to pay cash dividends on our stock may also be limited by the terms of any future debt or preferred securities or future credit facility.

 

PLAN OF DISTRIBUTION

 

We may sell the securities from time to time to or through underwriters or dealers, through agents, or directly to one or more purchasers. A distribution of the securities offered by this prospectus may also be effected through the issuance of derivative securities, including without limitation, warrants, rights to purchase and subscriptions. In addition, the manner in which we may sell some or all of the securities covered by this prospectus includes, without limitation, through:

 

  ·

a block trade in which a broker-dealer will attempt to sell as agent, but may position or resell a portion of the block, as principal, in order to facilitate the transaction;

     
  · purchases by a broker-dealer, as principal, and resale by the broker-dealer for its account; or
     
  · ordinary brokerage transactions and transactions in which a broker solicits purchasers.

 

A prospectus supplement or supplements with respect to each series of securities will describe the terms of the offering, including, to the extent applicable:

 

  · the terms of the offering;
     
  ·

the name or names of the underwriters or agents and the amounts of securities underwritten or purchased by each of them, if any;

     
  ·

the public offering price or purchase price of the securities or other consideration therefor, and the proceeds to be received by us from the sale;

     
  · any delayed delivery requirements;
     
  · any over-allotment options under which underwriters may purchase additional securities from us;
     
  · any underwriting discounts or agency fees and other items constituting underwriters’ or agents’ compensation;
     
  · any discounts or concessions allowed or re-allowed or paid to dealers; and
     
  · any securities exchange or market on which the securities may be listed.

 

 

 

  5  

 

 

The offer and sale of the securities described in this prospectus by us, the underwriters or the third parties described above may be effected from time to time in one or more transactions, including privately negotiated transactions, either:

 

  · at a fixed price or prices, which may be changed;
     
  · in an “at the market” offering within the meaning of Rule 415(a)(4) of the Securities Act of 1933, as amended, or the Securities Act;
     
  · at prices related to such prevailing market prices; or
     
  · at negotiated prices.

 

Only underwriters named in the prospectus supplement will be underwriters of the securities offered by the prospectus supplement.

 

Underwriters and Agents; Direct Sales

 

If underwriters are used in a sale, they will acquire the offered securities for their own account and may resell the offered securities from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. We may offer the securities to the public through underwriting syndicates represented by managing underwriters or by underwriters without a syndicate.

 

Unless the prospectus supplement states otherwise, the obligations of the underwriters to purchase the securities will be subject to the conditions set forth in the applicable underwriting agreement. Subject to certain conditions, the underwriters will be obligated to purchase all of the securities offered by the prospectus supplement, other than securities covered by any over-allotment option. Any public offering price and any discounts or concessions allowed or re-allowed or paid to dealers may change from time to time. We may use underwriters with whom we have a material relationship. We will describe in the prospectus supplement, naming the underwriter, the nature of any such relationship. 

 

We may sell securities directly or through agents we designate from time to time. We will name any agent involved in the offering and sale of securities, and we will describe any commissions we will pay the agent in the prospectus supplement. Unless the prospectus supplement states otherwise, our agent will act on a best-efforts basis for the period of its appointment.

 

We may authorize agents or underwriters to solicit offers by certain types of institutional investors to purchase securities from us at the public offering price set forth in the prospectus supplement pursuant to delayed delivery contracts providing for payment and delivery on a specified date in the future. We will describe the conditions to these contracts and the commissions we must pay for solicitation of these contracts in the prospectus supplement.

 

Dealers

 

We may sell the offered securities to dealers as principals. The dealer may then resell such securities to the public either at varying prices to be determined by the dealer or at a fixed offering price agreed to with us at the time of resale.

 

Institutional Purchasers

 

We may authorize agents, dealers or underwriters to solicit certain institutional investors to purchase offered securities on a delayed delivery basis pursuant to delayed delivery contracts providing for payment and delivery on a specified future date. The applicable prospectus supplement or other offering materials, as the case may be, will provide the details of any such arrangement, including the offering price and commissions payable on the solicitations.

 

 

 

  6  

 

 

We will enter into such delayed contracts only with institutional purchasers that we approve. These institutions may include commercial and savings banks, insurance companies, pension funds, investment companies and educational and charitable institutions.

 

Indemnification; Other Relationships

 

We may provide agents, underwriters, dealers and remarketing firms with indemnification against certain civil liabilities, including liabilities under the Securities Act, or contribution with respect to payments that the agents or underwriters may make with respect to these liabilities. Agents, underwriters, dealers and remarketing firms, and their affiliates, may engage in transactions with, or perform services for, us in the ordinary course of business. This includes commercial banking and investment banking transactions.

 

Market-Making; Stabilization and Other Transactions

 

There is currently no market for any of the offered securities, other than our common stock, which is quoted on the Nasdaq Capital Market. If the offered securities are traded after their initial issuance, they may trade at a discount from their initial offering price, depending upon prevailing interest rates, the market for similar securities and other factors. While it is possible that an underwriter could inform us that it intends to make a market in the offered securities, such underwriter would not be obligated to do so, and any such market-making could be discontinued at any time without notice. Therefore, no assurance can be given as to whether an active trading market will develop for the offered securities. We have no current plans for listing of the debt securities, preferred stock, warrants or subscription rights on any securities exchange or quotation system; any such listing with respect to any particular debt securities, preferred stock, warrants or subscription rights will be described in the applicable prospectus supplement or other offering materials, as the case may be. 

 

Any underwriter may engage in over-allotment, stabilizing transactions, short-covering transactions and penalty bids in accordance with Regulation M under the Securities Exchange Act of 1934, as amended, or the Exchange Act. Over-allotment involves sales in excess of the offering size, which create a short position. Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum price. Syndicate-covering or other short-covering transactions involve purchases of the securities, either through exercise of the over-allotment option or 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 stabilizing or covering transaction to cover short positions. Those activities may cause the price of the securities to be higher than it would otherwise be. If commenced, the underwriters may discontinue any of the activities at any time.

 

Any underwriters or agents that are qualified market makers on the Nasdaq Capital Market may engage in passive market making transactions in our common stock on the Nasdaq Capital Market in accordance with Regulation M under the Exchange Act, during the business day prior to the pricing of the offering, before the commencement of offers or sales of our common stock. 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. Passive market making may stabilize the market price of the securities at a level above that which might otherwise prevail in the open market and, if commenced, may be discontinued at any time.

 

Fees and Commissions

 

If 5% or more of the net proceeds of any offering of securities made under this prospectus will be received by a FINRA member participating in the offering or affiliates or associated persons of such FINRA member, the offering will be conducted in accordance with FINRA Rule 5121.

 

 

 

 

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DESCRIPTION OF SECURITIES WE MAY OFFER

 

General

 

This prospectus describes the general terms of our capital stock. The following description is not complete and may not contain all the information you should consider before investing in our capital stock. For a more detailed description of these securities, you should read the applicable provisions of Delaware law and our certificate of incorporation, as amended, referred to herein as our certificate of incorporation, and our amended and restated bylaws, referred to herein as our bylaws. When we offer to sell a particular series of these securities, we will describe the specific terms of the series in a supplement to this prospectus. Accordingly, for a description of the terms of any series of securities, you must refer to both the prospectus supplement relating to that series and the description of the securities described in this prospectus. To the extent the information contained in the prospectus supplement differs from this summary description, you should rely on the information in the prospectus supplement.

 

The total number of shares of capital stock we are authorized to issue is 110,000,000 shares, of which (1) 100,000,000 shares are common stock, par value $0.001 per share (or common stock) and (2) 10,000,000 shares are preferred stock, par value $0.001 per share (or preferred stock), which may, at the sole discretion of our board of directors be issued in one or more series.

 

We, directly or through agents, dealers or underwriters designated from time to time, may offer, issue and sell, together or separately, up to $50,000,000 in the aggregate of:

 

  · common stock;
  · preferred stock;
  ·

warrants to purchase common stock, preferred stock, debt securities, other securities or any combination of those securities;

  ·

subscription rights to purchase common stock, preferred stock, debt securities, other securities or any combination of those securities;

  ·

secured or unsecured debt securities consisting of notes, debentures or other evidences of indebtedness which may be senior debt securities, senior subordinated debt securities or subordinated debt securities, each of which may be convertible into equity securities; or

  · units comprised of, or other combinations of, the foregoing securities.

 

We may issue the debt securities as exchangeable for or convertible into shares of common stock, preferred stock or other securities that may be sold by us pursuant to this prospectus or any combination of the foregoing. The preferred stock may also be exchangeable for and/or convertible into shares of common stock, another series of preferred stock or other securities that may be sold by us pursuant to this prospectus or any combination of the foregoing. When a particular series of securities is offered, a supplement to this prospectus will be delivered with this prospectus, which will set forth the terms of the offering and sale of the offered securities.

 

Common Stock

 

As of April 8, 2022, there were 12,514,763 shares of common stock issued and outstanding, held of record by approximately 134 stockholders. Subject to preferential rights with respect to any outstanding preferred stock, all outstanding shares of common stock are of the same class and have equal rights and attributes.

 

 

 

 

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Dividend Rights

 

Holders of the common stock may receive dividends when, as and if declared by our board of directors out of the assets legally available for that purpose and subject to the preferential dividend rights of any other classes or series of stock of our Company. We have never paid, and have no plans to pay, any dividends on our shares of common stock. 

 

Voting Rights

 

Holders of the common stock are entitled to one vote per share in all matters as to which holders of common stock are entitled to vote. Holders of not less than a majority of the outstanding shares of common stock entitled to vote at any meeting of stockholders constitute a quorum unless otherwise required by law.

 

Election of Directors

 

Directors hold office until the next annual meeting of stockholders and are eligible for re-election at such meeting. Directors are elected by a plurality of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. There is no cumulative voting for directors.

 

Liquidation

 

In the event of any liquidation, dissolution or winding up of the Company, holders of the common stock have the right to receive ratably and equally all of the assets remaining after payment of liabilities and liquidation preferences of any preferred stock then outstanding.

 

Redemption

 

The common stock is not redeemable or convertible and does not have any sinking fund provisions.

 

Preemptive Rights

 

Holders of the common stock do not have preemptive rights.

 

Other Rights

 

Our common stock is not liable to further calls or to assessment by the registrant and for liabilities of the registrant imposed on its stockholders under state statutes.

 

Right to Amend Bylaws

 

The board of directors has the power to adopt, amend or repeal the bylaws. Bylaws adopted by the board of directors may be repealed or changed, and new bylaws made, with the requisite vote of our stockholders, and our stockholders may prescribe that any bylaw made by them shall not be altered, amended or repealed by the board of directors.

 

Change in Control

 

Provisions of Delaware law and our certificate of incorporation and bylaws could make the acquisition of our company by means of a tender offer, proxy contest or otherwise, and the removal of incumbent officers and directors, more difficult. These provisions include:

 

 

 


  9  

 

 

Section 203 of the DGCL, which prohibits a merger with a 15%-or-greater stockholder, such as a party that has completed a successful tender offer, until three years after that party became a 15%-or-greater stockholder; 

 

The authorization in our certificate of incorporation of undesignated preferred stock, which could be issued without stockholder approval in a manner designed to prevent or discourage a takeover; and

 

Our certificate of incorporation and bylaws provide that, except as otherwise required by law, special meetings of the stockholders can only be called by our board of directors. Stockholders at a special meeting may only consider matters set forth in the notice of the meeting. These provisions could have the effect of delaying until the next stockholder meeting stockholder actions that may be favored by the holders of a majority of our outstanding voting securities.

 

Together, these provisions may make the removal of management more difficult and may discourage transactions that could otherwise involve payment of a premium over prevailing market prices for our common stock.

 

Market, Symbol and Transfer Agent

 

Our common stock is listed for trading on the Nasdaq Capital Market under the symbol “AUUD”. The transfer agent and registrar for our common stock is VStock Transfer, LLC.

 

Preferred Stock

 

Our certificate of incorporation empowers our board of directors, without action by our shareholders, to issue up to 10,000,000 shares of preferred stock from time to time in one or more series, which preferred stock may be offered by this prospectus and supplements thereto. As of the date of this prospectus, there were no shares of preferred stock outstanding.

 

We will fix the rights, preferences, privileges and restrictions of the preferred stock of each series in the certificate of designation relating to that series. We will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from a current report on Form 8-K that we file with the SEC, the form of any certificate of designation that describes the terms of the series of preferred stock we are offering before the issuance of the related series of preferred stock. This description will include any or all of the following, as required:

 

  · the title and stated value;
  · the number of shares we are offering;
  · the liquidation preference per share;
  · the purchase price;
  · the dividend rate, period and payment date and method of calculation for dividends;
  ·

whether dividends will be cumulative or non-cumulative and, if cumulative, the date from which dividends will accumulate;

  · any contractual limitations on our ability to declare, set aside or pay any dividends;
  · the procedures for any auction and remarketing, if any;
  · the provisions for a sinking fund, if any;
  ·

the provisions for redemption or repurchase, if applicable, and any restrictions on our ability to exercise those redemption and repurchase rights;

  · any listing of the preferred stock on any securities exchange or market;

 

 

 

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  ·

whether the preferred stock will be convertible into our common stock, and, if applicable, the conversion price, or how it will be calculated, and the conversion period;

  ·

whether the preferred stock will be exchangeable into debt securities, and, if applicable, the exchange price, or how it will be calculated, and the exchange period;

  · voting rights, if any, of the preferred stock;
  · preemptive rights, if any;
  · restrictions on transfer, sale or other assignment, if any;
  · whether interests in the preferred stock will be represented by depositary shares;
  ·

a discussion of any material or special United States federal income tax considerations applicable to the preferred stock;

  ·

the relative ranking and preferences of the preferred stock as to dividend rights and rights if we liquidate, dissolve or wind up our affairs;

  ·

any limitations on issuance of any class or series of preferred stock ranking senior to or on a parity with the series of preferred stock as to dividend rights and rights if we liquidate, dissolve or wind up our affairs; and

  · any other specific terms, preferences, rights or limitations of, or restrictions on, the preferred stock.

 

If we issue shares of preferred stock under this prospectus, after receipt of payment therefor, the shares will be fully paid and non-assessable.

 

The Delaware General Corporation Law provides that the holders of preferred stock will have the right to vote separately as a class on any proposal involving fundamental changes in the rights of holders of that preferred stock. This right is in addition to any voting rights provided for in the applicable certificate of designation.

 

Our board of directors may authorize the issuance of preferred stock with voting or conversion rights that could adversely affect the voting power or other rights of the holders of our common stock. Preferred stock could be issued quickly with terms designed to delay or prevent a change in control of our Company or make removal of management more difficult. Additionally, the issuance of preferred stock could have the effect of decreasing the market price of our common stock.

 

Warrants

 

We may issue warrants to purchase our securities or other rights, including rights to receive payment in cash or securities based on the value, rate or price of one or more specified commodities, currencies, securities or indices, or any combination of the foregoing. Warrants may be issued independently or together with any other securities that may be sold by us pursuant to this prospectus or any combination of the foregoing and may be attached to, or separate from, such securities. To the extent warrants that we issue are to be publicly-traded, each series of such warrants will be issued under a separate warrant agreement to be entered into between us and a warrant agent.

 

We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from a current report on Form 8-K that we file with the SEC, forms of the warrant and warrant agreement, if any. The prospectus supplement relating to any warrants that we may offer will contain the specific terms of the warrants and a description of the material provisions of the applicable warrant agreement, if any. These terms may include the following:

 

  · the title of the warrants;
  · the price or prices at which the warrants will be issued;
  · the designation, amount and terms of the securities or other rights for which the warrants are exercisable;

 

 

 

 

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  ·

the designation and terms of the other securities, if any, with which the warrants are to be issued and the number of warrants issued with each other security;

  · the aggregate number of warrants;
  ·

any provisions for adjustment of the number or amount of securities receivable upon exercise of the warrants

or the exercise price of the warrants;

  · the price or prices at which the securities or other rights purchasable upon exercise of the warrants may be purchased;
  ·

if applicable, the date on and after which the warrants and the securities or other rights purchasable upon exercise of the warrants will be separately transferable;

  · a discussion of any material U.S. federal income tax considerations applicable to the exercise of the warrants;
  · the date on which the right to exercise the warrants will commence, and the date on which the right will expire;
  · the maximum or minimum number of warrants that may be exercised at any time;
  · information with respect to book-entry procedures, if any; and
  ·

any other terms of the warrants, including terms, procedures and limitations relating to the exchange and exercise of the warrants.

 

Exercise of Warrants. Each warrant will entitle the holder of warrants to purchase the amount of securities or other rights, at the exercise price stated or determinable in the prospectus supplement for the warrants. Warrants may be exercised at any time up to the close of business on the expiration date shown in the applicable prospectus supplement, unless otherwise specified in such prospectus supplement. After the close of business on the expiration date, if applicable, unexercised warrants will become void. Warrants may be exercised in the manner described in the applicable prospectus supplement. When the warrant holder makes the payment and properly completes and signs the warrant certificate at the corporate trust office of the warrant agent, if any, or any other office indicated in the prospectus supplement, we will, as soon as possible, forward the securities or other rights that the warrant holder has purchased. If the warrant holder exercises less than all of the warrants represented by the warrant certificate, we will issue a new warrant certificate for the remaining warrants.

 

Subscription Rights

 

We may issue rights to purchase our securities. The rights may or may not be transferable by the persons purchasing or receiving the rights. In connection with any rights offering, we may enter into a standby underwriting or other arrangement with one or more underwriters or other persons pursuant to which such underwriters or other persons would purchase any offered securities remaining unsubscribed for after such rights offering. In connection with a rights offering to holders of our capital stock a prospectus supplement will be distributed to such holders on the record date for receiving rights in the rights offering set by us.

 

We will file as exhibits to the registration statement of which this prospectus is a part, or will incorporate by reference from a current report on Form 8-K that we file with the SEC, forms of the subscription rights, standby underwriting agreement or other agreements, if any. The prospectus supplement relating to any rights that we offer will include specific terms relating to the offering, including, among other matters:

 

  · the date of determining the security holders entitled to the rights distribution;
  · the aggregate number of rights issued and the aggregate amount of securities purchasable upon exercise of the rights;
  · the exercise price;
  · the conditions to completion of the rights offering;
  · the date on which the right to exercise the rights will commence and the date on which the rights will expire; and
  · any applicable federal income tax considerations.

 

 

 

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Each right would entitle the holder of the rights to purchase the principal amount of securities at the exercise price set forth in the applicable prospectus supplement. Rights may be exercised at any time up to the close of business on the expiration date for the rights provided in the applicable prospectus supplement. After the close of business on the expiration date, all unexercised rights will become void.

 

Holders may exercise rights as described in the applicable prospectus supplement. Upon receipt of payment and the rights certificate properly completed and duly executed at the corporate trust office of the rights agent, if any, or any other office indicated in the prospectus supplement, we will, as soon as practicable, forward the securities purchasable upon exercise of the rights. If less than all of the rights issued in any rights offering are exercised, we may offer any unsubscribed securities directly to persons other than stockholders, to or through agents, underwriters or dealers or through a combination of such methods, including pursuant to standby underwriting arrangements, as described in the applicable prospectus supplement.

 

Debt Securities

 

As used in this prospectus, the term “debt securities” means the debentures, notes, bonds and other evidences of indebtedness that we may issue from time to time. The debt securities will either be senior debt securities, senior subordinated debt or subordinated debt securities. We may also issue convertible debt securities. Debt securities may be issued under an indenture (which we refer to herein as an Indenture), which are contracts entered into between us and a trustee to be named therein. The Indenture has been filed as an exhibit to the registration statement of which this prospectus forms a part. We may issue debt securities and incur additional indebtedness other than through the offering of debt securities pursuant to this prospectus. It is likely that convertible debt securities will not be issued under an Indenture.

 

The debt securities may be fully and unconditionally guaranteed on a secured or unsecured senior or subordinated basis by one or more guarantors, if any. The obligations of any guarantor under its guarantee will be limited as necessary to prevent that guarantee from constituting a fraudulent conveyance under applicable law. In the event that any series of debt securities will be subordinated to other indebtedness that we have outstanding or may incur, the terms of the subordination will be set forth in the prospectus supplement relating to the subordinated debt securities.

 

We may issue debt securities from time to time in one or more series, in each case with the same or various maturities, at par or at a discount. Unless indicated in a prospectus supplement, we may issue additional debt securities of a particular series without the consent of the holders of the debt securities of such series outstanding at the time of the issuance. Any such additional debt securities, together with all other outstanding debt securities of that series, will constitute a single series of debt securities under the applicable Indenture and will be equal in ranking. 

 

Should an Indenture relate to unsecured indebtedness, in the event of a bankruptcy or other liquidation event involving a distribution of assets to satisfy our outstanding indebtedness or an event of default under a loan agreement relating to secured indebtedness of our company or its subsidiaries, the holders of such secured indebtedness, if any, would be entitled to receive payment of principal and interest prior to payments on the unsecured indebtedness issued under an Indenture.

 

Each prospectus supplement will describe the terms relating to the specific series of debt securities. These terms will include some or all of the following:

 

  · the title of debt securities and whether the debt securities are senior or subordinated;
  · any limit on the aggregate principal amount of debt securities of such series;
  · the percentage of the principal amount at which the debt securities of any series will be issued;
  · the ability to issue additional debt securities of the same series;
  · the purchase price for the debt securities and the denominations of the debt securities;

 

 

 

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  · the specific designation of the series of debt securities being offered;
  ·

the maturity date or dates of the debt securities and the date or dates upon which the debt securities are payable and the rate or rates at which the debt securities of the series shall bear interest, if any, which may be fixed or variable, or the method by which such rate shall be determined;

  · the basis for calculating interest;
  · the date or dates from which any interest will accrue or the method by which such date or dates will be determined;
  · the duration of any deferral period, including the period during which interest payment periods may be extended;
  ·

whether the amount of payments of principal of (and premium, if any) or interest on the debt securities may be determined with reference to any index, formula or other method, such as one or more currencies, commodities, equity indices or other indices, and the manner of determining the amount of such payments;

  ·

the dates on which we will pay interest on the debt securities and the regular record date for determining who is entitled to the interest payable on any interest payment date;

  ·

the place or places where the principal of (and premium, if any) and interest on the debt securities will be payable, where any securities may be surrendered for registration of transfer, exchange or conversion, as applicable, and notices and demands may be delivered to or upon us pursuant to the applicable Indenture;

  · the rate or rates of amortization of the debt securities;
  · any terms for the attachment to the debt securities of warrants, options or other rights to purchase or sell our securities;
  ·

if the debt securities will be secured by any collateral and, if so, a general description of the collateral and the terms and provisions of such collateral security, pledge or other agreements;

  ·

if we possess the option to do so, the periods within which and the prices at which we may redeem the debt securities, in whole or in part, pursuant to optional redemption provisions, and the other terms and conditions of any such provisions;

  ·

our obligation or discretion, if any, to redeem, repay or purchase debt securities by making periodic payments to a sinking fund or through an analogous provision or at the option of holders of the debt securities, and the period or periods within which and the price or prices at which we will redeem, repay or purchase the debt securities, in whole or in part, pursuant to such obligation, and the other terms and conditions of such obligation;

  · the terms and conditions, if any, regarding the option or mandatory conversion or exchange of debt securities;
  ·

the period or periods within which, the price or prices at which and the terms and conditions upon which any debt securities of the series may be redeemed, in whole or in part at our option and, if other than by a board resolution, the manner in which any election by us to redeem the debt securities shall be evidenced;

  · any restriction or condition on the transferability of the debt securities of a particular series;
  ·

the portion, or methods of determining the portion, of the principal amount of the debt securities which

we must pay upon the acceleration of the maturity of the debt securities in connection with any event of default;

  ·

the currency or currencies in which the debt securities will be denominated and in which principal, any premium and any interest will or may be payable or a description of any units based on or relating to a currency or currencies in which the debt securities will be denominated;

  · provisions, if any, granting special rights to holders of the debt securities upon the occurrence of specified events;
  ·

any deletions from, modifications of or additions to the events of default or our covenants with respect to the applicable series of debt securities, and whether or not such events of default or covenants are consistent with those contained in the applicable Indenture;

  · any limitation on our ability to incur debt, redeem stock, sell our assets or other restrictions;
  ·

the application, if any, of the terms of the applicable Indenture relating to defeasance and covenant defeasance (which terms are described below) to the debt securities;

  · what subordination provisions will apply to the debt securities;
  · the terms, if any, upon which the holders may convert or exchange the debt securities into or for our securities or property;
  · whether we are issuing the debt securities in whole or in part in global form;
  ·

any change in the right of the trustee or the requisite holders of debt securities to declare the principal amount thereof due and payable because of an event of default;

 

 

 

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  · the depositary for global or certificated debt securities, if any;
  ·

any material federal income tax consequences applicable to the debt securities, including any debt securities denominated and made payable, as described in the prospectus supplements, in foreign currencies, or units based on or related to foreign currencies;

  ·

any right we may have to satisfy, discharge and defease our obligations under the debt securities, or terminate or eliminate restrictive covenants or events of default in the Indentures, by depositing money or U.S. government obligations with the trustee of the Indentures;

  ·

the names of any trustees, depositories, authenticating or paying agents, transfer agents or registrars or other agents with respect to the debt securities;

  ·

to whom any interest on any debt security shall be payable, if other than the person in whose name the security is registered, on the record date for such interest, the extent to which, or the manner in which, any interest payable on a temporary global debt security will be paid;

  ·

if the principal of or any premium or interest on any debt securities is to be payable in one or more currencies or currency units other than as stated, the currency, currencies or currency units in which it shall be paid and the periods within and terms and conditions upon which such election is to be made and the amounts payable (or the manner in which such amount shall be determined);

  ·

the portion of the principal amount of any debt securities which shall be payable upon declaration of acceleration of the maturity of the debt securities pursuant to the applicable Indenture;

  ·

if the principal amount payable at the stated maturity of any debt security of the series will not be determinable as of any one or more dates prior to the stated maturity, the amount which shall be deemed to be the principal amount of such debt securities as of any such date for any purpose, including the principal amount thereof which shall be due and payable upon any maturity other than the stated maturity or which shall be deemed to be outstanding as of any date prior to the stated maturity (or, in any

such case, the manner in which such amount deemed to be the principal amount shall be determined); and

  · any other specific terms of the debt securities, including any modifications to the events of default under the debt securities and any other terms which may be required by or advisable under applicable laws or regulations.

 

Unless otherwise specified in the applicable prospectus supplement, we do not anticipate the debt securities will be listed on any securities exchange. Holders of the debt securities may present registered debt securities for exchange or transfer in the manner described in the applicable prospectus supplement. Except as limited by the applicable Indenture, we will provide these services without charge, other than any tax or other governmental charge payable in connection with the exchange or transfer.

  

Debt securities may bear interest at a fixed rate or a variable rate as specified in the prospectus supplement. In addition, if specified in the prospectus supplement, we may sell debt securities bearing no interest or interest at a rate that at the time of issuance is below the prevailing market rate, or at a discount below their stated principal amount. We will describe in the applicable prospectus supplement any special federal income tax considerations applicable to these discounted debt securities.

 

We may issue debt securities with the principal amount payable on any principal payment date, or the amount of interest payable on any interest payment date, to be determined by referring to one or more currency exchange rates, commodity prices, equity indices or other factors. Holders of such debt securities may receive a principal amount on any principal payment date, or interest payments on any interest payment date, that are greater or less than the amount of principal or interest otherwise payable on such dates, depending upon the value on such dates of applicable currency, commodity, equity index or other factors. The applicable prospectus supplement will contain information as to how we will determine the amount of principal or interest payable on any date, as well as the currencies, commodities, equity indices or other factors to which the amount payable on that date relates and certain additional tax considerations.

 

 

 

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Units

 

We may issue units consisting of any combination of the other types of securities offered under this prospectus in one or more series. We may evidence each series of units by unit certificates that we may issue under a separate agreement. We may enter into unit agreements with a unit agent. Each unit agent, if any, may be a bank or trust company that we select. We will indicate the name and address of the unit agent, if any, in the applicable prospectus supplement relating to a particular series of units. Specific unit agreements, if any, will contain additional important terms and provisions. We will file as an exhibit to the registration statement of which this prospectus is a part, or will incorporate by reference from a current report that we file with the SEC, the form of unit and the form of each unit agreement, if any, relating to units offered under this prospectus.

 

If we offer any units, certain terms of that series of units will be described in the applicable prospectus supplement, including, without limitation, the following, as applicable:

 

  · the title of the series of units;
  · identification and description of the separate constituent securities comprising the units;
  · the price or prices at which the units will be issued;
  · the date, if any, on and after which the constituent securities comprising the units will be separately transferable;
  · a discussion of certain United States federal income tax considerations applicable to the units; and
  · any other material terms of the units and their constituent securities.

 

LEGAL MATTERS

 

Unless otherwise indicated in the applicable prospectus supplement, the validity of the securities offered by this prospectus will be passed upon for us by Carroll Legal LLC, Denver, Colorado. If legal matters in connection with offerings made by this prospectus are passed on by counsel for the underwriters, dealers or agents, if any, that counsel will be named in the applicable prospectus supplement. 

 

EXPERTS

 

Our balance sheets at December 31, 2021 and 2020 and the related statement of operations, changes in stockholders’ equity (deficit) and cash flows for the years ended December 31, 2021 and 2020, incorporated in this prospectus by reference, have been audited by Daszkal Bolton LLP, independent registered public accounting firm, with respect thereto, and has been so included in reliance upon the report of such firm given on their authority as experts in accounting and auditing.

 

WHERE YOU CAN FIND ADDITIONAL INFORMATION

 

We file annual, quarterly and other periodic reports, proxy statements and other information with the Securities and Exchange Commission using the Commission’s EDGAR system. The Commission maintains a web site that contains reports, proxy and information statements and other information regarding registrants that file electronically with the Commission. The address of such site is http//www.sec.gov.

 

 

 

 

 

 

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INCORPORATION OF DOCUMENTS BY REFERENCE

 

We are “incorporating by reference” in this prospectus certain documents we file with the SEC, which means that we can disclose important information to you by referring you to those documents. The information in the documents incorporated by reference is considered to be part of this prospectus. Statements contained in documents that we file with the SEC and that are incorporated by reference in this prospectus will automatically update and supersede information contained in this prospectus, including information in previously filed documents or reports that have been incorporated by reference in this prospectus, to the extent the new information differs from or is inconsistent with the old information. We have filed or may file the following documents with the SEC and they are incorporated herein by reference as of their respective dates of filing:

 

1. Our Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on February 17, 2022; and

 

2. The description of our Common Stock, which is contained in the Registration Statement on Form 8-A, as filed with the SEC on February 16, 2021, as updated by the description of our Common Stock contained in Exhibit 4.3 to our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, filed with the SEC on March 31, 2021.

 

All documents that we file with the SEC pursuant to Sections 13(a), 13(c), 14, and 15(d) of the Exchange Act subsequent to the date of this registration statement and prior to the filing of a post-effective amendment to this registration statement that indicates that all securities offered under this prospectus have been sold, or that deregisters all securities then remaining unsold, will be deemed to be incorporated in this registration statement by reference and to be a part hereof from the date of filing of such documents.

 

Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed modified, superseded or replaced for purposes of this prospectus to the extent that a statement contained in this prospectus, or in any subsequently filed document that also is deemed to be incorporated by reference in this prospectus, modifies, supersedes or replaces such statement. Any statement so modified, superseded or replaced shall not be deemed, except as so modified, superseded or replaced, to constitute a part of this prospectus. None of the information that we disclose under Items 2.02 or 7.01 of any Current Report on Form 8-K or any corresponding information, either furnished under Item 9.01 or included as an exhibit therein, that we may from time to time furnish to the SEC will be incorporated by reference into, or otherwise included in, this prospectus, except as otherwise expressly set forth in the relevant document. Subject to the foregoing, all information appearing in this prospectus is qualified in its entirety by the information appearing in the documents incorporated by reference.

 

You may request, orally or in writing, a copy of these documents, which will be provided to you at no cost (other than exhibits, unless such exhibits are specifically incorporated by reference), by contacting Brian Hoff, c/o Auddia Inc., at 2100 Central Avenue, Suite 200, Boulder, Colorado 80301. Our telephone number is (303) 219-9771. Information about us is also available at our website at https://www.auddiainc.com. However, the information in our website is not a part of this prospectus and is not incorporated by reference.

 

 

 

 

 

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