As
filed with the Securities and Exchange Commission on [ ],
2018
Registration
No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
MAGNEGAS
APPLIED TECHNOLOGY SOLUTIONS, INC.
(Exact
name of registrant as specified in its charter)
Delaware
|
26-0250418
|
(State
or other jurisdiction of
incorporation
or organization)
|
(I.R.S.
Employer
Identification
Number)
|
11885
44
th
Street North
Clearwater,
Florida 33762
(727)
934-3448
(Address,
Including Zip Code, and Telephone Number, Including Area Code, of Registrant’s Principal Executive Offices)
Tyler
B. Wilson, Esq.
General
Counsel
11885
44
th
Street North
Clearwater,
Florida 33762
(727)
934-3448
(Name,
Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)
Approximate
date of commencement of proposed sale to the public
: From time to time after this registration statement becomes effective.
If
the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, please
check the following box. [ ]
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check
the following box. [X]
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration statement number of the earlier effective registration statement
for the same offering. [ ]
If
this Form is a post-effective amendment filed pursuant to Rule 462I under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If
this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become
effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. [ ]
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register
additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following
box. [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large
accelerated filer
|
[ ]
|
Accelerated
filer
|
[ ]
|
|
|
|
|
Non-accelerated
filer
|
[ ]
|
Smaller
reporting company
|
[X]
|
|
|
|
|
|
|
Emerging
growth company
|
[ ]
|
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [ ]
CALCULATION
OF REGISTRATION FEE
Title of each class of
securities to be registered
|
|
Amount
to be
Registered(1)
|
|
|
Proposed
Maximum
Offering
Price
Per Share
|
|
|
Proposed
Maximum
Aggregate
Offering Price
|
|
|
Amount of
Registration Fee
|
|
Series C Convertible Preferred Stock, par value $0.001 per share, issuable upon exercise of outstanding Preferred Stock Warrants (2)
|
|
|
2,530
|
|
|
$
|
1,000
|
(3)
|
|
$
|
2,530,000
|
(3)
|
|
$
|
306.63
|
|
Common Stock, par value $0.001 per share, issuable upon conversion of shares of Series C Convertible Preferred Stock which are issuable upon exercise of outstanding Preferred Stock Warrants (4)
|
|
|
28,111,112
|
|
|
|
—
|
|
|
|
—
|
|
|
|
|
(7)
|
Common Stock, par value $0.001 per share, issuable upon exercise of outstanding Placement Agent Warrants (5)
|
|
|
27,778
|
|
|
$
|
0.0773
|
|
|
$
|
2,147.23
|
|
|
|
0.26
|
|
Common Stock, par value $0.001 per share, issuable upon exercise of outstanding Common Stock Warrants (6)
|
|
|
194,445
|
|
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$
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0.0773
|
|
|
$
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15,030.59
|
|
|
|
1.82
|
|
Total
|
|
|
|
|
|
|
|
|
|
$
|
2,547,177.82
|
|
|
$
|
308.72
|
(8)
|
(1)
|
Represents
shares offered by the selling stockholders. Includes an indeterminable number of additional shares pursuant to Rule 416 under
the Securities Act of 1933, as amended, that may be issued to prevent dilution from stock splits, stock dividends or similar
transactions that could affect the shares to be offered by selling stockholders.
|
|
|
(2)
|
Represents
shares issuable upon exercise of outstanding Preferred Stock Warrants, at a fixed exercise price of $900 per share.
|
|
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(3)
|
Estimated
solely for purposes of calculating the registration fee pursuant to Rule 457(i) under the Securities Act.
|
|
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(4)
|
Represents
shares issuable upon conversion of shares of Series C Convertible Preferred Stock which are issuable upon exercise of outstanding
Preferred Stock Warrants, with each share of Series C Convertible Preferred Stock having a stated value of $1,000 per share
and an initial conversion price into shares of common stock of $3.00 per share. The conversion price is variable as provided
in the Series C Convertible Preferred Stock’s governing document. The number of shares of common stock included represents
the maximum number of shares of common stock that may be issuable upon conversion of the Series C Convertible Preferred Stock
calculated assuming the current conversion floor price of $0.09 per share
|
|
|
(5)
|
Represents
shares issuable upon exercise of Placement Agent Warrants with an exercise price of $0.0773. The number of shares of
common stock included represents the maximum number of shares of common stock that may be issuable upon exercise of all
the Placement Agent Warrants.
|
|
|
(6)
|
Represents
shares issuable upon exercise of the Common Stock Warrants with an exercise price of $0.0773. The number of shares
of common stock included represents the maximum number of shares of common stock that may be issuable upon exercise of all
of the Common Stock Warrants.
|
|
|
(7)
|
No
separate consideration will be received for the shares of common stock issuable upon conversion of the of Series C Convertible
Preferred Stock; therefore, no registration fee for those shares is required pursuant to Rule 457(i) under the Securities
Act.
|
|
|
(8)
|
Pursuant
to Rule 457(p) under the Securities Act, filing fee due in connection with this filing is $308.72.
|
The
Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective
on such date as the Commission acting pursuant to said Section 8(a), may determine.
The
information in this prospectus is not complete and may be changed. The selling stockholders named in this prospectus may not sell
these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus
is not an offer to sell these securities and the selling stockholders named in this prospectus are not soliciting offers to buy
these securities in any jurisdiction where the offer or sale is not permitted.
Subject
to completion, dated October 29, 2018
PRELIMINARY
PROSPECTUS
MAGNEGAS
APPLIED TECHNOLOGY SOLUTIONS, INC.
2,530
Shares of Series C Convertible Preferred Stock issuable upon
exercise of outstanding Preferred Stock Warrants
(and 28,111,112 shares of Common Stock issuable
upon conversion of the Series C Convertible Preferred Stock)
194,445
shares of Common Stock issuable upon the exercise of Common Stock Warrants 27,778 shares of Common Stock issuable
upon the exercise of Placement Agent Warrants
This prospectus relates to the resale by the
selling stockholders identified in this prospectus of (i) up to 2,530 shares of Series C Convertible Preferred Stock that are
issuable upon the exercise of outstanding preferred stock warrants (and up to 28,111,112 shares of common stock that are
issuable upon the conversion of the Series C Convertible Preferred Stock that are issuable upon the exercise of outstanding preferred
stock warrants), and 194,445 shares of common stock underlying 194,445 common stock warrants and 27,778 shares
of common stock underlying 27,778 placement agent warrants, all of which were issued to the selling stockholders and the placement
agent, respectively, in connection with a private placement completed on June 15, 2017.
We are not selling any shares of preferred stock or common stock and will not receive
any proceeds from the sale of the shares under this prospectus. Upon the exercise of the preferred stock warrants for 2,530 shares
of our Series C Convertible Preferred Stock by payment of cash, we will receive the exercise price of the warrants, which is $900
per share, for an aggregate of approximately $2,277,000. Upon the exercise of the common stock warrants and placement agent warrants
for 222,223 shares of our common stock by the payment of cash, we will receive the exercise price of the warrants which
is $0.0773 per share, for an aggregate of approximately $17,200.
We
have agreed to bear all of the expenses incurred in connection with the registration of these shares. The selling stockholders
will pay or assume brokerage commissions and similar charges, if any, incurred for the sale of shares.
The
selling stockholders identified in this prospectus, or their pledgees, donees, transferees or other successors-in-interest, may
offer the shares from time to time through public or private transactions. The shares of common stock may be offered at prevailing
market prices, at prices related to prevailing market prices or at privately negotiated prices. The shares of Series C Convertible
Preferred Stock may be offered at a fixed price of $900 per share of Series C Convertible Preferred Stock. For additional information
on the methods of sale that may be used by the selling stockholders, see the section entitled “Plan of Distribution”
on page 14 of this prospectus. For a list of the selling stockholders, see the section entitled “Selling Stockholders”
on page 8 of this prospectus.
We
may amend or supplement this prospectus from time to time by filing amendments or supplements as required. You should read the
entire prospectus and any amendments or supplements carefully before you make your investment decision.
Our
common stock is listed on the NASDAQ Capital Market under the symbol “MNGA.” On October 26, 2018, the last
reported sale price of our common stock on the NASDAQ Capital Market was $0.24 per share. The Series C Convertible Preferred
Stock, the Common Stock Warrants and the Placement Agent Warrants will not be listed on any national securities exchange.
There is no established public trading market for the Series C Convertible Preferred Stock, the Common Stock Warrants or the
Placement Agent Warrants, and we do not expect a market to develop.
We
ceased to be an emerging growth company, as defined in Section 2(a) of the Securities Act of 1933, as amended, as of December
31, 2017
.
Investing
in the securities involves a high degree of risk. See “Risk Factors” beginning on page 5 of this prospectus and in
the documents to be filed with the Securities and Exchange Commission that are incorporated by reference in this prospectus before
deciding to purchase our securities.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The
date of this prospectus is , 2018.
TABLE
OF CONTENTS
You
should rely only on the information contained in or incorporated by reference into this prospectus. We have not authorized any
other person to provide you with different information. If anyone provides you with different or inconsistent information, you
should not rely on it. Neither we nor the selling stockholders will make an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted. You should assume that the information appearing in this prospectus is accurate as of
the date on its cover, and that any information incorporated by reference is accurate only as of the date of the document incorporated
by reference, unless we indicate otherwise. Our business, financial condition, results of operations and prospects may have changed
since those dates. You should read this prospectus and the documents incorporated by reference in this prospectus, in their entirety
before making an investment decision. You should also read and consider the information in the documents to which we have referred
you in the sections of this prospectus supplement entitled “Information Incorporated by Reference” and “Where
You Can Find More Information.”
ABOUT
THIS PROSPECTUS
Unless
context requires otherwise, all references to the terms “we,” “us,” “our,” and the
“company” throughout this prospectus mean MagneGas Applied Technology Solutions, Inc. and its subsidiaries.
All
references in this prospectus to our financial statements include, unless the context indicates otherwise, the related notes.
The
industry and market data and other statistical information contained in the documents we incorporate by reference are based on
management’s own estimates, independent publications, government publications, reports by market research firms or other
published independent sources, and, in each case, are believed by management to be reasonable estimates. Although we believe these
sources are reliable, we have not independently verified the information.
The
information contained in this prospectus is accurate only as of the date of this prospectus, regardless of the time of delivery
of this prospectus or of any sale of the securities. We further note that the representations, warranties and covenants made by
us in any agreement that is filed as an exhibit to any document that is incorporated by reference in this prospectus were made
solely for the benefit of the parties to such agreement, including, in some cases, for the purpose of allocating risk among the
parties to such agreements, and should not be deemed to be a representation, warranty or covenant to you. Moreover, such representations,
warranties and covenants should not be relied on as accurately representing the current state of our affairs.
PROSPECTUS
SUMMARY
The
following summary of our business highlights some of the information contained elsewhere in or incorporated by reference into
this prospectus. Because this is only a summary, however, it does not contain all of the information that may be important to
you. You should carefully read this prospectus, including the documents incorporated by reference, which are described under “Information
Incorporated by Reference” and “Where You Can Find More Information” in this prospectus. You should also carefully
consider the matters discussed in the section entitled “Risk Factors” in this prospectus and in other periodic reports
incorporated herein by reference.
Our
Company
MagneGas
Applied Technology Solutions, Inc. (the “Company”) is an alternative energy company that has developed a proprietary
plasma arc system (“Plasma Arc Flow Units” or “Plasma Arc Flow System”) which generates hydrogen based
synthetic gases through the gasification of various types of liquid feedstocks. The Company’s synthetic gas – MagneGas2®
- is bottled in cylinders and is distributed to the metalworking market as an alternative cutting fuel to acetylene and propane.
Through the course of its business development, the Company has established a retail and wholesale platform and a network of brokers
to sell its MagneGas2® for use in the metalworking and manufacturing industries throughout the world. Additionally, the Company
is in the process of developing ancillary uses of MagneGas2® for additional end-user applications. The Company’s Plasma
Arc Flow Units include various commercial applications, most notably the sterilization of liquid waste, which has resulted in
the Company’s marketing and sale of Plasma Arc Flow Units for third-party commercial use.
In
the second quarter of 2014 the Company began implementing an acquisition-focused growth strategy that was highlighted by the October
2014 purchase of Equipment Sales and Services, Inc. (“ESSI”). ESSI is a full line seller of industrial gases and equipment
for the welding and metal cutting industries. Since acquiring ESSI, the Company has opened several retail locations and
distributes MagneGas2® as a metal cutting fuel as well as other gases and welding supplies. Additional acquisitions of
independent gas and welding supply businesses has allowed the Company to augment its acquisition growth model with significant
organic growth. In January 2018, the Company acquired all of the assets of GGNG Enterprises, Inc. and began doing business in
southern California under the name “Complete Welding San Diego”. In February 2018, the Company acquired all
of the assets of Green Arc Supply, L.L.C. and began doing business in Texas and Louisiana under the name “Green Arc Supply”.
On April 3, 2018, the Company acquired all of the capital stock of Trico Welding Supplies, Inc. and began doing business in Northern
California under the name “Trico Welding Supplies”. In October 2018, the Company acquired Paris Oxygen Company,
Latex Welding Supplies and United Welding Specialties of Longview, Inc. and expanded its footprint in Texas and Louisiana.
Between
February and March of 2017, the Company formed five wholly owned subsidiaries in the State of Delaware respectively called MagneGas
Energy Solutions, LLC, MagneGas Welding Supply, LLC, MagneGas Real Estate Holdings, LLC, MagneGas IP, LLC and MagneGas Production,
LLC. The Company formed these entities to hold the various types of Company assets their names indicate. On June 29, 2018, the
Company organized MagneGas Limited under the laws of the United Kingdom and commenced business operations in greater Europe. Each
time the Company acquires the assets of an acquisition target in lieu of purchasing the issued and outstanding capital stock of
such acquisition target, it forms a new wholly owned subsidiary to hold the relevant assets. During 2018, the Company formed NG
Enterprises Acquisition, LLC to hold the tangible and intangible assets of GGNG Enterprises, Inc. and formed MWS Green Arc Acquisition,
LLC to hold the tangible and intangible assets of Green Arc Supply, L.L.C. On September 25, 2018, the Company changed its
name from “MagneGas Corporation” to “MagneGas Applied Technology Solutions, Inc.”.
June
2017 Private Placement
On
June 15, 2017, the Company closed a private placement financing, or the June 2017 Private Placement, in which we sold shares of
Series C Convertible Preferred Stock, Warrants to Purchase Series C Convertible Preferred Stock and Warrants to Purchase Common
Stock, for a total gross purchase price of up to $25,000,000. At the closing, we issued to the investors a total of 75 shares
of Series C Convertible Preferred Stock at a purchase price of $900 per share. The Series C Convertible Preferred Stock had an
initial conversion price equal to $3.00 per share. We also issued to the investors warrants to purchase up to 24,925 shares of
Series C Convertible Preferred Stock at an exercise price of $900 per share. The aggregate of 25,000 shares of Series C Convertible
Preferred Stock were initially convertible into an aggregate of 8,333,334 shares of common stock. We also issued to the investors
warrants to purchase up to 2,916,667 shares of common stock at an exercise price of $3.00 per share. Finally, we issued to the
placement agent for the June 2017 Private Placement, as partial compensation, placement agent warrants to purchase up to 416,667
shares of common stock at an exercise price of $3.30 per share.
On October 25, 2018, the
Company’s Board of Directors determined the number of shares of common stock initially registered in June 2017 Private Placement
was less than the number of shares of common stock required to be registered assuming full the exercise of the Series C Convertible
Preferred Warrants (and the Series C Convertible Preferred Stock), Common Stock Warrants and Placement Agent Warrants and
subsequent conversion of each of the foregoing into common stock. In light of the foregoing, the Company authorized the
registration of an additional 2,530 shares of Series C Convertible Preferred Stock (including the 28,111,112 shares underlying
the Series C Convertible Preferred Stock), the 194,445 shares of common stock underlying the common stock warrants and
the 27,778 shares of common stock underlying the placement agent warrants.
July
2017 Registered Direct Offering – Series D Convertible Preferred
On
July 27, 2017, we closed a registered direct financing, or the July 2017 Registered Direct Offering, in which we sold shares of
Common Stock (“Common Stock”), and Series D Convertible Preferred Warrants (“Preferred Warrants”) for
a total gross purchase price of up to $844,422 (the “Offering”) assuming full exercise of the Preferred Warrants.
At the initial closing, the Company issued to the investors a total of 150,000 shares of Common Stock at a purchase price of $1.00
per share, for gross proceeds of $150,000. The Company also issued to the investors the Preferred Warrants, which were exercisable
for a total of 694,422 shares of Series D Convertible Preferred Stock (the “Preferred Shares”) at an exercise price
of $1.00 per share. The Preferred Shares had an initial conversion price of $1.00 and were initially convertible into an aggregate
of 694,422 shares of Common Stock. The Offering was made pursuant to a prospectus supplement and accompanying base prospectus
relating to the Company’s effective shelf registration statement on Form S-3 (File No. 333-207928).
September
2017 Registered Direct Offering – Series E Convertible Preferred
On
September 15, 2017, we closed a registered direct financing, or the September 2017 Registered Direct Offering, in which we sold
36,765 shares of Preferred Stock and Preferred Warrants will be exercisable for a total of 419,117 for a total gross purchase
price of up to $620,000. At the initial closing, the Company issued to the Investors a total of 36,765 shares of Preferred Stock
at a purchase price of $1.36 per share. The Preferred Warrants were exercisable for a total of 419,117 Preferred Shares at an
exercise price of $1.36 per share. The Preferred Shares have an initial conversion price of $1.36 and will be initially convertible
into an aggregate of 36,765 shares of Common Stock. The Offering was made pursuant to a prospectus supplement and accompanying
base prospectus relating to the Company’s effective shelf registration statement on Form S-3 (File No. 333-207928).
Reverse
Stock Split
On
January 16, 2018, we completed a one-for-fifteen reverse stock split of our issued and outstanding shares of common stock, par
value $0.001 per share, which we refer to as the Reverse Stock Split. At that time, every fifteen shares of our issued and outstanding
common stock were automatically combined into one issued and outstanding share of our common stock. No fractional shares were
issued in connection with the Reverse Stock Split. All historical share and share-related information presented in this prospectus
gives effect to the Reverse Stock Split.
June
2018 Registered Direct Offering – Series F Convertible Preferred
On
June 27, 2018, we closed a registered direct financing, or the June 2018 Registered Direct Offering, in which we sold 817,670
shares of Series F Convertible Preferred Stock for gross proceeds of $556,016. The Series F Convertible Preferred Stock had an
initial conversion price of $0.68 and was initially convertible into an aggregate of 817,670 shares of common stock. The June
Registered Direct Offering was made pursuant to a prospectus supplement and accompanying base prospectus relating to the Company’s
effective shelf registration statement on Form S-3 (File No. 333-207928).
August
2018 Financing
On
August 27, 2018, we entered into a Securities Purchase Agreement (“SPA”), in which we sold up to 25,000,000 shares
of common stock at any time during the offering period and from time to time until the expiration or termination of the offering.
The purchase price for the common stock was $0.15 per share. Total gross proceeds to the Company upon completion of the
offering (assuming full subscription) was approximately $3,750,000. The offering was made pursuant to a prospectus supplement
and accompanying base prospectus relating to the Company’s effective shelf registration statement on Form S-3 (File No.
333-207928).
Additionally,
under the terms of the SPA, the Company agreed to grant the investor(s) one common stock purchase warrant for every share of common
stock purchased under the SPA at an exercise price of $0.30 per share (“Exercise Price”) (the “Warrants”).
The Warrants may only be exercised for cash and expire on September 31, 2019. Total gross proceeds to the Company, assuming full
exercise of the Warrants, will be approximately $7,500,000. The offering of the Warrants was exempt from registration under
Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the safe harbor
provided by Rule 506(b) of Regulation D (“August 2018 Warrant Offering”).
Name
Change
On
September 25, 2018, the Company changed its name from “MagneGas Corporation” to “MagneGas Applied Technology
Solutions, Inc.”. The name change was done as part of the Company’s corporate rebranding strategy.
October
2018 Registered Direct Offering and Private Placement
On
October 11, 2018, the Company entered into a Securities Purchase Agreement (“SPA”) with one or more investors identified
on the signature pages thereto (“Investors”). Under the terms of the SPA, the Company agreed to sell to each Investor,
and each Investor severally, but not jointly, agreed to purchase from the Company 21,800,000 shares of the Company’s common
stock, par value $0.001 per share (the “Common Stock”) and warrants to purchase up to 21,800,000 shares of Common
Stock (“Warrants”), for a total gross purchase price of approximately $5,014,000 (exclusive of the exercise
of the Warrants) (the “Offering”). The Company received aggregate net proceeds of approximately $4,588,160.
The Offering closed on October 15, 2018.
The sale of the Common
Stock at a price of $0.23 per share was made pursuant to a prospectus supplement, which was filed with the Securities and Exchange
Commission (the “SEC”) on October 11, 2018, and accompanying base prospectus relating to the Company’s shelf
registration statement on Form S-3 (File No. 333-207928), which was declared effective by the SEC on June 15, 2016. Additionally,
the grant of the Warrants with an exercise price of $0.3654 per Warrant was made pursuant to an exemption from registration
under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”). Pursuant to the SPA, holders
of Warrants have piggy-back registration rights beginning 45 days after the closing date until one year following the closing
date to have their Warrant Shares (defined below) registered on certain of our registration statements at the Company’s
expense.
Corporate
Information
MagneGas
Applied Technology Solutions, Inc. was organized under the laws of the State of Delaware on December 9, 2005. Our principal office
is located at 11885 44
th
Street North, Clearwater, Florida 33762 and its telephone number is (727) 934-3448.
We
file Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and other items with the Securities
and Exchange Commission, or the SEC. We provide access free of charge to all of these SEC filings, as soon as reasonably practicable
after filing, on our internet site located at
www.magnegas.com
. The information on our website is not incorporated by reference
into this prospectus and should not be considered to be part of this prospectus.
The
Offering
Securities
offered by the selling stockholders
|
|
(i)
2,530 shares of Series C Convertible Preferred Stock that are issuable upon the exercise
of outstanding preferred stock warrants (and up to 28,111,112 shares of common
stock that are issuable upon the conversion of the Series C Convertible Preferred Stock
that are issuable upon the exercise of outstanding preferred stock warrants) (ii)
194,445 shares of common stock that are issuable upon the exercise of outstanding Common
Stock Warrants and (iii) 27,778 shares of common stock that are issuable upon the exercise
of outstanding Placement Agent Warrants.,
|
|
|
|
Common
stock outstanding
|
|
126,055,862
shares
|
|
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|
Use
of proceeds
|
|
We
will not receive any proceeds from the sale of shares in this offering, but we will receive the exercise price of the preferred
stock warrants at the time of exercise, which is $900 per share and exercise price of the common stock warrants and placement
agents warrants at the time of exercise, which is $0.0773 per share respectively.
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Risk
Factors
|
|
You
should read the “Risk Factors” section of this prospectus for a discussion of factors to consider carefully before
deciding to invest in shares of our common stock.
|
|
|
|
NASDAQ
Capital Market symbol
|
|
“MNGA.”
The shares of Series C Convertible Preferred Stock, Common Stock Warrants and Placement
Agent Warrants are not currently, and will not be in the future, listed on any national
securities exchange. There is no established public trading market for the Series C Convertible
Preferred Stock, Common Stock Warrants and Placement Agent Warrants, and we do
not expect a market to develop.
|
The
number of shares of our common stock outstanding is based on 126,055,862 shares of our common stock outstanding as of October
26, 2018 and excludes the following (in each case, as of October 26, 2018):
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●
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206,084 shares issuable upon the exercise of options;
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●
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194,445 shares of common stock that are issuable upon
the exercise of common stock warrants granted in the June 2017 Private Placement (the “Common Stock Warrants”);
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●
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27,778 shares of common stock that are issuable upon the exercise
of placement agent warrants granted in the June 2017 Private Placement (the “Placement Agent Warrants”);
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●
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25,000,000 shares of common stock that are issuable upon the
exercise of common stock warrants granted in the August 2018 Financing;
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●
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20,056,000 shares of common stock that are issuable upon
the exercise of common stock warrants granted in the October 2018 Registered Direct Offering and Private Placement; and
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●
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Shares of common stock that are issuable upon (a) the exercise of 2,530 Series C Convertible Preferred Warrants outstanding into 2,530 shares of Series C Preferred Stock and the subsequent conversion of said Series C Preferred Stock to common stock and (b) the conversion of 36,765 outstanding shares of Series E Convertible Preferred Stock to common stock.
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Unless
otherwise indicated, all information in this prospectus assumes no exercise of the outstanding options and warrants, and no conversion
of the outstanding convertible debentures and convertible preferred stock.
RISK
FACTORS
An
investment in our securities involves a high degree of risk
.
You should carefully consider and evaluate all of the information
included and incorporated by reference in this prospectus, including the risk factors described below with respect to our Series
C Convertible Preferred Stock, as well as the other risk factors incorporated herein by reference from “Item 1A. Risk Factors”
of our Annual Report on Form 10-K for the year ended December 31, 2017, which was filed with the SEC on April 16, 2018, and as
further updated by our subsequent Exchange Act filings we file with the SEC after the filing of the registration statement of
which this prospectus is a part and that are, in each case, incorporated by reference herein. Any of these risks could materially
and adversely affect our business, results of operations and financial condition, which in turn could materially and adversely
affect the price of our common stock and the value of your investment in our securities.
Risks
Relating to the Series C Convertible Preferred Stock, Common Stock Warrants and Placement Agent Warrants
There
is not currently and there may never be an active trading market for our Series C Convertible Preferred Stock, Common Stock
Warrants or Placement Agent Warrants.
There
currently is no trading market for the Series C Convertible Preferred Stock, Common Stock Warrants or Placement Agent Warrants
and such a market may never develop. We have no plans to list the Series C Convertible Preferred Stock, Common Stock Warrants
or Placement Agent Warrants on any national securities exchange.
We
may not be able to raise the funds necessary to redeem the Series C Convertible Preferred Stock if required to do so.
Under
certain circumstances, holders of the Series C Convertible Preferred Stock have the right to demand that we redeem Series C Convertible
Preferred Stock. If we are not able to raise the funds necessary to redeem such shares, we will not be able to comply with our
redemption obligations and holders of the Series C Convertible Preferred Stock will not be able to redeem their shares.
Risks
Relating to this Offering
We
can provide no assurance that our Common Stock will continue to meet Nasdaq listing requirements, which may cause our shares of
Common Stock to trade at a discount and may make it difficult for you to sell your shares.
On
May 7, 2018, we received a notice from Nasdaq indicating that the Common Stock was subject to potential delisting from Nasdaq
because for a period of 30 consecutive business days, the bid price of the Common Stock had closed below the minimum $1.00 per
share requirement for continued inclusion under Nasdaq Marketplace Rule 5550(a)(2) (the “Bid Price Rule”). The notification
had no immediate effect on the listing or trading of the Common Stock on Nasdaq. Nasdaq stated in its letter that in accordance
with the Nasdaq listing requirements, the Company has been provided an initial period of 180 calendar days, or until November
5, 2018, to regain compliance. The letter states that the Nasdaq Staff will provide written notification that the Company has
achieved compliance with the minimum bid price listing requirement if at any time before November 5, 2018, the bid price of the
Common Stock closes at $1.00 per share or more for a minimum of ten consecutive business days.
If
the Company is unable to regain compliance by November 5, 2018, the Company may be eligible for an additional 180 calendar day
compliance period to demonstrate compliance with the bid price requirement. To qualify, the Company will be required to meet the
continued listing requirement for market value of publicly held shares set forth in Market Place Rule 5550(a) and all other initial
listing standards for the Nasdaq Capital Market set forth in Marketplace Rule 5505, with the exception of the bid price requirement,
and will need to provide written notice to Nasdaq of its intention to cure the deficiency during the second compliance period,
by effecting a reverse stock split, if necessary. If the Company does not qualify for the second compliance period or fails to
regain compliance during the second 180-day period, then Nasdaq will notify the Company of its determination to delist the Company’s
Common Stock, at which point the Company would have an opportunity to appeal the delisting determination to a Hearings Panel.
If
we are unable to meet these requirements, our Common Stock could be delisted from Nasdaq. If our Common Stock were to be delisted
from Nasdaq, our Common Stock could continue to trade on the OTCQB or similar marketplace following any delisting from Nasdaq.
Any such delisting of our Common Stock could have an adverse effect on the market price of, and the efficiency of the trading
market for, our Common Stock, not only in terms of the number of shares that can be bought and sold at a given price, but also
through delays in the timing of transactions and less coverage of us by securities analysts, if any. Also, if in the future we
were to determine that we need to seek additional equity capital, it could have an adverse effect on our ability to raise capital
in the public or private equity markets. Any of these changes could cause the value of your investment to decline.
Risks
Relating to Our Business
We
have a significant amount of goodwill and other intangible assets on our balance sheet that are subject to periodic impairment
evaluations; an impairment of our goodwill or other intangible assets may have a material adverse impact on our financial condition
and results of operations.
As
of June 30, 2018, we had goodwill and other intangible assets of $5,614,098, which represented approximately 28.7% of our total
assets. Accounting standards require us to test goodwill for impairment annually, and more frequently when events or changes in
circumstances indicate impairment may exist. There can be no assurance that reviews of our goodwill and other intangible assets
will not result in impairment charges. Although it does not affect cash flow, an impairment charge does have the effect of decreasing
our earnings, assets and shareholders’ equity. Factors that could indicate our goodwill or intangible assets are impaired
include a decline in our stock price and market capitalization or lower than projected operating results and cash flows. Our stock
price historically has shown volatility and often fluctuates significantly in response to market and other factors. Declines in
our stock price or lower operating results could increase the risk of impairment. If we determine that further impairment exists,
it may result in a significant non-cash charge to earnings and lower stockholders’ equity.
Pending
and future litigation may have a material adverse impact on our financial condition and results of operations.
W
e
may be a party to litigation matters involving our business,
which operates within a highly regulated industry. On September 4, 2018, we received notice that a law firm representing the estate
of an individual who sustained life-ending injuries while working for an end user of our products had made a claim to our insurance
carrier. The matter is under investigation by the U.S. Department of Transportation and the Occupational Health and Safety Administration.
The Company is still investigating the cause of the accident and there have been no conclusive findings as of this time. It is
unknown whether the final cause of the accident will be determined and whether those findings will negatively impact Company operations
or sales. The Company continues to be fully operational and transparent with all regulatory agencies.
For
more information regarding pending litigation, please see the Sections captioned “
Item 3. Legal Proceedings
”
contained in our Annual Report on Form 10-K for the year ended December 31, 2017 and “
Item 1. Legal Proceedings
”
contained in our Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission subsequent to the Form 10-K.
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus (including any documents incorporated by reference herein) contains statements with respect to us which constitute
‘‘forward-looking statements’’ within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended, and are intended to be covered by the ‘‘safe harbor’’
created by those sections. Forward-looking statements, which are based on certain assumptions and reflect our plans, estimates
and beliefs, can generally be identified by the use of forward-looking terms such as “believes,” “expects,”
“may,” “will,” “should,” “could,” “seek,” “intends,” “plans,”
“estimates,” “anticipates” or other comparable terms. These forward-looking statements include,
but are not limited to, statements concerning future events, our future financial performance, business strategy and plans and
objectives of management for future operations. Our actual results could differ materially from those discussed in the forward-looking
statements. Factors that could cause or contribute to these differences include those discussed in “Risk Factors”
in the documents incorporated by reference herein.
We
caution readers not to place undue reliance upon any such forward-looking statements, which speak only as of the date they are
made. We disclaim any obligation, except as specifically required by law and the rules of the Securities and Exchange Commission,
to publicly update or revise any such statements to reflect any change in company expectations or in events, conditions or circumstances
on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth
in the forward-looking statements.
You
should read this prospectus and the documents that we incorporate by reference herein and have filed as exhibits to the registration
statement, of which this prospectus is part, completely and with the understanding that our actual future results may be materially
different from what we expect. You should assume that the information appearing in this prospectus is accurate as of the date
on the cover of this prospectus only. Our business, financial condition, results of operations and prospects may change. We may
not update these forward-looking statements, even though our situation may change in the future, unless we have obligations under
the federal securities laws to update and disclose material developments related to previously disclosed information. We qualify
all of the information presented in this prospectus, and particularly our forward-looking statements, by these cautionary statements.
USE
OF PROCEEDS
We are filing the registration
statement of which this prospectus is a part to permit holders of the shares of our Series C Convertible Preferred Stock, the
Common Stock Warrants and Placement Agent Warrants, described in the section entitled “Selling Stockholders” to
resell such shares of our Series C Convertible Preferred Stock issuable upon the exercise of the preferred stock warrants (and
shares of our common stock that are issuable upon the conversion of the Series C Convertible Preferred Stock that are issuable
upon the exercise of the preferred stock warrants) and upon the exercise of the Common Stock Warrants and Placement Agent Warrants.
We will not receive any proceeds from the resale of any shares of Series C Convertible Preferred Stock, Common Stock Warrants
or Placement Agent Warrants offered by this prospectus by the selling stockholders. Upon the exercise of the preferred
stock warrants for 2,530 shares of our Series C Convertible Preferred Stock by payment of cash, we will receive the exercise price
of the warrants, which is $900 per share, or an aggregate of approximately $2,277,000. Upon the exercise of the Common Stock
Warrants and Placement Agent Warrants for 222,222 shares of our common stock by the payment of cash, we will receive the exercise
price of the warrants which is $0.0773 per share, for an aggregate of approximately $17,200.
The
preferred stock warrants will not, upon the effectiveness (and continued effectiveness) of the registration statement of which
this prospectus is a part, be eligible for cashless-exercise treatment. We plan to use any cash received from the exercise of
the preferred stock warrants for general corporate purposes. General corporate purposes may include providing working capital,
funding capital expenditures, or paying for acquisitions. We currently do not have any arrangements or agreements for any acquisitions.
We cannot precisely estimate the allocation of the proceeds from any exercise of the warrants for cash. Accordingly, in the event
the warrants are exercised for cash, our management will have broad discretion in the application of the proceeds of such exercises.
Pending the use of proceeds, we intend to invest the proceeds of any warrant for cash exercise in certificates of deposit or direct
or guaranteed obligations of the U.S. government. There is no assurance that the warrants will ever be exercised for cash.
The
selling stockholders will pay any underwriting discounts and commissions and expenses incurred by such selling stockholders for
brokerage, accounting, tax or legal services or any other expenses incurred by such selling stockholders in disposing of the shares.
We will bear all other costs, fees and expenses incurred in effecting the registration of the shares covered by this prospectus,
including, without limitation, all registration and filing fees, NASDAQ Capital Market listing fees and fees and expenses of our
counsel and our auditors.
SELLING
STOCKHOLDERS
The
shares of preferred stock being offered by the selling stockholders are those issuable to the selling stockholders upon exercise
of the preferred warrants. The shares of common stock being offered by the selling stockholders are those issuable to the selling
stockholders upon conversion of the preferred stock and exercise of the Common Stock Warrants and Placement Agent Warrants. We
are registering the shares of preferred stock and shares of common stock in order to permit the selling stockholders to offer
the shares for resale from time to time. Except for the ownership of our securities issued in the June 2017 Private Placement,
the July 2017 Registered Direct Offering, the September 2017 Registered Direct Offering and the October 2018 Registered Direct
Offering and Private Placement, the selling stockholders have not had any material relationship with us within the past three
years other than Maxim Group LLC and its designees. Maxim Group LLC served as the placement agent for the June Private
Placement and the placement agent in the October 2018 Registered Direct Offering and Private Placement. Maxim Group LLC acted
in the capacity of the investor in the June 2018 Registered Direct Offering. Maxim Group LLC is registered under the Exchange
Act as a broker-dealer. Other than Maxim Group LLC, to our knowledge, none of the selling stockholders listed below are broker-dealers
or affiliates of broker-dealers.
The
first table below lists the selling stockholders and other information regarding the beneficial ownership (as determined under
Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder) of the shares of preferred
stock held by each of the selling stockholders. The second column lists the number of shares of preferred stock beneficially owned
by the selling stockholders, based on their respective ownership of preferred stock and preferred warrants, as of October 26,
2018, assuming exercise of the preferred warrants held by each such selling stockholder on that date. The third column lists the
shares of preferred stock being offered by this prospectus by the selling stockholders. The fourth column assumes the sale of
all of the shares offered by the selling stockholders pursuant to this prospectus.
The
second table below lists the selling stockholders and other information regarding the beneficial ownership (as determined under
Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder) of the shares of common
stock held by each of the selling stockholders. The second column lists the number of shares of common stock beneficially owned
by the selling stockholders, based on their respective ownership of shares of common stock, preferred stock, common stock warrants
and placement agent warrants, as of October 26, 2018, assuming conversion of the preferred stock, exercise of the preferred
warrants, exercise of the common stock warrants and exercise of the placement agent warrants held by each such selling stockholder
on that date but taking account of any limitations on conversion and exercise set forth therein. The third column lists the shares
of common stock being offered by this prospectus by the selling stockholders and does not take in account any limitations on (i)
conversion of the preferred stock set forth in the certificate of designations or (ii) exercise of the warrants set forth therein.
The fourth column assumes the sale of all of the shares offered by the selling stockholders pursuant to this prospectus.
Because
the conversion price of the preferred stock and the exercise price of the warrants may be adjusted, the number of shares that
will actually be issued may be more or less than the number of shares being offered by this prospectus.
Under
the terms of the preferred stock, common stock warrants and the placement agent warrants, a selling stockholder may not convert
the preferred stock or exercise the common stock warrants or placement agent warrants to the extent (but only to the extent) such
selling stockholder or any of its affiliates would beneficially own a number of shares of our common stock which would exceed
4.99% of the outstanding shares of the Company. The number of shares in the second column reflects these limitations. The selling
stockholders may sell all, some or none of their shares in this offering. See “Plan of Distribution.”
Name of Selling Stockholder
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Number of Shares of
Preferred Stock Beneficially Owned
Prior to Offering
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Maximum Number of Shares
of Preferred Stock to be Sold
Pursuant to this Prospectus
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Number of Shares of
Preferred
Stock Beneficially
Owned After Offering
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Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B (1)
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39,295
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2,530
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36,765
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(1)
Includes (i) 2,530 shares of Series C Convertible Preferred Stock issuable upon exercise of outstanding Series C Preferred Stock
Warrants and (ii) 36,765 shares of Series E Convertible Preferred Stock. An aggregate of 2,530 shares of Series C Convertible
Preferred Stock are being registered for resale pursuant to this prospectus. Ayrton Capital LLC, the investment manager to Alto
Opportunity Master Fund, SPC - Segregated Master Portfolio B, has discretionary authority to vote and dispose of the shares held
by Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B and may be deemed to be the beneficial owner of these shares.
Waqas Khatri, in his capacity as Managing Member of Ayrton Capital LLC, may also be deemed to have investment discretion and voting
power over the shares held by Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B. Alto Opportunity Master Fund,
SPC - Segregated Master Portfolio B and Mr. Khatri each disclaim any beneficial ownership of these shares. The address of Ayrton
Capital LLC is 222 Broadway, 19
th
Floor, New York, NY 10038.
Name of Selling Stockholder
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Number of Shares of
Common Stock Beneficially Owned
Prior to Offering
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Maximum Number of Shares
of Common Stock to be Sold
Pursuant to this Prospectus
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Number of Shares of
Common
Stock Beneficially
Owned After Offering
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Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B (1)
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6,290,188
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28,256,945
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6,290,188
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Maxim Partners LLC (2)
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27,778
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27,778
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0
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Hudson Bay Master Fund Ltd. (3)
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6,290,188
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48,612
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6,241,576
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(1) Under the terms
of the Common Stock Warrants, the holders do not have the right to exercise the warrants to the extent that after giving
effect to such exercise, the holder (together with its affiliates) would beneficially own in excess of 4.99% (the
“Maximum Percentage”) of the shares of our common stock outstanding immediately after giving effect to such
exercise. Under the terms of the Series C Convertible Preferred Stock, the holders do not have the right to convert the
Series C Convertible Preferred Stock to the extent that after giving effect to such conversion, the holder (together with its
affiliates) would beneficially own in excess of the Maximum Percentage. Under the terms of the Series E Convertible Preferred
Stock, the holders do not have the right to convert the Series E Convertible Preferred Stock to the extent that after giving
effect to such conversion, the holder (together with its affiliates) would beneficially own in excess of the Maximum
Percentage. Under the terms of the warrants granted in the August 2018 Financing, the holders do not have the right to
exercise the warrants to the extent that after giving effect to such exercise, the holder (together with its affiliates)
would beneficially own in excess of the Maximum Percentage of the shares of our common stock outstanding immediately after
giving effect to such exercise. Under the terms of the warrants granted in the October 2018 Registered Direct Offering and
Private Placement, the holders do not have the right to exercise the warrants to the extent that after giving effect to such
exercise, the holder (together with its affiliates) would beneficially own in excess of the Maximum Percentage of the shares
of our common stock outstanding immediately after giving effect to such exercise. The number of shares of common stock
beneficially owned prior to the offering represents the maximum number of shares of common stock beneficially owned after
giving effect to the Maximum Percentage. The aggregate number of shares owned prior to the offering, without giving effect to
the Maximum Percentage, would equal 52,573,779 shares of common stock as follows: (i) 126,055,862 shares of
common stock issued and outstanding, (ii) 145,833 shares of common stock issuable upon exercise of the Common Stock
Warrants (iii) 28,111,112 shares of common stock issuable upon conversion of shares of Series C
Convertible Preferred Stock assuming a conversion price equal to the applicable floor price of $0.09 per share, (iv) 408,500
shares of common stock issuable upon conversion of shares of Series E Convertible Preferred Stock assuming a conversion price
equal to the applicable floor price of $0.09 per share and (v) 18,458,334 shares of common stock issuable upon exercise of
common stock warrants granted in the August 2018 Financing, and (vi) 5,450,000 shares of common stock issuable upon exercise
of common stock warrants granted in the October 2018 Registered Direct Offering and Private Placement. An aggregate of 28,256,945
shares of common stock, representing the shares of common stock issuable upon conversion of shares of Series C Convertible
Preferred Stock and the shares of common stock issuable upon exercise of the Common Stock Warrants, are being registered for
resale pursuant to this prospectus. Ayrton Capital LLC, the investment manager to Alto Opportunity Master Fund, SPC -
Segregated Master Portfolio B, has discretionary authority to vote and dispose of the shares held by Alto Opportunity Master
Fund, SPC - Segregated Master Portfolio B and may be deemed to be the beneficial owner of these shares. Waqas Khatri, in his
capacity as Managing Member of Ayrton Capital LLC, may also be deemed to have investment discretion and voting power over the
shares held by Alto Opportunity Master Fund, SPC - Segregated Master Portfolio B. Alto Opportunity Master Fund, SPC -
Segregated Master Portfolio B and Mr. Khatri each disclaim any beneficial ownership of these shares. The address of Ayrton
Capital LLC is 222 Broadway, 19
th
Floor, New York, NY 10038.
(2)
Includes 27,778 shares of common stock issuable upon the exercise of placement agent warrants. Maxim Partners LLC is an
affiliate of Maxim Group, LLC, a registered broker dealer and the placement agent in the June 2017 Private Placement. Michael
Rabinowitz has discretionary authority to vote and dispose of the shares of common stock held by Maxim Partners LLC and may
be deemed to be the beneficial owner of these shares. Maxim Partners LLC did not acquire the warrants in the ordinary course
of its business; rather its affiliate, Maxim Group LLC, acquired the warrants through its participation as placement agent in
the June 2017 Private Placement.
(3)
Under the terms of the Common Stock Warrants, the holders do not have the right to exercise the warrants to the extent that
after giving effect to such exercise, the holder (together with its affiliates) would beneficially own in excess of 4.99% (the
“Maximum Percentage”) of the shares of our common stock outstanding immediately after giving effect to such exercise.
Under the terms of the warrants granted in the August 2018 Financing, the holders do not have the right to exercise the warrants
to the extent that after giving effect to such exercise, the holder (together with its affiliates) would beneficially own in excess
of the Maximum Percentage of the shares of our common stock outstanding immediately after giving effect to such exercise. Under
the terms of the warrants granted in the October 2018 Registered Direct Offering and Private Placement, the holders do not have
the right to exercise the warrants to the extent that after giving effect to such exercise, the holder (together with its affiliates)
would beneficially own in excess of the Maximum Percentage of the shares of our common stock outstanding immediately after giving
effect to such exercise. The number of shares of common stock beneficially owned prior to the offering represents the maximum
number of shares of common stock beneficially owned after giving effect to the Maximum Percentage. The aggregate number of shares
owned prior to the offering, without giving effect to the Maximum Percentage, would equal 11,748,612 shares of common stock as
follows: (i) 126,055,862
shares of common stock issued and outstanding, (ii) 48,612 shares of common stock issuable upon exercise of the Common Stock Warrants,
(iii) 6,250,000 shares of common stock issuable upon exercise of common stock warrants granted in the August 2018 Financing and
(iv) 5,450,000 shares of common stock issuable upon exercise of common stock warrants granted in the October 2018 Registered Direct
Offering and Private Placement. Hudson Bay Capital Management, L.P., the investment manager of Hudson Bay Master Fund Ltd.,
has voting and investment power over these securities. Sander Gerber is the managing member of Hudson Bay Capital GP LLC, which
is the general partner of Hudson Bay Capital Management, L.P. Each of Hudson Bay Master Fund Ltd. and Sander Gerber disclaims
beneficial ownership over these securities. The address for Hudson Bay Master Fund Ltd. is 777 Third Avenue, 30th FL, New York,
NY 10017.
DESCRIPTION
OF SERIES C CONVERTIBLE PREFERRED STOCK
The
terms of the Series C Convertible Preferred Stock, or the Series C Preferred Stock, are contained in the Certificate of Designations,
Preferences and Rights of the Series C Convertible Preferred Stock of MagneGas Applied Technology Solutions, Inc. (f.k.a. “MagneGas
Corporation”), or the Series C Certificate of Designations, that we filed with the Secretary of State of the State of
Delaware on June 15, 2017. The following description is a summary of the material provisions of the Series C Preferred Stock and
the Series C Certificate of Designations. It does not purport to be complete and is qualified in all respects by the terms of
the Series C Certificate of Designations. We urge you to read the Series C Certificate of Designations because it, and not this
description, defines the rights of holders of Series C Preferred Stock. We have included the Series C Certificate of Designations
in our Current Report on Form 8-K filed with the Commission on June 19, 2017 which is incorporated by reference into this prospectus.
We also urge you to
read the Certificate of Designations, Preferences and Rights of the Series E Convertible Preferred Stock of MagneGas Applied Technology
Solutions, Inc. (f.k.a. “MagneGas Corporation”), which under the terms of the Series E Certificate of Designations
triggered certain material adjustments to provisions of the Series C Certificate of Designations related to conversion, amongst
other things. We have included the Series E Certificate of Designations in our Current Report on Form 8-K filed with the Commission
on September 18, 2017 which is incorporated by reference into this prospectus.
Finally, we urge you to read the Certificate of Designations, Preferences and Rights of the Series F Convertible
Preferred Stock of MagneGas Applied Technology Solutions, Inc. (f.k.a. “MagneGas Corporation”), which under the terms
of the Series F Certificate of Designations triggered certain material adjustments to provisions of the Series C Certificate of
Designations related to the Series C Preferred Stock’s floor price. We have included the Series F Certificate of Designations
in our Current Report on Form 8-K filed with the Commission on June 28, 2018 which is incorporated by reference into this prospectus.
Rank
The
Series C Preferred Stock, with respect to rights, powers, preferences and privileges, rank senior with respect to all shares of
capital stock of the Company, except for our Series A Preferred Stock, which rank pari passu to the Series C Preferred Stock,
and unless holders of at least a majority of the outstanding Series C Preferred Stock and Series A Preferred Stock, voting together
as a single class, consent to the creation of other capital stock of the Company that is senior or equal in rank to the Series
C Preferred Stock and Series A Preferred Stock.
Dividends
Holders
of the Series C Preferred Stock will be entitled to receive dividends, if and when declared by our Board of Directors, from time
to time, in its sole discretion and in accordance with the requirements of Delaware General Corporation Law. Upon the occurrence
of certain triggering events, the holders will be entitled to receive dividends at a rate of eighteen percent (18.0%) per annum.
Conversion
The
shares of Series C Preferred Stock are convertible into common stock at an initial conversion price of $3.00 per share, or the
conversion price, subject to certain adjustments. The Series C Preferred Stock may be converted into common stock at any time
at the option of the holders, subject to the limitations on beneficial ownership contained in the Series C Certificate of Designations.
On
each applicable installment date, provided there has been no equity conditions failure, we shall convert the applicable amount
of Series C Preferred Stock from each holder into shares of common stock; provided, however, that we may, at our option following
notice to each holder, redeem such amount of Series C Preferred Stock by paying to each holder the corresponding installment amount
in cash.
The
applicable installment conversion price with respect to a particular date of determination, shall be equal to the lower of:
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the
conversion price then in effect; and
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the
greater of (a) $0.35 and (b) the lower of (i) 85% of the VWAP of the common stock as of the trading day immediately preceding
the applicable installment date and (ii) 85% of the quotient of (A) the sum of the VWAP of the common stock for each of the
ten (10) trading days with the lowest VWAP of the common stock during the twenty (20) consecutive trading day period ending
and including the trading day immediately prior to the applicable installment date, divided by (B) ten (10).
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In
addition, upon the occurrence certain triggering events, a holder of Series C Preferred Stock has the option to convert a portion
of the Series C Preferred Stock into common stock at an alternate conversion price, which shall be the lower of:
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the
then-applicable conversion price; and
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the
greater of (a) $0.35 and (b) the lowest of (i) 85% of the VWAP of the common stock as of the trading day immediately preceding
the delivery or deemed delivery of the applicable conversion notice, (ii) 85% of the VWAP of the common stock as of the trading
day of the delivery or deemed delivery of the applicable conversion notice and (iii) 85% of the price computed as the quotient
of (A) the sum of the VWAP of the common stock for each of the ten (10) trading days with the lowest VWAP of the common stock
during the twenty (20) consecutive trading day period ending and including the trading day immediately preceding the delivery
or deemed delivery of the applicable conversion notice, divided by (B) ten (10).
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Adjustment
of Conversion Price
If
and whenever we subdivide or combine (by any stock split, stock dividend, stock combination, recapitalization or other similar
transaction) our outstanding common stock into a greater or smaller number of shares, then the conversion price in effect immediately
prior to such subdivision will be proportionately reduced or increased, as applicable.
Additionally,
if and whenever we issue or sell, or are deemed to have issued or sold, any shares of common stock (including the issuance or
sale of shares of common stock owned or held by or for our account, but excluding any excluded securities issued or sold or deemed
to have been issued or sold) for a consideration per share less than a price equal to the conversion price in effect immediately
prior to such issuance or sale or deemed issuance or sale then, immediately after such issuance, the conversion price then in
effect shall be reduced to an amount equal to the lower price.
Triggering
Events
The
Series C Certificate of Designations provide for certain triggering events which include, but are not limited to:
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(i)
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our
failure to timely file a registration statement,
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(ii)
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the
lapsing of a registration statement that is required to remain effective,
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(iii)
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our
suspension (or threatened suspension) from trading or the failure (or threatened failure) of our common stock to be trading
or listed (as applicable) on an eligible market for a period of five (5) consecutive trading days,
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(iv)
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notice
to any holder of Series C Preferred Stock or Series C Preferred Warrants of our intention not to comply, as required, with
a request for exercise of any warrants for warrant shares in accordance with the provisions of the Series C Preferred Warrants
or a request for conversion of any Series C Preferred Stock into shares of common stock that is requested in accordance with
the provisions of the Series C Certificate of Designations,
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(v)
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the
failure to cure a conversion or delivery failure with five (5) trading days after the applicable exercise or conversion date,
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(vi)
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failure
to maintain the authorized share allocation,
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(vii)
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failure
to reserve 100% of the aggregate number of additional Series C Preferred Stock as necessary to effect the exercise in full
of the Series C Preferred Warrants then outstanding,
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(viii)
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failure
of our Board of Directors to declare a dividend that’s required under the Series C Certificate of Designations,
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(ix)
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our
failure to pay any amount when due,
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(x)
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our
failure to remove a restrictive legend when required to do so in conformity with applicable federal law,
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(xi)
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the
occurrence of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $50,000 of indebtedness,
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(xii)
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bankruptcy
or insolvency or reorganization of the Company not dismissed within thirty (30) days of initiation,
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(xiii)
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the
entry by a court of a decree, order, judgment or other similar document in respect of the Company or any of our subsidiaries
of a voluntary or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization
or other similar law,
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(xiv)
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under
certain circumstances, our becoming subject to judgments for the payment of money or defaulting on indebtedness,
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(xv)
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our
breach of any transaction document,
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(xvi)
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any
breach of the Series C Certificate of Designations,
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(xvii)
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upon
the occurrence of certain material adverse events,
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(xviii)
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if
any provision of any transaction document ceases to be valid or enforceable, and
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(xix)
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if
either Ermanno Santilli or Scott Mahoney cease to be active officers and employees of the Company.
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Redemption
In
lieu of conversion, upon the occurrence of certain triggering events, a holder may require that we redeem all or any of the Series
C Preferred Stock at a price equal to the greater of:
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-
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the
product of (a) the conversion amount of the Series C Preferred Stock to be redeemed multiplied by (b) a redemption premium
of 115%; and
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-
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the
product of (a) the conversion rate with respect to the conversion amount in effect at such time of redemption multiplied by
(b) the product of (i) a redemption premium of 115% multiplied by (ii) the greatest closing sale price of the common stock
on any trading day during the period commencing on the date immediately preceding such triggering event and ending on the
date we make the entire redemption payment.
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If
we elect to effect an installment redemption in lieu of an installment conversion, in whole or in part, such Series C Preferred
Stock shall be redeemed by us in cash on the applicable installment date in an amount equal to 103% of the applicable installment
redemption amount.
In
addition to the redemptions described above, at any time no equity conditions failure exists, we shall have the right to redeem,
in one redemption, up to $10 million of the conversion amount of the Series C Preferred Stock then outstanding. The Series C Preferred
Stock subject to redemption at our option shall be redeemed by us in cash at a price equal to 115% of the greater of:
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-
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the
conversion amount of the Series C Preferred Stock being redeemed; and
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-
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the
product of (a) the conversion rate with respect to the conversion amount of the Series C Preferred Stock being redeemed multiplied
by (b) the greatest closing sale price of the common stock on any trading day during the period commencing on the date immediately
preceding such redemption and ending on the trading day immediately prior to the date we make the entire redemption payment.
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Voting
Rights
Holders
of Series C Preferred Stock shall have no voting rights, except as required by law (including without limitation, the Delaware
General Corporation Law) and as expressly provided in the Series C Certificate of Designations.
Exchange
Listing
There
is no established public trading market for the Series C Preferred Stock, and we do not expect a market to develop. In addition,
we do not intend to apply for listing of the Series C Preferred Stock on any securities exchange or recognized trading system.
Limitations
on Beneficial Ownership
The
Series C Preferred Stock may not be converted, and common stock may not be issued in connection therewith, if, after giving effect
to the conversion or issuance, a holder together with certain related parties would beneficially own in excess of 4.99% of the
outstanding common stock. At each holder’s option, the cap may be raised or lowered to any other percentage not in excess
of 9.99%, except that any increase will only be effective upon 61-days’ prior notice to us, and any increase or decrease
will apply only to such holder.
DESCRIPTION
OF COMMON STOCK
General
Holders
of our common stock are entitled to one vote for each share on all matters submitted to a stockholder vote. Our common stock does
not have cumulative voting rights. Holders of our common stock representing a majority of the voting power of our capital stock
issued and outstanding and entitled to vote, represented in person or by proxy, are necessary to constitute a quorum at any meeting
of our stockholders. A vote by the holders of a majority of our outstanding shares is required to effectuate certain fundamental
corporate changes such as liquidation, merger or an amendment to our certificate of incorporation. Although there are no provisions
in our charter or by-laws that may delay, defer or prevent a change in control, the board of directors is authorized, without
stockholder approval, to issue shares of preferred stock that may contain rights or restrictions that could have this effect.
Holders of common stock are entitled to share in all dividends that the board of directors, in its discretion, declares from legally
available funds. In the event of liquidation, dissolution or winding up, each outstanding share entitles its holder to participate
pro rata in all assets that remain after payment of liabilities and after providing for each class of stock, if any, having preference
over the common stock. Holders of our common stock have no pre-emptive rights, no conversion rights and there are no redemption
provisions applicable to our common stock.
Election
of Directors
The
holders of shares of common stock and the equivalent shares of outstanding Series A Preferred Stock, voting together, shall appoint
the members of our board of directors. Each share of common stock is entitled to one vote.
Dividends
Since
inception we have not paid any dividends on our common stock. We currently do not anticipate paying any cash dividends in the
foreseeable future on our common stock. Although we intend to retain our earnings, if any, to finance the exploration and growth
of our business, our board of directors will have the discretion to declare and pay dividends in the future. Payment of dividends
in the future will depend upon our earnings, capital requirements, and other factors, which our board of directors may deem relevant.
Anti-Takeover
Effects of Provisions of the Delaware General Corporation Law and our Certificate of Incorporation and Bylaws
Provisions
of the Delaware General Corporation Law, or the DGCL, and our amended and restated certificate of incorporation and bylaws could
make it more difficult to acquire us by means of a tender offer, a proxy contest or otherwise, or to remove incumbent officers
and directors. These provisions, summarized below, are expected to discourage certain types of coercive takeover practices and
takeover bids that our board of directors may consider inadequate and to encourage persons seeking to acquire control of us to
first negotiate with our board of directors. We believe that the benefits of increased protection of our ability to negotiate
with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us outweigh the disadvantages of discouraging
takeover or acquisition proposals because, among other things, negotiation of these proposals could result in improved terms for
our stockholders.
Delaware
Anti-Takeover Statute
. We are subject to Section 203 of the DGCL. Subject to certain exceptions, Section 203 prohibits a publicly
held Delaware corporation from engaging in a “business combination” with an “interested stockholder” for
three years following the date the person became an interested stockholder, unless the interested stockholder attained such status
with the approval of our board of directors or unless the business combination is approved in a prescribed manner.
Section
203 of the DGCL generally defines a “business combination” to include, among other things, any merger or consolidation
involving us and the interested stockholder and the sale of more than 10% of our assets.
In
general, an “interested stockholder” is any entity or person beneficially owning 15% or more of our voting stock or
any entity or person associated or affiliated with or controlling or controlled by such entity or person.
Amendments
to Our Certificate of Incorporation
. Under the DGCL, the affirmative vote of a majority of the outstanding shares entitled
to vote thereon and a majority of the outstanding stock of each class entitled to vote thereon is required to amend a corporation’s
certificate of incorporation. Under the DGCL, the holders of the outstanding shares of a class of our capital stock shall be entitled
to vote as a class upon a proposed amendment, whether or not entitled to vote thereon by the certificate of incorporation, if
the amendment would:
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-
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increase
or decrease the aggregate number of authorized shares of such class;
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-
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increase
or decrease the par value of the shares of such class; or
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-
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alter
or change the powers, preferences or special rights of the shares of such class so as to affect them adversely.
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If
any proposed amendment would alter or change the powers, preferences or special rights of one or more series of any class of our
capital stock so as to affect them adversely, but shall not so affect the entire class, then only the shares of the series so
affected by the amendment shall be considered a separate class for the purposes of this provision.
Vacancies
in the board of directors
. Our bylaws provide that, subject to limitations, any vacancy occurring in our board of directors
for any reason may be filled by a majority of the remaining members of our board of directors then in office, even if such majority
is less than a quorum. Each director so elected shall hold office until the expiration of the term of the other directors. Each
such directors shall hold office until his or her successor is elected and qualified, or until the earlier of his or her death,
resignation or removal.
Special
Meetings of Stockholders
. Under our bylaws, special meetings of stockholders may be called at any time by our President whenever
so directed in writing by a majority of the entire board of directors. Special meetings can also be called whenever one-third
of the number of shares of our capital stock entitled to vote at such meeting shall, in writing, request one. Under the DGCL,
written notice of any special meeting must be given not less than 10 nor more than 60 days before the date of the special meeting
to each stockholder entitled to vote at such meeting.
No
Cumulative Voting
. The DGCL provides that stockholders are denied the right to cumulate votes in the election of directors
unless our certificate of incorporation provides otherwise. Our amended and restated certificate of incorporation does not provide
for cumulative voting.
The
NASDAQ Capital Market Listing
Our
common stock is listed on the NASDAQ Capital Market under the symbol “MNGA.”
Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is Corporate Stock Transfer, Inc. The transfer agent’s address is 3200
Cherry Creek South Drive, Suite 430, Denver, CO 80209, and its telephone number is (303) 282-4800.
PLAN
OF DISTRIBUTION
We are registering the
shares of preferred stock outstanding and issuable upon exercise of the preferred warrants and the shares of common stock issuable
upon conversion of the preferred stock and the shares of common stock issuable upon exercise of the Common Stock Warrants and
Placement Agent Warrants to permit the resale of these shares of preferred stock and common stock by the holders of the preferred
stock, preferred warrants, Common Stock Warrants and Placement Agent Warrants from time to time after the date of
this prospectus. We will receive proceeds from the exercise of any preferred warrants, Common Stock Warrants and Placement
Agent Warrants. We will not receive any of the proceeds from the sale by the selling stockholders of the shares of common
stock. We will bear all fees and expenses incident to our obligation to register the shares of preferred stock and common stock.
The
selling stockholders may sell all or a portion of the shares of preferred stock and common stock held by them and offered hereby
from time to time directly or through one or more underwriters, broker-dealers or agents. If the shares of preferred stock or
common stock are sold through underwriters or broker-dealers, the selling stockholders will be responsible for underwriting discounts
or commissions or agent’s commissions. The shares of common stock may be sold in one or more transactions at fixed prices,
at prevailing market prices at the time of the sale, at varying prices determined at the time of sale or at negotiated prices.
The shares of preferred stock may be sold in one or more transactions at a fixed price of $900 per share of preferred stock. These
sales may be effected in transactions, which may involve crosses or block transactions, pursuant to one or more of the following
methods:
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●
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on
any national securities exchange or quotation service on which the securities may be listed or quoted at the time of sale;
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●
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in
the over-the-counter market;
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●
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in
transactions otherwise than on these exchanges or systems or in the over-the-counter market;
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●
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through
the writing or settlement of options, whether such options are listed on an options exchange or otherwise;
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●
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ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;
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●
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block
trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction;
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●
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its account;
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●
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an
exchange distribution in accordance with the rules of the applicable exchange;
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●
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privately
negotiated transactions;
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●
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short
sales made after the date the Registration Statement is declared effective by the SEC;
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●
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broker-dealers
may agree with a selling security holder to sell a specified number of such shares at a stipulated price per share;
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●
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a
combination of any such methods of sale; and
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●
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any
other method permitted pursuant to applicable law.
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The
selling stockholders may also sell shares of preferred stock and common stock under Rule 144 promulgated under the Securities
Act of 1933, as amended, if available, rather than under this prospectus. In addition, the selling stockholders may transfer the
shares of preferred stock and common stock by other means not described in this prospectus. If the selling stockholders effect
such transactions by selling shares of preferred stock or common stock to or through underwriters, broker-dealers or agents, such
underwriters, broker-dealers or agents may receive commissions in the form of discounts, concessions or commissions from the selling
stockholders or commissions from purchasers of the shares of preferred stock or common stock for whom they may act as agent or
to whom they may sell as principal (which discounts, concessions or commissions as to particular underwriters, broker-dealers
or agents may be in excess of those customary in the types of transactions involved). In connection with sales of the shares of
preferred stock or common stock or otherwise, the selling stockholders may enter into hedging transactions with broker-dealers,
which may in turn engage in short sales of the shares of preferred stock or common stock in the course of hedging in positions
they assume. The selling stockholders may also sell shares of preferred stock or common stock short and deliver shares of preferred
stock or common stock, as applicable, covered by this prospectus to close out short positions and to return borrowed shares in
connection with such short sales. The selling stockholders may also loan or pledge shares of preferred stock or common stock to
broker-dealers that in turn may sell such shares.
The
selling stockholders may pledge or grant a security interest in some or all of the preferred stock, preferred warrants or shares
of common stock owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties
may offer and sell the shares of preferred stock or common stock from time to time pursuant to this prospectus or any amendment
to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending, if necessary, the list of
selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus.
The selling stockholders also may transfer and donate the shares of preferred stock or common stock in other circumstances in
which case the transferees, donees, pledgees or other successors in interest will be the selling beneficial owners for purposes
of this prospectus.
To
the extent required by the Securities Act and the rules and regulations thereunder, the selling stockholders and any broker-dealer
participating in the distribution of the shares of preferred stock or common stock may be deemed to be “underwriters”
within the meaning of the Securities Act, and any commission paid, or any discounts or concessions allowed to, any such broker-dealer
may be deemed to be underwriting commissions or discounts under the Securities Act. At the time a particular offering of the shares
of preferred stock or common stock is made, a prospectus supplement, if required, will be distributed, which will set forth the
aggregate amount of shares of common stock being offered and the terms of the offering, including the name or names of any broker-dealers
or agents, any discounts, commissions and other terms constituting compensation from the selling stockholders and any discounts,
commissions or concessions allowed or re-allowed or paid to broker-dealers.
Under
the securities laws of some states, the shares of preferred stock and common stock may be sold in such states only through registered
or licensed brokers or dealers. In addition, in some states the shares of preferred stock and common stock may not be sold unless
such shares have been registered or qualified for sale in such state or an exemption from registration or qualification is available
and is complied with.
There
can be no assurance that any selling stockholder will sell any or all of the shares of preferred stock or common stock registered
pursuant to the registration statement, of which this prospectus forms a part.
The
selling stockholders and any other person participating in such distribution will be subject to applicable provisions of the Securities
Exchange Act of 1934, as amended, and the rules and regulations thereunder, including, without limitation, to the extent applicable,
Regulation M of the Exchange Act, which may limit the timing of purchases and sales of any of the shares of preferred stock or
common stock by the selling stockholders and any other participating person. To the extent applicable, Regulation M may also restrict
the ability of any person engaged in the distribution of the shares of common stock to engage in market-making activities with
respect to the shares of preferred stock or common stock. All of the foregoing may affect the marketability of the shares of preferred
stock or common stock and the ability of any person or entity to engage in market-making activities with respect to the shares
of preferred stock or common stock.
We
will pay all expenses of the registration of the shares of preferred stock and common stock pursuant to the registration rights
agreement, including, without limitation, Securities and Exchange Commission filing fees and expenses of compliance with state
securities or “blue sky” laws; provided, however, a selling stockholder will pay all underwriting discounts and selling
commissions, if any. We will indemnify the selling stockholders against liabilities, including some liabilities under the Securities
Act in accordance with the registration rights agreements or the selling stockholders will be entitled to contribution. We may
be indemnified by the selling stockholders against civil liabilities, including liabilities under the Securities Act that may
arise from any written information furnished to us by the selling stockholder specifically for use in this prospectus, in accordance
with the related registration rights agreements or we may be entitled to contribution.
Once
sold under the registration statement, of which this prospectus forms a part, the shares of preferred stock and common stock will
be freely tradable in the hands of persons other than our affiliates.
LEGAL
MATTERS
Certain
legal matters with respect to the securities will be passed upon for us by Tyler B. Wilson, Esq., our General Counsel.
EXPERTS
The
consolidated financial statements of MagneGas Applied Technology Solutions, Inc. as of December 31, 2017 and for the year ended
December 31, 2016 incorporated in this prospectus by reference to our Annual Report on Form 10-K for the year ended December 31,
2017, have been so incorporated on reliance on the report (which contains an explanatory paragraph relating to our ability to
continue as a going concern as described in the notes to the consolidated financial statements) of Marcum LLP, an independent
registered public accounting firm, given on the authority of said firm as experts in auditing and accounting.
WHERE
YOU CAN FIND MORE INFORMATION
This
prospectus is part of the registration statement on Form S-3 we filed with the SEC under the Securities Act of 1933, as amended,
and does not contain all the information set forth in the registration statement. Whenever a reference is made in this prospectus
to any of our contracts, agreements or other documents, the reference may not be complete, and you should refer to the exhibits
that are a part of the registration statement or the exhibits to the reports or other documents incorporated by reference in this
prospectus for a copy of such contract, agreement or other document.
Because
we are subject to the information and reporting requirements of the Securities Exchange Act of 1934, as amended, we file annual,
quarterly and special reports, and other information with the SEC. Our SEC filings are available to the public over the Internet
at the SEC’s website at http://www.sec.gov or on our website at http://www.magnegas.com.
The
website addresses referenced herein are not intended to function as hyperlinks, and the information contained in our website and
in the SEC’s website is not incorporated by reference into this prospectus and should not be considered to be part of this
prospectus.
In
addition, the public may read and copy any materials we file with the SEC at the SEC’s Public Reference Room at 100 F Street,
N.E., Room 1580, Washington, D.C. 20549. The public may obtain information on the operation of the Public Reference Room by calling
the SEC at 1-800-SEC-0330.
INFORMATION
INCORPORATED BY REFERENCE
The
SEC allows us to incorporate by reference the information we file with it, which means that we can disclose important information
to you by referring you to those documents. Any statement contained in a document incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein modifies or supersedes
such statement. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute
a part of this prospectus. Any information that we file with the SEC after the date of the initial registration statement of which
this prospectus forms a part and prior to effectiveness of the registration statement will automatically update and supersede
the information contained in this prospectus. This prospectus incorporates by reference our documents listed below and any future
filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act until all of the securities are sold:
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Our
Annual Report on Form 10-K for the year ended December 31, 2017, filed with the SEC on April 16, 2018.
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Our
Quarterly Report on Form 10-Q for the quarter ended March 31, 2018, filed with the SEC on May 15, 2018.
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Our
Quarterly Report on Form 10-Q for the quarter ended June 30, 2018, filed with the SEC on August 14, 2018.
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●
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Our
Current Reports on Form 8-K and Form 8-K/A, filed with the SEC on January 4, 2018, January 17, 2018, January 23, 2018, February
6, 2018 (two on this date), February 14, 2018, February 16, 2018, February 21, 2018 (two on this date), February 27, 2018,
March 1, 2018, March 7, 2018, March 8, 2018 (two on this date, but the filing incorporated herein is identified by referencing
Film No. 18676499 ), March 15, 2018, March 16, 2018, March 19, 2018, March 20, 2018, March 22, 2018, March 26, 2018, April
2, 2018, April 4, 2018, April 9, 2018, April 16, 2018, April 17, 2018 (three on this date, but the two filings incorporated
herein are identified by referencing Film No.’s 18757522 and 18759463), April 24, 2018, May 2, 2018, May 9, 2018,
May 10, 2018, May 11, 2018, May 23, 2018, June 4, 2018, June 5, 2018, June 12, 2018, June 14, 2018, June 18, 2018, June 20,
2018, June 28, 2018, July 2, 2018, July 5, 2018, July 30, 2018, August 9, 2018, August 20, 2018, August 29, 2018, August 31,
2018, September 4, 2018 (two on this date), September 13, 2018, September 17, 2018, September 19, 2018, October 1, 2018, October
4, 2018, October 9, 2018, October 11, 2018, October 17, 2018, October 22, 2018, October 23, 2018, October
26, 2018 and October 29, 2018.
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Our
definitive information statement on Schedule 14C filed with the SEC on January 29, 2018.
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Our
definitive information statement on Schedule 14C filed with the SEC on July 10, 2018.
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Our
definitive information statement on Schedule 14C filed with the SEC on September 10, 2018.
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Notwithstanding
the foregoing, we are not incorporating any document or portion thereof or information deemed to have been furnished and not filed
in accordance with SEC rules.
You
may request a free copy of the above-mentioned filings or any subsequent filings we incorporate by reference to this prospectus
by writing or telephoning us at the following address: MagneGas Applied Technology Solutions, Inc., 11885 44
th
Street
North, Clearwater, FL 33762, (727) 934-3448.
PART
II— INFORMATION NOT REQUIRED IN THE PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution.
The
following table sets forth the fees and expenses payable by the Company in connection with the sale of the securities being registered
hereby. All amounts shown are estimates except the SEC registration fee. All of these fees and expenses will be borne by the Company.
Securities and Exchange Commission Registration Fee
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$
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308.72
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Accounting Fees and Expenses
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0
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Legal Fees and Expenses
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0
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Miscellaneous Expenses
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0
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Total
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$
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308.72
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Item
15. Indemnification of Directors and Officers.
The
Delaware General Corporation Law and our certificate of incorporation and by-laws provide for indemnification of our directors
and officers for liabilities and expenses that they may incur in such capacities. In general, directors and officers are indemnified
with respect to actions taken in good faith in a manner reasonably believed to be in, or not opposed to, the best interests of
the registrant and, with respect to any criminal action or proceeding, actions that the indemnitee had no reasonable cause to
believe were unlawful.
Our
certificate of incorporation provides that no director shall be personally liable to us or to our stockholders for monetary damages
for breach of fiduciary duty as a director, except that the limitation shall not eliminate or limit liability to the extent that
the elimination or limitation of such liability is not permitted by the Delaware General Corporation Law as the same exists or
may hereafter be amended.
Our
by-laws further provide for the indemnification of our directors and officers to the fullest extent permitted by Section 145 of
the Delaware General Corporation Law, including circumstances in which indemnification is otherwise discretionary. A principal
effect of these provisions is to limit or eliminate the potential liability of our directors for monetary damages arising from
breaches of their duty of care, subject to certain exceptions. These provisions may also shield directors from liability under
federal and state securities laws.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers, and controlling
persons pursuant to the foregoing provisions, or otherwise, we have been advised that, in the opinion of the SEC, such indemnification
is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment of expenses incurred or paid by a director, officer or controlling person in
a successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection
with the securities being registered, we will, unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to the court of appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Securities Act and will be governed by the final adjudication of such issue.
We
maintain a general liability insurance policy that covers certain liabilities of directors and officers of our corporation arising
out of claims based on acts or omissions in their capacities as directors or officers.
Item
16. Exhibits and Financial Statement Schedules.
(a)
Exhibits.
The
exhibits to the registration statement for this offering are listed in the Exhibit Index attached hereto and incorporated by reference
herein.
(b)
Financial Statement Schedules.
No
financial statement schedules have been submitted because they are not required or are not applicable or because the information
required is included in the consolidated financial statements or the notes thereto.
Item
17. Undertakings.
(a)
The undersigned registrant hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
i.
To include any prospectus required by section 10(a)(3) of the Securities Act;
ii.
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if
the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering
price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
iii.
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement.
Provided
however, that paragraphs (1)(i), (1)(ii) and (1)(iii) of this section do not apply if the information required to be included
in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant
pursuant to section 13 or section 15(d) of the Exchange Act that are incorporated by reference in the registration statement,
or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2)
That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
(4)
That, for the purpose of determining liability under the Securities Act to any purchaser:
(i)
each prospectus filed pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed
prospectus was deemed part of and included in the registration statement; and
(ii)
each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance
on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information
required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement as of
the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of
securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any
person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement
relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof; provided, however, that no statement made in a registration
statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by
reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with
a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement
or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date.
(b)
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing
of the registrant’s annual report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where applicable, each filing
of an employee benefit plan’s annual report pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in this registration statement shall be deemed to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c)
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion
of the SEC such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Registration Statement to be
signed on its behalf by the undersigned, thereunto duly authorized, in the City of Clearwater, State of Florida, on October
29, 2018.
|
MAGNEGAS
APPLIED TECHNOLOGY SOLUTIONS, INC.
|
|
|
|
|
By:
|
/s/
Ermanno Santilli
|
|
|
Ermanno
Santilli
|
|
|
Chief Executive Officer
(Principal Executive Officer)
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We,
the undersigned officers and directors of MagneGas Applied Technology Solutions, Inc., hereby severally constitute and appoint
Ermanno Santilli and Scott Mahoney, and each of them singly (with full power to each of them to act alone), as our true and lawful
attorneys-in-fact and agents, with full power of substitution and re-substitution in each of them for him and in his name, place
and stead, and in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration
statement (and any other registration statement for the same offering that is to be effective upon filing pursuant to Rule 462(b)
under the Securities Act of 1933), and to file the same, with all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing requisite or necessary to be done in and about the premises, as full
to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact
and agents or any of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the
capacities held on the dates indicated.
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/
ERMANNO SANTILLI
|
|
Chief
Executive Officer and Director
|
|
October
29, 2018
|
Ermanno
Santilli
|
|
(Principal
Executive Officer)
|
|
|
|
|
|
|
|
/s/
SCOTT MAHONEY
|
|
Chief
Financial Officer and Secretary and Director
|
|
October
29, 2018
|
Scott
Mahoney
|
|
(Principal
Financial and Accounting Officer)
|
|
|
|
|
|
|
|
*
|
|
|
|
|
Robert
Dingess
|
|
Director
|
|
October
29, 2018
|
|
|
|
|
|
*
|
|
|
|
|
Kevin
Pollack
|
|
Director
|
|
October
29, 2018
|
|
|
|
|
|
*
|
|
|
|
|
William
Staunton
|
|
Director
|
|
October
29, 2018
|
*
By:
|
/s/
SCOTT MAHONEY
|
|
|
Scott
Mahoney
|
|
|
Attorney-in-fact
|
|
EXHIBIT
INDEX
Exhibit
Number
|
|
Description
|
|
|
|
3.1
|
|
Amended
and Restated Certificate of Incorporation of MagneGas Corporation (incorporated by reference to Exhibit 3.1 to the Registrant’s
Current Report on Form 8-K filed on June 19, 2017).
|
3.2
|
|
Certificate
of Designations for Series C Convertible Preferred Stock of MagneGas Corporation (incorporated by reference to Exhibit 3.2
to the Registrant’s Current Report on Form 8-K filed on June 19, 2017).
|
3.3
|
|
Certificate
of Designations for Series D Convertible Preferred Stock of MagneGas Corporation (incorporated by reference to Exhibit 3.1
to the Registrant’s Current Report on Form 8-K filed on July 27, 2017).
|
3.4
|
|
Bylaws
of MagneGas Corporation (incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form
10SB filed on April 3, 2006).
|
3.5
|
|
Amendment
No. 1 to Bylaws of MagneGas Corporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report
on Form 8-K filed on September 29, 2016).
|
3.6
|
|
Certificate of Designations for Series E Convertible Preferred Stock of MagneGas Corporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on September 18, 2017).
|
3.7
|
|
Certificate of Designations for Series F Convertible Preferred Stock of MagneGas Corporation (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on June 28, 2018).
|
4.1
|
|
Form
of Warrant to Purchase Series C Convertible Preferred Stock of MagneGas Corporation (incorporated by reference to Exhibit
10.2 to the Registrant’s Current Report on Form 8-K filed on June 12, 2017).
|
5.1
|
|
Opinion
of General Counsel.
|
10.1
|
|
Securities
Purchase Agreement dated June 12, 2017, by and among MagneGas Corporation and the buyers identified on the signature pages
thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on June 12,
2017).
|
10.2
|
|
Form
of Registration Rights Agreement by and among MagneGas Corporation and the buyers identified on the signature pages thereto
(incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K filed on June 12, 2017).
|
10.3
|
|
Amended
and Restated Registration Rights Agreement by and among MagneGas Corporation and the buyers identified on the signature pages
thereto (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on August 14,
2017).
|
21.1
|
|
List
of Subsidiaries
|
23.1
|
|
Consent
of Marcum LLP, an independent registered public accounting firm.
|
23.3
|
|
Consent
of General Counsel (included in the opinion filed as Exhibit 5.1)
|
24.1
|
|
Power
of Attorney (incorporated by reference to the signature page of this Registration Statement).
|
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