As
filed with the Securities and Exchange Commission on November 20, 2020
Registration
No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
S-3
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
Ocean
Power Technologies, Inc.
(Exact
name of registrant as specified in its charter)
Delaware
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22-2535818
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(State
or other jurisdiction of incorporation or organization)
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(I.R.S.
Employer Identification No.)
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28
Engelhard Drive, Suite B
Monroe Township, New Jersey 08831
(609) 730-0400
(Address,
including zip code, and telephone number, including area code, of registrant’s principal executive offices)
George
H. Kirby III
Chief Executive Officer
28
Engelhard Drive, Suite B
Monroe
Township, New Jersey 08831
(609) 730-0400
(Name,
address, including zip code, and telephone number, including area code, of agent for service)
Copies
to:
Robert
Reedy
Kevin
Poli
Porter
Hedges LLP
1000
Main, 36th Floor
Houston,
Texas 77002
Telephone:
(713) 226-6682
Telecopy:
(713) 228-1331
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 462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ]
If
this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become
effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. [ ]
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register
additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following
box. [ ]
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company and an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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Large
accelerated filer [ ]
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Accelerated
filer [ ]
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Non-accelerated
filer [X]
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Smaller
reporting company [X]
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Emerging
growth company [ ]
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CALCULATION
OF REGISTRATION FEE
Title of Each Class of Securities to be Registered (1)
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Amount to be Registered
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Proposed Maximum Aggregate
Offering Price per Unit
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Proposed Maximum Offering
Price
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Amount of Registration
Fee
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Debt Securities (2)
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Common Stock, par value $0.001 per share
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Preferred Stock, par value $0.001 per share
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Depositary Shares (3)
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Warrants
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Subscription Rights
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Purchase Contracts
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Units (6)
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Total
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$
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100,000,000
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(4)
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$
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10,910
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(5)
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(1)
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The securities registered consist of $100,000,000 of
an indeterminate number or amount of Debt Securities, Common Stock, Preferred Stock, Depositary Shares, Warrants, Subscription
Rights, Purchase Contracts and Units, as may be issued from time to time at indeterminate prices. In no event will the aggregate
initial offering price of all securities issued from time to time pursuant to this registration statement exceed $100,000,000
or the equivalent thereof in foreign currencies, foreign currency units or composite currencies. This registration statement also
covers an indeterminate amount of securities registered hereunder and listed in the “Calculation of Registration Fee”
table above as may be issued in exchange for, or upon conversion or exercise of, as the case may be, the securities registered
hereunder and listed in the “Calculation of Registration Fee” table above. In addition, pursuant to Rule 416 under
the Securities Act of 1933, as amended (the “Securities Act”), the shares being registered hereunder include such
indeterminate number of shares of common stock and preferred stock as may be issuable with respect to the shares being registered
hereunder as a result of stock splits, stock dividends, or similar transactions.
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(2)
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If any Debt Securities are issued at an original issue
discount, then the offering price of the Debt Securities shall be in such amount as shall result in an aggregate initial offering
price not to exceed $100,000,000 less the offering price of any security previously issued hereunder.
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(3)
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Such indeterminate number of Depositary Shares to be
evidenced by Depositary Receipts issued pursuant to a deposit agreement. In the event that the registrant elects to offer to the
public fractional interests in shares of Preferred Stock registered hereunder, Depositary Receipts will be distributed to those
persons purchasing the fractional interests and the shares of Preferred Stock will be issued to the depositary under the deposit
agreement.
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(4)
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The proposed maximum aggregate offering price has been
estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(o) of the Securities Act.
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(5)
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Calculated in accordance with Rule 457(o) of the Securities
Act.
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(6)
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Each unit will represent an interest in two or more
other securities, which may or may not be separable from one another.
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The
Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective
on such date as the Commission acting pursuant to said Section 8(a), may determine.
EXPLANATORY
NOTE
This
registration statement contains:
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a
base prospectus, which covers the offering, issuance and sales by us of up to $100,000,000 in the aggregate of the securities
identified above from time to time in one or more offerings; and
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a
sales agreement prospectus, which covers the offering, issuance and sales by us of up to $50,000,000 in the aggregate of shares
of common stock that may be issued and sold identified above from time to time under a sales agreement by and between us and
A.G.P./Alliance Global Partners, as sales agent.
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The
base prospectus immediately follows this explanatory note. The specific terms of any securities to be offered pursuant to the
base prospectus will be specified in a prospectus supplement to the base prospectus. The sales agreement prospectus immediately
follows the base prospectus. The $50,000,000 of common stock that may be offered, issued and sold under the sales agreement prospectus
is included in the $100,000,000 of securities that may be offered, issued and sold by us under the base prospectus. Upon
termination of the sales agreement, any portion of the $50,000,000 included in the sales agreement prospectus that is not sold
pursuant to the sales agreement will be available for sale in other offerings pursuant to the base prospectus, and if no shares
are sold under the sales agreement, the full $50,000,000 of securities may be sold in other offerings pursuant to the base prospectus.
The
information in this prospectus is not complete and may be changed. We 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 it
is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
Subject
to completion, DATED NOVEMBER 20, 2020
PROSPECTUS
OCEAN
POWER TECHNOLOGIES, INC.
$100,000,000
Debt
Securities
Common Stock
Preferred Stock
Depositary Shares
Warrants
Subscription
Rights
Purchase Contracts
Units
We
may offer from time to time debt securities, shares of our common stock, shares of our preferred stock, depositary shares, warrants,
subscription rights, purchase contracts and units.
The
aggregate initial offering price of the securities that we offer will not exceed $100,000,000. We will offer the securities in
amounts, at prices and on terms to be determined at the time of the offering.
Our
common stock is quoted on the Nasdaq Stock Market under the symbol “OPTT.” The last reported sale price of our common
stock on November 18, 2020 was $1.89 per share.
We
will provide the specific terms of the offering in supplements to this prospectus. You should read this prospectus and any supplement
carefully before you invest. This prospectus may not be used to offer and sell our securities unless accompanied by a prospectus
supplement.
Investing
in our securities involves significant risks that are described in the “Risk Factors” section beginning on page
4 of this prospectus.
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 , 2020.
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with the Securities and Exchange Commission, or the Commission or
the SEC, utilizing a “shelf” registration process. Under this shelf registration process, we may sell any combination
of the securities described in this prospectus in one or more offerings up to a total dollar amount of $100,000,000. This prospectus
provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of the offering and the offered securities. This prospectus,
together with applicable prospectus supplements, any information incorporated by reference, and any related free writing prospectuses
we file with the Commission, includes all material information relating to these offerings and securities. We may also add, update
or change in the prospectus supplement any of the information contained in this prospectus or in the documents that we have incorporated
by reference into this prospectus, including without limitation, a discussion of any risk factors or other special considerations
that apply to these offerings or securities or the specific plan of distribution. If there is any inconsistency between the information
in this prospectus and a prospectus supplement or information incorporated by reference having a later date, you should rely on
the information in that prospectus supplement or incorporated information having a later date. We urge you to read carefully this
prospectus, any applicable prospectus supplement and any related free writing prospectus, together with the information incorporated
herein by reference as described under the heading “Incorporation of Certain Documents By Reference” and the additional
information described under the heading “Where You Can Find More Information,” before buying any of the securities
being offered.
You
should rely only on the information we have provided or incorporated by reference in this prospectus, any applicable prospectus
supplement and any related free writing prospectus. We have not authorized anyone to provide you with different information. No
dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus,
any applicable prospectus supplement or any related free writing prospectus.
Neither
the delivery of this prospectus nor any sale made under it implies that there has been no change in our affairs or that the information
in this prospectus is correct as of any date after the date of this prospectus. You should assume that the information in this
prospectus, any applicable prospectus supplement or any related free writing prospectus is accurate only as of the date on the
front of the document and that any information we have incorporated by reference is accurate only as of the date of the document
incorporated by reference, regardless of the time of delivery of this prospectus, any applicable prospectus supplement or any
related free writing prospectus, or any sale of a security.
The
registration statement containing this prospectus, including exhibits to the registration statement, provides additional information
about us and the securities offered under this prospectus and any prospectus supplement. We have filed and plan to continue to
file other documents with the Commission that contain information about us and our business. Also, we will file legal documents
that control the terms of the securities offered by this prospectus as exhibits to the reports that we file with the Commission.
The registration statement and other reports can be read at the Commission website or at the Commission offices mentioned under
the heading “Where You Can Find More Information.”
This
prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made
to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents.
Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits
to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described below
under “Where You Can Find More Information.”
ocean
power technologies, Inc.
As
used in this prospectus, unless otherwise indicated, “we,” “our,” “us,” “Company”
or similar terms refer collectively to Ocean Power Technologies, Inc., and not the subsidiaries of Ocean Power Technologies, Inc.
We
are a marine power solutions provider. We control the design, manufacture, sales, installation, operations and maintenance of
our products and solutions while working closely with partners that provide payloads, integration services, and marine
installation capabilities. We believe our solutions provide persistent and reliable distributed offshore power
along with communications for remote surface and subsea applications. Our mission and purpose are to utilize our proprietary,
state-of-the-art technologies to enhance the environment by reducing the global carbon footprint through clean
and renewable solutions for reliable electrical power and, in so doing, drive demand for our products and
services.
We
also continue to develop and commercialize our proprietary systems that generate electricity by harnessing the renewable energy
of ocean waves for our PB3 PowerBuoy®, and solar power for our newest product, the hybrid PowerBuoy®. The PB3 PowerBuoy®
uses proprietary technologies that convert the kinetic energy created by the heaving motion of ocean waves into electricity. Based
on feedback from our current customers, discussions with potential future customers in the offshore oil and gas, defense and security,
science and research, and communications, as well as government applications in fishery protection, together with our market research
and publicly available data, we believe that numerous markets have a direct need for our solutions. While our recent projects
have been in the oil and gas industry, we believe there is an increasing need for our products and solutions in areas such as
fishery protection, offshore windfarm support, marine surveillance, and ocean-based science and research applications. We believe
that having demonstrated the capability of our solutions, we can advance our product and services and gain further adoption from
our target markets. Our marketing efforts are focused on offshore locations that require a cost-efficient solution for renewable,
reliable and persistent power and communications, either by supplying electric power to payloads that are integrated directly
with our product or located in its vicinity, such as on the seabed and in the water column. We believe we are the leader in offshore
autonomous ocean wave power conversion technology which provides renewable power for offshore operations that were previously
difficult to decarbonize.
Our
achievements during the first six months of fiscal 2021 included our continued work on Enel Green Power and Eni S.p.A. projects.
In October 2020, we entered into an agreement with Adams Communication & Engineering Technology, Inc. to, among other things,
conduct a feasibility study for the evaluation of a PB3 PowerBuoy® power and 5G communications solution in support of the
U.S. Navy’s Naval Postgraduate School’s Sea, Land, Air, Military Research Initiative, which conducts interdisciplinary
research in unmanned and robotic systems. In June 2020, we signed a memorandum of understanding with Mackay Marine (a division of Mackay Communications) to develop a Marine
Surveillance Solution.
We
were incorporated under the laws of the State of New Jersey in April 1984 and began commercial operations in 1994. On April 23,
2007, we reincorporated in the State of Delaware. Our principal executive offices are located at 28 Engelhard Drive, Suite B,
Monroe Township, New Jersey. Our telephone number is (609) 730-0400. We maintain a website at www.oceanpowertechnologies.com
where general information about us is available. We are not incorporating the contents of the website into this prospectus.
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
The
information discussed in this prospectus, our filings with the SEC and our public releases include “forward-looking statements”
within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the Private Securities Litigation Reform
Act of 1995 (the “PSLRA”), or in releases made by the SEC. Such forward-looking statements involve known and unknown
risks, uncertainties and other important factors that could cause the actual results, performance or achievements of us to differ
materially from any future results, performance or achievements expressed or implied by such forward-looking statements. Statements
that are not historical fact are forward-looking statements. Forward-looking statements can be identified by, among other things,
the use of forward-looking language, such as the words “plan,” “believe,” “expect,” “anticipate,”
“intend,” “estimate,” “project,” “may,” “will,” “would,”
“could,” “should,” “seeks,” or “scheduled to,” or other similar words, or the
negative of these terms or other variations of these terms or comparable language, or by discussion of strategy or intentions.
These cautionary statements are being made pursuant to the Securities Act, the Exchange Act and the PSLRA with the intention of
obtaining the benefits of the “safe harbor” provisions of such laws.
The
forward-looking statements contained in or incorporated by reference into this prospectus are largely based on our expectations,
which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based
on currently known market conditions and other factors. Although we believe such estimates and assumptions to be reasonable, they
are inherently uncertain and involve a number of risks and uncertainties that are beyond our control, including:
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the
impact of the COVID-19 pandemic on our business, operations, customers, suppliers and manufacturers;
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our
ability to commercialize our products, and achieve and sustain profitability;
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our
continued development of our proprietary technologies, and expected continued use of cash from operating activities unless
or until we achieve positive cash flow from the commercialization of our products and services;
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our
ability to obtain additional funding, as and if needed which will be subject to a number of factors, including market conditions,
and our operating performance;
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our
ability to continue as a going concern;
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our
estimates regarding expenses, future revenues and capital requirements;
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the
adequacy of our cash balances and our need for additional financings;
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our
ability to develop and manufacture commercially viable products;
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our
ability to successfully develop and market new products and solutions, such as the subsea battery and Marine Surveillance
Solutions;
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that
we will be successful in our efforts to commercialize our products or the timetable upon which commercialization can be achieved,
if at all;
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our
ability to identify and penetrate markets for our products and solutions;
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our
ability to implement our commercialization strategy as planned, or at all;
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our
ability to improve the power output, survivability and reliability of our products;
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our
relationships with our strategic partners may not be successful and we may not be successful in establishing additional relationships;
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the
reliability of our technology, products and solutions;
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our
ability to maintain the listing of our common stock on the Nasdaq Capital Market;
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our
ability to raise capital through our current equity facilities;
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the
impact of pending and threatened litigation on our business, financial condition and liquidity;
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changes
in current legislation, regulations and economic conditions that affect the demand for renewable energy;
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our
ability to compete effectively in our target markets;
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our
limited operating history and history of operating losses;
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our
sales and marketing capabilities and strategy in the United States and internationally; and
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our
ability to protect our intellectual property portfolio.
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Many
of these factors are beyond our ability to control or predict. These factors are not intended to represent a complete list of
the general or specific factors that may affect us.
In
addition, management’s assumptions about future events may prove to be inaccurate. All readers are cautioned that the forward-looking
statements contained in this prospectus and in the documents incorporated by reference into this prospectus are not guarantees
of future performance, and we cannot assure any reader that such statements will be realized or that the forward-looking events
and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements
due to factors described in “Risk Factors” included elsewhere in this prospectus and in the documents that we include
in or incorporate by reference into this prospectus, including our Annual Report on Form 10-K for the fiscal year ended April
30, 2020 and our subsequent SEC filings. All forward-looking statements speak only as of the date they are made. We do not intend
to update or revise any forward-looking statements as a result of new information, future events or otherwise, except as required
by law. These cautionary statements qualify all forward-looking statements attributable to us or persons acting on our behalf.
WHERE
YOU CAN FIND MORE INFORMATION
This
prospectus forms a part of a registration statement on Form S-3 we filed with the SEC. This prospectus does not contain all of
the information found in the registration statement. For further information regarding us and our securities, you may desire to
review the full registration statement, including its exhibits and schedules, filed under the Securities Act, as well as our
proxy statement, annual, quarterly and other reports and other information we file with the SEC. You may read and copy
any document we file with the SEC at the SEC’s public reference room at 100 F Street, N.E., Washington, D.C. 20549. You
may obtain information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. The SEC maintains a
website on the Internet at www.sec.gov that contains reports, proxy and information statements, and other information regarding
companies that file electronically with the SEC. We maintain a website on the Internet at www.oceanpowertechnologies.com.
Our registration statement, of which this prospectus constitutes a part, can be downloaded from the SEC’s website or from
our website at www.oceanpowertechnologies.com. Information on the SEC website, our website or any other website is not
incorporated by reference in this prospectus and does not constitute part of this prospectus.
INCORPORATION
OF CERTAIN DOCUMENTS BY REFERENCE
The
following documents, which have previously been filed by us with the SEC under the Exchange Act, are incorporated herein by reference:
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our
Annual Report on Form 10-K for the fiscal year ended April 30, 2020, filed with the SEC on June 29, 2020 (File No. 001-33417);
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our
Quarterly Report on Form 10-Q for the quarter ended July 31, 2020, filed with the SEC on September 14, 2020 (File No. 001-33417);
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our
Current Reports on Form 8-K, filed with the SEC on May 1, 2020, May 4, 2020, May 7, 2020, June 26, 2020, June 29, 2020, July
8, 2020, July 15, 2020, August 17, 2020, August 18, 2020, August 19, 2020, August 24, 2020, August 26, 2020, September 14,
2020, September 18, 2020, October 27, 2020, and November 16, 2020 (File No. 001-33417) (excluding any information furnished
pursuant to Item 2.02 or Item 7.01 of any such Current Report on Form 8-K);
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our
Proxy Statement on Schedule 14A, filed with the SEC on November 2, 2020; and
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the
description of our common stock set forth in our registration statement on Form 8-A filed on April 18, 2007 (File No. 001-33417)
and in any and all subsequent amendments and reports filed for the purpose of updating that description.
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All
documents filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding any information furnished
pursuant to Item 2.02 or Item 7.01 on any current report on Form 8-K and any corresponding information furnished under Item 9.01
or included as an exhibit) after the date of the initial registration statement of which this prospectus forms a part and until
the termination of the offering under this prospectus shall be deemed to be incorporated in this prospectus by reference and to
be a part hereof from the date of filing of such documents. Any statement contained herein, or in a document incorporated or deemed
to be incorporated by reference herein, shall be deemed to be modified or superseded for purposes of this prospectus to the extent
that a statement contained herein or in any subsequently filed document which also is or is deemed to be incorporated by reference
herein, modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this prospectus.
You
may request a free copy of these filings, other than any exhibits, unless the exhibits are specifically incorporated by reference
into this prospectus, by writing or telephoning us at the following address:
Ocean
Power Technologies, Inc.
28 Engelhard Drive, Suite B
Monroe
Township, New Jersey 08831
Attention: Chief Financial Officer
(609) 730-0400
RISK
FACTORS
An
investment in our securities involves a high degree of risk. You should carefully consider the risk factors and all of the other
information included in, or incorporated by reference into, this prospectus, including those risk factors included in our Annual
Report on Form 10-K for the year ended April 30, 2020, our Quarterly Report on Form 10-Q for the quarterly period ended July 31,
2020 and our subsequent Commission filings, in evaluating an investment in our securities. If any of these risks were to occur,
our business, financial condition or results of operations could be adversely affected. In that case, the trading price of our
securities could decline and you could lose all or part of your investment. When we offer and sell any securities pursuant to
a prospectus supplement, we may include additional risk factors relevant to such securities in the prospectus supplement.
USE
OF PROCEEDS
Unless
we inform you otherwise in the prospectus supplement or any pricing supplement, we will use the net proceeds from the sale of
the securities offered by us to build additional products and solutions to meet market demand, further advance the development
of new products and solutions, engage in corporate development and merger and acquisition activities, for working capital needs,
capital expenditures, repayment or refinancing of indebtedness, acquisitions, repurchases and redemptions of securities, and for
other general corporate purposes. The amounts and timing of these expenditures will depend on a number of factors, such as the
timing, scope, progress and results of our sales, research and development efforts, the timing and progress of any partnering
efforts, and the regulatory and competitive environment. Pending any specific application, we may initially invest funds in short-term
marketable securities or apply them to the reduction of indebtedness.
DILUTION
Our
net tangible book value at July 31, 2020, was approximately $10,115,883, or approximately $0.54 per share of common stock. Net
tangible book value per share of common stock is determined by dividing our tangible net worth, which is tangible assets less
liabilities, by the total number of shares of our common stock outstanding. If we offer shares of our common stock, purchasers
of our common stock in that offering may experience immediate dilution in net tangible book value per share. The prospectus supplement
relating to an offering of shares of our common stock will set forth the information regarding any dilutive effect of that offering.
DESCRIPTION
OF DEBT SECURITIES
The
following is a general description of the debt securities that we may issue from time to time. The particular terms relating to
each debt security, which may be different from or in addition to the terms described below, will be set forth in a prospectus
supplement relating to such securities.
The
debt securities will be our direct obligations. The senior debt securities will rank equally with all of our other senior and
unsubordinated debt. The senior subordinated debt securities will have a junior position to all of our senior debt, which is generally
defined in both the subordinated debt indenture and senior subordinated debt indenture to include all debt other than debt that
is expressly subordinated to or pari passu with the subordinated debt securities or senior subordinated debt securities, as the
case may be. The subordinated debt securities will have a junior position to all of our senior debt and all of our senior subordinated
debt. The senior debt securities will be issued under a senior debt indenture, the senior subordinated debt securities will be
issued under a senior subordinated debt indenture, and the subordinated debt securities will be issued under a subordinated debt
indenture. The indentures will be qualified under the Trust Indenture Act of 1939, as amended (the “Trust Indenture Act”).
The type and terms of the debt securities we offer under this prospectus may be limited by the other debt instruments to which
we are a party at the time of the offering.
Any
securities we issue will be structurally subordinated to the indebtedness and other liabilities, if any, of our subsidiaries,
including claims of our subsidiaries’ creditors, and any taxing authorities. Any claims we have as an unsecured creditor
of one of our subsidiaries would be subordinate to any security interest in the assets of that subsidiary and any indebtedness
of that subsidiary senior to the indebtedness held by us.
We
have summarized below the material provisions of the three indentures. The summary is not complete and is subject in all respects
to the provisions of and is qualified in its entirety by reference to the forms of indentures, which are filed as exhibits and
incorporated by reference into the registration statement of which this prospectus forms a part. The prospectus supplement relating
to the applicable issuance of debt securities will describe any significant differences between the indentures and the summary
below. The forms of senior indenture, senior subordinated indenture and subordinated indenture are substantially the same, except
for certain covenants of ours and provisions relating to subordination. You should read the indentures for provisions that may
be important to you. The forms of indentures may be supplemented or revised in connection with the filing of a prospectus supplement
with respect to a particular series of debt securities and such later version will govern any debt securities issued in conjunction
with that prospectus supplement.
Terms
Applicable to All Debt Securities
No
Limit on Debt Amounts. The indentures do not limit the amount of debt that can be issued under the indentures. These amounts
will be set from time to time by our board of directors.
Prospectus
Supplements. The prospectus supplement relating to a series of debt securities will summarize the specific terms of such debt
securities and the related offering including, with respect to each series of debt securities, some or all of the following, as
well as any other material terms of the debt securities:
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the
title of the securities of the series (which title will distinguish the securities of the series from all other series of
securities);
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any
limit upon the aggregate principal amount of the securities of the series which may be authenticated and delivered (which
limit will not pertain to securities authenticated and delivered upon registration of transfer of, or in exchange for, or
in lieu of, other securities of the series or any securities that are deemed never to have been authenticated and delivered);
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the
date or dates on which the principal of and premium, if any, on the securities of the series is payable or the method or methods
of determination thereof;
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the
rate or rates at which the securities of the series will bear interest, if any, or the method or methods of calculating such
rate or rates of interest, the date or dates from which such interest will accrue or the method or methods by which such date
or dates will be determined, the dates on which any such interest will be payable, our right, if any, to defer or extend an
interest payment date, the record date, if any, for the interest payable on any such security on any interest payment date,
and the basis upon which interest will be calculated if other than that of a 360-day year of twelve 30-day months;
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the
place or places where the principal of, premium, if any, and interest, if any, on securities of the series will be payable,
any securities of the series may be surrendered for registration of transfer, securities of the series may be surrendered
for exchange and notices and demands to or upon us in respect of the securities of the series and the indenture may be served
and notices to holders will be published;
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the
period or periods within which, the price or prices at which, the currency or currencies (including currency unit or units)
in which, and the other terms and conditions upon which, securities of the series may be redeemed, in whole or in part, at
our option and, the manner in which the particular securities of such series (if less than all securities of such series are
to be redeemed) are to be selected for redemption;
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our
right or obligation, if any, to redeem or purchase securities of the series pursuant to any sinking fund or analogous provisions
or upon the happening of a specified event or at the option of a holder thereof, and the period or periods within which, the
price or prices at which, the currency or currencies (including currency unit or units) in which, and the other terms and
conditions upon which, securities of the series will be redeemed or purchased, in whole or in part, pursuant to such obligation;
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if
other than denominations of $1,000 and any integral multiple thereof, the denominations in which securities of the series
will be issuable;
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if
other than U.S. dollars, the currency or currencies (including currency unit or units) in which the principal of, premium,
if any, and interest, if any, on the securities of the series will be payable, or in which the securities of the series will
be denominated, and the particular provisions applicable thereto;
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if
the payments of principal of, premium, if any, or interest, if any, on the securities of the series are to be made, at our
election or the election of a holder, in a currency or currencies (including currency unit or units) other than that in which
the securities of such series are denominated or designated to be payable, the currency or currencies (including currency
unit or units) in which such payments are to be made, the terms and conditions of such payments and the manner in which the
exchange rate with respect to such payments will be determined, and the particular provisions applicable thereto;
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if
the amount of payments of principal of, premium, if any, and interest, if any, on the securities of the series will be determined
with reference to an index, formula or other method (which index, formula or method may be based, without limitation, on a
currency or currencies (including currency unit or units) other than that in which the securities of the series are denominated
or designated to be payable), the index, formula or other method by which such amounts will be determined and any special
voting or defeasance provisions in connection therewith;
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if
other than the principal amount thereof, the portion of the principal amount of such securities of the series which will be
payable upon declaration of acceleration thereof or the method by which such portion will be determined;
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the
person to whom any interest on any securities of the series will be payable;
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provisions,
if any, granting special rights to the holders of securities of the series upon the occurrence of such events as may be specified;
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any
deletions from, modifications of or additions to the events of default or covenants pertaining to the securities of the series;
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under
what circumstances, if any, and with what procedures and documentation we will pay additional amounts on the securities of
the series held by a person who is not a U.S. person (including any definition of such term) in respect of taxes, assessments
or similar charges withheld or deducted and, if so, whether we have the option to redeem such securities rather than pay such
additional amounts (and the terms of any such option);
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the
forms of the securities of the series;
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the
applicability, if any, of any means of defeasance or covenant defeasance as may be specified for the securities of such series;
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if
other than the trustee, the identity of the registrar, conversion agent (if any) and any paying agent;
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if
the securities of the series will be issued in whole or in part in global form, (A) the depositary for such global securities,
(B) whether beneficial owners of interests in any securities of the series in global form may exchange such interests for
certificated securities of such series, to be registered in the names of or to be held by such beneficial owners or their
nominees and to be of like tenor of any authorized form and denomination, and (C) the circumstances under which any such exchange
may occur;
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the
designation of the depositary with respect to the securities of the series;
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any
restrictions on the registration, transfer or exchange of the securities of the series;
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if
the securities of the series may be issued or delivered (whether upon original issuance or upon exchange of a temporary security
of such series or otherwise), or any installment of principal or interest is payable, only upon receipt of certain certificates
or other documents or satisfaction of other conditions, the form and terms of such certificates, documents or conditions;
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if
the securities of the series will be convertible into or for other of our securities or property, and any deletions from,
modifications of or additions to the terms and conditions of any right to convert, exercise or exchange securities of the
series into or for other of our securities or property;
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whether
the securities of the series are secured or unsecured, and if secured, the security and related terms in connection therewith
(which will be provided for in a separate security agreement and/or other appropriate documentation); and
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any
other terms of the securities of the series, including any terms which may be required by or advisable under United States
laws or regulations or advisable (as we may determine) in connection with the marketing of securities of the series.
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Unless
otherwise provided in an applicable indenture relating to debt securities, the debt securities will be issued in the form of one
or more fully registered global securities that will be deposited with and registered in the name of a depositary or its nominee.
Upon issuance of a registered global security, the depositary will credit, on its book-entry registration and transfer system,
participants’ accounts with the principal amount of the debt security beneficially owned by such participants. Each person
owning a beneficial interest in a registered global security will have to rely on the procedures of the depositary for such registered
global security to exercise any rights of a holder under the applicable indenture. No service charge will be made for any transfer
or exchange of the debt securities, but we may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection with a transfer or exchange and any expenses payable in connection with any registration of transfer or
exchange of debt securities, other than exchanges not involving any transfer, such as the issuance of definitive securities in
replacement of temporary securities or the issuance of new securities upon surrender of a security that is transferred or redeemed
in part.
A
series of debt securities may be issued under the relevant indenture as original issue discount securities, which are securities
that are offered and sold at a discount from their stated principal amount. In addition, debt securities offered and sold at their
stated principal amount may under some circumstances, pursuant to applicable Treasury Regulations, be treated as issued at an
original issue discount for federal income tax purposes. Federal income tax consequences and other special considerations applicable
to any such original issue discount securities (or other debt securities treated as issued at an original issue discount) will
be described in the prospectus supplement relating to those securities.
Covenants.
We will agree in the indentures with respect to any series of debt securities to:
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pay
the principal, interest and any premium on the securities of the series when due;
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maintain
an office or agency where the securities of the series may be surrendered for registration of transfer, exchange, payment
or conversion (if the debt securities are convertible) and where notices and demands to or upon us in respect of the securities
of the series and the relevant indenture may be served;
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prepare
and file or deliver certain reports, as more fully specified in the relevant indenture, with the SEC, the trustee under the
relevant indenture, and/or registered holders of the securities of the series, as the case may be;
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deliver
to the trustee under the relevant indenture, as more fully specified in that indenture, officers’ certificates relating
to our compliance under the relevant indenture and the occurrence of any default or event of default under that indenture;
and
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unless
our board of directors determines that it is no longer desirable in the conduct of our business and that there will be no
adverse impact in any material respect to the holders of the securities of the series, subject to those exceptions as more
fully specified in the relevant indenture, do or cause to be done all things necessary to preserve and keep in full force
and effect our existence as a corporation and our rights (charter and statutory rights) and franchises.
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Consolidation,
Merger and Sale of Assets. We will agree in the indentures with respect to any series of debt securities that we will not
consolidate with or merge into any other entity or transfer all or substantially all of our assets unless:
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we
are the surviving entity; or
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the
successor or surviving entity assumes all of our obligations under the securities of such series and the indentures pursuant
to supplemental indentures in forms reasonably satisfactory to the trustee(s) under the relevant indentures and is organized
or existing under the laws of the United States of America and any state thereof or the District of Columbia; and, in either
case,
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immediately
after giving effect to such transaction, no event of default under the relevant indenture will have happened and be continuing.
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Upon
any such consolidation, merger or transfer of all or substantially all of our assets, the successor will be substituted for us
under the indenture and we will be relieved of all obligations and covenants under the indenture with respect to such series of
debt securities, except in the case of a lease of all or substantially all of our assets.
Satisfaction
and Discharge. Upon our request, the relevant indenture will no longer be effective with respect to any series of debt securities
for all but certain specified purposes if either:
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all
outstanding securities of that series have been delivered to the trustee for cancellation, we have paid all sums payable in
respect of that series and we have delivered to the trustee a certificate and opinion of legal counsel that all conditions
precedent to satisfaction and discharge have been fulfilled; or
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the
only securities that remain outstanding have, or within one year will, become due and payable or are to be called for redemption,
we have deposited with the trustee funds that are sufficient to make all future payments, no default or event of default will
have occurred and be continuing on the date of that deposit, we have paid all other sums payable in respect of that series,
and we have delivered to the trustee a certificate and opinion of counsel that all conditions precedent to satisfaction and
discharge have been fulfilled.
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Legal
Defeasance and Covenant Defeasance. Under each indenture, we may elect with respect to a series of debt securities, at our
option and subject to the satisfaction of the conditions described below, either:
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to
be deemed to have paid and discharged the entire indebtedness represented by the outstanding securities of the applicable
series and to have satisfied all of our other obligations under the securities of the applicable series and under the provisions
of the relevant indenture, which we refer to as legal defeasance; or
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to
be released from some of our obligations under the relevant indenture, which we refer to as covenant defeasance.
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We
can exercise legal or covenant defeasance with respect to any series of debt securities if the following conditions are met:
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we
irrevocably deposit with the applicable indenture trustee (or another trustee meeting certain eligibility requirements and
agreeing to be bound by the applicable provisions of the relevant indenture), in trust, for the benefit of the holders of
the applicable series of debt securities:
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cash
in United States dollars;
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non-callable
and non-redeemable direct obligations of the United States of America or of an agency or instrumentality controlled or supervised
by the United States of America, in each instance, the payment of which is unconditionally guaranteed as a full faith and
credit obligation of the United States of America; or
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a
combination of the foregoing that, in each case, is sufficient, in the opinion of a nationally recognized firm of independent
public accountants, to pay the principal of, interest and premium, if any, on the outstanding debt securities of the applicable
series on their stated maturity or applicable redemption date, as the case may be, and any mandatory sinking fund payments
applicable to that particular series of debt securities on the day on which the payments are due;
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we
deliver to the trustee an opinion of counsel confirming that the holders of the outstanding securities of the applicable series
will not recognize income, gain or loss for federal income tax purposes as a result of the defeasance;
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no
default or event of default shall have occurred and be continuing on the date of the deposit of the amounts to be held in
trust for the benefit of the holders (other than a default or event of default resulting from the borrowing of funds to be
applied to the deposit) or in the case of any insolvency-related defaults, at any time in the period ending on the 91st day
after the date of the deposit (or greater period of time in which any such deposit of trust funds may remain subject to bankruptcy
or insolvency laws that apply to the deposit by us); and
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we
deliver to the trustee an officers’ certificate and an opinion of counsel, each stating that all conditions precedent
provided for or relating to legal defeasance or covenant defeasance, as the case may be, have been complied with.
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After
satisfying the conditions for legal defeasance, the debt securities of the applicable series will be deemed outstanding only for
limited purposes as more fully set forth in the relevant indenture. After legal defeasance, the holders of outstanding debt securities
of the applicable series will have to rely solely on the deposits we make to the trust for repayment of such debt securities.
After
satisfying the conditions for covenant defeasance, the debt securities of the applicable series will be deemed not outstanding
for the purposes of the covenants from which we have been released but will continue to be deemed outstanding for all other purposes
under the relevant indenture.
The
prospectus supplement relating to a series of debt securities may describe additional provisions, if any, permitting legal defeasance
or covenant defeasance, and any modifications to the provisions described above, with respect to the debt securities of a particular
series.
Information
Concerning the Trustee. The prospectus supplement relating to a series of debt securities will include information concerning
the trustee under the applicable indenture and our relationship with the trustee at the time any debt securities are offered.
We may also maintain bank accounts, borrow money and have other banking or investment banking relationships with the trustee,
or its affiliates, in the ordinary course of business.
Global
Securities. The registered debt securities may be issued in the form of one or more fully registered global securities that
will be deposited with and registered in the name of a depositary or in the name of a nominee for a depositary identified in the
prospectus supplement relating to such debt securities. The specific terms of the depositary arrangement with respect to any debt
securities to be represented by a registered global security will be described in the prospectus supplement relating to such debt
securities. We anticipate that the description below will apply to all depositary arrangements.
Ownership
of beneficial interests in a registered global security will be limited to persons that have accounts with the depositary for
such registered global security (“participants”) or persons that may hold interests through participants. Upon the
issuance of a registered global security, the depositary will credit, on its book-entry registration and transfer system, the
participants’ accounts with the principal amounts of the debt securities represented by the registered global security beneficially
owned by such participants. Ownership of beneficial interests in such registered global security will be shown on, and the transfer
of such ownership interests will be effected only through, records maintained by the depositary for such registered global security
or on the records of participants for interests of persons holding through participants.
So
long as the depositary for a registered global security, or its nominee, is the registered owner of a registered global security,
the depositary or the nominee will be considered the sole owner or holder of the debt securities represented by the registered
global security for all purposes. Except as set forth below, owners of beneficial interests in a registered global security will
not:
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be
entitled to have the debt securities represented by such registered global security registered in their names;
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receive
or be entitled to receive physical delivery of such debt securities in definitive forms; or
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be
considered the owners of record or holders of the debt securities.
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Each
person owning a beneficial interest in a registered global security will have to rely on the procedures of the depositary for
such registered global security and, if such person is not a participant, on the procedures of the participant through which such
person owns its interest, to exercise any rights of a holder under the applicable indenture. We understand that under existing
industry practices, if we were to request any action of holders, or if an owner of a beneficial interest in a registered global
security desired to take any action that a holder is entitled to take under the applicable indenture, the depositary would authorize
the participants holding the relevant beneficial interests to take such action, and such participants would authorize beneficial
owners owning through such participants to take such action.
Principal
of, interest and premium, if any, on debt securities represented by a registered global security registered in the name of a depositary
or its nominee will be made to such depositary or its nominee, as the case may be, as the registered owner of such registered
global security. Neither we nor the trustee will have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests in such registered global security.
We
expect that the depositary for any debt securities represented by a registered global security, upon receipt of any payment of
principal, interest or premium, if any, will immediately credit participants’ accounts with such payments in amounts proportionate
to their respective beneficial interests in such registered global security as shown on the records of such depositary. We also
expect that payments by participants to owners of beneficial interests in such a registered global security held by the participants
will be governed by standing customer instructions and customary practices, as is now the case with securities held for the accounts
of customers in bearer form or registered in “street name.”
If
the depositary notifies us that it is unwilling or unable to continue as depositary for the global security or if at any time
the depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, and such registration as a
clearing agency is required by applicable law or regulation to serve as a depositary, and, in either situation, we do not appoint
a successor depositary within 90 days, we will issue debt securities in certificated form in exchange for the global security.
In addition, we may at any time in our sole discretion decide not to have any debt securities represented by a global security.
In such event we will issue debt securities in certificated form in exchange for the global security. The debt securities in certificated
form will be in the same minimal denominations and be of the same aggregate outstanding principal amount and tenor as the portion
of each global security to be exchanged.
Any
debt securities issued in certificated form in exchange for a global security will be registered in such name or names as the
depositary shall instruct the relevant trustee. We expect that such instructions will be based upon directions received by the
depositary from participants with respect to ownership of beneficial interests in such registered global security.
If
provided in a prospectus supplement relating to a series of debt securities, the debt securities of that series also may be issued
in the form of one or more global securities that will be deposited with a common depositary identified in the prospectus supplement.
The specific terms and procedures, including the specific terms of the depositary arrangement, with respect to any portion of
a series of debt securities to be represented by a global security will be described in the prospectus supplement relating to
that series.
Form,
Exchange, Transfer. Unless otherwise specified in a prospectus supplement relating to a series of debt securities, debt securities
will be issued in global form with accompanying book-entry procedures as outlined above. They also may be issued in registered
form without coupons.
A
holder of debt securities of any series may exchange the debt securities for other debt securities of the same series, in any
authorized denomination and with the same terms and aggregate principal amount. The securities are transferable at the corporate
trust office or corporate trust agency office of the trustee or at any transfer agent designated by us for that purpose. No service
charge will be made for any transfer or exchange of the debt securities, but we may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection with a transfer or exchange and any expenses payable in connection
with any registration of transfer or exchange of debt securities, other than exchanges not involving any transfer, such as the
issuance of definitive securities in replacement of temporary securities or the issuance of new securities upon surrender of a
security that is redeemed in part.
Particular
Terms of the Senior Debt Securities
Ranking
of Senior Debt Securities. Unless otherwise specified in a prospectus supplement relating to a series of senior debt securities,
the senior debt securities will constitute part of our senior debt and rank equally with all our other senior debt that is unsecured
(and will effectively rank junior to any secured debt). In addition to senior debt securities offered under this prospectus, senior
debt includes obligations under any credit facilities with banks or other institutional lenders. The senior debt securities will
be senior to our senior subordinated debt and subordinated debt. Our obligations under the senior debt securities will be structurally
subordinated to certain obligations of our subsidiaries.
Events
of Default. The following, among others, are events of default under a series of senior debt securities:
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we
fail to pay the principal, premium, if any, or any sinking fund payment on any securities of that series when due;
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we
fail to pay interest on any securities of that series when due and that failure continues for a period of 30 days;
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upon
exercise of a holder’s conversion right, we fail to deliver conversion consideration in accordance with the indenture;
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we
fail to comply with our obligations in the event of a consolidation, merger or sale of assets, as set forth in the indenture;
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we
fail to observe or perform any other covenant or agreement in the senior indenture for the benefit of that series (other than
a covenant or agreement with respect to which a failure to observe or perform is dealt with otherwise in the senior indenture
or is expressly included in the senior indenture solely for the benefit of a series of debt securities other than such series
of debt securities) and that failure continues for 90 days after we receive notice to comply from the trustee or holders of
at least 25% in aggregate principal amount of the outstanding senior debt securities;
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we
fail to pay our indebtedness or to pay or discharge certain final judgments against us, as set forth in the indenture; and
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certain
events of bankruptcy or insolvency occur, whether voluntary or not.
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The
indenture and the prospectus supplement relating to a series of senior debt securities may describe additional or different events
of default that apply to that series. An event of default with respect to one series of senior debt securities will not necessarily
constitute an event of default with respect to any other series of senior debt securities.
If
a default or an event of default occurs and is continuing, the trustee will mail to the holders of senior debt securities of the
affected series a notice to that effect within 90 days after the default occurs, if a responsible officer of the trustee under
the indenture has actual knowledge of the default or event of default. Except in the case of a default in the payment of principal
or interest, the trustee under the senior indenture may withhold notice if, and so long as, a committee of the trustee’s
responsible officers in good faith determines that withholding the notice is in the interests of the holders.
If
an event of default with respect to one or more series of senior debt securities occurs and is continuing, the trustee or the
holders of at least 25% in aggregate principal amount of the then outstanding senior debt securities of all series with respect
to which the event of default occurs and is continuing, treating all those series as a single class, may declare all the principal
of, accrued and unpaid interest or premium (or a lesser amount as may be provided for in the senior debt securities of the series),
if any, of all the senior debt securities of those series to be immediately due and payable. The holders of a majority in aggregate
principal amount of the then outstanding senior debt securities of all series covered by such declaration may annul or rescind
the declaration and any related payment default that resulted from the declaration but not any other payment default. Certain
events of bankruptcy and insolvency will result in all outstanding series of senior debt securities becoming due and payable immediately
without any further action on the part of the trustee or the holders.
The
senior indenture entitles the trustee to be indemnified by the holders before proceeding to exercise any right or power at the
request of any of the holders.
The
holders of a majority in principal amount of the outstanding senior debt securities of all series with respect to which an event
of default occurs and is continuing, treating all those series as a single class, may direct the time, method and place of conducting
any proceeding for any remedy available to the trustee or exercising any trust power conferred on it, except that:
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the
direction cannot conflict with any law or regulation or the indenture;
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the
trustee may take any other action deemed proper by the trustee that is not inconsistent with the direction; and
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the
trustee need not take any action that might subject it to personal liability or be unduly prejudicial to the holders of the
senior debt securities not joining in the action.
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A
holder may pursue a remedy directly under the senior indenture or a particular series of senior debt securities but, before doing
so, the following must occur:
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the
holder must give to the trustee written notice that an event of default has occurred and is continuing;
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the
holders of at least 25% in principal amount of the then outstanding senior debt securities of all affected series, treating
all those series as a single class, must make a written request to the trustee to pursue the remedy;
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the
holder, or holders, must offer and, if requested, provide to the trustee an indemnity satisfactory to the trustee against
any loss, liability or expense from the taking of the action;
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the
trustee does not comply with the request within 60 days after receipt of the request and offer and, if requested, the provision
of indemnity; and
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during
the 60-day period, the holders of a majority in principal amount of the then outstanding senior debt securities of all those
series, treating all those series as a single class, do not give the trustee a direction inconsistent with the written request.
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However,
holders have an absolute right to receipt of principal, interest or premium, if any, on or after the respective due dates and
to institute suit for the enforcement of those payments. The right of a holder of senior debt securities to bring suit for the
enforcement of any payments of principal, interest or premium, if any, on senior debt securities on or after the respective due
dates may not be impaired or affected without the consent of that holder.
The
holders of a majority in principal amount of the senior debt securities then outstanding of all affected series, treating all
such series as a single class, may, by notice to the trustee on behalf of all holders of the senior debt securities of all those
series, waive any past defaults, except:
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●
|
a
continuing default in payment of the principal of, interest or premium, if any, on, or any sinking fund payment on, senior
debt securities of the series;
|
|
●
|
a
continuing default in respect of a covenant or provision of the indenture that cannot be amended or modified without the consent
of each holder of senior debt securities affected;
|
|
●
|
one
arising from a failure to pay or deliver to converting holders consideration due upon conversion; and
|
|
●
|
in
respect of a covenant or provision that under the senior indenture cannot be modified or amended without the consent of the
holder of each outstanding note affected.
|
We
periodically will file statements with the trustees regarding our compliance with covenants in the senior indenture.
Modifications
and Amendments. Except as provided below, or more fully specified in the senior indenture and described in the applicable
prospectus supplement, the senior indenture may be amended or supplemented by us and the trustee with the consent of holders of
a majority in principal amount of all series of senior debt securities affected by the amendment or supplement, treating all such
series as a single class. In addition, the record holders of a majority in principal amount of the outstanding senior debt securities
of all series affected by the waiver, treating all such series as a single class, may, with respect to those series, waive defaults
under, or compliance with, the provisions of the senior indenture. Some amendments or waivers, however, require the consent of
each holder of any senior debt security affected. Without the consent of each affected holder, an amendment or waiver regarding
a series of senior debt securities may not:
|
●
|
change
the maturity date, or the payment date of any installment interest on, any securities;
|
|
●
|
reduce
the principal amount of, or interest on, any securities;
|
|
●
|
change
the place, manner or currency of payment of principal of, or interest on, any securities;
|
|
●
|
impair
the right to institute a suit for the enforcement of any payment on, or with respect to, or of the conversion of, any security;
|
|
●
|
change
the ranking of the securities in a manner adverse to the holders of securities;
|
|
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|
adversely
affect the right of holders of securities to convert their securities in accordance with the indenture, or reduce the amount
of consideration due upon conversion;
|
|
●
|
reduce
the percentage in aggregate principal amount of outstanding securities whose holders must consent to a modification or amendment
of the indenture or the securities;
|
|
●
|
reduce
the percentage in aggregate principal amount of outstanding securities whose holders must consent to a waiver of compliance
with any provision in the indenture, or the securities or a waiver of any default or event of default; or
|
|
●
|
modify
the applicable provisions of the indenture, except to increase the percentage required for modification or waiver or to provide
for the consent of each affected holder.
|
We
and the trustee under the senior indenture may amend or supplement the senior indenture or the senior debt securities issued thereunder
without notice to or the consent of any holder to:
|
●
|
provide
for the assumption by a successor company of the Company’s obligations under the securities and the indenture;
|
|
●
|
add
guarantees with respect to the securities;
|
|
●
|
add
to the covenants for the benefit of the holders or surrender any right or power conferred upon the Company;
|
|
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|
make
any change, including to cure any omission, ambiguity, manifest error or defect or to correct any inconsistency in the indenture
that does not adversely affect the rights of any holder in any material respect;
|
|
●
|
comply
with any requirement of the SEC in connection with the qualification of the indenture under the Trust Indenture Act or with
the rules of any applicable securities depositary;
|
|
●
|
provide
for the issuance of and establish the form and terms and conditions of the securities of any series, to establish the form
of any certifications required to be furnished, or to add to the rights of the holders of any series of securities;
|
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●
|
add
additional events of default;
|
|
●
|
evidence
the acceptance or appointment of a successor trustee or to add an additional trustee or agent in accordance with the indenture;
or
|
|
●
|
conform
the provisions of the indenture and the securities to the “Description of Notes” section as set forth in a preliminary
prospectus supplement related to the offering and sale of the securities, as supplemented by the related pricing term sheet.
|
Particular
Terms of the Senior Subordinated Debt Securities
Ranking
of Senior Subordinated Debt Securities. As described below, the senior subordinated debt securities will rank senior to any
subordinated debt securities and will be subordinated and junior in right of payment to any senior debt securities issued by us,
as well as certain other indebtedness incurred by us to the extent set forth in the applicable indenture and described in the
prospectus supplement relating to a series of senior subordinated debt securities. Unless the prospectus supplement relating to
a series of senior subordinated debt securities indicates otherwise, the following description will apply to our senior subordinated
debt securities.
Subordination.
Our obligations under the senior subordinated debt securities will be subordinated in right of payment to our obligations under
our senior debt and will be structurally subordinated to certain obligations of our subsidiaries, including claims payable. In
the indenture relating to the senior subordinated securities, we will agree not to create, incur or otherwise be liable for any
other indebtedness that ranks junior to the senior debt in right of payment, but senior to the senior subordinated securities.
For this purpose, “senior debt” generally includes any indebtedness that does not expressly provide that it is on
a parity with or subordinated in right of payment to the senior subordinated debt securities. Specifically, senior debt includes
obligations under any credit facility with banks or other institutional lenders and obligations under the senior debt securities
described in this prospectus. Senior debt will not include:
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any
liability for federal, state, local or other taxes;
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|
any
indebtedness to any of our subsidiaries or other affiliates;
|
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|
any
indebtedness that we may incur in violation of the senior subordinated indenture; or
|
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●
|
obligations
under any subordinated debt securities.
|
If
we distribute our assets to creditors upon any dissolution, winding-up, liquidation or reorganization or in bankruptcy, insolvency,
receivership or similar proceedings, we must first pay all amounts due or to become due on all senior debt before we pay the principal
of, or make any other payment on, the senior subordinated debt securities. The provisions of the senior subordinated debt indenture
providing these payment restrictions will not limit the right, if any, of a holder of senior subordinated debt securities to convert
the debt securities into equity securities.
We
may not make any payment on the senior subordinated debt securities if a default in the payment of the principal, interest or
premium, if any, including a default under any repurchase or redemption obligation in respect of designated senior debt, occurs
and continues beyond any applicable grace period. We may not make any payment on the senior subordinated debt securities if any
other default occurs and continues with respect to designated senior debt that permits holders of the designated senior debt to
accelerate its maturity and the trustee receives a notice of default from any person permitted to give notice. We may not resume
payments on the senior subordinated debt securities until the defaults are cured or specified time periods pass, unless the senior
debt is paid in full. The provisions of the senior subordinated debt indenture providing these payment restrictions will not limit
the right, if any, of a holder of senior subordinated debt securities to convert the debt securities into equity securities.
The
term “designated senior debt” means our obligations under our principal bank or other institutional credit facility,
if any, and any other debt expressly designated as senior debt with respect to the applicable senior subordinated debt securities.
We
expect that the terms of some of our senior debt will provide that an event of default under the senior subordinated debt securities
or an acceleration of their maturity will constitute an event of default under the senior debt. In that case, if the maturity
of the senior subordinated debt securities is accelerated because of an event of default, we may not make any payment on the senior
subordinated debt securities until we have paid all senior debt or the acceleration has been rescinded. If the payment of the
senior subordinated debt securities is accelerated because of an event of default, we must promptly notify the holders of senior
debt of the acceleration.
If
we experience a bankruptcy, dissolution or reorganization, holders of senior debt may receive more, ratably, and holders of the
senior subordinated debt securities may receive less, ratably, than our other creditors.
The
indenture for senior subordinated debt securities may not limit our ability to incur additional senior debt.
Events
of Default. The following, among others, are events of default under a series of senior subordinated debt securities:
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●
|
we
fail to pay the principal, premium, if any, or any sinking fund payment on any securities of that series when due;
|
|
●
|
we
fail to pay interest on any securities of that series when due and that failure continues for a period of 30 days;
|
|
●
|
upon
exercise of a holder’s conversion right, we fail to deliver conversion consideration in accordance with the indenture;
|
|
●
|
we
fail to comply with our obligations in the event of a consolidation, merger or sale of assets, as set forth in the indenture;
|
|
●
|
we
fail to observe or perform any other covenant or agreement in the senior subordinated indenture for the benefit of that series
(other than a covenant or agreement with respect to which a failure to observe or perform is dealt with otherwise in the senior
subordinated indenture or is expressly included in the senior subordinated indenture solely for the benefit of a series of
debt securities other than such series of debt securities) and that failure continues for 90 days after we receive notice
to comply from the trustee or holders of at least 25% in aggregate principal amount of the outstanding senior subordinated
debt securities;
|
|
●
|
we
fail to pay our indebtedness or to pay or discharge certain final judgments against us, as set forth in the indenture; and
|
|
●
|
certain
events of bankruptcy or insolvency occur, whether voluntary or not.
|
The
indenture and prospectus supplement relating to a series of senior subordinated debt securities may describe additional or different
events of default that apply to that series. An event of default with respect to one series of senior subordinated debt securities
will not necessarily constitute an event of default with respect to any other series of senior subordinated debt securities.
If
a default or an event of default occurs and is continuing, the trustee will mail to the holders of senior subordinated debt securities
of the affected series a notice to that effect within 90 days after the default occurs, if a responsible officer of the trustee
under the indenture has actual knowledge of the default or event of default.
Except
in the case of a default in the payment of principal or interest, the trustee under the senior subordinated indenture may withhold
notice if, and so long as, a committee of the trustee’s responsible officers in good faith determines that withholding the
notice is in the interests of the holders.
If
an event of default with respect to one or more series of senior subordinated debt securities occurs and is continuing, the trustee
or the holders of at least 25% in aggregate principal amount of the then outstanding senior subordinated debt securities of all
series with respect to which the event of default occurs and is continuing, treating all those series as a single class, may declare
all the principal of, accrued and unpaid interest and premium (or such lesser amount as may be provided for in the senior subordinated
debt securities of the series), if any (subject to applicable subordination provisions in the senior subordinated indenture) of
all the senior subordinated debt securities of those series, to be immediately due and payable. The holders of a majority in aggregate
principal amount of the then outstanding senior subordinated debt securities of all series covered by such declaration may annul
and rescind the declaration and any related payment default that resulted from the declaration but not any other payment default.
Certain events of bankruptcy and insolvency will result in all outstanding series of senior subordinated debt securities becoming
due and payable immediately without any further action on the part of the trustee or the holders.
The
senior subordinated indenture entitles the trustee to be indemnified by the holders before proceeding to exercise any right or
power at the request of any of the holders.
The
holders of a majority in principal amount of the outstanding senior subordinated debt securities of all series with respect to
which an event of default occurs and is continuing, treating all those series as a single class, may direct the time, method and
place of conducting any proceeding for any remedy available to the trustee or exercising any trust power conferred on it, except
that:
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●
|
the
direction cannot conflict with any law or regulation or the indenture;
|
|
●
|
the
trustee may take any other action deemed proper by the trustee that is not inconsistent with the direction; and
|
|
●
|
the
trustee need not take any action that might subject it to personal liability or be unduly prejudicial to the holders of the
senior subordinated debt securities not joining in the action.
|
A
holder may pursue a remedy directly under the senior subordinated indenture or a particular series of senior subordinated debt
securities but, before doing so, the following must occur:
|
●
|
the
holder must give to the trustee written notice that an event of default has occurred and is continuing;
|
|
●
|
the
holders of at least 25% in principal amount of the then outstanding senior subordinated debt securities of all affected series,
treating all those series as a single class, must make a written request to the trustee to pursue the remedy;
|
|
●
|
the
holder, or holders, must offer and, if requested, provide to the trustee an indemnity satisfactory to the trustee against
any loss, liability or expense from the taking of the action;
|
|
●
|
the
trustee does not comply with the request within 60 days after receipt of the request and offer and, if requested, the provision
of indemnity; and
|
|
●
|
during
the 60-day period, the holders of a majority in principal amount of the then outstanding senior subordinated debt securities
of all affected series, treating all those series as a single class, do not give the trustee a direction inconsistent with
the written request.
|
However,
holders have an absolute right to receipt of principal, interest or premium, if any, on or after the respective due dates and
to institute suit for the enforcement of those payments. The right of a holder of senior subordinated debt securities to bring
suit for the enforcement of any payments of principal, interest or premium, if any, on senior subordinated debt securities on
or after the respective due dates, without regard to acceleration or default, may not be impaired or affected without the consent
of that holder.
The
holders of a majority in principal amount of the senior subordinated debt securities then outstanding of all affected series,
treating all those series as a single class, may, by notice to the trustee on behalf of all holders of the senior subordinated
debt securities of those series, waive any past defaults, except:
|
●
|
a
continuing default in payment of the principal of, interest or premium, if any, on, or any sinking fund payment on, senior
subordinated debt securities of the series;
|
|
●
|
a
continuing default in respect of a covenant or provision of the indenture that cannot be amended or modified without the consent
of each holder of senior subordinated debt securities affected;
|
|
●
|
one
arising from a failure to pay or deliver to converting holders consideration due upon conversion; and
|
|
●
|
in
respect of a covenant or provision that under the senior subordinated indenture cannot be modified or amended without the
consent of the holder of each outstanding note affected.
|
We
periodically will file statements with the trustees regarding our compliance with covenants in the senior subordinated indenture.
Modifications
and Amendments. Except as provided below, or more fully specified in the senior subordinated indenture and described in the
applicable prospectus supplement, the senior subordinated indenture may be amended or supplemented by us and the trustee with
the consent of holders of a majority in principal amount of all series of senior subordinated debt securities affected by the
amendment or supplement, treating all such series as a single class. In addition, the record holders of a majority in principal
amount of the outstanding senior subordinated debt securities of all series affected by the waiver, treating all such series as
a single class, may, with respect to those series, waive defaults under, or compliance with, the provisions of the senior subordinated
indenture. Some amendments or waivers, however, require the consent of each holder of any senior subordinated debt security affected.
Without the consent of each affected holder, an amendment or waiver regarding a series of senior subordinated debt securities
may not:
|
●
|
change
the maturity date, or the payment date of any installment interest on, any securities;
|
|
●
|
reduce
the principal amount of, or interest on, any securities;
|
|
●
|
change
the place, manner or currency of payment of principal of, or interest on, any securities;
|
|
●
|
impair
the right to institute a suit for the enforcement of any payment on, or with respect to, or of the conversion of, any security;
|
|
●
|
change
the ranking of the securities in a manner adverse to the holders of securities;
|
|
●
|
adversely
affect the right of holders of securities to convert their securities in accordance with the indenture, or reduce the amount
of consideration due upon conversion;
|
|
●
|
reduce
the percentage in aggregate principal amount of outstanding securities whose holders must consent to a modification or amendment
of the indenture or the securities;
|
|
●
|
reduce
the percentage in aggregate principal amount of outstanding securities whose holders must consent to a waiver of compliance
with any provision in the indenture, or the securities or a waiver of any default or event of default; or
|
|
●
|
modify
the applicable provisions of the indenture, except to increase the percentage required for modification or waiver or to provide
for the consent of each affected holder.
|
We
and the trustee under the senior subordinated indenture may amend or supplement the senior subordinated indenture or the senior
subordinated debt securities of any series issued thereunder without the consent of any holder to:
|
●
|
provide
for the assumption by a successor company of the Company’s obligations under the securities and the indenture;
|
|
●
|
add
guarantees with respect to the securities;
|
|
●
|
add
to the covenants for the benefit of the holders or surrender any right or power conferred upon the Company;
|
|
●
|
make
any change, including to cure any omission, ambiguity, manifest error or defect or to correct any inconsistency in the indenture
that does not adversely affect the rights of any holder in any material respect;
|
|
●
|
comply
with any requirement of the SEC in connection with the qualification of the indenture under the Trust Indenture Act or with
the rules of any applicable securities depositary;
|
|
●
|
provide
for the issuance of and establish the form and terms and conditions of the securities of any series, to establish the form
of any certifications required to be furnished, or to add to the rights of the holders of any series of securities;
|
|
●
|
add
additional events of default;
|
|
●
|
evidence
the acceptance or appointment of a successor trustee or to add an additional trustee or agent in accordance with the indenture;
or
|
|
●
|
conform
the provisions of the indenture and the securities to the “Description of Notes” section as set forth in a preliminary
prospectus supplement related to the offering and sale of the securities, as supplemented by the related pricing term sheet.
|
Particular
Terms of the Subordinated Debt Securities
Ranking
of Subordinated Debt Securities. The subordinated debt securities will be subordinated and junior in right of payment to any
senior debt securities and senior subordinated debt securities issued by us, as well as certain other indebtedness incurred by
us to the extent set forth in the applicable indenture described in the prospectus supplement relating to a series of subordinated
debt securities.
Subordination.
Unless the prospectus supplement relating to a series of subordinated debt securities indicates otherwise, the subordination provisions
of the subordinated debt securities will be the same as those of the senior subordinated debt securities just described, except
that:
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|
“Senior
debt” will include our obligations under the senior subordinated debt securities, as well as under the other debt specified
above, including the “designated senior debt;” and
|
|
●
|
different
series of subordinated debt securities may rank senior to other series. In that case, our obligations under the higher-ranking
series will be “senior debt” in relation to the lower-ranking series, as set forth in the prospectus supplement.
|
The
subordinated indenture does not limit the amount of additional senior debt that we may incur. We expect from time to time to incur
additional indebtedness constituting senior debt.
Events
of Default. The following, among others, are events of default under a series of subordinated debt securities:
|
●
|
we
fail to pay the principal, premium, if any, or any sinking fund payment on any securities of that series when due;
|
|
●
|
we
fail to pay interest on any securities of that series when due and that failure continues for a period of 30 days;
|
|
●
|
upon
exercise of a holder’s conversion right, we fail to deliver conversion consideration in accordance with the indenture;
|
|
●
|
we
fail to comply with our obligations in the event of a consolidation, merger or sale of assets, as set forth in the indenture;
|
|
●
|
we
fail to observe or perform any other covenant or agreement in the subordinated indenture for the benefit of that series (other
than a covenant or agreement with respect to which a failure to observe or perform is dealt with otherwise in the subordinated
indenture or is expressly included in the subordinated indenture solely for the benefit of a series of debt securities other
than such series of debt securities) and that failure continues for 90 days after we receive notice to comply from the trustee
or holders of at least 25% in aggregate principal amount of the outstanding subordinated debt securities;
|
|
●
|
we
fail to pay our indebtedness or to pay or discharge certain final judgments against us, as set forth in the indenture; and
|
|
●
|
certain
events of bankruptcy or insolvency occur, whether voluntary or not.
|
The
indenture and prospectus supplement relating to a series of subordinated debt securities may describe additional or different
events of default that apply to that series. An event of default with respect to one series of subordinated debt securities will
not necessarily constitute an event of default with respect to any other series of subordinated debt securities.
If
a default or an event of default occurs and is continuing, the trustee will mail to the holders of subordinated debt securities
of the affected series a notice to that effect within 90 days after the default occurs, if a responsible officer of the trustee
under the indenture has actual knowledge of the default or event of default. Except in the case of a default in the payment of
principal or interest, the trustee under the subordinated indenture may withhold notice if, and so long as, a committee of the
trustee’s responsible officers in good faith determines that withholding the notice is in the interests of the holders.
If
an event of default with respect to one or more series of subordinated debt securities occurs and is continuing, the trustee or
the holders of at least 25% in aggregate principal amount of the then outstanding subordinated debt securities of all series with
respect to which the event of default occurs and is continuing, treating all those series as a single class, may declare all the
principal of, accrued and unpaid interest and premium (or a lesser amount as may be provided for in the subordinated debt securities
of the series), if any, (subject to applicable subordination provisions in the relevant indenture) of all the subordinated debt
securities of those series to be immediately due and payable. The holders of a majority in aggregate principal amount of the then
outstanding subordinated debt securities of all series covered by such declaration may annul and rescind the declaration and any
related payment default that resulted from the declaration but not any other payment default. Certain events of bankruptcy and
insolvency will result in all outstanding series of subordinated debt securities becoming due and payable immediately without
any further action on the part of the trustee or the holders.
The
subordinated indenture entitles the trustee to be indemnified by the holders before proceeding to exercise any right or power
at the request of any of the holders.
The
holders of a majority in principal amount of the outstanding subordinated debt securities of all series with respect to which
an event of default occurs and is continuing and that rank equal with each other, treating all those series as a single class,
may direct the time, method and place of conducting any proceeding for any remedy available to the trustee or exercising any trust
power conferred on it with respect to those series, except that:
|
●
|
the
direction cannot conflict with any law or regulation or the subordinated indenture;
|
|
●
|
the
trustee may take any other action deemed proper by the trustee that is not inconsistent with the direction; and
|
|
●
|
the
trustee need not take any action that might subject it to personal liability or be unduly prejudicial to the holders of the
subordinated debt securities not joining in the action.
|
A
holder may pursue a remedy directly under the subordinated indenture or a particular series of subordinated debt securities but,
before doing so, the following must occur:
|
●
|
the
holder must give to the trustee written notice that an event of default has occurred and is continuing;
|
|
●
|
the
holders of at least 25% in principal amount of the then outstanding subordinated debt securities of all affected series that
rank equal with each other, treating all those series as a single class, must make a written request to the trustee to pursue
the remedy;
|
|
●
|
the
holder, or holders, must offer and, if requested, provide to the trustee an indemnity satisfactory to the trustee against
any loss, liability or expense from the taking of the action;
|
|
●
|
the
trustee does not comply with the request within 60 days after receipt of the request and offer and, if requested, the provision
of indemnity; and
|
|
●
|
during
the 60-day period, the holders of a majority in principal amount of the then outstanding subordinated debt securities of all
those series, treating all those series as a single class, do not give the trustee a direction inconsistent with the written
request.
|
However,
holders have an absolute right to receipt of principal, interest and premium, if any, on or after the respective due dates and
to institute suit for the enforcement of those payments. The right of a holder of subordinated debt securities to bring suit for
the enforcement of any payments of principal, interest and premium, if any, on subordinated debt securities on or after the respective
due dates may not be impaired or affected without the consent of that holder.
The
holders of a majority in principal amount of the then outstanding subordinated debt securities of all affected series that rank
equal with each other treating all such series as a single class, may, by notice to the trustee on behalf of all holders of the
subordinated debt securities of such series, waive any past defaults, except:
|
●
|
a
continuing default in payment of the principal of, interest or premium, if any, on, or any sinking fund payment on, subordinated
debt securities of the series;
|
|
●
|
a
continuing default in respect of a covenant or provision of the indenture that cannot be amended or modified without the consent
of each holder of subordinated debt securities affected;
|
|
●
|
one
arising from a failure to pay or deliver to converting holders consideration due upon conversion; and
|
|
●
|
in
respect of a covenant or provision that under the subordinated indenture cannot be modified or amended without the consent
of the holder of each outstanding note affected.
|
We
periodically will file statements with the trustee regarding our compliance with covenants in the subordinated indenture.
Modifications
and Amendments. Except as provided below, or more fully specified in the subordinated indenture and described in the applicable
prospectus supplement, the subordinated indenture may be amended or supplemented by us and the trustee with the consent of holders
of a majority in principal amount of all affected series of subordinated debt securities that rank equal with each other, treating
all such series as a single class. In addition, the record holders of a majority in principal amount of the outstanding subordinated
debt securities of all series affected by the waiver that rank equal with each other, treating such series as a single class,
may, with respect to those series, waive defaults under, or compliance with, the provisions of the subordinated indenture. Some
amendments or waivers, however, require the consent of each holder of any subordinated debt security affected. Without the consent
of each affected holder, an amendment or waiver regarding a series of subordinated debt securities may not:
|
●
|
change
the maturity date, or the payment date of any installment interest on, any securities;
|
|
●
|
reduce
the principal amount of, or interest on, any securities;
|
|
●
|
change
the place, manner or currency of payment of principal of, or interest on, any securities;
|
|
●
|
impair
the right to institute a suit for the enforcement of any payment on, or with respect to, or of the conversion of, any security;
|
|
●
|
change
the ranking of the securities in a manner adverse to the holders of securities;
|
|
●
|
adversely
affect the right of holders of securities to convert their securities in accordance with the indenture, or reduce the amount
of consideration due upon conversion;
|
|
●
|
reduce
the percentage in aggregate principal amount of outstanding securities whose holders must consent to a modification or amendment
of the indenture or the securities;
|
|
●
|
reduce
the percentage in aggregate principal amount of outstanding securities whose holders must consent to a waiver of compliance
with any provision in the indenture, or the securities or a waiver of any default or event of default; or
|
|
●
|
modify
the applicable provisions of the indenture, except to increase the percentage required for modification or waiver or to provide
for the consent of each affected holder.
|
We
and the trustee under the subordinated indenture may amend or supplement the subordinated indenture or the subordinated debt securities
issued thereunder without the consent of any holder to:
|
●
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provide
for the assumption by a successor company of the Company’s obligations under the securities and the indenture;
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add
guarantees with respect to the securities;
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add
to the covenants for the benefit of the holders or surrender any right or power conferred upon the Company;
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make
any change, including to cure any omission, ambiguity, manifest error or defect or to correct any inconsistency in the indenture
that does not adversely affect the rights of any holder in any material respect;
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comply
with any requirement of the SEC in connection with the qualification of the indenture under the Trust Indenture Act or with
the rules of any applicable securities depositary;
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provide
for the issuance of and establish the form and terms and conditions of the securities of any series, to establish the form
of any certifications required to be furnished, or to add to the rights of the holders of any series of securities;
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add
additional events of default;
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evidence
the acceptance or appointment of a successor trustee or to add an additional trustee or agent in accordance with the indenture;
or
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conform
the provisions of the indenture and the securities to the “Description of Notes” section as set forth in a preliminary
prospectus supplement related to the offering and sale of the securities, as supplemented by the related pricing term sheet.
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DESCRIPTION
OF CAPITAL STOCK
In
the discussion that follows, we have summarized selected provisions of our certificate of incorporation and bylaws. You should
read our certificate of incorporation and bylaws as currently in effect for more details regarding the provisions we describe
below and for other provisions that may be important to you. We have filed copies of those documents with the SEC, and they are
incorporated by reference herein. Please read “Where You Can Find More Information.”
Authorized
and Outstanding Capital Stock
The
following description of our common stock and provisions of our certificate of incorporation and bylaws are summaries and are
qualified by reference to our certificate of incorporation and bylaws, which have been incorporated by reference as exhibits to
the registration statement of which this prospectus forms a part.
Our
authorized capital stock consists of 100,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred
stock, par value $0.001 per share, all of which are undesignated.
As
of November 18, 2020, there were 28,470,138 shares of common stock outstanding, and no shares of preferred stock were issued or
outstanding. As of November 18, 2020, there also were outstanding options representing the right to purchase a total of 531,506
shares of common stock at a weighted average exercise price of approximately $3.02 per share, (ii) warrants to purchase up to
7,298 shares of our common stock which are exercisable at a price of $121.60, (iii) warrants to purchase up to 8,925 shares of
our common stock which are exercisable at a price of $187.20, and (iv) warrants to purchase up to 4,927,680 shares of our common
stock which are exercisable at a price of $3.85.
Description
of Common Stock
Voting.
Holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders and do
not have cumulative voting rights. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election
of directors may elect all of the directors standing for election.
Dividends.
Holders of common stock are entitled to receive proportionately any dividends that may be declared by our Board, subject to any
preferential dividend rights of outstanding preferred stock.
Liquidation
and Distribution. Upon our liquidation, dissolution or winding up, the holders of common stock are entitled to receive proportionately
our net assets available after the payment of all debts and other liabilities and subject to the prior rights of any outstanding
preferred stock. Holders of common stock have no preemptive, subscription, redemption or conversion rights. Our outstanding shares
of common stock are, and the shares offered by us in this offering will be, when issued and paid for, fully paid and nonassessable.
The rights, preferences and privileges of holders of common stock are subject to, and may be adversely affected by, the rights
of the holders of shares of any series of preferred stock that we may designate and issue in the future.
Anti-Takeover
Effects of Delaware Law; Our Certificate of Incorporation and Our Bylaws
Delaware
law, our certificate of incorporation and our bylaws contain provisions that could have the effect of delaying, deferring or discouraging
another party from acquiring control of us. These provisions, which are summarized below, are intended to discourage coercive
takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control
of us to first negotiate with our Board.
Removal
of Directors
Our
certificate of incorporation currently provides that directors may be removed only for cause and only by the affirmative vote
of the holders of 75% of our shares of capital stock present in person or by proxy and entitled to vote. However, our Board of
Directors approved an amendment to our bylaws that became effective on June 17, 2016, which permits our directors to be removed
either for cause or without cause by our stockholders. At our annual meeting of stockholders for the year ended April 30, 2016
that was held on October 21, 2016 (the “2016 Annual Meeting”), we submitted a proposal to stockholders seeking stockholder
approval to amend our certificate of incorporation to delete the reference to “for cause” in Section 6 of Article
IX of the certificate of incorporation. This proposal to amend the certificate of incorporation did not receive the required affirmative
vote of the holders of at least 75% of the outstanding shares of common stock entitled to vote at the meeting, so the proposal
did not pass. However, we also submitted a proposal to stockholders at the 2016 Annual Meeting seeking approval to amend our certificate
of incorporation to add a clause that specified that, to the fullest extent permitted by law, any provision in the Certificate
of Incorporation that is contrary to a requirement of the Delaware General Corporate Law (the “DGCL”) shall be read
in conformity with the applicable requirement of the DGCL. This second proposal only required the affirmative vote of the holders
of a majority of the outstanding shares of common stock entitled to vote at the 2016 Annual Meeting, and it passed.
Our
Board of Directors takes the position that under current Delaware law, the “only for cause” provision in the certificate
of incorporation regarding removal of the company’s directors is not enforceable and is therefore not in conformity with
the applicable requirement of the DGCL. Accordingly, we will comply with the provisions of our bylaws, as amended and as described
above, relating to director removal and will not seek to enforce that provision of our certificate of incorporation relating to
stockholder removal of directors only for cause, as presently in effect. Under our certificate of incorporation and bylaws, any
vacancy on the Board, including a vacancy resulting from an enlargement of the Board, may be filled only by vote of a majority
of our directors then in office.
The
limitations on the ability of our stockholders to remove directors and fill vacancies could make it more difficult for a third
party to acquire, or discourage a third party from seeking to acquire, control of us.
Stockholder
Action by Written Consent; Special Meetings
Our
certificate of incorporation provides that any action required or permitted to be taken by our stockholders must be effected at
a duly called annual or special meeting of such holders and may not be effected by any consent in writing by such holders. Our
certificate of incorporation and our bylaws also provide that, except as otherwise required by law, special meetings of our stockholders
can only be called by our chairman of the board, our chief executive officer, our president or the Board.
Advance
Notice Requirements for Stockholder Proposals
Our
bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of stockholders,
including proposed nominations of persons for election to the Board. Stockholders at an annual meeting may only consider proposals
or nominations specified in the notice of meeting or brought before the meeting by or at the direction of the Board of Directors
or by a stockholder of record on the record date for the meeting, that is entitled to vote at the meeting and that has delivered
to our secretary a timely written notice in proper form of the stockholder’s intention to bring such business before the
meeting. These provisions could have the effect of delaying until the next stockholder meeting stockholder actions that are favored
by the holders of a majority of our outstanding voting securities.
Delaware
Business Combination Statute
We
are subject to Section 203 of the Delaware General Corporation Law. Subject to certain exceptions, Section 203 prevents a publicly
held Delaware corporation from engaging in a “business combination” with any “interested stockholder”
for three years following the date that 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.
A “business combination” includes, among other things, a 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 outstanding voting stock and any entity or person affiliated with or controlling
or controlled by such entity or person.
Amendment
of Certificate of Incorporation and Bylaws
The
Delaware General Corporation Law provides generally that the affirmative vote of a majority of the shares entitled to vote on
any matter is required to amend a corporation’s certificate of incorporation or bylaws, unless a corporation’s certificate
of incorporation or bylaws, as the case may be, requires a greater percentage. Our bylaws may be amended or repealed by a majority
vote of our Board of Directors or the affirmative vote of the holders of at least 75% of the voting power of our capital stock
issued and outstanding and entitled to vote on the matter.
Limitation
of Liability and Indemnification of Officers and Directors
Our
certificate of incorporation limits the personal liability of directors for breach of fiduciary duty to the maximum extent permitted
by the Delaware General Corporation Law. Our certificate of incorporation provides that no director will have personal liability
to us or to our stockholders for monetary damages for breach of fiduciary duty or other duty as a director. However, these provisions
do not eliminate or limit the liability of any of our directors:
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for
any breach of their duty of loyalty to us or our stockholders;
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for
acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;
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for
voting or assenting to unlawful payments of dividends or other distributions; or
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for
any transaction from which the director derived an improper personal benefit.
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Any
amendment to or repeal of these provisions will not eliminate or reduce the effect of these provisions in respect of any act or
failure to act, or any cause of action, suit or claim that would accrue or arise prior to any amendment or repeal or adoption
of an inconsistent provision. If the Delaware General Corporation Law is amended to provide for further limitations on the personal
liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent
permitted by the Delaware General Corporation Law.
In
addition, our certificate of incorporation provides that we must indemnify our directors and officers and we must advance expenses,
including attorneys’ fees, to our directors and officers in connection with legal proceedings, subject to limited exceptions.
Notice
of Share Ownership
Our
bylaws contain a provision requiring any beneficial owner of three percent or more of our outstanding common stock to notify us
of his or her stockholdings, as well as of any change in his or her beneficial ownership of one percent or more of our outstanding
common stock. Our bylaws do not provide for any specific remedy in the event a stockholder does not comply with this provision.
We do not intend to make any such information public, unless required by law or the rules of the SEC or the Nasdaq Capital Market.
Authorized
but Unissued Shares
Our
authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval,
subject to any limitations imposed by the listing standards of the Nasdaq Capital Market. These additional shares may be used
for a variety of corporate finance transactions, acquisitions and employee benefit plans. The existence of authorized but unissued
and unreserved common stock and preferred stock could make it more difficult or discourage an attempt to obtain control of us
by means of a proxy contest, tender offer, merger or otherwise.
Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is Computershare Trust Company, N.A. Its address is 462 South 4th Street, Suite
1600, Louisville, KY 40202, and its telephone number is 1-800-662-7232.
Our
common stock is listed on the Nasdaq Capital Market under the symbol “OPTT.”
DESCRIPTION
OF DEPOSITARY SHARES
General
We
may, at our option, elect to have shares of preferred stock be represented by depositary shares. The shares of any series of the
preferred stock underlying the depositary shares will be deposited under a separate deposit agreement between us and a bank or
trust company selected by us as the depositary. Subject to the terms of the deposit agreement, each owner of a depositary share
will be entitled, in proportion to the applicable interest in the number of shares of preferred stock underlying such depositary
share, to all the rights and preferences of the preferred stock underlying such depositary share, including dividend, voting,
redemption, conversion, exchange and liquidation rights.
The
depositary shares will be evidenced by depositary receipts issued pursuant to the deposit agreement, each of which will represent
the applicable interest in a number of shares of a particular series of the preferred stock described in the applicable prospectus
supplement.
Unless
otherwise specified in this prospectus supplement, a holder of depositary shares is not entitled to receive the shares of preferred
stock underlying the depositary shares.
Dividends
and Other Distributions
The
depositary will distribute all cash dividends or other cash distributions received in respect of the preferred stock to the record
holders of depositary shares representing such preferred stock in proportion to the numbers of such depositary shares owned by
such holders on the relevant record date.
In
the event of a distribution other than in cash, the depositary will distribute property received by it to the record holders of
depositary shares entitled thereto or the depositary may, with our approval, sell such property and distribute the net proceeds
from such sale to such holders.
Redemption
of Depositary Shares
If
preferred stock underlying the depositary shares is subject to redemption, the depositary shares will be redeemed from the proceeds
received by the depositary resulting from the redemption, in whole or in part, of the preferred stock held by the depositary.
The redemption price per depositary share will be equal to the aggregate redemption price payable with respect to the number of
shares of preferred stock underlying the depositary shares. Whenever we redeem preferred stock from the depositary, the depositary
will redeem as of the same redemption date a proportionate number of depositary shares representing the shares of preferred stock
that were redeemed. If less than all the depositary shares are to be redeemed, the depositary shares to be redeemed will be selected
by lot, pro rata or by another equitable method as may be determined by us.
After
the date fixed for redemption, the depositary shares so called for redemption will no longer be deemed to be outstanding and all
rights of the holders of the depositary shares will cease, except the right to receive the redemption price payable upon such
redemption. Any funds deposited by us with the depositary for any depositary shares which the holders thereof fail to redeem shall
be returned to us after a period of two years from the date such funds are so deposited.
Voting
Upon
receipt of notice of any meeting or action in lieu of any meeting at which the holders of any shares of preferred stock underlying
the depositary shares are entitled to vote, the depositary will mail the information contained in such notice to the record holders
of the depositary shares relating to such preferred stock. Each record holder of such depositary shares on the record date (which
will be the same date as the record date for the preferred stock) will be entitled to instruct the depositary as to the exercise
of the voting rights pertaining to the number of shares of preferred stock underlying such holder’s depositary shares. The
depositary will endeavor, insofar as practicable, to vote the number of shares of preferred stock underlying such depositary shares
in accordance with such instructions, and we will agree to take all action which may be deemed necessary by the depositary in
order to enable the depositary to do so.
Amendment
of the Depositary Agreement
The
form of depositary receipt evidencing the depositary shares and any provision of the deposit agreement may at any time be amended
by agreement between us and the depositary, provided, however, that any amendment which materially and adversely alters the rights
of the existing holders of depositary shares will not be effective unless such amendment has been approved by at least a majority
of the depositary shares then outstanding.
Charges
of Depositary
We
will pay all transfer and other taxes and governmental charges that arise solely from the existence of the depositary arrangements.
We will pay charges of the depositary in connection with the initial deposit of the preferred stock and any exchange or redemption
of the preferred stock. Holders of depositary shares will pay all other transfer and other taxes and governmental charges, and,
in addition, such other charges as are expressly provided in the deposit agreement to be for their accounts.
Miscellaneous
We,
or at our option, the depositary, will forward to the holders of depositary shares all reports and communications from us which
we are required to furnish to the holders of preferred stock.
Neither
the depositary nor we will be liable if either of us is prevented or delayed by law or any circumstances beyond our control in
performing our obligations under the deposit agreement. Our obligations and those of the depositary under the deposit agreement
will be limited to performance in good faith of our duties thereunder and we and the depositary will not be obligated to prosecute
or defend any legal proceeding in respect of any depositary share or preferred stock unless satisfactory indemnity has been furnished.
We and the depositary may rely upon written advice of counsel or accountants, or information provided by persons presenting preferred
stock for deposit, holders of depositary shares or other persons believed to be competent and on documents believed to be genuine.
Resignation
and Removal of Depositary; Termination of the Deposit Agreement
The
depositary may resign at any time by delivering to us notice of its election to do so, and we may at any time remove the depositary,
any such resignation or removal to take effect upon the appointment of a successor depositary and its acceptance of such appointment.
Such successor depositary will be appointed by us within 60 days after delivery of the notice of resignation or removal. The deposit
agreement may be terminated at our direction or by the depositary if a period of 90 days has expired after the depositary has
delivered to us written notice of its election to resign and a successor depositary has not been appointed. Upon termination of
the deposit agreement, the depositary will discontinue the transfer of depositary receipts, will suspend the distribution of dividends
to the holders thereof, and will not give any further notices (other than notice of such termination) or perform any further acts
under the deposit agreement except that the depositary will continue to deliver preferred stock certificates, together with such
dividends and distributions and the net proceeds of any sales of rights, preferences, privileges or other property in exchange
for depositary receipts surrendered. Upon our request, the depositary shall deliver all books, records, certificates evidencing
preferred stock, depositary receipts and other documents relating to the subject matter of the depositary agreement to us.
DESCRIPTION
OF WARRANTS
We
may issue warrants to purchase debt securities, preferred stock, common stock, depositary shares, purchase contracts or units
that are registered pursuant to the registration statement to which this prospectus relates. We may issue warrants independently
or together with other securities that are registered pursuant to the registration statement to which this prospectus relates.
Warrants sold with other securities may be attached to or separate from the other securities. We will issue each series of warrants
under a separate warrant agreement between us and a warrant agent that we will name in the prospectus supplement. We will describe
additional terms of the warrants and the applicable warrant agreements in the applicable prospectus supplement.
General
If
warrants are offered, the prospectus supplement relating to a series of warrants will include the specific terms of the warrants,
including:
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the
offering price;
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the
title of the warrants;
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the
aggregate number of warrants offered;
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the
dates or periods during which the warrants can be exercised;
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whether
the warrants will be issued in individual certificates to holders or in the form of global securities held by a depositary
on behalf of holders;
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the
designation and terms of any securities with which the warrants are issued;
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if
the warrants are issued as a unit with another security, the date, if any, on and after which the warrants and the other security
will be separately transferable;
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if
the exercise price is not payable in U.S. dollars, the foreign currency, currency unit or composite currency in which the
exercise price is denominated;
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any
terms, procedures and limitations relating to the transferability, exchange or exercise of the warrants;
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any
special tax implications of the warrants or their exercise;
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any
antidilution provisions of the warrants;
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any
redemption or call provisions applicable to the warrants; and
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any
other terms of the warrants.
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Transfers
and Exchanges
A
holder will be able to exchange warrant certificates for new warrant certificates of different denominations, or to transfer warrants,
at the corporate trust office of the warrant agent or any other office indicated in the prospectus supplement. Prior to exercise,
holders of warrants will have none of the rights of holders of the underlying securities.
Exercise
Holders
will be able to exercise warrants up to 5:00 P.M. New York City time on the date set forth in the prospectus supplement as the
expiration date.
After
this time, unless we have extended the expiration date, the unexercised warrants will be void.
Subject
to any restrictions and additional requirements that may be set forth in a prospectus supplement, holders of warrants may exercise
them by delivering to the warrant agent at its corporate trust office the following:
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warrant
certificates properly completed; and
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payment
of the exercise price.
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As
soon as practicable after the delivery, we will issue and deliver to the indicated holder the securities purchasable upon exercise.
If a holder does not exercise all the warrants represented by a particular certificate, we will also issue a new certificate for
the remaining number of warrants.
No
Rights of Security Holder Prior to Exercise
Prior
to the exercise of their warrants, holders of warrants will not have any of the rights of holders of the securities purchasable
upon the exercise of the warrants, and will not be entitled to:
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in
the case of warrants to purchase debt securities, payments of principal of, premium, if any, or interest, if any, on the debt
securities purchasable upon exercise; or
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in
the case of warrants to purchase equity securities, the right to vote or to receive dividend payments or similar distributions
on the securities purchasable upon exercise
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Enforceability
of Rights by Holders of Warrants
Each
warrant agent will act solely as our agent under the relevant warrant agreement and will not assume any obligation or relationship
of agency or trust for any warrant holder. A single bank or trust company may act as warrant agent for more than one issue of
warrants. A warrant agent will have no duty or responsibility if we default in performing our obligations under the relevant warrant
agreement or warrant, including any duty or responsibility to initiate any legal proceedings or to make any demand upon us.
Title
We
and the warrant agents and any of our respective agents may treat the registered holder of any warrant certificate as the absolute
owner of the warrants evidenced by that certificate for any purpose and as the person entitled to exercise the rights attaching
to the warrants so requested, despite any notice to the contrary.
DESCRIPTION
OF SUBSCRIPTION RIGHTS
We
may issue subscription rights to purchase common stock, preferred stock, depositary shares, other securities described in this
prospectus or any combination thereof. These subscription rights may be issued independently or together with any other security
offered by us and may or may not be transferable by the securityholder receiving the subscription rights in such offering. In
connection with any offering of subscription rights, we may enter into a standby arrangement with one or more underwriters or
other investors pursuant to which the underwriters or other investors may be required to purchase any securities remaining unsubscribed
for after such offering.
To
the extent appropriate, the applicable prospectus supplement will describe the specific terms of the subscription rights to purchase
shares of our securities offered thereby, including the following:
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the
date of determining the securityholders entitled to the subscription rights distribution;
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the
price, if any, for the subscription rights;
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the
exercise price payable for the common stock, preferred stock, depositary shares or other securities upon the exercise of the
subscription right;
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the
number of subscription rights issued to each securityholder;
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the
amount of common stock, preferred stock, depositary shares or other securities that may be purchased per each subscription
right;
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any
provisions for adjustment of the amount of securities receivable upon exercise of the subscription rights or of the exercise
price of the subscription rights;
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the
extent to which the subscription rights are transferable;
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the
date on which the right to exercise the subscription rights shall commence, and the date on which the subscription rights
shall expire;
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the
extent to which the subscription rights may include an over-subscription privilege with respect to unsubscribed securities;
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the
material terms of any standby underwriting or purchase arrangement entered into by us in connection with the offering of subscription
rights;
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any
applicable federal income tax considerations; and
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any
other terms of the subscription rights, including the terms, procedures and limitations relating to the transferability, exchange
and exercise of the subscription rights.
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DESCRIPTION
OF PURCHASE CONTRACTS
We
may issue purchase contracts obligating holders to purchase from us, and us to sell to the holders, a specified number, or amount,
of securities at a future date or dates. The purchase contracts may be issued separately or as part of units consisting of a purchase
contract and an underlying debt or preferred security covered by this prospectus, U.S. Treasury security or other U.S. government
or agency obligation. The holder of the unit may be required to pledge the debt, preferred security, U.S. Treasury security or
other U.S. government or agency obligation to secure its obligations under the purchase contract.
If
purchase contracts are offered, the prospectus supplement will specify the material terms of the purchase contracts, the units
and any applicable pledge or depository arrangements, including one or more of the following:
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the
stated amount that a holder will be obligated to pay under the purchase contract in order to purchase the underlying security;
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the
settlement date or dates on which the holder will be obligated to purchase the underlying security and whether the occurrence
of any events may cause the settlement date to occur on an earlier date and the terms on which any early settlement would
occur;
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the
events, if any, that will cause our obligations and the obligations of the holder under the purchase contract to terminate;
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the
settlement rate, which is a number that, when multiplied by the stated amount of a purchase contract, determines the number,
or amount, of securities that we will be obligated to sell and a holder will be obligated to purchase under that purchase
contract upon payment of the stated amount of that purchase contract;
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whether
the purchase contracts will be issued separately or as part of units consisting of a purchase contract and an underlying debt
or preferred security with an aggregate principal amount or liquidation amount equal to the stated amount;
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the
type of security, if any, that is pledged by the holder to secure its obligations under a purchase contract;
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the
terms of the pledge arrangement relating to the security, including the terms on which distributions or payments of interest
and principal on the security will be retained by a collateral agent, delivered to us or be distributed to the holder; and
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the
amount of the contract fee, if any, that may be payable by us to the holder or by the holder to us, the date or dates on which
the contract fee will be payable and the extent to which we or the holder, as applicable, may defer payment of the contract
fee on those payment dates.
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DESCRIPTION
OF UNITS
As
specified in the applicable prospectus supplement, we may issue units consisting of one or more shares of common stock, shares
of preferred stock, warrants, debt securities, subscription rights, purchase contracts or any combination of such securities.
The applicable prospectus supplement will describe:
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the
securities comprising the units, including whether and under what circumstances the securities comprising the units may be
separately traded;
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the
terms and conditions applicable to the units, including a description of the terms of any applicable unit agreement governing
the units; and
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a
description of the provisions for the payment, settlement, transfer or exchange of the units.
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FOrmS
OF SECURITIES
We
may issue the debt securities, warrants, purchase contracts and units of any series in the form of one or more fully registered
global securities that will be deposited with a depositary or with a nominee for a depositary and registered in the name of the
depositary or its nominee. In that case, one or more global securities will be issued in a denomination or aggregate denominations
equal to the portion of the aggregate principal or face amount of outstanding registered securities of the series to be represented
by such global securities. Unless and until the depositary exchanges a global security in whole for securities in definitive registered
form, the global security may not be transferred except as a whole by the depositary to a nominee of the depositary or by a nominee
of the depositary to the depositary or another nominee of the depositary or by the depositary or any of its nominees to a successor
of the depositary or a nominee of such successor.
The
specific terms of the depositary arrangement with respect to any portion of a series of securities to be represented by a global
security will be described in the prospectus supplement relating to such series. We anticipate that the following provisions will
apply to all depositary arrangements.
Ownership
of beneficial interests in a global security will be limited to persons that have accounts with the depositary for such global
security known as “participants” or persons that may hold interests through such participants.
Upon
the issuance of a global security, the depositary for such global security will credit, on its book-entry registration and transfer
system, the participants’ accounts with the respective principal or face amounts of the securities represented by the global
security beneficially owned by the participants. The accounts to be credited shall be designated by any dealers, underwriters
or agents participating in the distribution of such securities.
Ownership
of beneficial interests in such global security will be shown on, and the transfer of such ownership interests will be effected
only through, records maintained by the depositary for such global security (with respect to interests of participants) and on
the records of participants (with respect to interests of persons holding through participants). The laws of some states may require
that certain purchasers of securities take physical delivery of such securities in definitive form. Such limits and such laws
may impair the ability to own, transfer or pledge beneficial interests in global securities.
So
long as the depositary for a global security, or its nominee, is the registered owner of such global security, such depositary
or such nominee, as the case may be, will be considered the sole owner or holder of the securities represented by such global
security for all purposes under the applicable indenture, warrant agreement, purchase contract or unit agreement. Except as set
forth below, owners of beneficial interests in a global security will not be entitled to have the securities represented by such
global security registered in their names, will not receive or be entitled to receive physical delivery of such securities in
definitive form and will not be considered the owners or holders thereof under the applicable indenture, warrant agreement, purchase
contract or unit agreement. Accordingly, each person owning a beneficial interest in a global security must rely on the procedures
of the depositary for the global security and, if such person is not a participant, on the procedures of the participant through
which such person owns its interest, to exercise any rights of a holder under the applicable indenture, warrant agreement, purchase
contract or unit agreement. We understand that under existing industry practices, if we request any action of holders or if an
owner of a beneficial interest in a global security desires to give or take any action which a holder is entitled to give or take
under the applicable indenture, warrant agreement, purchase contract or unit agreement, the depositary for such global security
would authorize the participants holding the relevant beneficial interests to give or take such action, and such participants
would authorize beneficial owners owning through such participants to give or take such action or would otherwise act upon the
instructions of beneficial owners holding through them.
Principal,
premium, if any, and interest payments on debt securities, and any payments to holders with respect to warrants, purchase contracts
or units represented by a global security registered in the name of a depositary or its nominee will be made to such depositary
or its nominee, as the case may be, as the registered owner of such global security. None of us, the trustees, the warrant agents,
the unit agents or any of our other agents, agent of the trustees or agent of the warrant agents or unit agents will have any
responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests
in such global security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests.
We
expect that the depositary for any securities represented by a global security, or its nominee, upon receipt of any payment of
principal, premium, interest or other distribution of underlying securities or commodities to holders in respect of such global
security, will immediately credit participants’ accounts in amounts proportionate to their respective beneficial interests
in such global security as shown on the records of such depositary or its nominee. We also expect that payments by participants
to owners of beneficial interests in such global security held through such participants will be governed by standing customer
instructions and customary practices, as is now the case with the securities held for the accounts of customers in bearer form
or registered in “street name,” and will be the responsibility of such participants.
If
the depositary for any securities represented by a global security is at any time unwilling or unable to continue as depositary
or ceases to be a clearing agency registered under the Exchange Act, and we do not appoint a successor depositary registered as
a clearing agency under the Exchange Act within 90 days, we will issue such securities in definitive form in exchange for such
global security. In addition, we may at any time and in our sole discretion determine not to have any of the securities of a series
represented by one or more global securities and, in such event, will issue securities of such series in definitive form in exchange
for all of the global security or securities representing such securities. Any securities issued in definitive form in exchange
for a global security will be registered in such name or names as the depositary shall instruct the relevant trustee, warrant
agent or other relevant agent of ours. We expect that such instructions will be based upon directions received by the depositary
from participants with respect to ownership of beneficial interests in such global security.
PLAN
OF DISTRIBUTION
We
may sell our securities from time to time through underwriters, dealers or agents or directly to purchasers, in one or more transactions
at a fixed price or prices, which may be changed, or at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. We may also sell our securities upon the exercise of subscription rights that
may be distributed to security holders. We may use these methods in any combination.
We
will describe the terms of the offering of the securities in a prospectus supplement, information incorporated by reference or
any related free writing prospectus, including:
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the
name or names of any underwriters, if any;
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the
purchase price of the securities and the proceeds we will receive from the sale;
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any
underwriting discounts and other items constituting underwriters’ compensation;
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any
initial public offering price;
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any
discounts or concessions allowed or reallowed or paid to dealers; and
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any
securities exchange or market on which the securities may be listed.
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Only
underwriters we name in the prospectus supplement, information incorporated by reference or any related free writing prospectus
are underwriters of the securities offered thereby.
The
distribution of securities may be effected, from time to time, in one or more transactions, including:
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block
transactions (which may involve crosses) and transactions on the NASDAQ or any other organized market where the securities
may be traded;
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its own account pursuant to a prospectus supplement;
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ordinary
brokerage transactions and transactions in which a broker-dealer solicits purchasers;
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sales
“at the market” to or through a market maker or into an existing trading market, on an exchange or otherwise;
and
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sales
in other ways not involving market makers or established trading markets, including direct sales to purchasers.
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By
Underwriters
We
may use an underwriter or underwriters in the offer or sale of our securities.
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If
we use an underwriter or underwriters, the offered securities will be acquired by the underwriters for their own account.
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We
will include the names of the specific managing underwriter or underwriters, as well as any other underwriters, and the terms
of the transactions, including the compensation the underwriters and dealers will receive, in the prospectus supplement.
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The
underwriters will use this prospectus and the prospectus supplement to sell our securities.
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We
may also sell securities pursuant to one or more standby agreements with one or more underwriters in connection with the call,
redemption or exchange of a specified class or series of any of our outstanding securities. In a standby agreement, the underwriter
or underwriters would agree either:
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to
purchase from us up to the number of shares of common stock that would be issuable upon conversion or exchange of all the
shares of the class or series of our securities at an agreed price per share of common stock; or
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to
purchase from us up to a specified dollar amount of offered securities at an agreed price per offered security, which price
may be fixed or may be established by formula or other method and which may or may not relate to market prices of our common
stock or any other outstanding security.
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The
underwriter or underwriters would also agree, if applicable, to convert or exchange any securities of the class or series held
or purchased by the underwriter or underwriters into or for our common stock or other security.
The
underwriter or underwriters may assist in the solicitation of conversions or exchanges by holders of the class or series of securities.
By
Dealers
We
may use a dealer to sell our securities.
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If
we use a dealer, we, as principal, will sell our securities to the dealer.
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The
dealer will then resell our securities to the public at varying prices that the dealer will determine at the time it sells
our securities.
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We
will include the name of the dealer and the terms of our transactions with the dealer in the prospectus supplement.
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If
we offer securities in a subscription rights offering to our existing security holders, we may enter into a standby underwriting
agreement with dealers, acting as standby underwriters. We may pay the standby underwriters a commitment fee for the securities
they commit to purchase on a standby basis. If we do not enter into a standby underwriting arrangement, we may retain a dealer-manager
to manage a subscription rights offering for us.
By
Agents
We
may designate agents to solicit offers to purchase our securities.
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We
will name any agent involved in offering or selling our securities and any commissions that we will pay to the agent in the
prospectus supplement.
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Unless
we indicate otherwise in the prospectus supplement, our agents will act on a best efforts basis for the period of their appointment.
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Our
agents may be deemed to be underwriters under the Securities Act of any of our securities that they offer or sell.
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By
Delayed Delivery Contracts
We
may authorize our agents and underwriters to solicit offers by certain institutions to purchase our securities at the public offering
price under delayed delivery contracts.
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If
we use delayed delivery contracts, we will disclose that we are using them in the prospectus supplement and will tell you
when we will demand payment and delivery of the securities under the delayed delivery contracts.
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These
delayed delivery contracts will be subject only to the conditions that we set forth in the prospectus supplement.
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We
will indicate in the prospectus supplement the commission that underwriters and agents soliciting purchases of our securities
under delayed delivery contracts will be entitled to receive.
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Direct
Sales
We
may directly solicit offers to purchase our securities, and we may directly sell our securities to institutional or other investors,
including our affiliates. We will describe the terms of our direct sales in the prospectus supplement. We may also sell our securities
upon the exercise of rights which we may issue.
General
Information
Underwriters,
dealers and agents that participate in the distribution of our securities may be underwriters as defined in the Securities Act,
and any discounts or commissions they receive and any profit they make on the resale of the offered securities may be treated
as underwriting discounts and commissions under the Securities Act. Any underwriters or agents will be identified and their compensation
described in a prospectus supplement. We may indemnify agents, underwriters and dealers against certain civil liabilities, including
liabilities under the Securities Act, or make contributions to payments they may be required to make relating to those liabilities.
Our agents, underwriters and dealers, or their affiliates, may be customers of, engage in transactions with or perform services
for us in the ordinary course of business.
Each
series of securities offered by this prospectus (other than common stock) may be a new issue of securities with no established
trading market. Any underwriters to whom securities offered by this prospectus are sold by us for public offering and sale may
make a market in the securities offered by this prospectus, but the underwriters will not be obligated to do so and may discontinue
any market making at any time without notice. No assurance can be given as to the liquidity of the trading market for any securities
offered by this prospectus.
Representatives
of the underwriters through whom our securities are sold for public offering and sale may engage in over-allotment, stabilizing
transactions, syndicate short covering transactions and penalty bids in accordance with Regulation M under the Exchange Act. Over-allotment
involves syndicate sales in excess of the offering size, which creates a syndicate short position. Stabilizing transactions permit
bids to purchase the offered securities so long as the stabilizing bids do not exceed a specified maximum.
Syndicate
covering transactions involve purchases of the offered securities in the open market after the distribution has been completed
in order to cover syndicate short positions. Penalty bids permit the representative of the underwriters to reclaim a selling concession
from a syndicate member when the offered securities originally sold by such syndicate member are purchased in a syndicate covering
transaction to cover syndicate short positions. Such stabilizing transactions, syndicate covering transactions and penalty bids
may cause the price of the offered securities to be higher than it would otherwise be in the absence of such transactions. These
transactions may be effected on a national securities exchange and, if commenced, may be discontinued at any time. Underwriters,
dealers and agents may be customers of, engage in transactions with or perform services for, us and our subsidiaries in the ordinary
course of business.
Fees
and Commissions
In
compliance with the guidelines of the Financial Industry Regulatory Authority, or FINRA, the aggregate maximum discount, commission
or agency fees or other items constituting underwriting compensation to be received by any FINRA member or independent broker-dealer
will not exceed 8% of any offering pursuant to this prospectus and any applicable prospectus supplement or other offering materials;
however, it is anticipated that the maximum commission or discount to be received in any particular offering of securities will
be less than this amount.
If
5% or more of the net proceeds of any offering of securities made under this prospectus will be received by a FINRA member participating
in the offering or affiliates or associated persons of such FINRA member, the offering will be conducted in accordance with FINRA
Rule 5121.
LEGAL
MATTERS
Certain
legal matters in connection with the securities offered hereby will be passed on for us by Porter Hedges LLP, Houston, Texas.
Any underwriters will be advised about other issues relating to any offering by their own legal counsel.
EXPERTS
The
consolidated financial statements of Ocean Power Technologies, Inc. and subsidiaries (the Company) as of April 30, 2020 and 2019,
and for the years then ended, have been incorporated by reference herein, in reliance upon the report of KPMG LLP, independent
registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting
and auditing.
The
audit report covering the April 30, 2020 consolidated financial statements contains an explanatory paragraph that states that
the Company’s recurring losses from operations and accumulated deficit raise substantial doubt about the Company’s
ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result
from the outcome of that uncertainty.
The
audit report covering the April 30, 2020 consolidated financial statements refers to the Company changing its method of
accounting for leases as of May 1, 2019 due to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic
842), and the related amendments.
The
information in this prospectus is not complete and may be changed. We 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 it
is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
SUBJECT
TO COMPLETION, DATED NOVEMBER 20, 2020
Prospectus
Up
to $50,000,000
Shares
of Common Stock
This
prospectus relates to the offer and sale, from time to time, of shares of our common stock
having an aggregate gross sales price of up to $50,000,000, to or through A.G.P./Alliance
Global Partners, or A.G.P., acting as our sales agent, in accordance with the terms of a sales
agreement we have entered into with A.G.P., up to a maximum of $100,000,000, which is the amount included in the registration
statement of which this prospectus is a part.
Sales
of our common stock, if any, under this prospectus will be made by any method that is deemed to be an “at the market offering”
as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended, or the Securities Act. A.G.P. is
not required to sell any specific amount of securities, but will act as our sales agent using commercially reasonable efforts
consistent with its normal trading and sales practices, on mutually agreed terms between A.G.P. and us. There is no arrangement
for funds to be received in any escrow, trust or similar arrangement.
A.G.P.
will be entitled to compensation at a fixed commission rate of 3.25% of the gross proceeds from the sale of our common stock on
our behalf as sales agent pursuant to the sales agreement. In connection with the sale of the common stock on our behalf, A.G.P.
will be deemed to be an “underwriter” within the meaning of the Securities Act, and the compensation of A.G.P. will
be deemed to be underwriting commissions or discounts. We have also agreed to provide indemnification and contribution to A.G.P.
against certain civil liabilities, including liabilities under the Securities Act. See “Plan of Distribution.”
Our
common stock is listed on The Nasdaq Capital Market under the symbol “OPTT.” The last reported sale price of our common
stock on The Nasdaq Capital Market on November 18, 2020 was $1.89 per share.
Investing
in our common stock involves a high degree of risk. See “Risk Factors” beginning on page 3 of this prospectus and
in our reports filed with the Securities and Exchange Commission which are incorporated by reference herein for a discussion
of information that should be considered in connection with an investment in our common stock.
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.
A.G.P.
The
date of this prospectus is , 2020
Table
of Contents
Prospectus
About
This Prospectus
You
should assume that the information contained in this prospectus is accurate only as of the date on the front of the applicable
document and that any information we have incorporated by reference into this prospectus is accurate only as of the date of the
document incorporated by reference, regardless of the time of delivery of this prospectus, or any sale of a security.
In
addition, we incorporate important information into this prospectus by reference. You may obtain the information incorporated
by reference into this prospectus without charge by following the instructions under “Where You Can Find More Information”
in this prospectus. We urge you to carefully read this prospectus and the information incorporated by reference before buying
any of the securities being offered under this prospectus.
To
the extent that any statement that we make in this prospectus or any documents incorporated by reference herein or therein, the
statements made in this prospectus will be deemed to modify or supersede those made in such documents incorporated by reference
herein or therein.
You
should rely only on the information contained, or incorporated herein by reference, in this prospectus and contained, or incorporated
herein by reference, in the accompanying prospectus. We have not authorized anyone to provide you with different information.
No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus.
You should not rely on any unauthorized information or representation. This prospectus is an offer to sell only the securities
offered hereby, and only under circumstances and in jurisdictions where it is lawful to do so.
This
prospectus is part of a registration statement on Form S-3 (File No. 333-________) we filed with the Securities and Exchange Commission,
or SEC, using a “shelf” registration process. Under this “shelf” process, we may sell from time to time
in one or more offerings up to $100,000,000 of our common stock, preferred stock, debt securities, warrants, depositary shares,
subscription rights, purchase contracts and units. The $50,000,000 of shares of common stock that may be offered, issued and sold
under this prospectus is included in the $100,000,000 of securities that may be offered, issued and sold by us pursuant to our
shelf registration statement.
Unless
expressly stated otherwise, all references in this prospectus to “we,” “us,” “our” or similar
references mean Ocean Power Technologies, Inc. and its subsidiaries on a consolidated basis.
Prospectus
Summary
This
summary highlights certain information about us, this offering and information appearing elsewhere in this prospectus and in the
documents we incorporate by reference. This summary is not complete and does not contain all of the information that you should
consider before investing in our securities. To fully understand this offering and its consequences to you, you should read this
entire prospectus carefully, including the information referred to under the heading “Risk Factors” in this prospectus
on page 3, and the financial statements and other information incorporated by reference in this prospectus when making an investment
decision. In this prospectus, the terms “we,” “us,” and the “company” refer to Ocean Power
Technologies, Inc. and its subsidiaries.
Our
Company
We
are a marine power solutions provider. We control the design, manufacture, sales, installation, operations and maintenance of
our products and solutions while working closely with partners that provide payloads, integration services, and marine
installation capabilities. We believe our solutions provide persistent and reliable distributed offshore power
along with communications for remote surface and subsea applications. Our mission and purpose are to utilize our proprietary,
state-of-the-art technologies to enhance the environment by reducing the global carbon footprint by through clean
and renewable solutions for reliable electrical power and, in so doing, drive demand for our products and
services.
We
also continue to develop and commercialize our proprietary systems that generate electricity by harnessing the renewable energy
of ocean waves for our PB3 PowerBuoy®, and solar power for our newest product, the hybrid PowerBuoy®. The PB3 PowerBuoy®
uses proprietary technologies that convert the kinetic energy created by the heaving motion of ocean waves into electricity. Based
on feedback from our current customers, discussions with potential future customers in the offshore oil and gas, defense and security,
science and research, and communications, as well as government applications in fishery protection, together with our market research
and publicly available data, we believe that numerous markets have a direct need for our solutions. While our recent projects
have been in the oil and gas industry, we believe there is an increasing need for our products and solutions in areas such as
fishery protection, offshore windfarm support, marine surveillance, and ocean-based science and research applications. We believe
that having demonstrated the capability of our solutions, we can advance our product and services and gain further adoption from
our target markets. Our marketing efforts are focused on offshore locations that require a cost-efficient solution for renewable,
reliable and persistent power and communications, either by supplying electric power to payloads that are integrated directly
with our product or located in its vicinity, such as on the seabed and in the water column. We believe we are the leader in offshore
autonomous ocean wave power conversion technology which provides renewable power for offshore operations that were previously
difficult to decarbonize.
Our
achievements during the first six months of fiscal 2021 included our continued work on Enel Green Power and Eni S.p.A. projects.
In October 2020, we entered into an agreement with Adams Communication & Engineering Technology, Inc. to, among other things,
conduct a feasibility study for the evaluation of a PB3 PowerBuoy® power and 5G communications solution in support of the
U.S. Navy’s Naval Postgraduate School’s Sea, Land, Air, Military Research Initiative, which conducts interdisciplinary
research in unmanned and robotic systems. In June 2020, we signed a memorandum of understanding with Mackay Marine (a division of Mackay Communications) to develop a Marine
Surveillance Solution.
Corporate
Information
Our
principal executive offices are located at 28 Engelhard Drive, Monroe Township, New Jersey 08831. Our telephone number is (609)
730-0400. We were incorporated in New Jersey in 1984 and reincorporated in the State of Delaware in 2007. We maintain a website
at www.oceanpowertechnologies.com where general information about us is available. We are not incorporating the contents of the
website into this prospectus.
The
Offering
Common
stock offered by us
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Shares
of common stock having an aggregate offering price of up to $50,000,000. The actual number of shares issued will vary depending
on the sales price under this offering.
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Plan
of Distribution
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“At
the market offering” that may be made from time to time to or through our sales agent, A.G.P. See “Plan of Distribution”
on page 9.
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Use
of proceeds
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We
intend to use the net proceeds from this offering to build additional products and solutions to meet market demand, further
advance the development of new products and solutions, engage in corporate development and merge acquisition activities, for
working capital needs, capital expenditures, repayment or refinancing of indebtedness, acquisitions, repurchases and redemptions
of securities, and for other general corporate purposes. However, we will retain broad discretion over how the net proceeds
are used. See “Use of Proceeds.”
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Risk
factors
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Investing
in our securities involves a high degree of risk. You should carefully consider all of the information in this prospectus
and the documents incorporated by reference in this prospectus. In particular, see “Risk Factors” beginning on
page 3 of this prospectus.
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Nasdaq
Capital Market symbol
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“OPTT”
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RISK
FACTORS
Investing
in our common stock involves substantial risk. You should carefully consider the risk factors disclosed below as well as those
contained in our most recent Annual Report on Form 10-K, which is incorporated by reference herein, as updated by our subsequent
filings under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the other information contained
in this prospectus before acquiring any of our common stock. These risks could have a material adverse effect on our business,
results of operations or financial condition and cause the value of our common stock to decline. You could lose all or part of
your investment.
This
prospectus also contain or incorporate by reference forward-looking statements that involve risks and uncertainties. Our actual
results could differ materially from those anticipated in the forward-looking statements as a result of certain factors, including
the risks faced by us described or incorporated by reference in this prospectus. See “Cautionary Note Regarding Forward-Looking
Statements.”
Risks
Related to our Common Stock and the Offering
Historically,
our stock price has been volatile, and this is likely to continue; purchasers of our common stock could incur substantial losses
as a result.
Historically,
the market price of our common stock has fluctuated significantly, and we expect that this will continue. Purchasers of our common
stock could incur substantial losses relating to their investment in our stock as a result. For the fiscal year ended April 30,
2020, the 52-week low and high prices for our common stock was $0.33 and $2.84, respectively. Also, the stock market in general
has recently experienced volatility that has often been unrelated or disproportionate to the operating performance of particular
companies. These broad market fluctuations could result in fluctuations in the price of our common stock, which could cause purchasers
of our common stock to incur substantial losses. The market price for our common stock may be influenced by many factors, including:
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developments
in our business or with respect to our projects;
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the
success of competitive products or technologies;
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regulatory
developments in the United States and foreign countries;
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developments
or disputes concerning patents or other proprietary rights;
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the
recruitment or departure of key personnel;
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quarterly
or annual variations in our financial results or those of companies that are perceived to be similar to us;
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market
conditions in the conventional and renewable energy industries and issuance of new or changed securities analysts’ reports
or recommendations;
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the
failure of securities analysts to cover our common stock or changes in financial estimates by analysts;
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the
inability to meet the financial estimates of analysts who follow our common stock;
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investor
perception of our company and of our targeted markets; and
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general
economic, political and market conditions.
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The
market valuation of our business may fluctuate due to factors beyond our control and the value of the investment of our stockholders
may fluctuate correspondingly.
The
market valuation of energy companies, such as us, frequently fluctuate due to factors unrelated to the past or present operating
performance of such companies. Our market valuation may fluctuate significantly in response to a number of factors, many of which
are beyond our control, including:
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Changes
in securities analysts’ estimates of our financial performance;
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Fluctuations
in stock market prices and volumes, particularly among securities of energy companies;
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Changes
in market valuations of similar companies;
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Announcements
by us or our competitors of significant contracts, new technologies, acquisitions, commercial relationships, joint ventures
or capital commitments;
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Variations
in our quarterly operating results;
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Fluctuations
in coal, oil, natural gas, methanol and ammonia prices;
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Loss
of a major customer of failure to complete significant commercial contracts;
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Loss
of a relationship with a partner; and
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Additions
or departures of key personnel.
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As
a result, the value of your investment may fluctuate.
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Our
management will have broad discretion over the use of proceeds from this offering and may not use the proceeds effectively.
Our
management will have broad discretion as to the application of the net proceeds from this offering and could spend the proceeds
in a variety of ways that may ultimately fail to improve our operating results or enhance the value of our common stock. Our failure
to apply these funds effectively could have a negative effect on our business and cause the price of our common stock to decline.
A
large number of shares may be sold in the market following this offering, which may depress the market price of our common stock.
All
of our shares of common stock sold in the offering will be freely tradable without restriction or further registration under the
Securities Act. As a result, a substantial number of our shares of common stock may be sold in the public market following this
offering, which may cause the market price of our common stock to decline. If there are more shares of common stock offered for
sale than buyers are willing to purchase, then the market price of our common stock may decline to a market price at which buyers
are willing to purchase the offered shares of common stock and sellers remain willing to sell the shares of common stock.
The
actual number of shares we will issue under the sales agreement, at any one time or in total, is uncertain.
Subject
to certain limitations in the sales agreement and compliance with applicable law, we have the discretion to deliver a placement
notice to A.G.P. at any time and from time to time during the term of the sales agreement. The actual number of shares common
stock that are sold to or through A.G.P. on our behalf pursuant to any placement notice we deliver to A.G.P. will depend on the
market price of the common stock during the periods in which sales are made and any restrictions or limitations applicable to
such sales, such as a minimum price below which sales may not be made, that we may include in such placement notice or that otherwise
apply under the sales agreement. Because the price per share of each share of common stock sold will fluctuate based on the market
price of our common stock during the sales period, it is not possible at this stage to predict the number of shares that will
ultimately be issued.
You
may experience immediate dilution in the book value per share of the common stock you purchase.
Because
the price per share of our common stock being offered from time to time may be substantially higher than the book value per share
of our common stock at the time of the sale, you may suffer substantial dilution in the net tangible book value of the common
stock you purchase in this offering.
USE
OF PROCEEDS
The
amount of proceeds from this offering will depend upon the number of shares of our common stock sold to or through A.G.P. under
the sales agreement and the prices at which they are sold. There can be no assurance that we will be able to sell any shares of
common stock under the sales agreement with A.G.P. or to what extent we will be able to utilize the sales agreement.
We
intend to use the net proceeds from this offering, if any, to build additional products and solutions to meet market demand, further
advance the development of new products and solutions, engage in corporate development and merge acquisition activities, for working
capital needs, capital expenditures, repayment or refinancing of indebtedness, acquisitions, repurchases and redemptions of securities,
and for other general corporate purposes. The amounts and timing of these expenditures will depend on a number of factors, such
as the timing, scope, progress and results of our research and development efforts, the timing and progress of any partnering
efforts, and the regulatory and competitive environment. As of the date of this prospectus, we have not determined the amount
of net proceeds to be used specifically for any particular purpose or the timing of any expenditures. Accordingly, management
will retain broad discretion and flexibility in applying the net proceeds from the sale of the securities, if any. Pending any
use of the net proceeds from this offering, if any, we intend to invest the net proceeds in repurchase contracts or deposit them
in checking accounts at financial institutions.
Dividend
Policy
We
have never declared or paid any cash dividends on our common stock, and we do not currently anticipate declaring or paying cash
dividends on our common stock in the foreseeable future. We currently intend to retain all of our future earnings, if any, to
finance the growth and development of our business. Any future determination relating to our dividend policy will be made at the
discretion of our Board of Directors and will depend on a number of factors, including future earnings, capital requirements,
financial conditions, future prospects, contractual restrictions and covenants and other factors that our Board of Directors may
deem relevant.
DILUTION
If
you invest in this offering, your ownership interest will be diluted to the extent of the difference between the public offering
price per share and the as adjusted net tangible book value per share after giving effect to this offering. Our net tangible book
value as of July 31, 2020, was approximately $10,115,883, or approximately $0.54 per share of common stock. Net tangible book
value per share represents the amount of total tangible assets (total assets less intangible assets) less total liabilities, divided
by the number of shares of our common stock outstanding as of July 31, 2020.
Dilution
in net tangible book value per share represents the difference between the amount per share paid by purchasers in this offering
and the net tangible book value per share of our common stock immediately after this offering. After giving effect to the sale
of 25,380,710 shares of our common stock in this offering (based on an assumed offering price of $1.97 per share, which was the
closing price of our common stock on November 17, 2020), but excluding the sales agent discounts and commissions and estimated
offering expenses payable by us, our as adjusted net tangible book value as of July 31, 2020 would have been approximately $60,115,883,
or approximately $1.37 per share of common stock. This represents an immediate decrease in net tangible book value of $0.83 per
share of common stock to our existing stockholders and an immediate decrease in net tangible book value of $0.60 per share of
common stock to investors in this offering. The actual amounts above are based on 18,620,565 shares outstanding as of July 31,
2020 and do not reflect the exercise of warrants outstanding on common stock, the exercise of outstanding options to purchase
shares of common stock and non-vested restricted stock issued to employees in the computation as the effect would be anti-dilutive.
Description
of Securities
In
this offering, we are offering shares of our common stock having an aggregate gross sales price of up to $50,000,000. In
the discussion that follows, we have summarized selected provisions of our certificate of incorporation and bylaws. You should
read our certificate of incorporation and bylaws as currently in effect for more details regarding the provisions we describe
below and for other provisions that may be important to you. We have filed copies of those documents with the SEC, and they are
incorporated by reference herein. Please read “Where You Can Find More Information.”
Authorized
and Outstanding Capital Stock
The
following description of our common stock and provisions of our certificate of incorporation and bylaws are summaries and are
qualified by reference to our certificate of incorporation and bylaws, which have been incorporated by reference as exhibits to
the registration statement of which this prospectus forms a part.
Our
authorized capital stock consists of 100,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of preferred
stock, par value $0.001 per share, all of which are undesignated.
As
of November 18, 2020, there were 28,470,138 shares of common stock outstanding, and no shares of preferred stock were issued or
outstanding. As of November 18, 2020, there also were outstanding options representing the right to purchase a total of 531,506
shares of common stock at a weighted average exercise price of approximately $3.02 per share, (ii) warrants to purchase up to
7,298 shares of our common stock which are exercisable at a price of $121.60, (iii) warrants to purchase up to 8,925 shares of
our common stock which are exercisable at a price of $187.20, and (iv) warrants to purchase up to 4,927,680 shares of our common
stock which are exercisable at a price of $3.85.
Description
of Common Stock
Voting.
Holders of common stock are entitled to one vote for each share held on all matters submitted to a vote of stockholders and do
not have cumulative voting rights. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election
of directors may elect all of the directors standing for election.
Dividends.
Holders of common stock are entitled to receive proportionately any dividends that may be declared by our Board, subject to any
preferential dividend rights of outstanding preferred stock.
Liquidation
and Distribution. Upon our liquidation, dissolution or winding up, the holders of common stock are entitled to receive proportionately
our net assets available after the payment of all debts and other liabilities and subject to the prior rights of any outstanding
preferred stock. Holders of common stock have no preemptive, subscription, redemption or conversion rights. Our outstanding shares
of common stock are, and the shares offered by us in this offering will be, when issued and paid for, fully paid and nonassessable.
The rights, preferences and privileges of holders of common stock are subject to, and may be adversely affected by, the rights
of the holders of shares of any series of preferred stock that we may designate and issue in the future.
Anti-Takeover
Effects of Delaware Law; Our Certificate of Incorporation and Our Bylaws
Delaware
law, our certificate of incorporation and our bylaws contain provisions that could have the effect of delaying, deferring or discouraging
another party from acquiring control of us. These provisions, which are summarized below, are intended to discourage coercive
takeover practices and inadequate takeover bids. These provisions are also designed to encourage persons seeking to acquire control
of us to first negotiate with our Board.
Removal
of Directors
Our
certificate of incorporation currently provides that directors may be removed only for cause and only by the affirmative vote
of the holders of 75% of our shares of capital stock present in person or by proxy and entitled to vote. However, our Board of
Directors approved an amendment to our bylaws that became effective on June 17, 2016, which permits our directors to be removed
either for cause or without cause by our stockholders. At our annual meeting of stockholders for the year ended April 30, 2016
that was held on October 21, 2016 (the “2016 Annual Meeting”), we submitted a proposal to stockholders seeking stockholder
approval to amend our certificate of incorporation to delete the reference to “for cause” in Section 6 of Article
IX of the certificate of incorporation. This proposal to amend the certificate of incorporation did not receive the required affirmative
vote of the holders of at least 75% of the outstanding shares of common stock entitled to vote at the meeting, so the proposal
did not pass. However, we also submitted a proposal to stockholders at the 2016 Annual Meeting seeking approval to amend our certificate
of incorporation to add a clause that specified that, to the fullest extent permitted by law, any provision in the Certificate
of Incorporation that is contrary to a requirement of the Delaware General Corporate Law (the “DGCL”) shall be read
in conformity with the applicable requirement of the DGCL. This second proposal only required the affirmative vote of the holders
of a majority of the outstanding shares of common stock entitled to vote at the 2016 Annual Meeting, and it passed.
Our
Board of Directors takes the position that under current Delaware law, the “only for cause” provision in the certificate
of incorporation regarding removal of the company’s directors is not enforceable and is therefore not in conformity with
the applicable requirement of the DGCL. Accordingly, we will comply with the provisions of our bylaws, as amended and as described
above, relating to director removal and will not seek to enforce that provision of our certificate of incorporation relating to
stockholder removal of directors only for cause, as presently in effect. Under our certificate of incorporation and bylaws, any
vacancy on the Board, including a vacancy resulting from an enlargement of the Board, may be filled only by vote of a majority
of our directors then in office.
The
limitations on the ability of our stockholders to remove directors and fill vacancies could make it more difficult for a third
party to acquire, or discourage a third party from seeking to acquire, control of us.
Stockholder
Action by Written Consent; Special Meetings
Our
certificate of incorporation provides that any action required or permitted to be taken by our stockholders must be effected at
a duly called annual or special meeting of such holders and may not be effected by any consent in writing by such holders. Our
certificate of incorporation and our bylaws also provide that, except as otherwise required by law, special meetings of our stockholders
can only be called by our chairman of the board, our chief executive officer, our president or the Board.
Advance
Notice Requirements for Stockholder Proposals
Our
bylaws establish an advance notice procedure for stockholder proposals to be brought before an annual meeting of stockholders,
including proposed nominations of persons for election to the Board. Stockholders at an annual meeting may only consider proposals
or nominations specified in the notice of meeting or brought before the meeting by or at the direction of the Board of Directors
or by a stockholder of record on the record date for the meeting, that is entitled to vote at the meeting and that has delivered
to our secretary a timely written notice in proper form of the stockholder’s intention to bring such business before the
meeting. These provisions could have the effect of delaying until the next stockholder meeting stockholder actions that are favored
by the holders of a majority of our outstanding voting securities.
Delaware
Business Combination Statute
We
are subject to Section 203 of the Delaware General Corporation Law. Subject to certain exceptions, Section 203 prevents a publicly
held Delaware corporation from engaging in a “business combination” with any “interested stockholder”
for three years following the date that 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.
A “business combination” includes, among other things, a 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 outstanding voting stock and any entity or person affiliated with or controlling
or controlled by such entity or person.
Amendment
of Certificate of Incorporation and Bylaws
The
Delaware General Corporation Law provides generally that the affirmative vote of a majority of the shares entitled to vote on
any matter is required to amend a corporation’s certificate of incorporation or bylaws, unless a corporation’s certificate
of incorporation or bylaws, as the case may be, requires a greater percentage. Our bylaws may be amended or repealed by a majority
vote of our Board of Directors or the affirmative vote of the holders of at least 75% of the voting power of our capital stock
issued and outstanding and entitled to vote on the matter.
Limitation
of Liability and Indemnification of Officers and Directors
Our
certificate of incorporation limits the personal liability of directors for breach of fiduciary duty to the maximum extent permitted
by the Delaware General Corporation Law. Our certificate of incorporation provides that no director will have personal liability
to us or to our stockholders for monetary damages for breach of fiduciary duty or other duty as a director. However, these provisions
do not eliminate or limit the liability of any of our directors:
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for
any breach of their duty of loyalty to us or our stockholders;
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for
acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law;
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for
voting or assenting to unlawful payments of dividends or other distributions; or
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for
any transaction from which the director derived an improper personal benefit.
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Any
amendment to or repeal of these provisions will not eliminate or reduce the effect of these provisions in respect of any act or
failure to act, or any cause of action, suit or claim that would accrue or arise prior to any amendment or repeal or adoption
of an inconsistent provision. If the Delaware General Corporation Law is amended to provide for further limitations on the personal
liability of directors of corporations, then the personal liability of our directors will be further limited to the greatest extent
permitted by the Delaware General Corporation Law.
In
addition, our certificate of incorporation provides that we must indemnify our directors and officers and we must advance expenses,
including attorneys’ fees, to our directors and officers in connection with legal proceedings, subject to limited exceptions.
Notice
of Share Ownership
Our
bylaws contain a provision requiring any beneficial owner of three percent or more of our outstanding common stock to notify us
of his or her stockholdings, as well as of any change in his or her beneficial ownership of one percent or more of our outstanding
common stock. Our bylaws do not provide for any specific remedy in the event a stockholder does not comply with this provision.
We do not intend to make any such information public, unless required by law or the rules of the SEC or the Nasdaq Capital Market.
Authorized
but Unissued Shares
Our
authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval,
subject to any limitations imposed by the listing standards of the Nasdaq Capital Market. These additional shares may be used
for a variety of corporate finance transactions, acquisitions and employee benefit plans. The existence of authorized but unissued
and unreserved common stock and preferred stock could make it more difficult or discourage an attempt to obtain control of us
by means of a proxy contest, tender offer, merger or otherwise.
Transfer
Agent and Registrar
The
transfer agent and registrar for our common stock is Computershare Trust Company, N.A. Its address is 462 South 4th Street, Suite
1600, Louisville, KY 40202, and its telephone number is 1-800-662-7232.
Our
common stock is listed on the Nasdaq Capital Market under the symbol “OPTT.”
PLAN
OF DISTRIBUTION
We
have entered into the sales agreement with A.G.P. under which we may issue and sell shares of our common stock having an aggregate
gross sales price of up to $50,000,000 from time to time to or through A.G.P., acting as our sales agent. The sales of our common
stock, if any, under this prospectus will be made at market prices by any method deemed to be an “at the market offering”
as defined in Rule 415(a)(4) under the Securities Act, including sales made directly on The Nasdaq Capital Market, on any other
existing trading market for our common stock, or to or through a market maker.
Each
time that we wish to issue and sell shares of our common stock under the sales agreement, we will provide A.G.P. with a placement
notice describing the amount of shares to be sold, the time period during which sales are requested to be made, any limitation
on the amount of shares of common stock that may be sold in any single day, any minimum price below which sales may not be made
or any minimum price requested for sales in a given time period and any other instructions relevant to such requested sales. Upon
receipt of a placement notice, A.G.P., acting as our sales agent, will use commercially reasonable efforts, consistent with its
normal trading and sales practices and applicable state and federal laws, rules and regulations and the rules of The Nasdaq Capital
Market, to sell shares of our common stock under the terms and subject to the conditions of the placement notice and the sales
agreement. We or A.G.P. may suspend the offering of common stock pursuant to a placement notice upon notice and subject to other
conditions.
Settlement
for sales of common stock, unless the parties agree otherwise, will occur on the second trading day following the date on which
any sales are made in return for payment of the net proceeds to us. There are no arrangements to place any of the proceeds of
this offering in an escrow, trust or similar account. Sales of our common stock as contemplated in this prospectus will be settled
through the facilities of The Depository Trust Company or by such other means as we and A.G.P. may agree upon.
We
will pay A.G.P. commissions for its services in acting as our sales agent in the sale of our common stock pursuant to the sales
agreement. A.G.P. will be entitled to compensation at a fixed commission rate of 3.25% of the gross proceeds from the sale of
our common stock on our behalf pursuant to the sales agreement. We have also agreed to reimburse A.G.P. for certain specified
expenses incurred by A.G.P., including the fees and disbursements of its legal counsel incurred by A.G.P. in connection with entering
into the sales agreement in an amount not to exceed $50,000, plus up to $10,000 per year for other expenses. after the date of
this prospectus in connection with its further periodic due diligence investigation of our company in connection with this offering.
We estimate that the total expenses of the offering payable by us, excluding discounts, commissions and reimbursements payable
to A.G.P. under the sales agreement, will not exceed approximately $200,000. The remaining
sales proceeds, after deducting any expenses payable by us and any transaction fees imposed by any governmental, regulatory, or
self-regulatory organization in connection with the sales, will equal our net proceeds for the sale of such common stock.
Because
there are no minimum sale requirements as a condition to this offering, the actual total public offering price, commissions and
net proceeds to us, if any, are not determinable at this time. The actual dollar amount and number of shares of common stock we
sell through this prospectus will be dependent, among other things, on market conditions and our capital raising requirements.
We
will report at least quarterly the number of shares of common stock sold through A.G.P. under the sales agreement, the net proceeds
to us and the compensation paid by us to A.G.P. in connection with the sales of common stock under the sales agreement.
In
connection with the sale of the common stock on our behalf, A.G.P. will be deemed to be an “underwriter” within the
meaning of the Securities Act, and the compensation of A.G.P. will be deemed to be underwriting commissions or discounts. We have
agreed to provide indemnification and contribution to A.G.P. against certain civil liabilities, including liabilities under the
Securities Act.
A.G.P.
will not engage in any market making activities involving our common stock while the offering is ongoing under this prospectus
if such activity would be prohibited under Regulation M or other anti-manipulation rules under the Securities Act. As
our sales agent, A.G.P. will not engage in any transactions that stabilizes our common stock.
The
offering pursuant to the sales agreement will terminate upon the earlier of (i) the sale of all shares of common stock subject
to the agreement and (ii) termination of the sales agreement as permitted therein. We may terminate the sales agreement in our
sole discretion at any time by giving 10 days’ prior notice to A.G.P. A.G.P. may terminate the sales agreement under the
circumstances specified in the sales agreement and in its sole discretion at any time by giving 10 days’ prior notice to
us.
The
sales agreement has been filed as an exhibit to a current report on Form 8-K that we filed with the Commission in connection with
this offering and is incorporated into this prospectus by reference.
A.G.P.
and its affiliates have provided, and may in the future provide, investment banking, commercial banking and other financial services
for us in the ordinary course of business, for which services that may in the future receive customary fees.
This
prospectus in electronic format may be made available on a website maintained by A.G.P., and A.G.P. may distribute this prospectus
electronically.
LEGAL
MATTERS
The
validity of the securities being offered by this prospectus and other legal matters concerning this offering will
be passed on for us by Porter Hedges LLP, Houston, Texas. A.G.P. is being represented in connection with this offering
by Kelley Drye & Warren LLP, New York, New York.
EXPERTS
The
consolidated financial statements of Ocean Power Technologies, Inc. and subsidiaries (the Company) as of April 30, 2020 and 2019,
and for the years then ended, have been incorporated by reference herein, in reliance upon the report of KPMG LLP, independent
registered public accounting firm, incorporated by reference herein, and upon the authority of said firm as experts in accounting
and auditing.
The
audit report covering the April 30, 2020 consolidated financial statements contains an explanatory paragraph that states that
the Company’s recurring losses from operations and accumulated deficit raise substantial doubt about the Company’s
ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result
from the outcome of that uncertainty.
The
audit report covering the April 30, 2020 consolidated financial statements refers to the Company changing its method of
accounting for leases as of May 1, 2019 due to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic
842), and the related amendments.
Certain
Documents Incorporated By Reference
The
following documents, which have previously been filed by us with the SEC under the Exchange Act, are incorporated herein by reference:
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our
Annual Report on Form 10-K for the fiscal year ended April 30, 2020, filed with the SEC on June 29, 2020 (File No. 001-33417);
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our
Quarterly Report on Form 10-Q for the quarter ended July 31, 2020, filed with the SEC on September 14, 2020 (File No. 001-33417);
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our
Current Reports on Form 8-K, filed with the SEC on May 1, 2020, May 4, 2020, May 7, 2020, June 26, 2020, June 29, 2020, July
8, 2020, July 15, 2020, August 17, 2020, August 18, 2020, August 19, 2020, August 24, 2020, August 26, 2020, September 14,
2020, September 18, 2020, October 27, 2020 and November 16, 2020 (File No. 001-33417) (excluding any information furnished
pursuant to Item 2.02 or Item 7.01 of any such Current Report on Form 8-K);
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our
Proxy Statement on Schedule 14A, filed with the SEC on November 2, 2020; and
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the
description of our common stock set forth in our registration statement on Form 8-A filed on April 18, 2007 (File No. 001-33417)
and in any and all subsequent amendments and reports filed for the purpose of updating that description.
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All
documents filed by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding any information furnished
pursuant to Item 2.02 or Item 7.01 on any current report on Form 8-K) after the date of the initial registration statement and
prior to the effectiveness of the registration statement and after the date of this prospectus and prior to the termination of
this offering shall be deemed to be incorporated in this prospectus by reference and to be a part hereof from the date of filing
of such documents. Any statement contained herein, or in a document incorporated or deemed to be incorporated by reference herein,
shall be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained herein or
in any subsequently filed document which also is or is deemed to be incorporated by reference herein, modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute
a part of this prospectus.
You
may request a free copy of these filings, other than any exhibits, unless the exhibits are specifically incorporated by reference
into this prospectus, by writing or telephoning us at the following address:
Ocean
Power Technologies, Inc.
28
Engelhard Drive, Suite B
Monroe
Township, NJ 08831
Attention:
Chief Financial Officer
(609)
730-0400
Where
You Can Find More Information
We
are subject to the informational requirements of the Exchange Act and in accordance therewith, file reports, proxy statements
and other information with the SEC. These reports, proxy statements and other information can be inspected and copied at the SEC’s
Public Reference room at 100 F Street, N.E., 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. In addition, the SEC maintains an Internet site at www.sec.gov that
contains reports, proxy and information statements, and other information regarding issuers that file electronically with the
SEC. We maintain a website at www.oceanpowertechnologies.com. Information on our website or any other website is not incorporated
by reference into this prospectus and does not constitute part of this prospectus. Please note that information contained in our
website, whether currently posted or posted in the future, is not a part of this prospectus or the documents incorporated by reference
in this prospectus.
Cautionary
Note Regarding Forward-Looking Statements
The
information discussed in this prospectus, our filings with the SEC and our public releases include “forward-looking statements”
within the meaning of Section 27A of the Securities Act, and Section 21E of the Exchange Act. Forward-looking statements are subject
to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Among those
risks, trends and uncertainties are:
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the
impact of the COVID-19 pandemic on our business, operations, customers, suppliers and manufacturers;
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our
ability to commercialize our products, and achieve and sustain profitability;
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our
continued development of our proprietary technologies, and expected continued use of cash from operating activities unless
or until we achieve positive cash flow from the commercialization of our products and services;
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our
ability to obtain additional funding, as and if needed which will be subject to a number of factors, including market conditions,
and our operating performance;
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our
ability to continue as a going concern;
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our
estimates regarding expenses, future revenues and capital requirements;
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the
adequacy of our cash balances and our need for additional financings;
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our
ability to develop and manufacture commercially viable products;
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our
ability to successfully develop and market new products and solutions, such as the subsea battery and Marine Surveillance
Solutions;
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that
we will be successful in our efforts to commercialize our products or the timetable upon which commercialization can be achieved,
if at all;
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our
ability to identify and penetrate markets for our products and solutions;
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our
ability to implement our commercialization strategy as planned, or at all;
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our
ability to improve the power output, survivability and reliability of our products;
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our
relationships with our strategic partners may not be successful and we may not be successful in establishing additional relationships;
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the
reliability of our technology, products and solutions;
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our
ability to maintain the listing of our common stock on the Nasdaq Capital Market;
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our
ability to raise capital through our current equity facilities;
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the
impact of pending and threatened litigation on our business, financial condition and liquidity;
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changes
in current legislation, regulations and economic conditions that affect the demand for renewable energy;
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our
ability to compete effectively in our target markets;
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our
limited operating history and history of operating losses;
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our
sales and marketing capabilities and strategy in the United States and internationally; and
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our
ability to protect our intellectual property portfolio.
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These
forward-looking statements are identified by their use of terms and phrases such as “expect,” “estimate,”
“project,” “plan,” “believe,” “achievable,” “anticipate” and similar
terms and phrases. Although we believe that the expectations reflected in these forward-looking statements are reasonable, they
do involve certain assumptions, risks and uncertainties. Our actual results could differ materially from those anticipated in
these forward-looking statements as a result of certain factors, including but not limited to the risks and uncertainties discussed
in the section entitled “Risk Factors” included elsewhere in this prospectus and in the documents that we include
in or incorporate by reference into this prospectus, including our Annual Report on Form 10-K for the fiscal year ended April
30, 2020 and our subsequent SEC filings.
All
forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the
cautionary statements in this section and elsewhere in this prospectus and in the documents incorporated by reference. Other than
as required under the securities laws, we do not assume a duty to update these forward-looking statements, whether as a result
of new information, subsequent events or circumstances, changes in expectations or otherwise.
Up
to $50,000,000
Shares
of Common Stock
Prospectus
A.G.P.
, 2020
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses of Issuance and Distribution.
The
following table sets forth the various expenses, all of which will be borne by us, in connection with the sale and distribution
of the securities being registered, other than the underwriting discounts, commissions, and expenses. All amounts shown are estimates
except for the Securities and Exchange Commission registration fee.
Securities and Exchange Commission registration fee
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$
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10,910
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Accounting fees and expenses
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$
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*
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Legal fees and expenses
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$
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*
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Printing and engraving expenses
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$
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*
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Transfer agent fees
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$
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*
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Miscellaneous
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$
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*
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Total
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$
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*
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*
|
Estimated
expenses are presently not known and cannot be estimated.
|
Item
15. Indemnification of Directors and Officers.
Section
102 of the General Corporation Law of the State of Delaware permits a corporation to eliminate the personal liability of directors
of a corporation to the corporation or its stockholders for monetary damages for a breach of fiduciary duty as a director, except
where the director breached his duty of loyalty, failed to act in good faith, engaged in intentional misconduct or knowingly violated
a law, authorized the payment of a dividend or approved a stock repurchase in violation of Delaware corporate law or obtained
an improper personal benefit. The Registrant’s certificate of incorporation provides that no director of the Registrant
shall be personally liable to it or its stockholders for monetary damages for any breach of fiduciary duty as director, notwithstanding
any provision of law imposing such liability, except to the extent that the General Corporation Law of the State of Delaware prohibits
the elimination or limitation of liability of directors for breaches of fiduciary duty.
Section
145 of the General Corporation Law of the State of Delaware provides that a corporation has the power to indemnify a director,
officer, employee, or agent of the corporation and certain other persons serving at the request of the corporation in related
capacities against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlements actually and reasonably
incurred by the person in connection with an action, suit or proceeding to which he is or is threatened to be made a party by
reason of such position, if such person acted in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation, and, in any criminal action or proceeding, had no reasonable cause to believe his conduct
was unlawful, except that, in the case of actions brought by or in the right of the corporation, no indemnification shall be made
with respect to any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless
and only to the extent that the Court of Chancery or other adjudicating court determines that, despite the adjudication of liability
but in view of all of the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses
which the Court of Chancery or such other court shall deem proper.
The
Registrant’s certificate of incorporation provides that the Registrant will indemnify each person who was or is a party
or threatened to be made a party to any threatened, pending or completed action, suit or proceeding (other than an action by or
in the right of the Registrant) by reason of the fact that he or she is or was, or has agreed to become, a director or officer
of the Registrant, or is or was serving, or has agreed to serve, at the Registrant’s request as a director, officer, partner,
employee or trustee of, or in a similar capacity with, another corporation, partnership, joint venture, trust or other enterprise
(all such persons being referred to as an “Indemnitee”), or by reason of any action alleged to have been taken or
omitted in such capacity, against all expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred in connection with such action, suit or proceeding and any appeal therefrom, if such Indemnitee
acted in good faith and in a manner he or she reasonably believed to be in, or not opposed to, the Registrant’s best interests,
and, with respect to any criminal action or proceeding, he or she had no reasonable cause to believe his or her conduct was unlawful.
The
Registrant’s certificate of incorporation provides that the Registrant will indemnify any Indemnitee who was or is a party
to an action or suit by or in the right of the Registrant to procure a judgment in the Registrant’s favor by reason of the
fact that the Indemnitee is or was, or has agreed to become, a director or officer of the Registrant, or is or was serving, or
has agreed to serve, at the Registrant’s request as a director, officer, partner, employee or trustee or, or in a similar
capacity with, another corporation, partnership, joint venture, trust or other enterprise, or by reason of any action alleged
to have been taken or omitted in such capacity, against all expenses (including attorneys’ fees) and, to the extent permitted
by law, amounts paid in settlement actually and reasonably incurred in connection with such action, suit or proceeding, and any
appeal therefrom, if the Indemnitee acted in good faith and in a manner he or she reasonably believed to be in, or not opposed
to, the best interests of the Registrant, except that no indemnification shall be made with respect to any claim, issue or matter
as to which such person shall have been adjudged to be liable to the Registrant, unless a court determines that, despite such
adjudication but in view of all of the circumstances, he or she is entitled to indemnification of such expenses. Notwithstanding
the foregoing, to the extent that any Indemnitee has been successful, on the merits or otherwise, he or she will be indemnified
by the Registrant against all expenses (including attorneys’ fees) actually and reasonably incurred in connection therewith.
Expenses must be advanced to an Indemnitee under certain circumstances.
The
Registrant maintains a general liability insurance policy that covers certain liabilities of the Registrant’s directors
and officers arising out of claims based on acts or omissions in their capacities as directors or officers.
The
Registrant’s directors and officers are covered by insurance policies indemnifying them against certain liabilities, including
certain liabilities arising under the Securities Act of 1933, as amended, which might be incurred by them in such capacities and
against which they cannot be indemnified by the Registrant.
Item
16. Exhibits.
Exhibit
No.
|
|
Description
of Exhibit
|
1.1
|
|
Form
of Underwriting Agreement.*
|
3.1
|
|
Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 10-Q (File no. 1-33417) filed on September 14, 2007).
|
3.2
|
|
Certificate of Amendment to Certificate of Incorporation of the Company, filed with the Secretary of State of the State of Delaware on October 27, 2015 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on October 28, 2015).
|
3.3
|
|
Certificate of Amendment to Certificate of Incorporation of the Company, filed with the Secretary of State of the State of Delaware on October 21, 2016 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on October 21, 2016).
|
3.4
|
|
Amended and Restated Bylaws of Ocean Power Technologies, Inc. effective as of June 17, 2016 (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed on June 23, 2016).
|
3.5
|
|
Certificate of Amendment to Certificate of Incorporation of the Company, filed with the Secretary of State of the State of Delaware on March 8, 2019 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on March 8, 2019).
|
4.1
|
|
Specimen certificate for Common Stock (incorporated by reference to Exhibit 4.1 to the Registrant’s Form S-1/A (File no. 333-138595) filed on March 19, 2007).
|
4.2
|
|
Form
of Senior Indenture Incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-3 filed
on February 12, 2016 ) (File No. 333-209517).
|
4.3
|
|
Form
of Senior Indenture Incorporated by reference to Exhibit 4.6 to the Company’s Registration Statement on Form S-3 filed
on February 12, 2016 ) (File No. 333-209517).
|
4.4
|
|
Form
of Subordinated Indenture Incorporated by reference to Exhibit 4.7 to the Company’s Registration Statement on Form S-3
filed on February 12, 2016 ) (File No. 333-209517).
|
4.5
|
|
Form of Senior Debt Security (included in Exhibit 4.2).
|
4.6
|
|
Form of Senior Subordinated Debt Security (included in Exhibit 4.3).
|
4.7
|
|
Form of Subordinated Debt Security (included in Exhibit 4.4).
|
4.8
|
|
Form
of Subscription Rights Agreement and Form Subscription Rights Certificate.*
|
4.9
|
|
Form
of Purchase Contract.*
|
4.10
|
|
Form
of Unit Agreement.*
|
4.11
|
|
Form
of Pledge Agreement.*
|
4.12
|
|
Form
of Deposit Agreement.*
|
4.13
|
|
Form
of Depositary Share.*
|
5.1
|
|
Opinion of Porter Hedges LLP with respect to legality of the securities, including consent.**
|
21.1
|
|
Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 to the Registrant’s Annual Report on Form 10-K for the year ended April 30, 2020).
|
23.1
|
|
Consent of KPMG LLP.**
|
23.2
|
|
Consent of Porter Hedges LLP (included in Exhibit 5.1).**
|
24.1
|
|
Power of Attorney (contained in signature pages).
|
*
|
OPT
will file as an exhibit to a current report on Form 8-K (i) any underwriting agreement relating to securities offered hereby,
(ii) the instruments setting forth the terms of the depositary shares, warrants, subscription rights, purchase contracts or
units, (iii) any additional required opinion of counsel to OPT as to the legality of the securities offered hereby or (iv)
any required opinion of counsel to OPT as to certain tax matters relative to securities offered hereby.
|
**
|
Filed
herewith.
|
Item
17. Undertakings.
(a)
The undersigned registrant hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i)
To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
(ii)
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in 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;
(iii)
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement; provided, however, that paragraphs (a)(1)(i),
(a)(1)(ii) and (a)(1)(iii) of this section do not apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in reports filed with or furnished to the Commission by the registrant pursuant to section 13
or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement, or is
contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
(2)
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold
at the termination of the offering.
(4)
That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:
(i)
If the registrant is relying on Rule 430B:
(A)
Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as
of the date the filed prospectus was deemed part of and included in the registration statement; and
(B)
Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance
on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information
required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement
as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale
of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and
any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement
relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration
statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by
reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with
a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement
or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date;
or
(ii)
If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating
to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A,
shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness.
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 first use, 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 date of first use.
(5)
That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial
distribution of the securities:
The
undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration
statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or
sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser
and will be considered to offer or sell such securities to such purchaser:
(i)
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant
to Rule 424;
(ii)
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred
to by the undersigned registrant;
(iii)
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned
registrant or its securities provided by or on behalf of the undersigned registrant; and
(iv)
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
(b)
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933,
each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c)
Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that
in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the 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.
(d)
The undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee
to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed
by the Commission under Section 305(b)(2) of the Act.
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the Township of Monroe, State of New Jersey, on the 20th day of November,
2020.
|
OCEAN
POWER TECHNOLOGIES, INC.
|
|
|
|
|
By:
|
/s/
George H. Kirby III
|
|
|
George
H. Kirby III
|
|
|
Chief
Executive Officer
|
POWER
OF ATTORNEY AND SIGNATURES
We
the undersigned officers and directors of Ocean Power Technologies, Inc., hereby, severally constitute and appoint George H. Kirby
III, Matthew T. Shafer and John Lawrence, each of them singly, our true and lawful attorneys with full power to them and each
of them singly, to sign for us and in our names in the capacities indicated below, the registration statement on Form S-3 filed
herewith and any and all pre-effective and post-effective amendments to said registration statement and any subsequent registration
statement for the same offering which may be filed under Rule 462(b) and generally to do all such things in our names and on our
behalf in our capacities as officers and directors to enable Ocean Power Technologies, Inc. to comply with the provisions of the
Securities Act of 1933, and all requirements of the Securities and Exchange Commission, hereby ratifying and confirming our signatures
as they may be signed by our said attorneys, or any of them, to said registration statement and any and all amendments thereto
or to any subsequent registration statement for the same offering which may be filed under Rule 462(b).
Pursuant
to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
President,
Chief Executive Officer
|
|
|
/s/
George H. Kirby III
|
|
and
Director (Principal Executive Officer)
|
|
November
20, 2020
|
George
H. Kirby III
|
|
|
|
|
|
|
|
|
|
/s/
Matthew T. Shafer
|
|
Chief
Financial Officer and Treasurer
|
|
November
20, 2020
|
Matthew
T. Shafer
|
|
(Principal
Financial and Accounting Officer)
|
|
|
|
|
|
|
|
/s/
Terence J. Cryan
|
|
Chairman
of the Board and Director
|
|
November
20, 2020
|
Terence
J. Cryan
|
|
|
|
|
|
|
|
|
|
/s/
Dean J. Glover
|
|
Vice
Chairman of the Board and Director
|
|
November
20, 2020
|
Dean
J. Glover
|
|
|
|
|
|
|
|
|
|
/s/
Steven M. Fludder
|
|
Director
|
|
November
20, 2020
|
Steven
M. Fludder
|
|
|
|
|
|
|
|
|
|
/s/
Robert K. Winters
|
|
Director
|
|
November
20, 2020
|
Robert
K. Winters
|
|
|
|
|
/s/
Kristine S. Moore
|
|
Director
|
|
November
20, 2020
|
Kristine
S. Moore
|
|
|
|
|
Exhibit
Index
Exhibit
No.
|
|
Description
of Exhibit
|
1.1
|
|
Form
of Underwriting Agreement.*
|
3.1
|
|
Certificate of Incorporation of the Registrant (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 10-Q (File no. 1-33417) filed on September 14, 2007).
|
3.2
|
|
Certificate of Amendment to Certificate of Incorporation of the Company, filed with the Secretary of State of the State of Delaware on October 27, 2015 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on October 28, 2015).
|
3.3
|
|
Certificate of Amendment to Certificate of Incorporation of the Company, filed with the Secretary of State of the State of Delaware on October 21, 2016 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on October 21, 2016).
|
3.4
|
|
Amended and Restated Bylaws of Ocean Power Technologies, Inc. effective as of June 17, 2016 (incorporated by reference to Exhibit 3.2 to the Registrant’s Current Report on Form 8-K filed on June 23, 2016).
|
3.5
|
|
Certificate of Amendment to Certificate of Incorporation of the Company, filed with the Secretary of State of the State of Delaware on March 8, 2019 (incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on March 8, 2019).
|
4.1
|
|
Specimen certificate for Common Stock (incorporated by reference to Exhibit 4.1 to the Registrant’s Form S-1/A (File no. 333-138595) filed on March 19, 2007).
|
4.2
|
|
Form of Senior Indenture (incorporated by reference to Exhibit 4.5 to the Company’s Registration Statement on Form S-3 filed on February 12, 2016 (File No. 333-209517).
|
4.3
|
|
Form of Senior Indenture (incorporated by reference to Exhibit 4.6 to the Company’s Registration Statement on Form S-3 filed on February 12, 2016 (File No. 333-209517)).
|
4.4
|
|
Form of Subordinated Indenture (incorporated by reference to Exhibit 4.7 to the Company’s Registration Statement on Form S-3 filed on February 12, 2016 (File No. 333-209517)).
|
4.5
|
|
Form of Senior Debt Security (included in Exhibit 4.2).
|
4.6
|
|
Form of Senior Subordinated Debt Security (included in Exhibit 4.3).
|
4.7
|
|
Form of Subordinated Debt Security (included in Exhibit 4.4).
|
4.8
|
|
Form
of Subscription Rights Agreement and Form Subscription Rights Certificate.*
|
4.9
|
|
Form
of Purchase Contract.*
|
4.10
|
|
Form
of Unit Agreement.*
|
4.11
|
|
Form
of Pledge Agreement.*
|
4.12
|
|
Form
of Deposit Agreement.*
|
4.13
|
|
Form
of Depositary Share.*
|
5.1
|
|
Opinion of Porter Hedges LLP with respect to legality of the securities, including consent.**
|
21.1
|
|
Subsidiaries of the Registrant (incorporated by reference to Exhibit 21.1 to the Registrant’s Annual Report on Form 10-K for the year ended April 30, 2020).
|
23.1
|
|
Consent of KPMG LLP.**
|
23.2
|
|
Consent of Porter Hedges LLP (included in Exhibit 5.1).**
|
24.1
|
|
Power of Attorney (contained in signature pages).
|
*
|
OPT
will file as an exhibit to a current report on Form 8-K (i) any underwriting agreement relating to securities offered hereby,
(ii) the instruments setting forth the terms of the depositary shares, warrants, subscription rights, purchase contracts or
units, (iii) any additional required opinion of counsel to OPT as to the legality of the securities offered hereby or (iv)
any required opinion of counsel to OPT as to certain tax matters relative to securities offered hereby.
|
**
|
Filed
herewith.
|
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