Filed
Pursuant to Rule 424(b)(5)
Registration
No. 333-252167
PROSPECTUS
SUPPLEMENT
(To
Prospectus dated January 22, 2021)
VERB
TECHNOLOGY COMPANY, INC.
Up
to $30,000,000 of Common
Stock
Verb
Technology Company, Inc. has entered into an At-The-Market Issuance
Sales Agreement (the “Sales Agreement”) with Truist Securities,
Inc. (the “Sales Agent”) relating to the offer and sale of up to
$30,000,000 of our common stock, par value $0.0001 per share,
offered by this prospectus supplement and the accompanying
prospectus.
Sales
of our common stock, if any, under this prospectus supplement and
the accompanying prospectus may be made in transactions that are
deemed to be “at-the-market” offerings as defined in Rule 415(a)(4)
under the Securities Act of 1933, as amended (the “Securities
Act”), including sales made directly on or through The Nasdaq
Capital Market, the trading market for our common stock, or any
other trading market in the United States for our common stock,
sales made to or through a market maker other than on an exchange,
directly to the Sales Agent as principal in negotiated
transactions, or through a combination of any such methods of sale.
The Sales Agent will act as sales agent on a commercially
reasonable efforts basis consistent with its normal trading and
sales practices. There is no arrangement for funds to be received
in any escrow, trust or similar arrangement.
We
will pay the Sales Agent a commission of up to 3.0% of the gross
sales price per share of common stock issued by us and sold through
the Sales Agent as our sales agent under the Sales Agreement. In
connection with the sale of the common stock on our behalf, the
Sales Agent will be deemed to be an “underwriter” within the
meaning of the Securities Act and the compensation of the Sales
Agent will be deemed to be underwriting commissions or
discounts.
Our common stock is listed on The Nasdaq Capital Market under the
symbol “VERB.” On November 15, 2021, the last reported sale price
of our common stock on The Nasdaq Capital Market was $1.99 per
share.
Investing in our common stock involves a high degree of risk.
Refer to the section entitled “Risk Factors” beginning on page S-5
of this prospectus 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.
Sales Agent
Truist Securities
The
date of this prospectus supplement is November 16,
2021.
TABLE
OF CONTENTS
Prospectus
Supplement
Prospectus
ABOUT THIS PROSPECTUS
This
document is in two parts. The first part is this prospectus
supplement, which describes the specific terms of this offering and
also adds to and updates information contained in the accompanying
prospectus and the documents incorporated by reference herein. The
second part, the accompanying prospectus, provides more general
information. Generally, when we refer to this prospectus, we are
referring to both parts of this document combined. To the extent
there is a conflict between the information contained in this
prospectus supplement and the information contained in the
accompanying prospectus or any document incorporated by reference
herein or therein filed prior to the date of this prospectus
supplement, you should rely on the information in this prospectus
supplement; provided that if any statement in one of these
documents is inconsistent with a statement in another document
having a later date—for example, a document incorporated by
reference in the accompanying prospectus—the statement in the
document having the later date modifies or supersedes the earlier
statement.
The
representations, warranties and covenants made by us in any
agreement that is filed as an exhibit to any document that is
incorporated by reference herein were made solely for the benefit
of the parties to such agreement, including, in some cases, for the
purpose of allocating risk among the parties to such agreements,
and should not be deemed to be a representation, warranty or
covenant to you. Moreover, such representations, warranties or
covenants were accurate only as of the date when made. Accordingly,
such representations, warranties and covenants should not be relied
on as accurately representing the current state of our
affairs.
You
should rely only on the information contained in this prospectus
supplement or the accompanying prospectus, or the information
incorporated by reference herein or therein. We have not authorized
anyone to provide you with information that is different. The
information contained in this prospectus supplement or the
accompanying prospectus, or incorporated by reference herein or
therein, is accurate only as of the respective dates thereof,
regardless of the time of delivery of this prospectus supplement
and the accompanying prospectus or of any sale of our shares. It is
important that you read and consider all information contained in
this prospectus supplement and the accompanying prospectus,
including the documents incorporated by reference herein and
therein, in making your investment decision. You should also read
and consider the information in the documents to which we have
referred you in the sections entitled “Where You Can Find
Additional Information” and “Incorporation of Certain Information
by Reference” in this prospectus.
We
are offering shares of our common stock only in jurisdictions where
offers are permitted. The distribution of this prospectus and the
offering of our shares in certain jurisdictions may be restricted
by law. Persons outside the United States who come into possession
of this prospectus must inform themselves about, and observe any
restrictions relating to, the offering of our shares and the
distribution of this prospectus outside the United States. This
prospectus does not constitute, and may not be used in connection
with, an offer to sell, or a solicitation of an offer to buy, any
shares offered by this prospectus by any person in any jurisdiction
in which it is unlawful for such person to make such an offer or
solicitation.
Unless
otherwise mentioned, or unless the context requires otherwise, all
references in this prospectus supplement to the “Company,” “we,”
“us,” “our” and “Verb” refer to Verb Technology Company, Inc., a
Nevada corporation.
PROSPECTUS SUMMARY
This
prospectus summary highlights selected information included
elsewhere in this prospectus and does not contain all of the
information you should consider before buying shares of our common
stock. You should read the entire prospectus carefully, including
the section entitled “Risk Factors” and the financial statements
and related notes incorporated by reference in this prospectus,
before deciding to invest in our common stock. Some of the
statements in this prospectus constitute forward-looking
statements. For additional information, refer to the section
entitled “Cautionary Note Regarding Forward-Looking
Statements.”
Our
Business
Overview
We
are a Software-as-a-Service (“SaaS”) applications platform
developer. Our platform is comprised of a suite of interactive
video-based sales enablement business software products marketed on
a subscription basis. Our applications, available in both mobile
and desktop versions, are offered as a fully integrated suite, as
well as on a standalone basis, and include verbCRM, our
white-labelled Customer Relationship Management (“CRM”) application
for large sales-based enterprises; verbTEAMS, our CRM application
for small-and medium-sized businesses and solopreneurs; verbLEARN,
our Learning Management System application, verbLIVE, our Live
Stream eCommerce application, verbPULSE, our artificial
intelligence notification application, and verbMAIL, our
interactive video sales communication tool integrated with
Microsoft Outlook.
Our Technology
Our
suite of applications can be distinguished from other sales
enablement applications because our applications utilize our
proprietary interactive video technology as the primary means of
communication between sales and marketing professionals and their
customers and prospects. Moreover, the proprietary data collection
and analytics capabilities of our applications inform our users on
their devices in real time, when and for how long their prospects
have watched a video, how many times such prospects watched it, and
what they clicked on, which allows our users to focus their time
and efforts on ‘hot leads’ or interested prospects rather than on
those that have not seen such video or otherwise expressed interest
in such content. Users can create their hot lead lists by using
familiar, intuitive ‘swipe left/swipe right’ on-screen navigation.
Our clients report that these capabilities provide for a much more
efficient and effective sales process, resulting in increased sales
conversion rates. We developed the proprietary patent-pending
interactive video technology, as well as several other
patent-issued and patent-pending technologies that serve as the
unique foundation for all our platform applications.
Our Products
verbCRM
combines the capabilities of CRM lead-generation, content
management, and in-video ecommerce capabilities in an intuitive,
yet powerful tool for both inexperienced as well as highly skilled
sales professionals. verbCRM allows users to quickly and easily
create, distribute, and post videos to which they can add a choice
of on-screen clickable icons which, when clicked, allow viewers to
respond to the user’s call-to-action in real-time, in the video,
while the video is playing, without leaving or stopping the video.
For example, our technology allows a prospect or customer to click
on a product they see featured in a video and impulse buy it, or to
click on a calendar icon in the video to make an appointment with a
salesperson, among many other novel features and functionalities
designed to eliminate or reduce friction from the sales process for
our users. The verbCRM app is designed to be easy to use and
navigate and takes little time and training for a user to begin
using the app effectively. It usually takes less than four minutes
for a novice user to create an interactive video from our app.
Users can add interactive icons to pre-existing videos, as well as
to newly created videos shot with practically any mobile device.
verbCRM interactive videos can be distributed via email, text
messaging, chat app, or posted to popular social media directly and
easily from our app. No software download is required to view Verb
interactive videos on virtually any mobile or desktop device,
including smart TVs.
verbLEARN is an
interactive, video-based learning management system that
incorporates all of the clickable in-video technology featured in
our verbCRM application and adapts them for use by educators for
video-based education. verbLEARN is used by enterprises seeking to
educate a large sales team or a customer base about new products,
or elicit feedback about existing products. It also incorporates
Verb’s proprietary data collection and analytics capabilities that
inform users in real time when and for how long the viewers watched
the video, how many times they watched it, and what they clicked
on, in addition to adding gamification features that enhance the
learning aspects of the application.
verbLIVE
builds on popular video-based platforms such as Facebook Live,
Zoom, WebEx, and Go2Meeting, among others, by adding Verb’s
proprietary interactive in-video ecommerce capabilities – including
an in-video Shopify shopping cart integrated for Shopify account
holders - to our own live stream video broadcasting application.
verbLIVE is a next-generation live stream platform that allows
hosts to utilize a variety of novel sales-driving features,
including placing interactive icons on-screen that appear on the
screens of all viewers, providing in-video click-to-purchase
capabilities for products or services featured in the live video
broadcast, in real-time, driving friction-free selling. verbLIVE
also provides the host with real-time viewer engagement data and
interaction analytics. verbLIVE is entirely browser-based, allowing
it to function easily and effectively on all devices without
requiring the host or the viewers to download software, and is
secured through end-to-end encryption.
verbPULSE is a business/augmented intelligence
notification-based sales enablement platform feature set that
tracks users’ interactions with current and prospective customers
and then helps coach users by telling them what to do next in order
to close the sale, virtually automating the selling process.
verbTEAMS
is our interactive, video-based CRM for small-and medium-sized
businesses and solopreneurs. verbTEAMS also incorporates verbLIVE
as a bundled application. verbTEAMS features self-sign-up,
self-onboarding, self-configuring, content management system
capabilities, user level administrative capabilities, and
high-quality analytics capabilities in both mobile and desktop
platforms that sync with one another. It also has a built-in
one-click sync capability with Salesforce.
We continue to invest in the future of interactive livestreaming.
Following are some of our recent initiatives:
MARKETPLACE is a centralized, immersive and social online
destination where shoppers will be able to explore shoppable
livestream events hosted worldwide 24/7 across numerous product and
service categories. Through MARKETPLACE, which will incorporate our
verbLIVE Attribution technology, shoppers will be able to
communicate with hosts and ask questions about products in
real-time through an on-screen chat visible to all shoppers, and
invite friends and family to share in their shopping experience.
Shoppers will be able to click on an unintrusive in-video overlay
to place items in an on-screen shopping cart for purchase without
interrupting the video. Throughout the experience, the shopping
cart follows shoppers seamlessly from event to event, shoppable
video to shoppable video, host to host, product to product. We
believe the tools MARKETPLACE will offer will make it an attractive
platform for big box retail, boutiques, and celebrities, as well as
for their customers and followers.
verbTV is an online destination for shoppable entertainment
where viewers will be able to click on-screen to purchase featured
products and services in lieu of viewing traditional
advertisements. VerbTV will feature commercial-free television
content, such as concerts, game shows, sports and e-sports,
sitcoms, podcasts, special events, news, live events, and other
forms of video entertainment, all of which will be interactive and
shoppable. In addition to attracting viewers through our innovative
approach to advertising, we believe the native ecommerce
capabilities, real-time monetization, data collection and
analytical tools offered by the platform will attract producers,
content creators, sponsors, and advertisers alike.
Verb Partnerships and Integrations
verbMAIL
for Microsoft Outlook is a product of our partnership with
Microsoft and is available as an add-in to Microsoft Outlook for
Outlook and Office 365 subscribers. verbMAIL allows users to create
interactive videos seamlessly within Outlook by clicking the
verbMAIL icon in the Outlook toolbar. The videos are automatically
added to an email and can be sent easily through Outlook using the
user’s contacts they already have in Outlook. The application
allows users to easily track viewer engagement and together with
other features represents an effective sales tool available for all
Outlook users worldwide. Currently offered without charge, a
subscription-based paid version with a suite of enhanced features
for sales and marketing professionals is slated for release later
this year.
verbMAIL
for Google Gmail is currently under development. It will
include a feature set substantially identical to verbMAIL for
Outlook.
Salesforce Integration. We
have completed and deployed the integration of verbLIVE into
Salesforce and have launched a joint marketing campaign with
Salesforce to introduce the verbLIVE plug-in functionality to
current Salesforce users. We have also developed a verbCRM sync
application for Salesforce users that is currently being utilized
by at least one of our large enterprise clients and the verbLIVE
plug-in is now being offered to all Salesforce users on a monthly
subscription fee basis while we work to build adoption
rates.
Popular
Enterprise Back-Office System Integrations. We have
integratedverbCRM into systems
offered by 17 of the most popular direct sales back-office system
providers, such as Direct Scale, Exigo, By Design, Thatcher,
Multisoft, Xennsoft, and Party Plan. Direct sales back-office
systems provide many of the support functions required for direct
sales operations, including payroll, customer genealogy management,
statistics, rankings, and earnings, among other direct sales
financial tracking capabilities. The integration into these
back-office providers, facilitated through our own API development,
allows single sign-on convenience for users, as well as enhanced
data analytics and reporting capabilities for all users. Our
experience confirms that our integration into these back-end
platforms accelerates the adoption of verbCRM by large direct sales
enterprises that rely on these systems and as such, we believe this
represents a competitive advantage.
Non-Digital
Products and Services
Historically, we
provided certain non-digital services to some of our enterprise
clients such as printing and fulfillment services. We designed and
printed welcome kits and starter kits for their marketing needs and
provided fulfillment services, which consisted of managing the
preparation, handling and shipping of our client’s custom-branded
merchandise they use for marketing purposes at conferences and
other events. We also managed the fulfillment of our clients’
product sample packs that verbCRM users order through the app for
automated delivery and tracking to their customers and
prospects.
In
May 2020, we executed a contract with Range Printing (“Range”), a
company in the business of providing enterprise class printing,
sample assembly, warehousing, packaging, shipping, and fulfillment
services. Pursuant to the contract, through an automated process we
have established for this purpose, Range receives orders for
samples and merchandise from us as and when we receive them from
our clients and users, and print, assemble, store, package and ship
such samples and merchandise on our behalf. The Range contract
provides for a service fee arrangement based upon the specific
services to be provided by Range that is designed to maintain our
relationship with our clients by continuing to service their
non-digital needs, while eliminating the labor and overhead costs
associated with the provision of such services by us.
Our Market
Our client base has historically consisted primarily of
multi-national direct sales enterprises to whom we provide
white-labeled, client-branded versions of our products. Our clients
now include large enterprises in the life sciences sector,
professional sports franchises, educational institutions,
not-for-profits, as well as clients in the entertainment industry,
and the burgeoning CBD industry, among other business sectors. As
of September 30, 2021, we provide subscription-based application
services to approximately 140 enterprise clients for use in over
139 countries, in over 48 languages, which collectively account for
a user base generated through more than 3.0 million downloads of
our verbCRM application. Among the new business sectors targeted
for this year are medical equipment and pharmaceutical sales, armed
services and government institutions, small businesses and
individual entrepreneurs.
Corporate
Information
We
are a Nevada corporation that was incorporated in February 2005.
Our principal executive and administrative offices are located at
782 South Auto Mall Drive, American Fork, Utah 84003, and our
telephone number is (855) 250-2300. Our website address is
https://www.verb.tech/. Information on or accessed through our
website is not incorporated into this prospectus and is not a part
of this prospectus.
The
Offering
|
Shares
offered by us |
|
Shares
of our common stock having an aggregate offering price of up to
$30,000,000. |
| |
|
|
| Common
stock to be outstanding immediately after this
offering |
|
Up to
15,075,376 shares, after giving effect to the sale of $30.0 million
of shares of our common stock at an assumed price of $1.99 per
share, which was the closing price of our common stock on The
Nasdaq Capital Market on November 15, 2021. The maximum number of
shares that may be issued will vary depending on the price at which
shares may be sold from time to time during this
offering.(1) |
| |
|
|
| The
Nasdaq Capital Market symbol |
|
VERB |
| |
|
|
| Use
of Proceeds |
|
We
intend to use the net proceeds from this offering for working
capital and other general corporate purposes. For additional
information, refer to the section entitled “Use of
Proceeds.” |
| |
|
|
| Risk
Factors |
|
Investing
in our common stock involves a high degree of risk. You should
carefully consider the information set forth in the section
entitled “Risk Factors” beginning on page S-5 of this prospectus
for a discussion of information that should be considered in
connection with an investment in our common stock. |
| (1) |
The
number of shares of common stock that will be outstanding
immediately after this offering is based on the 70,169,666 shares
outstanding as of September 30, 2021, and excludes the
following: |
|
|
● |
5,528,405
shares of common stock issuable upon the exercise of outstanding
stock options as of September 30, 2021, with a weighted-average
exercise price of $1.70 per share; |
|
|
|
|
|
|
● |
2,109,999
shares of common stock issuable upon vesting of restricted stock
unit awards as of September 30, 2021, with a weighted-average grant
date fair value of $1.41 per share; |
|
|
|
|
|
|
● |
5,673,601
shares of common stock reserved for future issuance under our 2019
Omnibus Incentive Plan (the “Incentive Plan”) as of September 30,
2021; |
|
|
|
|
|
|
● |
11,008,302
shares of common stock issuable upon exercise of warrants to
purchase common stock outstanding as of September 30, 2021, with a
weighted-average exercise price of $2.67 per share; and |
|
|
|
|
|
|
● |
any
additional shares of common stock we may issue from time to time
after that date. |
Unless
otherwise indicated, all information in this prospectus assumes no
exercise of outstanding options and warrants.
RISK FACTORS
An
investment in our common stock involves a high degree of risk.
Before deciding whether to invest in our common stock, you should
consider carefully the risks described below, as well as the risk
factors contained in our most recent Annual Report on Form 10-K and
Quarterly Reports on Form 10-Q filed with the Securities and
Exchange Commission (“SEC”), together with the other information
contained in this prospectus supplement, the accompanying
prospectus, and the information and documents incorporated by
reference herein and therein. If any of these risks actually
occurs, our business, financial condition, results of operations
and liquidity could be materially adversely impacted. This could
cause the trading price of our common stock to decline, resulting
in a loss of all or part of your investment.
Risks
Related to This Offering
Sales of our common stock in this offering, or the perception
that such sales may occur, could cause the market price of our
common stock to fall.
We may issue and sell shares of our common stock for aggregate
gross proceeds of up to $30.0 million from time to time in
connection with this offering. The issuance and sale from time to
time of these new shares of common stock, or our ability to issue
these new shares of common stock in this offering, could have the
effect of depressing the market price of our common stock.
You will suffer immediate and substantial dilution in the net
tangible book value per share of the common stock that you purchase
in this offering.
The shares sold in this offering, if any, will be sold from time to
time at various prices; however, the assumed offering price of our
common stock is substantially higher than the net tangible book
value per share of our common stock. Therefore, if you purchase
shares of common stock in this offering, you will pay a price per
share of common stock that substantially exceeds our net tangible
book value per share after giving effect to this offering. Assuming
that an aggregate of 15,075,376 shares of our common stock are sold
at a price of $1.99 per share of common stock, which is the last
reported sale price of our common stock on The Nasdaq Capital
Market (“Nasdaq”) on November 15, 2021, for aggregate gross
proceeds of $30.0 million, and after deducting commissions and
estimated offering expenses payable by us, new investors in this
offering will experience immediate dilution of $1.76 per share,
representing the difference between the assumed offering price of
the common stock and our as adjusted net tangible book value per
share as of September 30, 2021 after giving effect to this
offering. For a more detailed illustration of the dilution you
would incur if you purchase common stock in this offering, refer to
the section entitled “Dilution.”
If you purchase shares of common stock in this offering, you may
also experience future dilution as a result of future equity
offerings.
We
may be required to raise additional capital in the future to fund
the growth and operation of our business. To raise additional
capital, we may offer additional shares of our common stock, or
other securities convertible into, or exercisable or exchangeable
for, shares of our common stock, at prices that may be lower than
the assumed offering price of our common stock in this offering. In
addition, investors purchasing our securities in the future could
have rights superior to those of our existing stockholders.
Furthermore, if any of our outstanding options or warrants are
exercised at prices below the assumed offering price, or if we
grant additional options or other awards under our equity incentive
plans, or if we issue additional warrants, you may experience
further dilution of your investment.
We have no intention of declaring dividends in the foreseeable
future.
The
decision to pay cash dividends on our common stock rests with our
board of directors and will depend on a number of factors,
including our earnings, cash balance, capital requirements and
financial condition. We do not anticipate declaring any dividends
in the foreseeable future, as we intend to use any excess cash for
the development, operation and expansion of our business. Investors
in our common stock should not expect to receive dividend income on
their investment, and investors will be dependent on the
appreciation of our common stock, if any, to earn a return on their
investment.
Future sales of our common stock in the public market could cause
our stock price to fall.
Sales
of a substantial number of shares of our common stock in the public
market, or the perception that these sales might occur, could
depress the market price of our common stock and could impair our
ability to raise capital through the sale of additional equity
securities. As of September 30, 2021, we had
70,169,666
shares of common stock outstanding, all of which shares were, and
continue to be, eligible for sale in the public market, subject in
some cases to compliance with the requirements of Rule 144,
including the volume limitations and manner of sale requirements.
In addition, all of the shares offered under this prospectus will
be freely tradable upon issuance without restriction.
The common stock offered hereby will be sold in
“at-the-market” offerings, and investors who buy shares at
different times will likely pay different prices.
Investors who purchase shares in this offering at different times
will likely pay different prices, and so may experience different
outcomes in their investment results. We will have discretion,
subject to market demand, to vary the timing, prices, and numbers
of shares sold, and there is no minimum or maximum sales price.
Investors may experience a decline in the value of their shares as
a result of share sales made at prices lower than the prices they
paid.
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
sales notice to the Sales Agent at any time throughout the term of
the Sales Agreement. The number of shares that are sold by the
Sales Agent after we deliver a sales notice will fluctuate based on
the market price of the common stock during the sales period and
limits we set with the Sales Agent. Because the price per share of
each share 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, if any, that will ultimately
be issued.
CAUTIONARY NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus, and the
documents incorporated by reference herein and therein, contain
“forward-looking statements” within the meaning of the federal
securities laws, which statements are subject to considerable risks
and uncertainties. These forward-looking statements are intended to
qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. All statements
included or incorporated by reference in this prospectus, other
than statements of historical fact, are forward-looking statements.
You can identify forward-looking statements by the use of words
such as “anticipate,” “believe,” “continue” “could,” “expect,”
“intend,” “may,” “will,” or the negative of such terms, or other
comparable terminology. Forward-looking statements also include the
assumptions underlying or relating to such statements. In
particular, forward-looking statements included or incorporated by
reference in this prospectus relate to, among other things, our
future or assumed financial condition, results of operations,
liquidity, business forecasts and plans, strategic plans and
objectives, financing plans, customers, products and competitive
environment. We caution you that the foregoing list may not include
all of the forward-looking statements made in this prospectus.
Our
forward-looking statements are based on our management’s current
assumptions and expectations about future events and trends, which
affect or may affect our business, strategy, operations or
financial performance. Although we believe that these
forward-looking statements are based upon reasonable assumptions,
they are subject to numerous known and unknown risks and
uncertainties and are made in light of information currently
available to us. Our actual financial condition and results could
differ materially from those anticipated in these forward-looking
statements as a result of various factors, including those set
forth in the section entitled “Risk Factors” beginning on page S-5
of this prospectus, as well as the risk factors contained in our
most recent Annual Report on Form 10-K, Quarterly Reports on Form
10-Q and the other reports we file with the SEC. You should read
this prospectus with the understanding that our actual future
results may be materially different from and worse than what we
expect.
Moreover,
we operate in an evolving environment. New risk factors and
uncertainties emerge from time to time and it is not possible for
our management to predict all risk factors and uncertainties, nor
can we assess the impact of all factors on our business or the
extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any
forward-looking statements.
Forward-looking
statements speak only as of the date they were made, and, except to
the extent required by law or Nasdaq Listing Rules, we undertake no
obligation to update or review any forward-looking statement
because of new information, future events or other
factors.
We
qualify all of our forward-looking statements by these cautionary
statements.
USE
OF PROCEEDS
We may issue and sell shares of our common stock having aggregate
gross proceeds of up to $30.0 million from time to time.
Because
there is no minimum offering amount required as a condition to
close this offering, the actual total public offering amount,
commissions paid to the Sales Agent and proceeds to us, if any, are
not determinable at this time. We estimate that the net proceeds
from the sale of the shares of common stock that we are offering
may be up to approximately $29.3 million, after deducting
commissions payable to the Sales Agent and estimated offering
expenses payable by us.
We
intend to use the net proceeds of this offering for working capital
and other general corporate purposes. We have not yet determined
the amount of net proceeds to be used specifically for any
particular purposes or the timing of these expenditures.
Accordingly, our management will have significant discretion and
flexibility in applying the net proceeds from the sale of these
securities, and investors will be relying on our judgment regarding
the application of the net proceeds from this offering.
Pending
our use of the net proceeds from this offering, we intend to
maintain the net proceeds as cash deposits or cash management
instruments, such as U.S. government securities or money market
mutual funds.
DIVIDEND POLICY
We
have never paid cash dividends on our common stock and do not
anticipate declaring any dividends in the foreseeable future. We
intend to use any excess cash for the development, operation and
expansion of our business. The decision to pay cash dividends on
our common stock rests with our board of directors and will depend
on a number of factors, including our earnings, cash balance,
capital requirements and financial condition. Investors in our
common stock should not expect to receive dividend income on their
investment, and investors will be dependent on the appreciation of
our common stock, if any, to earn a return on their
investment.
DILUTION
If
you purchase shares of common stock
in this offering, you will experience dilution to the extent of the
difference between the public offering price per share in this
offering and our as adjusted net tangible book value per share
after this offering.
Our net tangible book value as of September 30, 2021 was
approximately $(9.7) million or $(0.14) per share of common stock.
Net tangible book value per share is determined by dividing the net
of total tangible assets less total liabilities, by the aggregate
number of shares of common stock outstanding as of
September 30, 2021.
After giving effect to the sale of our common stock in the
aggregate amount of $30.0 million at the assumed offering
price of $1.99 per share of common stock, the last reported sale
price of our common stock on November 15, 2021, and after
deducting commissions and estimated offering expenses payable by
us, our as adjusted net tangible book value as of
September 30, 2021 would have been approximately $19.6
million, or $0.23 per share of common stock. This represents an
immediate increase in net tangible book value of $0.37 per share to
our existing stockholders and immediate dilution of $1.76 per share
to new investors in this offering.
The following table illustrates this dilution on a per share basis.
The as adjusted information is illustrative only and will adjust
based on the actual public offering price, the actual number of
shares sold and other terms of the offering determined at the time
shares of our common stock are sold pursuant to this prospectus
supplement. The as adjusted information assumes that all of our
common stock in the aggregate amount of $30.0 million is sold at
the assumed public offering price of $1.99 per share. The shares
sold in this offering, if any, will be sold from time to time at
various prices.
|
|
|
|
|
|
|
Amount |
|
|
Assumed
offering
price per share |
|
|
|
|
|
$ |
1.99 |
|
|
Net
tangible book value per share at September 30, 2021 |
|
$ |
(0.14 |
) |
|
|
|
|
|
Increase
in net tangible book value per share to the existing stockholders
attributable to this offering |
|
$ |
0.37
|
|
|
|
|
|
| As
adjusted net tangible book value per share attributable to this
offering |
|
|
|
|
|
$ |
0.23 |
|
| Dilution
per share to new investors in this offering |
|
|
|
|
|
$ |
1.76 |
|
The
number of shares of common stock that will be outstanding
immediately after this offering is based on the 70,169,666 shares
outstanding as of September 30, 2021, and excludes the
following:
|
|
● |
5,528,405
shares of
common stock issuable upon the exercise of outstanding stock
options as of September 30, 2021, with a weighted-average exercise
price of $1.70 per share; |
|
|
|
|
|
|
● |
2,109,999
shares of common stock issuable upon vesting of restricted stock
unit awards as of September 30, 2021, with a weighted-average grant
date fair value of $1.41 per share; |
|
|
|
|
|
|
● |
5,673,601
shares of
common stock reserved for future issuance under the Incentive Plan
as of September 30, 2021; |
|
|
|
|
|
|
● |
11,008,302
shares of
common stock issuable upon exercise of warrants to purchase common
stock outstanding as of September 30, 2021, with a weighted-average
exercise price of $2.67 per share; and |
|
|
|
|
|
|
● |
any
additional shares of common stock we may issue from time to time
after that date. |
PLAN OF DISTRIBUTION
We
have entered into an At-The-Market Issuance Sales Agreement with
Truist Securities, Inc., as Sales Agent, under which we may issue
and sell over a period of time, and from time to time, shares of
our common stock having an aggregate offering price of up to $30.0
million through the Sales Agent acting as sales agent or directly
to the Sales Agent acting as principal. This prospectus supplement
relates to our ability to issue and sell over a period of time, and
from time to time, shares of our common stock to or through the
Sales Agent pursuant to the Sales Agreement. Sales of the shares to
which this prospectus supplement and the accompanying prospectus
relate, if any, may be made in transactions that are deemed to be
“at-the-market” offerings as defined in Rule 415 under the
Securities Act, including sales made directly on or through Nasdaq,
the trading market for our common stock, or any other trading
market in the Unites States for our common stock, sales made to or
through a market maker other than on an exchange, directly to the
Sales Agent as principal in negotiated transactions, or through a
combination of any such methods of sale. To the extent required by
Regulation M, the Sales Agent acting as our sales agent will not
engage in any transactions that stabilize our common stock while
the offering is ongoing under this prospectus
supplement.
Upon
written instructions from us, the Sales Agent will offer the shares
of our common stock, subject to the terms and conditions of the
Sales Agreement, on a daily basis or as otherwise agreed upon by us
and the Sales Agent. We will designate the maximum amount of shares
of our common stock to be sold through the Sales Agent on a daily
basis or otherwise determine such maximum amount together with the
Sales Agent, subject to certain limitations set forth by the SEC.
Subject to the terms and conditions of the Sales Agreement, the
Sales Agent will use commercially reasonable efforts to sell on our
behalf all of the shares of our common stock so designated or
determined. We may instruct the Sales Agent not to sell shares of
our common stock if the sales cannot be effected at or above the
price designated by us in any such instruction. The Sales Agent may
also sell our common stock in negotiated transactions with our
prior approval. We or the Sales Agent may suspend the offering of
shares of our common stock being made under the Sales Agreement
upon proper notice to the other party.
For
its services as sales agent in connection with the sale of shares
of our common stock that may be offered hereby, we will pay the
Sales Agent an aggregate fee of up to 3.0% of the gross sales price
per share for any shares sold through it acting as our sales agent.
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 shares. We
have agreed to reimburse the Sales Agent for certain of its
expenses in an amount not to exceed $50,000, and, thereafter,
reasonable fees and expenses of the Sales Agent’s incurred in
conjunction of performing legal services related to the Sales
Agreement for the Company.
The
Sales Agent will provide written confirmation to us no later than
the opening of the trading day immediately following the day in
which shares of common stock are sold by it on our behalf under the
Sales Agreement. Each confirmation will include the number of
shares sold on that day, the compensation payable by us to the
Sales Agent and the proceeds to us net of such
compensation.
Settlement
for sales of our common stock will occur, unless the parties agree
otherwise, on the second business day following the date on which
any sales were made in return for payment of the proceeds to us net
of compensation paid by us to the Sales Agent. There is no
arrangement for funds to be received in an escrow, trust or similar
arrangement.
Unless
otherwise required, we will report at least quarterly the number of
shares of common stock sold through the Sales Agent under the Sales
Agreement, the net proceeds to us and the compensation paid by us
to the Sales Agent in connection with the sales of common
stock.
In
connection with the sale of common stock on our behalf, the Sales
Agent will be deemed to be an “underwriter” within the meaning of
the Securities Act, and the compensation paid to it will be deemed
to be underwriting commissions or discounts. We have agreed, under
the Sales Agreement, to provide indemnification and contribution to
the Sales Agent against certain civil liabilities, including
liabilities under the Securities Act.
In
the ordinary course of its business, the Sales Agent and/or its
affiliates may perform investment banking, broker-dealer, financial
advisory or other services for us for which it may receive separate
fees.
We
estimate that the total expenses from this offering payable by us,
excluding compensation payable to the Sales Agent under the Sales
Agreement, will be approximately $75,000.
The
offering of common stock pursuant to the Sales Agreement will
terminate upon the earlier of (1) the sale of shares of our common
stock with an aggregate offering price of $30.0 million subject to
the Sales Agreement and (2) the termination of the Sales Agreement,
pursuant to its terms, by either the Sales Agent or us.
The
Company and the Sales Agent may in the future agree to add one or
more additional sales agents to the offering, in which case the
Company will file a further prospectus supplement providing the
name of such additional sales agents and any other required
information.
LEGAL MATTERS
The
validity of the shares of common stock offered under this
prospectus will be passed upon by Stradling Yocca Carlson &
Rauth, P.C., Newport Beach, California. Certain legal matters
relating to this offering will be passed upon for the Sales Agent
by Goodwin Procter LLP, New York, New York.
EXPERTS
The
financial statements of Verb Technology Company, Inc. as of and for
the years ended December 31, 2020 and 2019 appearing in Verb
Technology Company, Inc.’s Annual Report on Form 10-K have been
audited by Weinberg & Company, P.A., an independent registered
public accounting firm, as stated in their report thereon, included
therein, and are incorporated by reference in reliance upon such
report and upon the authority of such firm as experts in accounting
and auditing.
WHERE YOU CAN FIND ADDITIONAL
INFORMATION
We
have filed with the SEC a registration statement on Form S-3 under
the Securities Act, and the rules and regulations promulgated
thereunder, with respect to the shares of common stock offered
under this prospectus. This prospectus, which constitutes a part of
the registration statement, does not contain all of the information
contained in the registration statement and the exhibits and
schedules thereto. Certain contracts and other documents described
in this prospectus, and the documents incorporated by reference
herein, are filed as exhibits to the registration statement, and
you may review the full text of these contracts and documents by
referring to these exhibits. For further information with respect
to us and the shares of common stock offered under this prospectus,
reference is made to the registration statement and its exhibits
and schedules.
We
file annual, quarterly and current reports, proxy statements, and
other information with the SEC. The SEC maintains a website that
contains these reports, proxy and information statements, and other
information we file electronically with the SEC. Our filings are
available free of charge at the SEC’s website at
www.sec.gov.
Our
website address is https://www.verb.tech/. We maintain a section on
our website, https://www.verb.tech/investor-relations/sec-filings,
through which you can obtain copies of the reports, proxy and
information statements, and other information we file
electronically with the SEC. We use our website as a channel of
distribution for material company information. Important
information, including financial information, analyst
presentations, financial news releases, and other material
information about us is routinely posted on and accessible on our
website. The information set forth on, or accessible from, our
website is not part of this prospectus.
INCORPORATION OF CERTAIN INFORMATION BY
REFERENCE
The
SEC allows us to “incorporate by reference” into this prospectus
much of the information we file with the SEC, which means that we
can disclose important information to you by referring you to those
publicly available documents. The information that we incorporate
by reference in this prospectus is considered to be part of this
prospectus. These documents may include Annual Reports on Form
10-K, Quarterly Reports on Form 10-Q and Current Reports on Form
8-K, as well as proxy and information statements. You should read
the information incorporated by reference because it is an
important part of this prospectus.
This
prospectus incorporates by reference the documents listed below,
other than those documents or the portions of those documents
deemed to be furnished and not filed in accordance with SEC
rules:
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|
● |
our
Annual Report on Form 10-K for the fiscal year ended December 31,
2020, filed with the SEC on March 31, 2021; |
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|
● |
our
Quarterly Report on Form 10-Q for the quarter ended March 31, 2021,
filed with the SEC on May 13, 2021; |
|
|
|
|
|
|
● |
our
Quarterly Report on Form 10-Q for the quarter ended June 30, 2021,
filed with the SEC on August 16, 2021; |
|
|
|
|
|
|
● |
our
Quarterly Report on Form 10-Q for the quarter ended September 30,
2021, filed with the SEC on November 15, 2021; |
|
|
|
|
|
|
● |
our
Definitive Proxy Statement on Schedule 14A, filed with the SEC on
September 3, 2021; |
|
|
|
|
|
|
● |
our
Current Reports on Form 8-K filed with the SEC on January 6, 2021,
March 15, 2021, March 16, 2021, April 30, 2021, June 4, 2021,
August 12, 2021, August 20, 2021, October 4, 2021, and October 22,
2021; and
|
|
|
|
|
|
|
● |
the
description of our securities contained in Exhibit 4.17 of our
Annual Report on Form 10-K for the fiscal year ended December 31,
2019, filed with the SEC on May 14, 2020, including any amendment
or report filed for the purpose of updating such
description. |
We
also incorporate by reference any future filings (other than
current reports furnished under Item 2.02 or Item 7.01 of Form 8-K,
and exhibits filed on such form that are related to such items,
unless such Form 8-K expressly provides to the contrary) made with
the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act after the date of this prospectus supplement but prior
to the termination of the offering, and such future filings will
become a part of this prospectus from the respective dates that
such documents are filed with the SEC. Any statement contained
herein, or in a document incorporated by reference herein, shall be
deemed to be modified or superseded for purposes hereof or of the
related prospectus supplement to the extent that a statement
contained herein or in any other subsequently filed document which
is also incorporated herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this
prospectus.
You
may obtain copies of the documents incorporated by reference in
this prospectus free of charge by requesting them in writing or by
telephone at the following address:
Verb
Technology Company, Inc.
782 South
Auto Mall Drive
American Fork, Utah 84003
Attn: Investor Relations
Telephone: (855) 250-2300
$75,000,000
Common
Stock
Preferred
Stock
Debt
Securities
Warrants
Subscription
Rights
Units
We
may offer and sell up to $75,000,000 in the aggregate of the
securities identified above from time to time in one or more
offerings. This prospectus provides you with a general description
of the securities.
Each
time we offer and sell securities, we will provide a supplement to
this prospectus that contains specific information about the
offering and the amounts, prices and terms of the securities. The
supplement may also add, update or change information contained in
this prospectus with respect to that offering. You should carefully
read this prospectus and the applicable prospectus supplement
before you invest in any of our securities.
We
may offer and sell the securities described in this prospectus and
any prospectus supplement to or through one or more underwriters,
dealers and agents, or directly to purchasers, or through a
combination of these methods. If any underwriters, dealers or
agents are involved in the sale of any of the securities, their
names and any applicable purchase price, fee, commission or
discount arrangement between or among them will be set forth, or
will be calculable from the information set forth, in the
applicable prospectus supplement. See the sections of this
prospectus entitled “About this Prospectus” and “Plan of
Distribution” for more information. No securities may be sold
without delivery of this prospectus and the applicable prospectus
supplement describing the method and terms of the offering of such
securities.
INVESTING
IN OUR SECURITIES INVOLVES RISKS. SEE THE “RISK FACTORS” ON PAGE 1
OF THIS PROSPECTUS AND ANY SIMILAR SECTION CONTAINED IN THE
APPLICABLE PROSPECTUS SUPPLEMENT CONCERNING FACTORS YOU SHOULD
CONSIDER BEFORE INVESTING IN OUR SECURITIES.
Our
common stock is listed on The Nasdaq Capital Market under the
symbol “VERB.” On January 14, 2021 the last reported sale price of
our common stock on The Nasdaq Capital Market was $1.88 per
share.
Neither
the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or
determined if this prospectus or the accompanying prospectus is
truthful or complete. Any representation to the contrary is a
criminal offense.
The
date of this prospectus is January 22, 2021.
TABLE
OF CONTENTS
ABOUT THIS PROSPECTUS
This
prospectus is part of a registration statement that we filed with
the U.S. Securities and Exchange Commission, or the SEC, using a
“shelf” registration process. By using a shelf registration
statement, we may sell securities from time to time and in one or
more offerings up to a total dollar amount of $75,000,000 as
described in this prospectus.
This
prospectus provides you only with a general description of the
securities that we may offer. Each time that we offer and sell
securities, we will provide a prospectus supplement to this
prospectus that contains specific information about the securities
being offered and sold and the specific terms of that offering. We
may also authorize one or more free writing prospectuses to be
provided to you that may contain material information relating to
these offerings. The prospectus supplement or free writing
prospectus may also add, update or change information contained in
this prospectus with respect to that offering. If there is any
inconsistency between the information in this prospectus and the
applicable prospectus supplement or free writing prospectus, you
should rely on the prospectus supplement or free writing
prospectus, as applicable. Before purchasing any securities, you
should carefully read both this prospectus and the applicable
prospectus supplement (and any applicable free writing
prospectuses), together with the additional information described
under the heading “Where You Can Find More Information.”
We
have not authorized anyone to provide you with any information or
to make any representations other than those contained in, or
incorporated by reference in, this prospectus, any applicable
prospectus supplement or any free writing prospectuses prepared by
or on behalf of us or to which we have referred you. We take no
responsibility for, and can provide no assurance as to the
reliability of, any other information that others may give you. We
will not make an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted. You should assume that
the information appearing in this prospectus and the applicable
prospectus supplement to this prospectus is accurate only as of the
date on its respective cover, that the information appearing in any
applicable free writing prospectus is accurate only as of the date
of that free writing prospectus, and that any information
incorporated by reference is accurate only as of the date of the
document incorporated by reference, unless we indicate otherwise.
Our business, financial condition, results of operations and
prospects may have changed since those dates.
When
we refer to “Verb,” “we,” “our,” “us” and the “Company” in this
prospectus, we mean Verb Technology Company, Inc., and its
consolidated subsidiaries unless otherwise specified. When we refer
to “you,” we mean the potential holders of the applicable series of
securities.
ABOUT VERB TECHNOLOGY COMPANY,
INC.
Overview
We
are a Software-as-a-Service applications platform developer. Our
platform is comprised of a suite of interactive video-based sales
enablement business software products marketed on a subscription
basis. Our applications, available in both mobile and desktop
versions, are offered as a fully integrated suite, as well as on a
standalone basis, and include verbCRM, our white-labelled Customer
Relationship Management (“CRM”) application for large sales-based
enterprises; verbTEAMS, our CRM application for small and medium
sized businesses and solopreneurs; verbLEARN, our Learning
Management System application, and verbLIVE, our Live Stream
eCommerce application.
Our
suite of applications can be distinguished from other sales
enablement applications because our applications utilize our
proprietary interactive video technology as the primary means of
communication between sales and marketing professionals and their
customers and prospects. Moreover, the proprietary data collection
and analytics capabilities of our applications inform our users in
real time, on their devices, when and for how long their prospects
have watched a video, how many times such prospects watched it, and
what they clicked-on, which allows our users to focus their time
and efforts on ‘hot leads’ or interested prospects rather than on
those that have not seen such video or otherwise expressed interest
in such content. Users can create their hot lead lists by using
familiar, intuitive ‘swipe left/swipe right’ on-screen navigation.
Our clients report that these capabilities provide for a much more
efficient and effective sales process, resulting in increased sales
conversion rates. We developed the proprietary patent-pending
interactive video technology, as well as several other
patent-issued and patent-pending technologies that serve as the
unique foundation for all of our platform applications
Corporate
Information
We
are a Nevada corporation. Our principal executive/administrative
offices are located at 782 South Auto Mall Drive, American Fork,
Utah 84003, and our telephone number is (855) 250-2300. Our website
address is https://www.verb.tech/. Information on or
accessed through our website is not incorporated into this
prospectus and is not a part of this prospectus.
RISK FACTORS
Investing
in our securities involves a high degree of risk. Before making an
investment decision or acquiring any offered securities pursuant to
this prospectus, you should carefully consider the specific factors
discussed under the heading “Risk Factors” in the applicable
prospectus supplement, together with all of the other information
contained or incorporated by reference in the prospectus supplement
or appearing or incorporated by reference in this prospectus, in
light of your particular investment objectives and financial
circumstances. You should also consider the risks, uncertainties,
and assumptions discussed under the heading “Risk Factors” included
in our most recent Annual Report on Form 10-K, as revised or
supplemented by our subsequent Quarterly Reports on Form 10-Q, or
our Current Reports on Form 8-K that we have filed with the SEC,
all of which are incorporated herein by reference, and which may be
amended, supplemented, or superseded from time to time by other
reports we file with the SEC in the future. Moreover, the risks so
described are not the only risks we face. Additional risks not
presently known to us or that we currently perceive as immaterial
may ultimately prove more significant than expected and impair our
business operations. Any of these risks could adversely affect our
business, financial condition, results of operations, and
prospects. The trading price of our securities could decline due to
any of these risks and you may lose all or part of your investment.
This prospectus and the incorporated documents also contain
forward-looking statements that involve risks and
uncertainties.
SPECIAL NOTE REGARDING
FORWARD-LOOKING STATEMENTS
This
prospectus, any prospectus supplement, and the documents
incorporated by reference into this prospectus contain certain
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, or the Securities Act, and
Section 21E of the Securities Exchange Act of 1934, as amended, or
the Exchange Act, and the Private Securities Litigation Reform Act
of 1995 with respect to our business, financial condition,
liquidity, and results of operations. These forward-looking
statements are not historical facts but rather are plans and
predictions based on current expectations, estimates, and
projections about our industry, our beliefs, and assumptions. We
use words such as “may,” “will,” “could,” “should,” “anticipate,”
“expect,” “intend,” “project,” “plan,” “believe,” “seek,”
“estimate,” “assume,” and variations of these words and similar
expressions to identify forward-looking statements. Statements in
this prospectus and the other documents incorporated by reference
that are not historical facts are hereby identified as
“forward-looking statements” for the purpose of the safe harbor
provided by Section 21E of the Exchange Act and Section 27A of the
Securities Act. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties, and
other factors, some of which are beyond our control, are difficult
to predict and could cause actual results to differ materially from
those expressed or forecasted in the forward-looking statements.
These risks and uncertainties include those described in the
section above entitled “Risk Factors,” in our Annual Report on Form
10-K for the fiscal year ended December 31, 2019, our subsequent
Quarterly Reports on Form 10-Q for the quarterly periods ended
March 31, 2020, June 30, 2020, and September 30, 2020, and the
risks detailed from time to time on our future reports filed with
the SEC.
You
should not place undue reliance on these forward-looking statements
because the matters they describe are subject to certain risks,
uncertainties, and assumptions that are difficult to predict. The
forward-looking statements contained in this prospectus or any
prospectus supplement are made as of the date of this prospectus
or, in the case of any accompanying prospectus supplement or
documents incorporated by reference, the date of any such document.
Over time, our actual results, performance, or achievements may
differ from those expressed or implied by our forward-looking
statements, and such difference might be significant and materially
adverse to our security holders. Except as required by law, we
undertake no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events,
or otherwise. We have identified some of the important factors that
could cause future events to differ from our current expectations
and they are described in this prospectus under the captions “Risk
Factors,” and as well as in our most recent Annual Report on Form
10-K and any subsequently filed Quarterly Reports on Form 10-Q, and
in other documents that we may file with the SEC, all of which you
should review carefully. Please consider our forward-looking
statements in light of those risks as you read this prospectus and
any prospectus supplement.
USE OF PROCEEDS
Except
as set forth in any accompanying prospectus supplement, we intend
to use the net proceeds from the sale of any securities offered
under this prospectus for general corporate purposes unless the
applicable prospectus supplement provides otherwise. General
corporate purposes may include, and are not limited to, research
and development costs, the acquisition or licensing of other
businesses, products or product candidates, working capital and
capital expenditures.
We
may temporarily invest the net proceeds in a variety of capital
preservation instruments, including investment grade instruments,
certificates of deposit or direct or guaranteed obligations of the
U.S. government, or may hold such proceeds as cash, until they are
used for their stated purpose. We have not determined the amount of
net proceeds to be used specifically for such purposes. As a
result, management will retain broad discretion over the allocation
of net proceeds.
DESCRIPTION OF CAPITAL
STOCK
The
following is a summary of all material characteristics of our
capital stock as set forth in our Articles of Incorporation, as
amended, or Articles of Incorporation, and our Amended and Restated
Bylaws, or Bylaws. The summary does not purport to be complete and
is qualified in its entirety by reference to our Articles of
Incorporation and our Bylaws, and to the provisions of the Nevada
Revised Statutes, or the NRS. We encourage you to review complete
copies of our Articles of Incorporation and our Bylaws. You can
obtain copies of these documents by following the directions
outlined in “Where You Can Find More Information” and
“Incorporation of Certain Information by Reference” elsewhere in
this prospectus.
Authorized
Capital Stock
Our
authorized capital stock consists of 200,000,000 shares of common
stock, $0.0001 par value per share, and 15,000,000 shares of
preferred stock, $0.0001 par value per share, of which 6,000 shares
have been designated Series A Preferred Stock. As of January 14,
2021, we had 48,392,483 shares of common stock outstanding and
1,856 shares of Series A Preferred Stock outstanding.
Common
Stock
All
outstanding shares of our common stock are fully paid and
nonassessable. The following summarizes the rights of holders of
our common stock:
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|
● |
a
holder of common stock is entitled to one vote per share on all
matters to be voted upon generally by the stockholders and are not
entitled to cumulative voting for the election of
directors; |
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|
● |
subject
to preferences that may apply to shares of preferred stock
outstanding, the holders of common stock are entitled to receive
lawful dividends as may be declared by our board of
directors; |
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|
● |
upon
our liquidation, dissolution or winding up, the holders of shares
of common stock are entitled to receive a pro rata portion of all
our assets remaining for distribution after satisfaction of all our
liabilities and the payment of any liquidation preference of any
outstanding preferred stock; |
|
|
● |
there
are no redemption or sinking fund provisions applicable to our
common stock; and |
|
|
● |
there
are no preemptive, subscription or conversion rights applicable to
our common stock. |
Preferred
Stock
All
of the preferred stock authorized in our articles of incorporation
is undesignated. Our board of directors is authorized, without
further approval from our stockholders, to create one or more
series of preferred stock, and to designate the rights, privileges,
preferences, restrictions, and limitations of any given series of
preferred stock. Accordingly, our board of directors may, without
stockholder approval, issue shares of preferred stock with
dividend, liquidation, conversion, voting, or other rights that
could adversely affect the voting power or other rights of the
holders of our common stock. The issuance of preferred stock could
have the effect of restricting dividends payable to holders of our
common stock, diluting the voting power of our common stock,
impairing the liquidation rights of our common stock, or delaying
or preventing a change in control of us, all without further action
by our stockholders. The following is a summary of the terms and
conditions of the Series A Preferred Stock.
Series
A Preferred Stock
The
rights and preferences of the Series A Preferred Stock are outlined
below.
Rank
and Liquidation Preference
Shares
of Series A Preferred Stock rank prior to our common stock as to
distribution of assets upon liquidation events, which include a
liquidation, dissolution or winding up of our company, whether
voluntary or involuntary. The liquidation preference of each share
of Series A Preferred Stock is equal to $1,000.00, or the Stated
Value, plus any accrued but unpaid dividends on the Series A
Preferred Stock and any other fees or liquidated damages then due
and owing under the Certificate of Designation of Rights,
Preferences, and Restrictions of Series A Convertible Preferred
Stock, or the Certificate of Designations. If the assets are
insufficient to pay in full such amounts, then the entire assets to
be distributed to the holders of our Series A Preferred Stock shall
be distributed pro rata among the holders of our Series A Preferred
Stock in accordance with the respective amounts that would be
payable on such shares if all amounts payable thereon were paid in
full.
Dividend
Rights
The
holders of Series A Preferred Stock are entitled to receive lawful
dividends as may be declared by our board of directors.
Optional
Conversion Rights
Each
share of Series A Preferred Stock is convertible at the option of
the holder into shares of our common stock at any time. Each share
of Series A Preferred Stock is convertible into the number of
shares of common stock as calculated by dividing the Stated Value
of such share of Series A Preferred Stock by the conversion price.
The conversion price was initially $1.55 per share of Series A
Preferred Stock, which conversion price was subsequently adjusted
to $1.10 per share and is subject to further adjustment; therefore,
each share of Series A Preferred Stock was initially convertible
into approximately 645 shares of common stock and after adjustment
of the conversion price to $1.10 per share, each share of Series A
convertible stock is now convertible into approximately 909 shares
of common stock, which number is equal to the quotient of the
Stated Value of the Series A Preferred Stock of $1,000.00 divided
by the conversion price of $1.10 per share of Series A Preferred
Stock. No fractional shares or scrip representing fractional shares
are to be issued upon conversion of the Series A Preferred Stock.
As to any fraction of share that the holder of Series A Preferred
Stock would otherwise be entitled to purchase upon conversion, we
shall, at our election, either pay a cash adjustment in respect of
such final fraction in an amount equal to such fraction multiplied
by the conversion price, or round up to the next whole
share.
The
holders of Series A Preferred Stock cannot convert the Series A
Preferred Stock if, after giving effect to the conversion, the
number of shares of our common stock beneficially held by the
holder (together with such holder’s affiliates) would be in excess
of 4.99% (or, upon election by a holder prior to the issuance of
any shares, 9.99% of the number of shares of our common stock
issued and outstanding immediately after giving effect to the
issuance of any shares of common stock issuance upon conversion of
the Series A Preferred Stock held by the holder).
We
are also prevented from issuing shares of our common stock upon
conversion of the Series A Preferred Stock or exercise of the
August Warrants (as defined below), which, when aggregated with any
shares of our common stock issued on or after the issuance date and
prior to such conversion date or exercise date, as applicable (i)
in connection with any conversion of the Series A Preferred Stock
issued pursuant to that certain securities purchase agreement
entered into on August 14, 2019 by and among us and the investors
thereto, or SPA, (ii) in connection with the exercise of any August
Warrants issued pursuant to the SPA, and (iii) in connection with
the exercise of any warrants issued to any registered broker-dealer
as a fee in connection with the issuance of the securities pursuant
to the SPA, would exceed 4,459,725 shares of common stock, or
19.99% Cap. This prohibition will terminate upon the approval by
our stockholders of a release from such 19.99% Cap.
Mandatory
Conversion Rights
In
the event the closing price on The Nasdaq Capital Market is 100%
greater than the then-base conversion price on each trading day for
any twenty trading days during a consecutive thirty trading day
period, we may, within one trading day after the later of
stockholder approval to issue a number of shares of common stock in
excess of the 19.99% Cap and the date that the conversion shares
registration statement filed by us with the SEC declared effective,
notify each holder of Series A Preferred Stock that all or part of
such holder’s Series A Preferred Stock, plus all liquidated damages
and other amounts due, were converted into shares of common stock.
Any mandatory conversion will be made into the number of shares of
common stock determined on the same basis as the optional
conversion rights above.
Conversion
Price Adjustments
The
conversion price of the Series A Preferred Stock is subject to
certain customary adjustments, including upon certain subsequent
equity sales and rights offerings. The conversion price is also
subject to downward adjustments if we issue shares of our common
stock or securities convertible into or exercisable for shares of
common stock, other than specified excluded securities, at per
share prices less than the then-base conversion price. In this
event, the conversion price shall be reduced to then-base
conversion price.
The
conversion price is also subject to adjustment if we issue rights,
options, or warrants to holders of common stock entitling them to
subscribe for or purchase shares of common stock at a price per
share that is lower than the volume weighted average price on the
date for determination of stockholders entitled to receive such
rights, option, or warrants. In this event, the conversion price
shall be multiplied by a fraction of which the denominator is the
number of shares of common stock outstanding on the date of
issuance of such rights, options, or warrants plus the number of
additional shares of common stock offered for subscription or
purchase, and the numerator shall be the number of shares of common
stock outstanding on the date of issuance of such rights, options,
or warrants plus the number of shares that the aggregate offering
price of the total number of shares so offered would purchase at
such volume weighted average price.
If we
distribute to holders of common stock evidences of our indebtedness
or assets, including cash and cash dividends, or rights or warrants
to subscribe for or purchase any security, subject to certain
limitations, then the conversion price shall be adjusted by
multiplying the conversion price then in effect immediately prior
to the record date fixed for determination of stockholders entitled
to receive such distribution by a fraction of which the denominator
shall be the volume weighted average price determined as of the
record date, and of which the numerator shall be the volume
weighted average price on such record date less the then fair
market value at such record date of the portion of such assets or
evidence of indebtedness or rights or warrants so distributed
applicable to one outstanding share of our common stock as
determined by our board of directors in good faith.
In
the event of a Fundamental Transaction (as defined below) while the
Series A Preferred Stock is outstanding, holders of Series A
Preferred Stock shall have the right to receive, for each share of
common stock issuable upon conversion of the shares of our Series A
Preferred Stock that would have been issuable upon such conversion
immediately prior to the occurrence of such Fundamental
Transaction, the number of shares of common stock of the successor
or acquiring corporation or of us, if we are the surviving
corporation, and any additional consideration receivable as a
result of the Fundamental Transaction by a holder of the number of
shares of common stock for which the Series A Preferred Stock is
convertible immediately prior to such Fundamental Transaction. A
“Fundamental Transaction” is defined as any time while the Series A
Preferred Stock is outstanding (a) we, directly or indirectly, in
one or more related transactions shall effect any merger or
consolidation of us with or into another person, (b) we, directly
or indirectly, effect any sale, lease, license, assignment,
transfer, conveyance, or other disposition of all or substantially
all of our assets in one or a series of related transactions, (c)
any, direct or indirect, purchase offer, tender offer, or exchange
offer (whether by us or another person) is completed pursuant to
which holders of our common stock are permitted to sell, tender, or
exchange their shares for other securities, cash, or property and
has been accepted by the holders of a majority of the outstanding
common stock, (d) we, directly or indirectly, in one or more
related transactions effect any reclassification, reorganization or
recapitalization of our common stock or any compulsory share
exchange, pursuant to which the common stock is effectively
converted into or exchanged for other securities, cash or property,
or (e) we, directly or indirectly, in one or more related
transactions consummate a stock or share purchase agreement or
other business combination (including, without limitation, a
reorganization, recapitalization, spin-off, or scheme of
arrangement) with another person, whereby such other person
acquires more than 50% of the outstanding shares of common stock
(not including any shares of common stock held by the other person
or other persons making or party to, or associated or affiliated
with the other persons making or party to, such stock or share
purchase agreement or other business combination).
Voting
Rights and Protective Provisions
The
holders of Series A Preferred Stock have no voting rights. However,
we cannot, without the affirmative vote of the holders of a
majority of the then-outstanding shares of Series A Preferred
Stock:
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authorize
or create any class of stock ranking as to dividends, redemption,
or distribution of assets upon a liquidation senior to, or
otherwise pari passu with, the Series A Preferred
Stock; |
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amend
our articles of incorporation, or other charter documents in any
manner that materially and adversely affects any rights of the
holders; |
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increase
the number of authorized shares of Series A Preferred Stock;
or |
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enter
into any agreement with respect to any of the
foregoing. |
As
long as any shares of Series A Preferred Stock are outstanding,
unless the holders of at least 75% in Stated Value of the
then-outstanding shares of Series A Preferred Stock have otherwise
given prior written consent, we cannot, directly or
indirectly:
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other
than permitted indebtedness, as long as 25% of the then-outstanding
shares of Series A Preferred Stock issued pursuant to the SPA are
then outstanding, enter into, create, incur, assume, guarantee, or
suffer to exist any indebtedness for borrowed money of any kind
that is or may be senior to the Series A Preferred Stock in
dividend rights or liquidation preference, including, but not
limited to, a guarantee, on or with respect to any of our property
or assets now owned or hereafter acquired or any interest therein
of any income or profits therefrom; |
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other
than permitted liens, enter into, create, incur, assume, or suffer
to exist any liens of any kind, on or with respect to any of our
property or assets now owned or hereafter acquired or any interest
therein or any income or profits therefrom; |
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amend
our charter documents, including, without limitation, our articles
of incorporation and bylaws, in any manner that materially and
adversely affects any rights of the holder; |
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repay,
repurchase, or offer to repay, repurchase, or otherwise acquire
more than a de minimis number of shares of our common stock, common
stock equivalents or junior securities, other than as to (a) the
conversion shares or warrant shares as permitted under the
transaction documents and (b) repurchases of common stock or common
stock equivalents of departing officers and directors, provided
that such repurchases shall not exceed an aggregate of $100,000 for
all officers and directors for so long as the Series A Preferred
Stock is outstanding; |
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pay
cash dividends or distributions on junior securities; |
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enter
into any transaction with any affiliate of us that would be
required to be disclosed in any public filing with the SEC, unless
such transaction is made on an arm’s length basis and expressly
approved by a majority of the disinterested directors of us (even
if less than a quorum otherwise required for board approval);
or |
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enter
into any agreement with respect to the foregoing. |
Reservation
of Shares
We
initially were required to reserve 3,245,162 shares of common stock
for issuance upon conversion of shares of Series A Preferred Stock
and are required to maintain a sufficient number of reserved shares
of common stock to allow for the conversion of all shares of Series
A Preferred Stock.
Undesignated
Preferred Stock
The
ability to authorize undesignated preferred stock makes it possible
for our board of directors to issue preferred stock with voting or
other rights or preferences that could impede the success of any
attempt to acquire us. These and other provisions may have the
effect of deferring hostile takeovers or delaying changes in
control or management of us.
Anti-Takeover
Effects of Nevada Law and Our Articles of Incorporation and
Bylaws
Some
provisions of Nevada law, our articles of incorporation, and our
bylaws contain provisions that could make the following
transactions more difficult: an acquisition of us by means of a
tender offer; an acquisition of us by means of a proxy contest or
otherwise; or the removal of our incumbent officers and directors.
It is possible that these provisions could make it more difficult
to accomplish or could deter transactions that stockholders may
otherwise consider to be in their best interest or in our best
interests, including transactions that provide for payment of a
premium over the market price for our shares.
These
provisions, summarized below, are intended to discourage coercive
takeover practices and inadequate takeover bids. These provisions
are also designed to encourage persons seeking to acquire control
of us to first negotiate with our board of directors. We believe
that the benefits of the increased protection of our potential
ability to negotiate with the proponent of an unfriendly or
unsolicited proposal to acquire or restructure us outweigh the
disadvantages of discouraging these proposals because negotiation
of these proposals could result in an improvement of their
terms.
Undesignated
Preferred Stock. The ability of our board of directors, without
action by the stockholders, to issue up to 14,994,000 shares of
preferred stock, which was previously authorized but remain
undesignated, other than the Series A Preferred Stock, with voting
or other rights or preferences as designated by our board of
directors could impede the success of any attempt to change control
of us. These and other provisions may have the effect of deferring
hostile takeovers or delaying changes in control or management of
us.
Stockholder
Meetings. Our bylaws provide that a special meeting of
stockholders may be called only by our president, by all of the
directors provided that there are no more than three directors, or
if more than three, by any three directors, or by the holder of a
majority of our capital stock.
Stockholder
Action by Written Consent. Our bylaws allow for any action that
may be taken at any annual or special meeting of the stockholders
to be taken without a meeting and without prior notice, if a
consent in writing, setting forth the action so taken, is signed by
the holders of outstanding shares having not less than the minimum
number of votes that would be necessary to authorize or take such
action at a meeting at which all shares entitled to vote thereon
were present and voted.
Stockholders
Not Entitled to Cumulative Voting. Our bylaws do not permit
stockholders to cumulate their votes in the election of directors.
Accordingly, the holders of a majority of the outstanding shares of
our common stock entitled to vote in any election of directors can
elect all of the directors standing for election, if they choose,
other than any directors that holders of our preferred stock may be
entitled to elect.
Nevada
Business Combination Statutes. The “business combination”
provisions of Sections 78.411 to 78.444, inclusive, of the NRS,
generally prohibit a Nevada corporation with at least 200
stockholders from engaging in various “combination” transactions
with any interested stockholder for a period of two years after the
date of the transaction in which the person became an interested
stockholder, unless the transaction is approved by the board of
directors prior to the date the interested stockholder obtained
such status or the combination is approved by the board of
directors and thereafter is approved at a meeting of the
stockholders by the affirmative vote of stockholders representing
at least 60% of the outstanding voting power held by disinterested
stockholders, and extends beyond the expiration of the two-year
period, unless:
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the
combination was approved by the board of directors prior to the
person becoming an interested stockholder or the transaction by
which the person first became an interested stockholder was
approved by the board of directors before the person became an
interested stockholder or the combination is later approved by a
majority of the voting power held by disinterested stockholders;
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if
the consideration to be paid by the interested stockholder is at
least equal to the highest of: (a) the highest price per share paid
by the interested stockholder within the two years immediately
preceding the date of the announcement of the combination or in the
transaction in which it became an interested stockholder, whichever
is higher, (b) the market value per share of common stock on the
date of announcement of the combination and the date the interested
stockholder acquired the shares, whichever is higher, or (c) for
holders of preferred stock, the highest liquidation value of the
preferred stock, if it is higher. |
A
“combination” is generally defined to include mergers or
consolidations or any sale, lease exchange, mortgage, pledge,
transfer, or other disposition, in one transaction or a series of
transactions, with an “interested stockholder” having: (a) an
aggregate market value equal to 5% or more of the aggregate market
value of the assets of the corporation, (b) an aggregate market
value equal to 5% or more of the aggregate market value of all
outstanding shares of the corporation, (c) 10% or more of the
earning power or net income of the corporation, and (d) certain
other transactions with an interested stockholder or an affiliate
or associate of an interested stockholder.
In
general, an “interested stockholder” is a person who, together with
affiliates and associates, owns (or within two years, did own) 10%
or more of a corporation’s voting stock. The statute could prohibit
or delay mergers or other takeover or change in control attempts
and, accordingly, may discourage attempts to acquire us even though
such a transaction may offer our stockholders the opportunity to
sell their stock at a price above the prevailing market
price.
Nevada
Control Share Acquisition Statutes. The “control share”
provisions of Sections 78.378 to 78.3793, inclusive, of the NRS
apply to “issuing corporations” that are Nevada corporations with
at least 200 stockholders, including at least 100 stockholders of
record who are Nevada residents, and that conduct business directly
or indirectly in Nevada. The control share statute prohibits an
acquirer, under certain circumstances, from voting its shares of a
target corporation’s stock after crossing certain ownership
threshold percentages, unless the acquirer obtains approval of the
target corporation’s disinterested stockholders. The statute
specifies three thresholds: one-fifth or more but less than
one-third, one-third but less than a majority, and a majority or
more, of the outstanding voting power. Generally, once an acquirer
crosses one of the above thresholds, those shares in an offer or
acquisition and acquired within 90 days thereof become “control
shares” and such control shares are deprived of the right to vote
until disinterested stockholders restore the right. These
provisions also provide that if control shares are accorded full
voting rights and the acquiring person has acquired a majority or
more of all voting power, all other stockholders who do not vote in
favor of authorizing voting rights to the control shares are
entitled to demand payment for the fair value of their shares in
accordance with statutory procedures established for dissenters’
rights.
A
corporation may elect to not be governed by, or “opt out” of, the
control share provisions by making an election in its articles of
incorporation or bylaws, provided that the opt-out election must be
in place on the 10th day following the date an acquiring person has
acquired a controlling interest, that is, crossing any of the three
thresholds described above. We have not opted out of the control
share statutes, and will be subject to these statutes if we are an
“issuing corporation” as defined in such statutes.
The
effect of the Nevada control share statutes is that the acquiring
person, and those acting in association with the acquiring person,
will obtain only such voting rights in the control shares as are
conferred by a resolution of the stockholders at an annual or
special meeting. The Nevada control share law, if applicable, could
have the effect of discouraging takeovers of us.
Amendment
of Charter Provisions. The amendment of any of the above
provisions would require approval by holders of at least a majority
of the total voting power of all of our outstanding voting
stock.
The
provisions of Nevada law, our articles of incorporation, and our
bylaws could have the effect of discouraging others from attempting
hostile takeovers and, as a consequence, they may also inhibit
temporary fluctuations in the market price of our common stock that
often result from actual or rumored hostile takeover attempts.
These provisions may also have the effect of preventing changes in
the composition of our board of directors and management. It is
possible that these provisions could make it more difficult to
accomplish transactions that stockholders may otherwise deem to be
in their best interests.
Outstanding
Warrants
Listed
Common Stock Purchase Warrants
Exercisability.
The warrants are exercisable immediately upon issuance and at any
time for the five-year period from the date of issuance. The
warrants will be exercisable, at the option of each holder, in
whole or in part, by delivering to us a duly executed exercise
notice accompanied by payment in full for the number of shares of
our common stock purchased upon such exercise (except in the case
of a cashless exercise as discussed below).
Cashless
Exercise. In the event that a registration statement covering
shares of our common stock underlying the warrants is not available
for the resale of such shares of our common stock underlying the
warrants, the holder may, in its sole discretion, exercise the
warrant in whole or in part and, in lieu of making the cash payment
otherwise contemplated to be made to us upon such exercise in
payment of the aggregate exercise price, elect instead to receive
upon such exercise the net number of shares of our common stock
determined according to the formula set forth in the warrant. In no
event will we be required to make any cash payments or net cash
settlement to the registered holder in lieu of issuing shares of
our common stock underlying the warrants.
Exercise
Price. The initial exercise price per-whole share of our common
stock purchasable upon exercise of the warrants is $3.443, or 110%
of the effective offering price. The exercise price is subject to
appropriate adjustment in the event of certain stock dividends and
distributions, stock splits stock combinations, reclassifications,
or similar events affecting our common stock and also upon any
distribution of assets, including cash, stock, or other property to
our stockholders.
Transferability.
Subject to applicable laws, the warrants may be transferred at the
option of the holders upon surrender of the warrants together with
the appropriate instruments of transfer.
Exchange
Listing. The warrants are listed on The Nasdaq Capital Market
under the symbol “VERBW.” Trading commenced at the open of the
market on April 5, 2019. We cannot provide assurances that a
trading market for the warrants will develop or be
maintained.
Fundamental
Transaction. If, at any time while the warrants are
outstanding, (a) we consolidate or merge with or into another
corporation and we are not the surviving corporation, (b) we sell,
lease, license, assign, transfer, convey, or otherwise dispose of
all or substantially all of our assets, (c) any purchase offer,
tender offer, or exchange offer (whether by us or another
individual or entity) is completed pursuant to which holders of
shares of our common stock are permitted to sell, tender, or
exchange their shares of our common stock for our other securities,
cash, or property and has been accepted by the holders of 50% or
more of the outstanding shares of our common stock, (d) we effect
any reclassification or recapitalization of shares of our common
stock or any compulsory share exchange pursuant to which the shares
of our common stock are converted into or exchanged for other
securities, cash, or property, or (e) we consummate a stock or
share purchase agreement or other business combination with another
person or entity whereby such other person or entity acquires more
than 50% of the outstanding shares of our common stock, each, a
“Common Stock Purchase Warrant Fundamental Transaction,” then upon
any subsequent exercise of the warrants, the holders thereof will
have the right to receive the same amount and kind of securities,
cash, or property as it would have been entitled to receive upon
the occurrence of such Common Stock Purchase Warrant Fundamental
Transaction if it had been immediately prior to such Common Stock
Purchase Warrant Fundamental Transaction, the holder of the number
of warrant shares then issuable upon exercise of the warrant, and
any additional consideration payable as part of the Common Stock
Purchase Warrant Fundamental Transaction.
Rights
as a Stockholder. Except as otherwise provided in the warrants
or by virtue of such holder’s ownership of shares of our common
stock, the holder of the warrant does not have the rights or
privileges of a holder of our common stock, including any voting
rights, until the holder exercises the warrant.
August
2019 Warrants
On
August 14, 2019, we entered into the SPA with certain purchasers
named therein, or the Preferred Purchasers, pursuant to which we
agreed to issue and sell to the Preferred Purchasers, in addition
to shares of our Series A Preferred Stock, warrants, which we refer
to as the August Warrants, to purchase up to approximately 3.87
million shares of our common stock. We closed the offering on
August 14, 2019 and issued 5,030 shares of Series A Preferred Stock
and granted the August Warrants exercisable for up to 3,245,162
shares of common stock in connection therewith. We received gross
proceeds equal to $5,030,000.
Exercisability.
The warrants are exercisable from and after six months after the
date of issuance and at any time for the five-year period from the
date of issuance. The warrants will be exercisable, at the option
of each holder, in whole or in part, by delivering to us a duly
executed exercise notice accompanied by payment in full for the
number of shares of our common stock purchased upon such exercise
(except in the case of a cashless exercise as discussed
below).
Cashless
Exercise. In the event that a registration statement covering
shares of our common stock underlying the warrants is not available
for the resale of such shares of our common stock underlying the
warrants, the holder may, in its sole discretion, exercise the
warrant in whole or in part and, in lieu of making the cash payment
otherwise contemplated to be made to us upon such exercise in
payment of the aggregate exercise price, elect instead to receive
upon such exercise the net number of shares of our common stock
determined according to the formula set forth in the warrant. In no
event will we be required to make any cash payments or net cash
settlement to the registered holder in lieu of issuing shares of
our common stock underlying the warrants.
Exercise
Price. The initial exercise price per-whole share of our common
stock purchasable upon exercise of the warrants was $1.88. The
exercise price is subject to appropriate adjustment in the event of
certain stock dividends and distributions, stock splits, stock
combinations, reclassifications, or similar events affecting our
common stock and also upon any distribution of assets, including
cash, stock, or other property to our stockholders. If we or any
subsidiary, at any time while the August Warrants are outstanding,
sell or grant any option to purchase, or sell or grant any right to
reprice or otherwise dispose of or issue any common stock or common
stock equivalents at an effective price less than the exercise
price then in effect, then the exercise price shall be reduced to
the lower exercise price then in effect, subject to adjustment for
reverse and forward stock splits, recapitalizations, and similar
transactions and subject to certain exceptions. If we, at any time
while the August Warrants are outstanding, issue rights, options,
or warrants to all holders of common stock entitling them to
subscribe for or purchase shares of common stock at a price per
share less than the volume weighted average price on the record
date mentioned below, then the exercise price shall be multiplied
by a fraction, of which the denominator shall be the number of
shares of common stock outstanding on the date of issuance of such
rights, options, or warrants plus the number of additional shares
of common stock offered for subscription or purchase, and of which
the numerator shall be the number of shares of common stock
outstanding on the date of issuance of such rights, options, or
warrants plus the number of shares that the aggregate offering
price of the total number of shares so offered (assuming receipt by
us in full of all consideration payable upon exercise of such
rights, options or warrants) would purchase at such volume weighted
average price. Such adjustment shall be made whenever such rights,
options, or warrants are issued, and shall become effective
immediately after the record date for the determination of
stockholders entitled to receive such rights, options, or
warrants.
Transferability.
Subject to applicable laws, the warrants may be transferred at the
option of the holders upon surrender of the warrants together with
the appropriate instruments of transfer.
Exchange
Listing. Our August Warrants are not listed on any securities
exchange or other trading system and we do not intend to apply for
listing on any securities exchange or other trading
system.
Fundamental
Transaction. If, at any time while the warrants are
outstanding, (a) we consolidate or merge with or into another
corporation and we are not the surviving corporation, (b) we sell,
lease, license, assign, transfer, convey, or otherwise dispose of
all or substantially all of our assets, (c) any purchase offer,
tender offer, or exchange offer (whether by us or another
individual or entity) is completed pursuant to which holders of
shares of our common stock are permitted to sell, tender, or
exchange their shares of our common stock for our other securities,
cash, or property and has been accepted by the holders of 50% or
more of the outstanding shares of our common stock, (d) we effect
any reclassification or recapitalization of shares of our common
stock or any compulsory share exchange pursuant to which the shares
of our common stock are converted into or exchanged for other
securities, cash, or property, or (e) we consummate a stock or
share purchase agreement or other business combination with another
person or entity whereby such other person or entity acquires more
than 50% of the outstanding shares of our common stock, each, an
“August Warrant Fundamental Transaction,” then upon any subsequent
exercise of the warrants, the holders thereof will have the right
to receive the same amount and kind of securities, cash, or
property as it would have been entitled to receive upon the
occurrence of such August Warrant Fundamental Transaction if it had
been immediately prior to such August Warrant Fundamental
Transaction, the holder of the number of warrant shares then
issuable upon exercise of the warrant, and any additional
consideration payable as part of the August Warrant Fundamental
Transaction. In the event of an August Warrant Fundamental
Transaction, we or any successor entity shall, at the holder’s
option, exercisable at any time concurrently with, or within 30
days after, the consummation of the August Warrant Fundamental
Transaction (or, if later, the date of the public announcement of
the applicable August Warrant Fundamental Transaction), purchase
the warrant from the holder by paying to the holder an amount of
cash equal to the Black Scholes Value (as defined below) of the
remaining unexercised portion of the warrant on the date of the
consummation of such August Warrant Fundamental Transaction. For
purposes of the August Warrants, “Black Scholes Value” means the
value of the warrant based on the Black-Scholes Option Pricing
Model obtained from the “OV” function on Bloomberg, L.P., or
Bloomberg, determined as of the day of consummation of the
applicable August Warrant Fundamental Transaction for pricing
purposes and reflecting (A) a risk-free interest rate corresponding
to the U.S. Treasury rate for a period equal to the time between
the date of the public announcement of the applicable August
Warrant Fundamental Transaction and the termination date, (B) an
expected volatility equal to the 100-day volatility obtained from
the HVT function on Bloomberg (determined utilizing a 365-day
annualization factor) as of the trading day immediately following
the public announcement of the applicable August Warrant
Fundamental Transaction (but in no event shall such expected
volatility be greater than one hundred percent (100%)), (C) the
underlying price per share used in such calculation shall be the
greater of (i) the sum of the price per share being offered in
cash, if any, plus the value of any non-cash consideration, if any,
being offered in such August Warrant Fundamental Transaction and
(ii) the greater of (x) the last volume weighted average price
immediately prior to the public announcement of such August Warrant
Fundamental Transaction and (y) the last volume weighted average
price immediately prior to the consummation of such August Warrant
Fundamental Transaction, and (D) a remaining option time equal to
the time between the date of the public announcement of the
applicable August Warrant Fundamental Transaction and the
termination date and (E) a zero cost of borrow. The payment of the
Black Scholes Value will be made by wire transfer of immediately
available funds within five business days of the holder’s election
(or, if later, on the effective date of the August Warrant
Fundamental Transaction).
Rights
as a Stockholder. Except as otherwise provided in the warrants
or by virtue of such holder’s ownership of shares of our common
stock, the holder of the warrant does not have the rights or
privileges of a holder of our common stock, including any voting
rights, until the holder exercises the warrant.
February
2020 Warrants
In
connection with our private placement of common stock in February
2020, the Preferred Purchasers who, as of February 7, 2020,
continued to own shares of our Series A Preferred Stock (a) waived
their respective rights, or the February 2020 Waiver, to
participate in our private placement, and (b) declined to accept
the price protection rights to which they otherwise were entitled
as holders of shares of our Series A Preferred Stock. In connection
with the February 2020 Waiver, we granted to each of our Preferred
Purchasers who continued to own shares of our Series A Preferred
Stock as of February 7, 2020 a five-year common stock purchase
warrant, or February 2020 Warrants, the terms of which are
substantially similar to the terms of our August Warrants, with the
sole material differences being the grant date and the $1.55
per-share exercise price. The initial per-share exercise price of
our August Warrants was $1.88 and, by virtue of our private
placement, the per-share exercise price was modified to $1.10. Our
February 2020 Warrants are not listed on any securities exchange or
other trading system and we do not intend to apply for listing on
any securities exchange or other trading system.
As of
January 14, 2021, we had 13,311,251 shares of our common stock
underlying outstanding warrants, having a weighted-average exercise
price of approximately $2.49 per share.
SoloFire
Exchange Agreement
In
connection with our acquisition of Ascend Certification, LLC, dba
SoloFire (“SoloFire”) on September 4, 2020, we entered into an
Exchange Agreement with the prior owners of SoloFire whereby we
agreed that on or after March 4, 2021, the prior owners of SoloFire
can exchange their Class B interests in our acquisition subsidiary,
Verb Acquisition Co., LLC, for up to an aggregate of 2,642,159
shares of our common stock.
Outstanding
Options and Awards
As of
January 14, 2021, we had 6,228,045 shares of our common stock
underlying outstanding stock options, having a weighted-average
exercise price of approximately $1.58 per share, and 2,811,508
restricted stock awards having a weighted-average grant date fair
value of $1.32 issued under our Incentive Plan,
respectively.
Choice
of Forum
Our
bylaws provide that, unless we consent in writing to the selection
of an alternative forum, the state and federal courts in the State
of Nevada shall be the exclusive forum for any litigation relating
to our internal affairs, including, without limitation: (a) any
derivative action brought on behalf of us, (b) any action asserting
a claim for breach of fiduciary duty to us or our stockholders by
any current or former officer, director, employee, or agent of us,
or (c) any action against us or any current or former officer,
director, employee, or agent of us arising pursuant to any
provision of the NRS, the articles of incorporation, or the bylaws.
For the avoidance of doubt, the exclusive forum provision described
above does not apply to any claims arising under the Securities Act
or Exchange Act. Section 27 of the Exchange Act creates exclusive
federal jurisdiction over all suits brought to enforce any duty or
liability created by the Exchange Act or the rules and regulations
thereunder, and Section 22 of the Securities Act creates concurrent
jurisdiction for federal and state courts over all suits brought to
enforce any duty or liability created by the Securities Act or the
rules and regulations thereunder. See “Risk Factors— Risks Related
to an Investment in Our Securities—Our bylaws contain an exclusive
forum provision, which could limit our stockholders’ ability to
obtain a favorable judicial forum for disputes with us or our
directors, officers, employees or agents.”
Transfer
Agent and Registrar
Our
transfer agent and registrar for our common stock is VStock
Transfer, LLC, 18 Lafayette Place, Woodmere, New York 11598. Its
telephone number is 855-9VSTOCK.
Quotation
on The Nasdaq Capital Market
Shares
of our common stock are being traded on The Nasdaq Capital Market
under the symbol “VERB.” Our common stock purchase warrants are
being traded on The Nasdaq Capital Market under the symbol
“VERBW.”
DESCRIPTION OF DEBT
SECURITIES
The
following description, together with the additional information we
include in any applicable prospectus supplement or free writing
prospectus, summarizes certain general terms and provisions of the
debt securities that we may offer under this prospectus. When we
offer to sell a particular series of debt securities, we will
describe the specific terms of the series in a supplement to this
prospectus. We will also indicate in the supplement to what extent
the general terms and provisions described in this prospectus apply
to a particular series of debt securities.
We
may issue debt securities either separately, or together with, or
upon the conversion or exercise of or in exchange for, other
securities described in this prospectus. Debt securities may be our
senior, senior subordinated or subordinated obligations and, unless
otherwise specified in a supplement to this prospectus, the debt
securities will be our direct, unsecured obligations and may be
issued in one or more series.
The
debt securities will be issued under an indenture between us and a
third party to be identified therein as trustee. We have summarized
select portions of the indenture below. The summary is not
complete. The form of the indenture has been filed as an exhibit to
the registration statement and you should read the indenture for
provisions that may be important to you. In the summary below, we
have included references to the section numbers of the indenture so
that you can easily locate these provisions. Capitalized terms used
in the summary and not defined herein have the meanings specified
in the indenture.
We
may offer under this prospectus up to an aggregate principal amount
of $75,000,000 in debt securities, or if debt securities are issued
at a discount, or in a foreign currency, foreign currency units or
composite currency, the principal amount as may be sold for an
aggregate initial public offering price of up to $75,000,000.
Unless otherwise specified in the applicable prospectus supplement,
the debt securities will represent direct, unsecured obligations of
the Company and will rank equally with all of our other unsecured
indebtedness.
General
The
terms of each series of debt securities will be established by or
pursuant to a resolution of our board of directors and set forth or
determined in the manner provided in a resolution of our board of
directors, in an officer’s certificate or by a supplemental
indenture. (Section 2.2) We can issue an unlimited amount of debt
securities under the indenture that may be issued in one or more
series. Unless otherwise set forth in a resolution of our board of
directors, a supplemental indenture or an officer’s certificate
detailing the adopt of a series of debt securities, all securities
in a series shall be identical. Debt securities may differ between
series with respect to any term, provided, that all series of debt
securities shall be equally and ratably entitled to the benefits of
the indenture. (Section 2.1)
The
following statements relating to the debt securities and the
indenture are summaries, qualified in their entirety by reference
to the detailed provisions of the indenture and the final form
indenture as may be filed with a future prospectus
supplement.
The
prospectus supplement will set forth, to the extent required, the
following terms of the debt securities in respect of which the
prospectus supplement is delivered:
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the
title of the series; |
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the
aggregate principal amount; |
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the
issue price or prices, expressed as a percentage of the aggregate
principal amount of the debt securities; |
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any
limit on the aggregate principal amount; |
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the
date or dates on which principal is payable; |
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the
interest rate or rates (which may be fixed or variable) or, if
applicable, the method used to determine such rate or
rates; |
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the
date or dates from which interest, if any, will be payable and any
regular record date for the interest payable; |
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the
place or places where principal and, if applicable, premium and
interest, is payable; |
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the
terms and conditions upon which we may, or the holders may require
us to, redeem or repurchase the debt securities; |
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the
obligation, if any, of the Company to redeem or repurchase the debt
securities of a series pursuant to any sinking fund or analogous
provision or at the option of a holder of the debt securities, and
the period or periods within which, the price or prices at which
and the terms and conditions upon which debt securities of a series
shall be redeemed or purchased, in whole or in part, pursuant to
such obligation; |
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the
denominations in which such debt securities may be issuable, if
other than denominations of $1,000 or any integral multiple of that
number; |
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whether
the debt securities are to be issuable in the form of certificated
securities (as described below) or global securities (as described
below); |
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the
portion of principal amount that will be payable upon declaration
of acceleration of the maturity date if other than the principal
amount of the debt securities; |
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the
currency of denomination; |
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the
designation of the currency, currencies or currency units in which
payment of principal and, if applicable, premium and interest, will
be made; |
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if
payments of principal and, if applicable, premium or interest, on
the debt securities are to be made in one or more currencies or
currency units other than the currency of denomination, the manner
in which the exchange rate with respect to such payments will be
determined; |
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if
amounts of principal and, if applicable, premium and interest may
be determined by reference to an index based on a currency or
currencies or by reference to a commodity, commodity index, stock
exchange index or financial index, then the manner in which such
amounts will be determined; |
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the
provisions, if any, relating to any collateral provided for such
debt securities; |
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any
addition to or change in the covenants and/or the acceleration
provisions described in this prospectus or in the
indenture; |
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any
events of default, if not otherwise described below under “Defaults
and Notice”; |
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the
terms and conditions, if any, for conversion into or exchange for
shares of our common stock or preferred stock; |
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any
depositaries, interest rate calculation agents, exchange rate
calculation agents or other agents; |
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the
terms and conditions, if any, upon which the debt securities shall
be subordinated in right of payment to other indebtedness of the
Company; and |
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if
the debt securities of a series, in whole or any specified part,
shall be defeasible. (Section 2.2) |
We
may issue debt securities that provide for an amount less than
their stated principal amount to be due and payable upon
declaration of acceleration of their maturity pursuant to the terms
of the indenture. We will provide you with information on the
federal income tax considerations and other special considerations
applicable to any of these debt securities in the applicable
prospectus supplement.
If we
denominate the purchase price of any of the debt securities in a
foreign currency or currencies or a foreign currency unit or units,
or if the principal of and any premium and interest on any series
of debt securities is payable in a foreign currency or currencies
or a foreign currency unit or units, we will provide you with
information on the restrictions, elections, general tax
considerations, specific terms and other information with respect
to that issue of debt securities and such foreign currency or
currencies or foreign currency unit or units in the applicable
prospectus supplement.
Exchange
and/or Conversion Rights
We
may issue debt securities which can be exchanged for or converted
into shares of our common stock or preferred stock. If we do, we
will describe the terms of exchange or conversion in the prospectus
supplement relating to these debt securities. (Section
2.2)
Transfer
and Exchange
Each
debt security will be represented by either one or more global
securities registered in the name of The Depository Trust Company,
or the Depositary, or a nominee of the Depositary (we will refer to
any debt security represented by a global debt security as a
book-entry debt security), or a certificate issued in definitive
registered form (we will refer to any debt security represented by
a certificated security as a certificated debt security) as set
forth in the applicable prospectus supplement. Except as set forth
under the heading “Global Debt Securities and Book-Entry System”
below, book-entry debt securities will not be issuable in
certificated form.
Certificated Debt Securities
You
may transfer or exchange certificated debt securities in accordance
with the terms of the indenture. (Section 2.4) You will not be
charged a service charge for any transfer or exchange of
certificated debt securities but may be required to pay an amount
sufficient to cover any tax or other governmental charge payable in
connection with such transfer or exchange. (Section 2.7)
You
may effect the transfer of certificated debt securities and the
right to receive the principal of, premium and interest on
certificated debt securities only by surrendering the certificate
representing those certificated debt securities and either
reissuance by us or the trustee of the certificate to the new
holder or the issuance by us or the trustee of a new certificate to
the new holder. (Section 2.7)
Global Securities
Each
global debt security representing book-entry debt securities will
be deposited with, or on behalf of, the Depositary, and registered
in the name of the Depositary or a nominee of the Depositary.
Please see “Global Securities.”
No
Protection in the Event of a Change of Control
Unless
we state otherwise in the applicable prospectus supplement, the
debt securities will not contain any provisions which may afford
holders of the debt securities protection in the event we have a
change in control or in the event of a highly leveraged transaction
(whether or not such transaction results in a change in control)
which could adversely affect holders of debt securities.
Covenants
Unless
otherwise indicated in this prospectus or the applicable prospectus
supplement, our debt securities may not have the benefit of any
covenant that limits or restricts our business or operations, the
pledging of our assets or the incurrence by us of indebtedness. We
will describe in the applicable prospectus supplement any material
covenants in respect of a series of debt securities. (Article
4)
Consolidation,
Merger and Sale of Assets
We
may not consolidate with or merge with or into, or sell, assign,
convey, transfer, lease or otherwise dispose of all or
substantially all of our properties and assets to any person, or a
successor person, unless:
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the
indenture shall remain in full force and effect and either we are
the surviving corporation or the successor person (if other than
us) is a corporation organized and validly existing under the laws
of any U.S. domestic jurisdiction or a corporation or comparable
legal entity organized under the laws of a foreign jurisdiction and
expressly assumes by a supplemental indenture executed and
delivered to the trustee, all of our obligations on the debt
securities and under the indenture; and |
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immediately
after giving effect to the transaction, no Default or Event of
Default, shall have occurred and be continuing. (Section
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Defaults
and Notice
Unless
otherwise specified in the resolution of our board of directors,
supplemental indenture or officer’s certificate establishing a
series of debt securities, “Event of Default” means with respect to
any series of debt securities, any of the following:
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failure
to pay the principal of, or premium, if any, on any debt security
when the same becomes due and payable at Maturity, upon
acceleration, redemption or otherwise; |
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failure
to make a payment of any interest on any debt security of such
series when due and payable, and the default continues for a period
of 30 days; |
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failure
to perform or observe any other covenants or agreements in the
indenture with respect to the debt securities of the series or in
the Indenture for 60 days after written notice from the trustee or
the holders of not less than 25% of the aggregate principal amount
of the debt securities of the series then outstanding, with such
notice specifying the default, demanding that it be remedied and
stating that the notice is a “Notice of Default”; |
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certain
events relating to our bankruptcy, insolvency or reorganization or
the bankruptcy, insolvency or reorganization of a Significant
Subsidiary; |
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certain
cross defaults, if and as applicable; and |
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any
other Event of Default specified in the resolution of our board of
directors, supplemental indenture or officer’s certificate
establishing such series of debt securities. (Section
6.1) |
No
Event of Default with respect to a particular series of debt
securities necessarily constitutes an Event of Default with respect
to any other series of debt securities. (Section 6.2) The
occurrence of certain Events of Default or an acceleration under
the indenture may constitute an event of default under certain
indebtedness of ours or our subsidiary outstanding from time to
time.
If an
Event of Default with respect to debt securities of any series at
the time outstanding (except as to certain events of bankruptcy,
insolvency or reorganization) occurs and is continuing, then the
trustee or the holders of not less than 25% in principal amount of
the outstanding debt securities of that series may, by a notice in
writing to us (and to the trustee if given by the holders), declare
to be due and payable immediately the principal of, and accrued and
unpaid interest, if any, on, all debt securities of that series. In
the case of an Event of Default resulting from certain events of
bankruptcy, insolvency or reorganization, the principal (or such
specified amount) of and accrued and unpaid interest, if any, on
all outstanding debt securities will become and be immediately due
and payable without any declaration or other act on the part of the
trustee or any holder of outstanding debt securities. At any time
after a declaration of acceleration with respect to debt securities
of any series has been made, but before a judgment or decree for
payment of the money due has been obtained by the trustee, the
holders of a majority in principal amount of the outstanding debt
securities of that series may rescind and annul the acceleration if
all Events of Default, other than the non-payment of accelerated
principal and interest, if any, with respect to debt securities of
that series, have been cured or waived as provided in the indenture
and such rescission would not conflict with any judgment or decree.
(Section 6.2) We refer you to the prospectus supplement relating to
any series of debt securities that are discount securities for the
particular provisions relating to acceleration of a portion of the
principal amount of such discount securities upon the occurrence of
an Event of Default.
The
trustee is entitled to be indemnified by holders of debt securities
before proceeding to exercise any trust or power under the
indenture at the request of such holders. (Section 6.6) The holders
of at least a majority in aggregate principal amount of the then
outstanding debt securities of any series may direct the time,
method and place of conducting any proceedings for any remedy
available to the trustee for such series, or of exercising any
trust or power conferred upon the trustee with respect to the debt
securities of such series. (Section 6.5) However, the trustee may
decline to follow any such direction that conflicts with law or the
indenture, or that the trustee determines may be unduly prejudicial
to the holders of the debt securities of such series not joining in
such direction. (Section 6.5)
No
holder of any debt security of any series will have any right to
institute any proceeding or pursue any remedy, with respect to the
indenture or a series of debt securities, unless:
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That
holder has previously given to the trustee written notice of a
continuing Event of Default with respect to debt securities of that
series; and |
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The
holders of note less than 25% in principal amount of the
outstanding debt securities of that series have made written
request, and offered indemnity or security satisfactory to the
trustee, to the trustee to institute the proceeding as trustee, and
the trustee has failed to institute the proceeding within 60 days
and has not received from the holder of not less than a majority in
principal amount of the outstanding debt securities of that series
a direction inconsistent with that request within such 60 day
periods (Section 6.6). |
No
holder of debt securities under the indenture may use the indenture
to prejudice the rights of another holder or to obtain a preference
or priority over another holder of debt securities. (Section
6.6)
Notwithstanding
any other provision in the indenture, the holder of any debt
security will have an absolute and unconditional right to receive
payment of the principal of, premium and any interest on that debt
security on or after the due dates expressed in that debt security
and to institute suit for the enforcement of payment. (Section
6.7)
The
indenture requires us, within 120 days after the end of our fiscal
year, to furnish to the trustee a statement as to compliance with
the indenture. (Section 4.4) If a Default or Event of Default
occurs and is continuing with respect to the securities of any
series and if it is known to a responsible officer of the trustee,
the trustee shall mail to each holder of the securities of that
series notice of a Default or Event of Default within 90 days after
it occurs or, if later, after a responsible officer of the trustee
has knowledge of such Default or Event of Default (except if such
Default or Event of Default has been validly cured or waived before
the trustee gives such notice). The indenture provides that the
trustee may withhold notice to the holders of debt securities of
any series of any Default or Event of Default (except in payment on
any debt securities of that series) with respect to debt securities
of that series if the trustee determines in good faith that
withholding notice is in the interest of the holders of those debt
securities. (Section 7.5)
Modification
of the Indenture
We
and the trustee may modify, amend or supplement the indenture or
the debt securities of any series without the consent of any holder
of any debt security:
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to
comply with covenants in the indenture described above under the
heading “Consolidation, Merger and Sale of Assets”; |
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to
provide for uncertificated securities in addition to or in place of
certificated securities; |
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to
provide for certificated debt securities in addition to
uncertificated debt securities; |
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to
comply with requirements of the SEC in order to effect or maintain
the qualification of the indenture under the Trust Indenture
Act; |
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to
cure any ambiguity, defect or inconsistency or make any other
change to the indenture or the debt securities that does not
materially and adversely affect the rights of any holder of our
debt securities under the indenture; |
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to
provide for the issuance of and establish the form and terms and
conditions of debt securities of any series as permitted by the
indenture; or |
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to
effect the appointment of a successor trustee with respect to the
debt securities of any series and to add to or change any of the
provisions of the indenture to provide for or facilitate
administration by more than one trustee. (Section 8.1) |
We
may also modify or supplement the indenture with the written
consent of the holders of at least a majority in principal amount
of the outstanding debt securities of each series affected by the
modifications or supplement. The holders of at least a majority in
principal amount of the outstanding debt securities of each such
series affected by the modifications or supplement may waive
compliance by us in a particular instance with any provision of the
indenture or the debt securities of such affected series of debt
securities without notice to any holder of our debt securities. We
may not make any modification or amendment without the consent of
the holders of each affected debt security then outstanding if that
amendment will:
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reduce
the amount of debt securities whose holders must consent to an
amendment, supplement or waiver; |
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reduce
the rate of or change the time for payment of interest (including
default interest) on any debt security; |
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reduce
the principal of or premium on or change the fixed maturity of any
debt security or reduce the amount of, or postpone the date fixed
for, the payment of any sinking fund or analogous obligation with
respect to any series of debt securities; |
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make
the principal of or premium or interest on any debt security
payable in currency other than that stated in the debt
security; |
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change
the amount or time of any payment required by any debt security, or
reduce the premium payable upon any redemption of any debt
securities, or change the time before which no such redemption may
be made; |
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waive
a default in the payment of the principal of, or interest or
premium, if any, on, any debt security (except a rescission of
acceleration of the debt securities of any series by the holders of
at least a majority in aggregate principal amount of the then
outstanding debt securities of that series and a waiver of the
payment default that resulted from such acceleration); |
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waive
a redemption payment with respect to any debt security, or change
any of the provisions with respect to the redemption of any debt
securities; |
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reduce
the principal amount of discount securities payable upon
acceleration of maturity; or |
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make
any change to certain provisions of the indenture relating to the
rights of holders to institute suit with respect to the indenture
or the debt securities of a series and the modification or
supplement of the indenture or the debt securities of any series
requiring the consent of holders of our debt securities. (Section
8.2) |
The
holders of a majority in principal amount of the outstanding debt
securities of any series may on behalf of the holders of all the
debt securities of such series waive any past default under the
indenture with respect to that series and its consequences, except
a default in the payment of the principal of, premium or any
interest on any debt security of that series (Section 6.4);
provided, however, that the holders of a majority in principal
amount of the outstanding debt securities of any series may rescind
an acceleration and its consequences, including any related payment
default that resulted from the acceleration. (Section
6.2)
Defeasance
of Debt Securities and Certain Covenants in Certain
Circumstances
Legal
Defeasance. The indenture provides that, unless otherwise
provided by the terms of the applicable series of debt securities,
we may be discharged from any and all obligations in respect of the
debt securities of any series (subject to certain exceptions). We
will be so discharged upon the irrevocable deposit with the
trustee, in trust, of money and/or U.S. government obligations or,
in the case of debt securities denominated in a single currency
other than U.S. Dollars, government obligations of the government
that issued or caused to be issued such currency, that, through the
payment of interest and principal in accordance with their terms,
will provide money or U.S. government obligations in an amount
sufficient in the opinion of a nationally recognized firm of
independent public accountants or investment bank to pay and
discharge each installment of principal, premium and interest on
and any mandatory sinking fund payments in respect of the debt
securities of that series on the stated maturity of those payments
in accordance with the terms of the indenture and those debt
securities.
This
discharge may occur only if, among other things, we have delivered
to the trustee an opinion of counsel stating that we have received
from, or there has been published by, the United States Internal
Revenue Service a ruling or, since the date of execution of the
indenture, there has been a change in the applicable United States
federal income tax law, in either case to the effect that, and
based thereon such opinion shall confirm that, the holders of the
debt securities of that series will not recognize income, gain or
loss for United States federal income tax purposes as a result of
the deposit, defeasance and discharge and will be subject to United
States federal income tax on the same amounts and in the same
manner and at the same times as would have been the case if the
deposit, defeasance and discharge had not occurred. (Section
8.3)
Defeasance
of Certain Covenants. The indenture provides that, unless
otherwise provided by the terms of the applicable series of debt
securities, upon compliance with certain conditions:
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we
may omit to comply with the covenant described under the heading
“Consolidation, Merger and Sale of Assets” and certain other
covenants set forth in the indenture, as well as any additional
covenants which may be set forth in the applicable prospectus
supplement; and |
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any
omission to comply with those covenants will not constitute a
Default or an Event of Default with respect to the debt securities
of that series (“covenant defeasance”). |
This
is referred to as covenant defeasance. The conditions
include:
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depositing
with the trustee money and/or U.S. government obligations or, in
the case of debt securities denominated in a single currency other
than U.S. Dollars, government obligations of the government that
issued or caused to be issued such currency, that, through the
payment of interest and principal in accordance with their terms,
will provide money in an amount sufficient in the opinion of a
nationally recognized firm of independent public accountants or
investment bank to pay and discharge each installment of principal
of, premium and interest on and any mandatory sinking fund payments
in respect of the debt securities of that series on the stated
maturity of those payments in accordance with the terms of the
indenture and those debt securities; and |
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delivering
to the trustee an opinion of counsel to the effect that the holders
of the debt securities of that series will not recognize income,
gain or loss for United States federal income tax purposes as a
result of the deposit and related covenant defeasance and will be
subject to United States federal income tax on the same amounts and
in the same manner and at the same times as would have been the
case if the deposit and related covenant defeasance had not
occurred. (Section 9.3). |
No
Personal Liability of Directors, Officers, Employees or
Shareholders
None
of our past, present or future directors, officers, employees or
shareholders, as such, will have any liability for any of our
obligations under the debt securities or the indenture or for any
claim based on, or in respect or by reason of, such obligations or
their creation. By accepting a debt security, each holder waives
and releases all such liability. This waiver and release is part of
the consideration for the issue of the debt securities. However,
this waiver and release may not be effective to waive liabilities
under U.S. federal securities laws, and it is the view of the SEC
that such a waiver is against public policy. (Section
10.9)
Governing
Law
The
indenture and the debt securities, including any claim or
controversy arising out of or relating to the indenture or the
securities, will be governed by the laws of the State of New York.
(Section 10.8)
DESCRIPTION OF
WARRANTS
We
may issue warrants to purchase shares of our common stock,
preferred stock and/or debt securities in one or more series
together with other securities or separately, as described in each
applicable prospectus supplement. Below is a description of certain
general terms and provisions of the warrants that we may offer.
Particular terms of the warrants will be described in the
applicable warrant agreements and the applicable prospectus
supplement for the warrants.
The
applicable prospectus supplement will contain, where applicable,
the following terms of and other information relating to the
warrants:
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the
number of shares of common stock or preferred stock purchasable
upon the exercise of warrants to purchase such shares and the price
at which such number of shares may be purchased upon such
exercise; |
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the
designation, stated value and terms (including, without limitation,
liquidation, dividend, conversion and voting rights) of the series
of |
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preferred
stock purchasable upon exercise of warrants to purchase preferred
stock; |
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the
principal amount of debt securities that may be purchased upon
exercise of a debt warrant and the exercise price for the
warrants, |
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which
may be payable in cash, securities or other property; |
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the
date, if any, on and after which the warrants and the related debt
securities, preferred stock or common stock will be separately
transferable; |
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the
terms of any rights to redeem or call the warrants; |
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the
date on which the right to exercise the warrants will commence and
the date on which the right will expire; |
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United
States Federal income tax consequences applicable to the warrants;
and |
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any
additional terms of the warrants, including terms, procedures, and
limitations relating to the exchange, exercise and settlement of
the warrants. |
Holders
of equity warrants will not be entitled:
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to
vote, consent or receive dividends; |
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receive
notice as shareholders with respect to any meeting of shareholders
for the election of our directors or any other matter;
or |
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exercise
any rights as shareholders of Verb. |
Each
warrant will entitle its holder to purchase the principal amount of
debt securities or the number of shares of preferred stock or
common stock at the exercise price set forth in, or calculable as
set forth in, the applicable prospectus supplement. Unless we
otherwise specify in the applicable prospectus supplement, holders
of the warrants may exercise the warrants at any time up to the
specified time on the expiration date that we set forth in the
applicable prospectus supplement. After the close of business on
the expiration date, unexercised warrants will become
void.
A
holder of warrant certificates may exchange them for new warrant
certificates of different denominations, present them for
registration of transfer and exercise them at the corporate trust
office of the warrant agent or any other office indicated in the
applicable prospectus supplement. Until any warrants to purchase
debt securities are exercised, the holder of the warrants will not
have any rights of holders of the debt securities that can be
purchased upon exercise, including any rights to receive payments
of principal, premium or interest on the underlying debt securities
or to enforce covenants in the applicable indenture. Until any
warrants to purchase common stock or preferred stock are exercised,
the holders of the warrants will not have any rights of holders of
the underlying common stock or preferred stock, including any
rights to receive dividends or payments upon any liquidation,
dissolution or winding up on the common stock or preferred stock,
if any.
Prospective
purchasers of warrants should be aware that special United States
federal income tax, accounting and other considerations may be
applicable to instruments such as warrants. The applicable
prospectus supplement will describe such considerations, to the
extent they are material, as they apply generally to purchasers of
such warrants.
DESCRIPTION OF SUBSCRIPTION
RIGHTS
We
may issue subscription rights to purchase our common stock,
preferred stock or debt securities. These subscription rights may
be offered independently or together with any other security
offered hereby and may or may not be transferable by the
stockholder receiving the subscription rights in such offering. In
connection with any offering of subscription rights, we may enter
into a standby arrangement with one or more underwriters or other
purchasers pursuant to which the underwriters or other purchasers
may be required to purchase any securities remaining unsubscribed
for after such offering.
The
prospectus supplement relating to any subscription rights we offer,
if any, will, to the extent applicable, include specific terms
relating to the offering, including some or all of the
following:
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the
price, if any, for the subscription rights; |
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the
exercise price payable for our common stock, preferred stock or
debt securities upon the exercise of the subscription
rights; |
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the
number of subscription rights to be issued to each
stockholder; |
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the
number and terms of our common stock, preferred stock or debt
securities which may be purchased per each subscription
right; |
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the
extent to which the subscription rights are
transferable; |
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any
other terms of the subscription rights, including the terms,
procedures and limitations relating to the exchange and exercise of
the subscription rights; |
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the
date on which the right to exercise the subscription rights shall
commence, and the date on which the subscription rights shall
expire; |
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the
extent to which the subscription rights may include an
over-subscription privilege with respect to unsubscribed securities
or an over-allotment privilege to the extent the securities are
fully subscribed; and |
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if
applicable, the material terms of any standby underwriting or
purchase arrangement which may be entered into by us in connection
with the offering of subscription rights. |
The
descriptions of the subscription rights in this prospectus and in
any prospectus supplement are summaries of the material provisions
of the applicable subscription right agreements. These descriptions
do not restate those subscription right agreements in their
entirety and may not contain all the information that you may find
useful. We urge you to read the applicable subscription right
agreements because they, and not the summaries, define your rights
as holders of the subscription rights. For more information, please
review the forms of the relevant subscription right agreements,
which will be filed with the SEC promptly after the offering of
subscription rights and will be available as described in the
section of this prospectus captioned “Where You Can Find More
Information.”
GLOBAL SECURITIES
Unless
we indicate differently in any applicable prospectus supplement,
the securities initially will be issued in book-entry form and
represented by one or more global notes or global securities, or,
collectively, global securities. The global securities will be
deposited with, or on behalf of, The Depository Trust Company, New
York, New York, as depositary, or DTC, and registered in the name
of Cede & Co., the nominee of DTC. Unless and until it is
exchanged for individual certificates evidencing securities under
the limited circumstances described below, a global security may
not be transferred except as a whole by the depositary to its
nominee or by the nominee to the depositary, or by the depositary
or its nominee to a successor depositary or to a nominee of the
successor depositary.
DTC has
advised us that it is:
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a
limited-purpose trust company organized under the New York Banking
Law; |
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a
“banking organization” within the meaning of the New York Banking
Law; |
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a
member of the Federal Reserve System; |
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a
“clearing corporation” within the meaning of the New York Uniform
Commercial Code; and |
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a
“clearing agency” registered pursuant to the provisions of Section
17A of the Exchange Act. |
DTC
holds securities that its participants deposit with DTC. DTC also
facilitates the settlement among its participants of securities
transactions, such as transfers and pledges, in deposited
securities through electronic computerized book-entry changes in
participants’ accounts, thereby eliminating the need for physical
movement of securities certificates. “Direct participants” in DTC
include securities brokers and dealers, including underwriters,
banks, trust companies, clearing corporations and other
organizations. DTC is a wholly-owned subsidiary of The Depository
Trust & Clearing Corporation, or DTCC. DTCC is the holding
company for DTC, National Securities Clearing Corporation and Fixed
Income Clearing Corporation, all of which are registered clearing
agencies. DTCC is owned by the users of its regulated subsidiaries.
Access to the DTC system is also available to others, which we
sometimes refer to as indirect participants, that clear through or
maintain a custodial relationship with a direct participant, either
directly or indirectly. The rules applicable to DTC and its
participants are on file with the SEC.
Purchases
of securities under the DTC system must be made by or through
direct participants, which will receive a credit for the securities
on DTC’s records. The ownership interest of the actual purchaser of
a security, which we sometimes refer to as a beneficial owner, is
in turn recorded on the direct and indirect participants’ records.
Beneficial owners of securities will not receive written
confirmation from DTC of their purchases. However, beneficial
owners are expected to receive written confirmations providing
details of their transactions, as well as periodic statements of
their holdings, from the direct or indirect participants through
which they purchased securities. Transfers of ownership interests
in global securities are to be accomplished by entries made on the
books of participants acting on behalf of beneficial owners.
Beneficial owners will not receive certificates representing their
ownership interests in the global securities, except under the
limited circumstances described below.
To
facilitate subsequent transfers, all global securities deposited by
direct participants with DTC will be registered in the name of
DTC’s partnership nominee, Cede & Co., or such other name as
may be requested by an authorized representative of DTC. The
deposit of securities with DTC and their registration in the name
of Cede & Co. or such other nominee will not change the
beneficial ownership of the securities. DTC has no knowledge of the
actual beneficial owners of the securities. DTC’s records reflect
only the identity of the direct participants to whose accounts the
securities are credited, which may or may not be the beneficial
owners. The participants are responsible for keeping account of
their holdings on behalf of their customers.
So
long as the securities are in book-entry form, you will receive
payments and may transfer securities only through the facilities of
the depositary and its direct and indirect participants. We will
maintain an office or agency in the location specified in the
prospectus supplement for the applicable securities, where notices
and demands in respect of the securities and the indenture may be
delivered to us and where certificated securities may be
surrendered for payment, registration of transfer or
exchange.
Conveyance
of notices and other communications by DTC to direct participants,
by direct participants to indirect participants and by direct
participants and indirect participants to beneficial owners will be
governed by arrangements among them, subject to any legal
requirements in effect from time to time.
Redemption
notices will be sent to DTC. If less than all of the securities of
a particular series are being redeemed, DTC’s practice is to
determine by lot the amount of the interest of each direct
participant in the securities of such series to be
redeemed.
Neither
DTC nor Cede & Co. (or such other DTC nominee) will consent or
vote with respect to the securities. Under its usual procedures,
DTC will mail an omnibus proxy to us as soon as possible after the
record date. The omnibus proxy assigns the consenting or voting
rights of Cede & Co. to those direct participants to whose
accounts the securities of such series are credited on the record
date, identified in a listing attached to the omnibus
proxy.
So
long as securities are in book-entry form, we will make payments on
those securities to the depositary or its nominee, as the
registered owner of such securities, by wire transfer of
immediately available funds. If securities are issued in definitive
certificated form under the limited circumstances described below
and unless if otherwise provided in the description of the
applicable securities herein or in the applicable prospectus
supplement, we will have the option of making payments by check
mailed to the addresses of the persons entitled to payment or by
wire transfer to bank accounts in the United States designated in
writing to the applicable trustee or other designated party at
least 15 days before the applicable payment date by the persons
entitled to payment, unless a shorter period is satisfactory to the
applicable trustee or other designated party.
Redemption
proceeds, distributions and dividend payments on the securities
will be made to Cede & Co., or such other nominee as may be
requested by an authorized representative of DTC. DTC’s practice is
to credit direct participants’ accounts upon DTC’s receipt of funds
and corresponding detail information from us on the payment date in
accordance with their respective holdings shown on DTC records.
Payments by participants to beneficial owners will be governed by
standing instructions and customary practices, as is the case with
securities held for the account of customers in bearer form or
registered in “street name.” Those payments will be the
responsibility of participants and not of DTC or us, subject to any
statutory or regulatory requirements in effect from time to time.
Payment of redemption proceeds, distributions and dividend payments
to Cede & Co., or such other nominee as may be requested by an
authorized representative of DTC, is our responsibility,
disbursement of payments to direct participants is the
responsibility of DTC, and disbursement of payments to the
beneficial owners is the responsibility of direct and indirect
participants.
Except
under the limited circumstances described below, purchasers of
securities will not be entitled to have securities registered in
their names and will not receive physical delivery of securities.
Accordingly, each beneficial owner must rely on the procedures of
DTC and its participants to exercise any rights under the
securities and the indenture.
The
laws of some jurisdictions may require that some purchasers of
securities take physical delivery of securities in definitive form.
Those laws may impair the ability to transfer or pledge beneficial
interests in securities.
DTC
may discontinue providing its services as securities depositary
with respect to the securities at any time by giving reasonable
notice to us. Under such circumstances, in the event that a
successor depositary is not obtained, securities certificates are
required to be printed and delivered.
As
noted above, beneficial owners of a particular series of securities
generally will not receive certificates representing their
ownership interests in those securities. However, if:
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DTC
notifies us that it is unwilling or unable to continue as a
depositary for the global security or securities representing such
series of securities or if DTC ceases to be a clearing agency
registered under the Exchange Act at a time when it is required to
be registered and a successor depositary is not appointed within 90
days of the notification to us or of our becoming aware of DTC’s
ceasing to be so registered, as the case may be; |
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we
determine, in our sole discretion, not to have such securities
represented by one or more global securities; or |
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an
Event of Default has occurred and is continuing with respect to
such series of securities, we will prepare and deliver certificates
for such securities in exchange for beneficial interests in the
global securities |
we
will prepare and deliver certificates for such securities in
exchange for beneficial interests in the global securities. Any
beneficial interest in a global security that is exchangeable under
the circumstances described in the preceding sentence will be
exchangeable for securities in definitive certificated form
registered in the names that the depositary directs. It is expected
that these directions will be based upon directions received by the
depositary from its participants with respect to ownership of
beneficial interests in the global securities.
Euroclear
and Clearstream
If so
provided in the applicable prospectus supplement, you may hold
interests in a global security through Clearstream Banking S.A.,
which we refer to as “Clearstream,” or Euroclear Bank S.A./N.V., as
operator of the Euroclear System, which we refer to as “Euroclear,”
either directly if you are a participant in Clearstream or
Euroclear or indirectly through organizations which are
participants in Clearstream or Euroclear. Clearstream and Euroclear
will hold interests on behalf of their respective participants
through customers’ securities accounts in the names of Clearstream
and Euroclear, respectively, on the books of their respective U.S.
depositaries, which in turn will hold such interests in customers’
securities accounts in such depositaries’ names on DTC’s
books.
Clearstream
and Euroclear are securities clearance systems in Europe.
Clearstream and Euroclear hold securities for their respective
participating organizations and facilitate the clearance and
settlement of securities transactions between those participants
through electronic book-entry changes in their accounts, thereby
eliminating the need for physical movement of
certificates.
Payments,
deliveries, transfers, exchanges, notices and other matters
relating to beneficial interests in global securities owned through
Euroclear or Clearstream must comply with the rules and procedures
of those systems. Transactions between participants in Euroclear or
Clearstream, on one hand, and other participants in DTC, on the
other hand, are also subject to DTC’s rules and
procedures.
Investors
will be able to make and receive through Euroclear and Clearstream
payments, deliveries, transfers and other transactions involving
any beneficial interests in global securities held through those
systems only on days when those systems are open for business.
Those systems may not be open for business on days when banks,
brokers and other institutions are open for business in the United
States.
Cross-market
transfers between participants in DTC, on the one hand, and
participants in Euroclear or Clearstream, on the other hand, will
be effected through DTC in accordance with the DTC’s rules on
behalf of Euroclear or Clearstream, as the case may be, by their
respective U.S. depositaries; however, such cross-market
transactions will require delivery of instructions to Euroclear or
Clearstream, as the case may be, by the counterparty in such system
in accordance with the rules and procedures and within the
established deadlines (European time) of such system. Euroclear or
Clearstream, as the case may be, will, if the transaction meets its
settlement requirements, deliver instructions to its U.S.
depositary to take DTC, and making or receiving payment in
accordance with normal procedures for same-day fund settlement.
Participants in Euroclear or Clearstream may not deliver
instructions directly to their respective U.S.
depositaries.
Due
to time zone differences, the securities accounts of a participant
in Euroclear or Clearstream purchasing an interest in a global
security from a direct participant in DTC will be credited, and any
such crediting will be reported to the relevant participant in
Euroclear or Clearstream, during the securities settlement
processing day (which must be a business day for Euroclear or
Clearstream) immediately following the settlement date of DTC. Cash
received in Euroclear or Clearstream as a result of sales of
interests in a global security by or through a participant in
Euroclear or Clearstream to a direct participant in DTC will be
received with value on the settlement date of DTC but will be
available in the relevant Euroclear or Clearstream cash account
only as of the business day for Euroclear or Clearstream following
DTC’s settlement date.
Other
The
information in this section of this prospectus concerning DTC,
Clearstream, Euroclear and their respective book-entry systems has
been obtained from sources that we believe to be reliable, but we
do not take responsibility for this information. This information
has been provided solely as a matter of convenience. The rules and
procedures of DTC, Clearstream and Euroclear are solely within the
control of those organizations and could change at any time.
Neither we nor the trustee nor any agent of ours or of the trustee
has any control over those entities and none of us takes any
responsibility for their activities. You are urged to contact DTC,
Clearstream and Euroclear or their respective participants directly
to discuss those matters. In addition, although we expect that DTC,
Clearstream and Euroclear will perform the foregoing procedures,
none of them is under any obligation to perform or continue to
perform such procedures and such procedures may be discontinued at
any time. Neither we nor any agent of ours will have any
responsibility for the performance or nonperformance by DTC,
Clearstream and Euroclear or their respective participants of these
or any other rules or procedures governing their respective
operations.
DESCRIPTION OF UNITS
Below
is a description of certain general terms and provisions of the
units that we may offer. Particular terms of the units will be
described in the applicable unit agreements and the applicable
prospectus supplement for the units. We urge you to read the
applicable prospectus supplements related to the units that we sell
under this prospectus, as well as the complete unit agreements that
contain the terms of the units.
We
may issue units comprised of our common stock, our preferred stock,
debt securities, warrants, rights, purchase contracts, or any
combination of such securities under this prospectus. Units may be
issued in one or more series, independently or together with shares
of our common stock, our preferred stock, debt securities,
warrants, rights or purchase contracts, and the units may be
attached to or separate from such securities. We may issue units
directly or under a unit agreement to be entered into between us
and a unit agent. We will name any unit agent in the applicable
prospectus supplement. Any unit agent will act solely as our agent
in connection with the units of a particular series and will not
assume any obligation or relationship of agency or trust for or
with any holders or beneficial owners of units. Each unit will be
issued so that the holder of the unit is also the holder of each
security included in the unit. Thus, the holder of a unit will have
the rights and obligations of a holder of each included security.
We will describe in the applicable prospectus supplement the terms
of the series of units, including the following:
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the
designation and terms of the units and of the securities comprising
the units, including whether and under what circumstances those
securities may be held or transferred separately; |
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the
price or prices at which the units will be issued; |
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the
date, if any, on and after which the securities included in the
units will be separately transferable; |
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any
provisions of the governing unit agreement that differ from those
described in this section; and |
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any
provisions for the issuance, payment, settlement, transfer, or
exchange of the units or of the securities comprising the
units. |
PLAN OF DISTRIBUTION
We
may sell the securities being offered by this prospectus separately
or together:
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directly
to purchasers; |
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through
agents; |
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to or
through underwriters; |
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through
dealers; |
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in
“at-the-market” offerings (as defined in Rule 415 under the
Securities Act); |
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through
a block trade in which the broker or dealer engaged to handle the
block trade will attempt to sell the securities as agent, but may
position and resell a portion of the block as principal to
facilitate the transaction; |
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through
a combination of any of these methods of sale; or |
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through
any other method permitted by applicable law and described in a
prospectus supplement. |
In
addition, we may issue the securities being offered by this
prospectus as a dividend or distribution. We may effect the
distribution of the securities from time to time in one or more
transactions:
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at a
fixed price or prices, which may be changed from time to
time; |
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at
market prices prevailing at the times of sale; |
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prices related to prevailing market prices; or |
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negotiated prices. |
For
example, we may engage in at-the-market offerings into an existing
trading market in accordance with Rule 415(a)(4) under the
Securities Act. We may also sell securities through a rights
offering, forward contracts or similar arrangements. In any
distribution of subscription rights to stockholders, if all of the
underlying securities are not subscribed for, we may then sell the
unsubscribed securities directly to third parties or may engage the
services of one or more underwriters, dealers or agents, including
standby underwriters, to sell the unsubscribed securities to third
parties.
The
securities issued and sold under this prospectus will have no
established trading market, other than our common stock, which is
listed on The Nasdaq Capital Market. Any shares of our common stock
sold pursuant to this prospectus will be eligible for listing and
trading on The Nasdaq Capital Market, subject to official notice of
issuance. Any underwriters to whom securities are sold by us for
public offering and sale may make a market in the securities, but
the underwriters will not be obligated to do so and may discontinue
any market making at any time without notice. The securities, other
than our common stock, may or may not be listed on a national
securities exchange or other trading market.
We
will set forth in a prospectus supplement:
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the
terms of any underwriting or other agreement that we reach relating
to sales under this prospectus; |
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the
method of distribution of the securities; |
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the
names of any agents, underwriters or dealers, including any
managing underwriters, used in the offering of
securities; |
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the
terms of any direct sales, including the terms of any bidding or
auction process, or the terms of any other
transactions; |
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any
delayed delivery obligations to take the securities; |
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the
compensation payable to agents, underwriters and dealers, which may
be in the form of discounts, concessions or
commissions; |
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any
activities that may be undertaken by agents, underwriters and
dealers to stabilize, maintain or otherwise affect the price of the
securities; and |
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any
indemnification and contribution obligations owing to agents,
underwriters and dealers. |
If we
sell directly to institutional investors or others, they may be
deemed to be underwriters within the meaning of the Securities Act
with respect to any resale of the securities. Unless otherwise
indicated in a prospectus supplement, if we sell through an agent,
such agent will be acting on a best efforts basis for the period of
its appointment. Any agent may be deemed to be an “underwriter” of
the securities as that term is defined in the Securities Act. If a
dealer is used in the sale of the securities, we or an underwriter
will sell securities to the dealer, as principal. The dealer may
resell the securities to the public at varying prices to be
determined by the dealer at the time of resale.
To
the extent permitted by and in accordance with Regulation M under
the Exchange Act, in connection with an offering an underwriter may
engage in over-allotments, stabilizing transactions, short covering
transactions and penalty bids. Over-allotments involve sales in
excess of the offering size, which creates a short position.
Stabilizing transactions permit bids to purchase the underlying
security so long as the stabilizing bids do not exceed a specified
maximum. Short covering transactions involve purchases of the
securities in the open market after the distribution is completed
to cover short positions. Penalty bids permit the underwriters to
reclaim a selling concession from a dealer when the securities
originally sold by the dealer are purchased in a covering
transaction to cover short positions. Those activities may cause
the price of the securities to be higher than it would be
otherwise. If commenced, the underwriters may discontinue any of
the activities at any time.
To
the extent permitted by and in accordance with Regulation M under
the Exchange Act, any underwriters who are qualified market makers
on The Nasdaq Capital Market may engage in passive market making
transactions in the securities on The Nasdaq Capital Market during
the business day prior to the pricing of an offering, before the
commencement of offers or sales of the securities. Passive market
makers must comply with applicable volume and price limitations and
must be identified as passive market makers. In general, a passive
market maker must display its bid at a price not in excess of the
highest independent bid for such security; if all independent bids
are lowered below the passive market maker’s bid, however, the
passive market maker’s bid must then be lowered when certain
purchase limits are exceeded.
The
specific terms of any lock-up provisions in respect of any given
offering will be described in the applicable prospectus
supplement.
The
underwriters, dealers and agents may engage in transactions with
us, or perform services for us, in the ordinary course of business
for which they receive compensation.
No
securities may be sold under this prospectus without delivery, in
paper format or in electronic format, or both, of the applicable
prospectus supplement describing the method and terms of the
offering.
LEGAL MATTERS
The
validity of the shares of common stock offered under this
prospectus will be passed upon by Troutman Pepper Hamilton Sanders
LLP, Irvine, California. Additional legal matters may be passed
upon for us or any underwriters, dealers or agents, by counsel that
we will name in the applicable prospectus supplement. As
appropriate, legal counsel representing the underwriters, dealers
or agents will be named in the accompanying prospectus supplement
and may opine to certain legal matters.
EXPERTS
The
consolidated financial statements of Verb Technology Company, Inc.
as of and for the years ended December 31, 2019 and 2018 appearing
in this prospectus and registration statement of which this
prospectus is a part have been audited by Weinberg & Company,
P.A., an independent registered public accounting firm, as stated
in its report thereon, included therein, and are included in
reliance upon such report and upon the authority of such firm as
experts in accounting and auditing.
WHERE YOU CAN FIND MORE
INFORMATION
We
file quarterly and current reports, proxy statements, and other
information with the SEC. The SEC maintains a website that contains
these reports, proxy and information statements, and other
information we file electronically with the SEC. Our filings are
available free of charge at the SEC’s website at
www.sec.gov.
You
can obtain copies of any of the documents incorporated by reference
in this prospectus from us, or as described above, through the
SEC’s website. Documents incorporated by reference are available
from us, without charge, excluding all exhibits unless specifically
incorporated by reference in the documents. You may obtain
documents incorporated by reference in this prospectus by writing
to us at the following address: 782 South Auto Mall Drive, American
Fork, Utah 84003, Attention: Investor Relations, by emailing us at
info@verb.tech, or by calling us at 855.250.2300. We also maintain
a section on our website,
https://www.verb.tech/investor-relations/sec-filings, through which
you can obtain copies of the documents that we have filed with the
SEC. We use our website as a channel of distribution for material
company information. Important information, including financial
information, analyst presentations, financial news releases, and
other material information about us is routinely posted on and
accessible at https://www.verb.tech. The information set forth on,
or accessible from, our website is not part of this
prospectus.
INCORPORATION OF CERTAIN INFORMATION
BY REFERENCE
The
SEC allows us to “incorporate by reference” into this prospectus
much of the information we file with the SEC, which means that we
can disclose important information to you by referring you to those
publicly available documents. The information that we incorporate
by reference into this prospectus is considered to be part of this
prospectus. These documents may include Annual Reports on Form
10-K, Quarterly Reports on Form 10-Q and Current Reports on Form
8-K, as well as proxy statements. You should read the information
incorporated by reference because it is an important part of this
prospectus.
This
prospectus incorporates by reference the documents listed below,
other than those documents or the portions of those documents
deemed to be furnished and not filed in accordance with SEC
rules:
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our
Annual Report on Form 10-K for the fiscal year ended December 31,
2019, filed with the SEC on May 14, 2020; |
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our
Amendment No. 1 to our Annual Report on Form 10-K/A for the fiscal
year ended December 31, 2019, filed with the SEC on June 4,
2020; |
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our
Quarterly Reports on Form 10-Q for the quarters ended March 31,
2020, June 30, 2020, and September 30, 2020, filed with the SEC on
May 15, 2020, August 14, 2019, and November 16, 2020, respectively
and our Amendment No. 1 to our Quarterly Report on Form 10-Q/A for
the quarter ended March 31, 2020, filed with the SEC on June 4,
2020; |
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our
Definitive Proxy Statement on Schedule 14A, filed with the SEC on
September 11, 2020; |
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our
Current Reports on Form 8-K filed with the SEC on February 25,
2020, March 23, 2020, March 27, 2020, May 4, 2020, May 14,2020,
July 24, 2020, July 30, 2020, July 31, 2020, August 17, 2020,
August 20, 2020, September 10, 2020, October 13, 2020, October 22,
2020, November 17, 2020 and January 6, 2021; and |
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the
description of our securities contained in Exhibit 4.17 of our
Annual Report on Form 10-K for the fiscal year ended December31,
2019, filed with the SEC on May 14, 2020, including any amendment
or report filed for the purpose of updating such
description. |
We
also incorporate by reference any future filings (other than
current reports furnished under Item 2.02 or Item 7.01 of Form 8-K
and exhibits filed on such form that are related to such items
unless such Form 8-K expressly provides to the contrary) made with
the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act, including those made after the date of the initial
filing of the registration statement of which this prospectus forms
a part and prior to effectiveness of such registration statement,
until we file a post-effective amendment that indicates the
termination of the offering of the shares of common stock made by
this prospectus and such future filings will become a part of this
prospectus from the respective dates that such documents are filed
with the SEC. Any statement contained herein or in a document
incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes hereof or of
the related prospectus supplement to the extent that a statement
contained herein or in any other subsequently filed document which
is also incorporated or deemed to be incorporated herein modifies
or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this prospectus.
You
may obtain copies of the documents incorporated by reference in
this prospectus from us free of charge by requesting them in
writing or by telephone at the following address:
Verb
Technology Company, Inc.
782 South Auto Mall Drive
American Fork, Utah 84003
Attn: Investor Relations
Telephone: (855) 250-2300
VERB
TECHNOLOGY COMPANY, INC.
Up
to $30,000,000 of Common
Stock
PROSPECTUS
SUPPLEMENT
November
16, 2021
Sales Agent
Truist Securities
Verb Technology (NASDAQ:VERB)
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