As filed with the Securities and Exchange Commission on
September 23, 2020
Registration
No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
CLEANSPARK, INC.
(Exact name of registrant as specified in its charter)
Nevada |
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87-0449945 |
(State
or other jurisdiction of incorporation or organization) |
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(I.R.S.
Employer Identification No.) |
1185 S. 1800 West, Suite 3
Woods Cross, Utah 84087
(702) 244-4405
(Address, including zip code, and telephone number, including area
code, of registrant’s principal executive offices)
Zachary K. Bradford
President and CEO
CleanSpark, Inc.
1185 S. 1800 West, Suite 3
Woods Cross, Utah 84087
(702) 244-4405
(Name, address, including zip code, and telephone number, including
area code, of agent for service)
Copies to:
Christopher L. Tinen
Procopio, Cory, Hargreaves & Savitch LLP
12544 High Bluff Drive, Suite 400
San Diego, California 92130
(858) 720-6320
Approximate date of commencement of proposed sale to the
public:
From time to time after the effective date of this Registration
Statement.
If the
only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check
the following box: ☐
If any of
the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in
connection with dividend or interest reinvestment plans, check the
following box: ☐
If this
Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check
the following box and list the Securities Act registration
statement number of the earlier effective registration statement
for the same offering: ☐
If this
Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box
and list the Securities Act registration statement number of the
earlier effective registration statement for the same
offering: ☐
If this
Form is a registration statement pursuant to General
Instruction I.D. or a post-effective amendment thereto that
shall become effective upon filing with the Commission pursuant to
Rule 462(e) under the Securities Act, check the following
box. ☐
If this
Form is a post-effective amendment to a registration statement
filed pursuant to General Instruction I.D. filed to register
additional securities or additional classes of securities pursuant
to Rule 413(b) under the Securities Act, check the following
box. ☐
Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, a
smaller reporting company, or an “emerging growth company”. See the
definitions of “large accelerated filer”, “accelerated filer”,
“smaller reporting company” and “emerging growth company” in
Rule 12b-2 of the Exchange Act.
Large
accelerated filer ☐ |
Accelerated
filer ☒ |
Non-accelerated
filer ☐ |
Smaller
reporting company ☒ |
|
Emerging
growth company ☐ |
If an
emerging growth company, indicate by check mark if the registrant
has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided
pursuant to Section 7(a)(2)(B) of the Securities
Act. ☐
CALCULATION OF REGISTRATION FEE
Title
of Each Class of Securities to be Registered |
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Amount
to be
Registered (1)(2) |
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Proposed
Maximum
Offering
Price Per Security (3) |
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Proposed
Maximum
Aggregate
Offering Price (3) |
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Amount
of
Registration Fee (4) |
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Common
Stock, $0.001 par value per share |
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Preferred
Stock, $0.001 par value per share |
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Debt
Securities |
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Warrants |
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Rights |
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Units |
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Total |
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$ |
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$ |
200,000,000 |
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$ |
25,960.00 |
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(1) |
Pursuant
to Rule 416(a), this registration statement also covers any
additional securities that may be offered or issued in connection
with any stock split, stock dividend or similar
transaction. |
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(2) |
There
is being registered hereunder an indeterminate number of shares of
(a) common stock, (b) preferred stock, (c) debt securities, (d)
warrants to purchase common stock, preferred stock, debt securities
or other securities of the Registrant, (e) subscription rights to
purchase common stock, preferred stock, debt securities or other
securities of the Registrant, and (d) units, consisting of some or
all of these securities in any combination, as may be sold from
time to time by the Registrant. Any securities registered hereunder
may be sold separately or as units with other securities registered
hereunder. There are also being registered hereunder an
indeterminate number of shares of securities as shall be issuable
upon conversion, exchange or exercise of any securities that
provide for such issuance. In no event will the aggregate offering
price of all types of securities issued by the Registrant pursuant
to this registration statement exceed $200,000,000. |
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(3) |
The
proposed maximum offering price per share and proposed maximum
aggregate offering price for each type of security will be
determined from time to time by the Registrant in connection with
the issuance by the Registrant of the securities registered
hereunder. |
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(4) |
Calculated
pursuant to Rule 457(o) under the Securities Act. |
The Registrant hereby amends this registration statement on such
date or dates as may be necessary to delay its effective date until
the Registrant shall file a further amendment which specifically
states that this registration statement shall thereafter become
effective in accordance with Section 8(a) of the Securities
Act of 1933 or until the registration statement shall become
effective on such date as the Securities and Exchange Commission,
acting pursuant to said Section 8(a), may determine.
The information in this prospectus is not complete and may be
changed. We may not sell any of these securities until the
registration statement filed with the Securities and Exchange
Commission is effective. This prospectus is not an offer to sell
these securities, and is not soliciting an offer to buy these
securities, in any jurisdiction where the offer or sale is not
permitted.
SUBJECT TO COMPLETION, DATED SEPTEMBER 23, 2020
PROSPECTUS

$200,000,000
COMMON STOCK
PREFERRED STOCK
DEBT SECURITIES
WARRANTS
RIGHTS
UNITS
From time to time, we may offer up to $200,000,000 aggregate dollar
amount of shares of our common stock, preferred stock, debt
securities, warrants to purchase our common stock, preferred stock,
debt securities or other securities, subscription rights and/or
units consisting of some or all of these securities, in any
combination, together or separately, in one or more offerings, in
amounts, at prices and on the terms that we will determine at the
time of the offering and which will be set forth in a prospectus
supplement and any related free writing prospectus.
This prospectus describes the general manner in which those
securities may be offered using this prospectus. Each time we offer
securities, we will specify in an accompanying prospectus
supplement and any related free writing prospectus the terms of
securities offered and the offering thereof and may also add,
update or change information contained in this
prospectus.
You should read this prospectus, the information incorporated, or
deemed to be incorporated, by reference in this prospectus, and any
applicable prospectus supplement and related free writing
prospectus carefully before you invest.
Our common stock is currently listed on the Nasdaq Capital Market
(“Nasdaq”) under the symbol “CLSK.” On September 18, 2020, the last
reported sale price of our common stock was $11.55 per share. None
of the other securities we may offer are currently quoted on any
market or securities exchange.
An investment in our securities involves a high degree of risk.
You should carefully consider the information under the heading
“Risk Factors” beginning on page 5 of this prospectus and any
applicable prospectus supplement, before investing in our
securities.
The securities described in this prospectus may be sold to or
through underwriters or dealers, directly to purchasers or through
agents designated from time to time. For additional information on
the methods of sale, you should refer to the section entitled “Plan
of Distribution” in this prospectus. If any underwriters, dealers
or agents are involved in the sale of any securities with respect
to which this prospectus is being delivered, the names of such
underwriters or agents and any applicable fees, discounts or
commissions, details regarding over-allotment options, if any, will
be set forth in a prospectus supplement. The price to the public of
such securities and the net proceeds we expect to receive from such
sale will also be set forth in a prospectus supplement.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus
is
, 2020
TABLE OF
CONTENTS
ABOUT
THIS PROSPECTUS
This prospectus is part of a registration statement that we filed
with the Securities and Exchange Commission, or SEC, using a
“shelf” registration process. Under this shelf registration
process, from time to time, we may sell any combination of the
securities described in this prospectus in one or more offerings,
up to an aggregate dollar amount of $200,000,000. Each time we sell
securities under this shelf registration process, we will provide a
prospectus supplement that will contain specific information about
the terms of the offering. We have provided to you in this
prospectus a general description of the securities we may
offer.
We may also add, update or change in a prospectus supplement any of
the information contained in this prospectus. To the extent there
is a conflict between the information contained in this prospectus
and any applicable prospectus supplement, you should rely on the
information in such 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 this prospectus or any prospectus supplement—the
statement in the document having the later date modifies or
supersedes the earlier statement. You should read both this
prospectus and any prospectus supplement together with additional
information described under the next heading “Where You Can Find
More Information.”
You should rely only on the information contained in or
incorporated by reference into this prospectus or any applicable
prospectus supplement. No dealer, salesperson or any other person
is authorized to give any information or to make any representation
other than the information and representations contained in or
incorporated by reference into this prospectus or any applicable
prospectus supplement. If different information is given or
different representations are made, you may not rely on that
information or those representations as having been authorized by
us. You may not imply from the delivery of this prospectus and any
applicable prospectus supplement, nor from a sale made under this
prospectus and any applicable prospectus supplement, that our
affairs are unchanged since the date of this prospectus and any
applicable prospectus supplement or that the information contained
in any document incorporated by reference is accurate as of any
date other than the date of the document incorporated by reference,
regardless of the time of delivery of this prospectus and any
applicable prospectus supplement or any sale of a security. This
prospectus and any applicable prospectus supplement may only be
used where it is legal to sell the securities.
In this prospectus, unless the context otherwise requires, the
terms “CleanSpark,” “CLSK,” the “Company,” “we,” “us,” and “our”
refer to CleanSpark, Inc., a Nevada corporation.
PROSPECTUS SUMMARY
This summary does not contain all the information that you
should consider before investing in our securities. You should read
the entire prospectus and the information incorporated by reference
in this prospectus carefully, including “Risk Factors” and the
financial data and related notes and other information incorporated
by reference, before making an investment decision.
Overview
We are in the business of providing advanced energy software and
control technology that enables a plug-and-play enterprise solution
to modern energy challenges. Our services consist of intelligent
energy monitoring and controls, microgrid design and engineering
and consulting services. Our software allows energy users to obtain
resiliency and economic optimization. Our software is uniquely
capable of enabling a microgrid to be scaled to the user's specific
needs and can be widely implemented across commercial, industrial,
military and municipal deployment.
Integral to our business is our mPulse and mVSO software platforms
(the “Platforms”). When the Platforms are implemented on a
customer’s power system, they are able to control the distributed
energy resources on site to provide secure, sustainable energy
often at significant cost savings for our energy customers. The
Platforms allows customers to efficiently manage renewable energy
generation, other distributed energy generation technologies
including energy generation assets, energy storage assets, and
energy consumption assets. By having autonomous control over the
distributed facets of energy usage and energy storage, customers
are able to reduce their dependency on utilities, thereby keeping
energy costs relatively constant over time. The overall aim is to
transform energy consumers into energy producers by supplying power
that anticipates their routine instead of interrupting it.
We also own patented gasification technologies. Our technology
converts any organic material into SynGas. SynGas can be used as
clean, renewable, environmentally friendly, warming fuel for power
plants, motor vehicles, and as feedstock for the generation of DME
(Di-Methyl Ether).
As previously disclosed, we plan to continue our focus on the
Distributed energy and microgrid side of the business in 2020, as
opposed to expending significant efforts on the Gasifier side of
the business. We plan to continue our efforts to better our
technology, service existing customers and market our System
(defined below) to prospective clients. We feel that this focus
would provide the best opportunity for our shareholders.
Lines of
Business
Through CleanSpark, LLC, the
Company provides microgrid engineering, design and software
solutions to military, commercial and residential
customers.
The services offered consist
of, microgrid design and engineering, project development
consulting services. The work is performed under fixed price bid
contracts and negotiated price contracts.
Through CleanSpark Critical
Power Systems, Inc., the Company provides custom hardware solutions
for distributed energy systems that serve military and commercial
residential properties. The equipment is generally sold under
negotiated fixed price contracts.
Through GridFabric, LLC the
Company provides Open Automated Demand response (“OpenADR”) and
other middleware communication protocol software solutions to
commercial and utility customers.
Distributed Energy Management and Microgrids
Integral to our
business is our
Distributed Energy Management
Business (the “DER Business”). The main assets of our DER
Business include our
propriety software
systems (“Systems”)
and also our
engineering
and methodology trade secrets. The Distributed Energy systems and Microgrids that utilize our Systems are capable of providing secure, sustainable
energy with
significant cost
savings for its
energy customers. The
Systems allows customers to design, engineer, and then efficiently manage renewable energy generation,
storage and
consumption. By
having autonomous
control over the multiple
facets of energy
usage and
storage, customers are
able to reduce their
dependency on utilities, thereby keeping energy costs relatively constant over
time. The overall aim
is to transform energy
consumers into intelligent energy producers by supplying and managing power in a manner that anticipates their routine
instead of interrupting it.
Around the world, the aging
grid is becoming
unstable and
unreliable due to
increases in loads
and lack of
new large-scale generation facilities.
This inherent
instability is compounded by the push to integrate a growing number and variety of renewable but intermittent energy generators
and advanced technologies into
outdated electrical
systems.
Simultaneously, defense installations, industrial
complexes, communities, and campuses across the world are turning to virtual power plants and microgrids as a means to decrease their reliance from the grid, reduce utility costs, utilize cleaner power,
and enhance energy security
and surety.
The convergence of
these factors is
creating a
“perfect storm” in
the power supply
optimization
and energy management arena. Efficiently building and operating the distributed energy
management systems
and microgrids of tomorrow, while maximizing the use of sustainable energy to produce
affordable, stable, predictable, and reliable power on a large scale, is a significant opportunity that
first-movers can leverage to capture a large share of this emerging global industry.
A microgrid is
comprised of
any number of generation, energy storage,
and smart distribution assets that
serve a single
or multiple loads,
both connected to
the utility grid
and separate from
the utility grid
“islanded.” In the past, distributed energy management systems and microgrids have consisted of
off-grid generators
organized with
controls to provide power where utility lines cannot run. Today,
modern distributed
energy management
systems and
microgrids integrate
renewable energy generation systems (REGS) with advanced energy storage devices
and interoperate with the local utility grid. Advanced autonomous cyber-secure
microgrids controls relay information between intelligent
hardware and
localized servers to
make decisions in real-time that deliver optimum
power where it
is needed, when it is
needed.
Our Systems create an integrated distributed energy
management control
platform that seamlessly integrates all
forms of energy generation with energy storage devices
and controls
facility loads to
provide energy
security in real time free of cyber threats. Able to
interoperate
with the local utility grid, the Systems bring users the ability to choose
when to buy or sell
power to and from the grid, enabling what we believe is the most cost-effective
power solution that
exists on the current
market.
Our Systems are ideal for commercial, industrial,
mining, defense, campus and residential users and ranges in size from 4KW to 100MW
and beyond and can deliver power at or below
the current cost of
utility power.
Our services consist
of distributed energy
microgrid system engineering and design, and project
consulting services.
The work is
performed under fixed
price bid contracts and
negotiated price contracts.
mPulse Software Suite
mPulse is a
modular platform that enables fine-grained control of a
Microgrid based on
customer operational
goals, equipment
and forecasts of load and generation. mPulse performs
high-frequency calculations, threshold-based alarming,
execution of domain-specific business rules,
internal and
external health monitoring,
historical data persistence, and system-to-operator notifications.
The modular design increases
system flexibility and extensibility. In addition,
the deployment of
the mPulse system
follows a security-conscious posture by
deploying hardware-based
firewalls as well as encryption across communication channels. mPulse allows
configuration for site-specific equipment
and operation
and provides a
clean, informative user
interface to allow customers to monitor and analyze the data streams that describe how
their microgrid is
operating.
mPulse supports our
innovative fractal
approach to microgrid
design, which
enables multiple
microgrids on a single
site to interact in a number of different ways, including as peers, in a
parent-child
relationship, and in parallel or completely disconnected. Each
grid can have different operational
objectives, and
those operational
objectives can change
over time. Any
microgrid can be islanded from the rest of the microgrid as well as the larger utility grid. The mPulse software can control
the workflow required
in both the islanding
steps as well as
the reconnecting steps
of this maneuver and coordinate connected equipment such that
connections are only made when it is safe to do so.
Microgrid Value Stream Optimizer (mVSO)
The Microgrid Value Stream
Optimizer (mVSO) tool provides a robust distributed energy and microgrid system modeling
solution. mVSO
takes utility rate
data and load data for
a customer site
and helps automate the sizing and analysis of potential microgrid solutions as
well as providing a financial analysis around each
grid configuration.
mVSO uses historical data to
generate projected
energy generation
assets and models how storage responds to varying operational modes and command logics based upon predicted
generation
and load curves. mVSO analyzes multiple equipment
combinations and
operational situations
to determine the optimal
configuration for a site based on the financials, equipment outlay,
utility cost savings, etc., to arrive at payback and IRR values. This ultimately provides the user with data to design a distributed energy and/or
microgrid system that
will meet the customers’ performance
benchmarks.
Switchgear Equipment
As an energy technology company, part of our business model is to
assess our technologies, product offerings and business direction
and determine whether any strategic acquisitions would benefit us.
In line with our focus, on January 22, 2019, we acquired the
outstanding capital stock of Pioneer Critical Power, Inc., a
Delaware corporation (“Pioneer”), which we have since renamed and
redomiciled to the State of Nevada and changed the name to
CleanSpark Critical Power Systems Inc.
As
consideration for the transaction, we issued to its sole shareholder
Pioneer Power Solutions, Inc. (“Pioneer Power”) a total of 175,000
shares of our common stock, a 5-year warrant to purchase 50,000
shares of our common stock at an exercise price of $16.00 per share
and a 5-year warrant to purchase 50,000 shares of our common stock
at an exercise price of $20.00 per share.
The parties also signed additional agreements in connection with
the transaction, as previously disclosed in our SEC filings, mainly
requiring Pioneer Power to indemnify us in certain circumstances
and restricting Pioneer Power from engaging in a competing
business.
We also signed a Contract Manufacturing Agreement, whereby Pioneer
Power shall exclusively manufacture parallel switchgears, automatic
transfer switches and related control and circuit protective
equipment for us, for a period of eighteen months.
We plan to utilize the new intellectual property we gained from the
acquisition and the manufacturing agreement in place to enter into
the switchgear equipment sales industry. We acquired executed
contracts and purchase orders, which we expect will result in
significant gross sales, as well as hired personnel to operate this
new line of business.
As a result of this transaction, the parties terminated a
contemplated asset purchase arrangement previously disclosed in our
SEC filings.
Software Development, Marketing & Design –
p2kLabs
As CleanSpark continues to drive towards profitability and further
market and sell CleanSpark software and controls, our acquisition
of p2kLabs, Inc. not only contributes additional revenues, but also
adds depth to our team in sales, marketing, design and software
development.
We plan to maximize the value of our offering, internalize what
would otherwise be expenses, and diversify our ability to better
serve our valued clients.
As consideration for the transaction, we issued to its sole shareholder,
Amer Tadayon, a total of 95,699 shares of our common stock and paid
$1,155,000 in cash.
The parties also signed additional agreements in connection with
the transaction, as previously disclosed in our SEC filings, mainly
an employment agreement with Amer Tadayon.
OpenADR and communication protocol
software solutions – GridFabric
As CleanSpark continues to expand its energy software offerings,
our acquisition of GridFabric, LLC allows CleanSpark to offer Open
ADR solutions to commercial and utility Customers. CleanSpark will
also utilize GridFabric's communications protocols as an integral
part of our Demand Response offerings integrated into
mPulse.
GridFabric creates software solutions that help power utilities and
IoT (Internet of Things) products that manage energy loads.
OpenADR 2.0b is now the basis for the standard to be
developed by the International Electrotechnical Commission.
GridFabric's core products are Canvas and Plaid.
Canvas
Canvas is an OpenADR 2.0b Virtual Top Node ('VTN') built
for testing and managing Virtual End Nodes ('VENs') that are
piloting and running load shifting programs. Canvas is offered to
customers in the Cloud as a SaaS solution or as a licensed
software.
Plaid
Plaid is a licensed software solution that allows any internet
connected product that uses energy (i.e. Solar, Storage &
Inverters, Demand Response, EV Charging, Lighting, Industrial
controls, Building Management Systems, etc.) to add
load shifting capabilities by translating load shifting protocols
into their existing APIs. Companies that implement Plaid through
GridFabric get a Certified OpenADR 2.0b Virtual End Node
(VEN) upon completion of the implementation process.
As consideration for the transaction, we issued to its members, a
total of 26,427 shares of our common stock and paid $400,000 in
cash. Additional shares of the Company’s common stock, valued at up
to $750,000.00, will be issuable to Sellers if GridFabric
achieves certain revenue and product release milestones related to
the future performance of GridFabric.
Nasdaq Listing
On January 24, 2020, the Company was approved for listing on the
Nasdaq Capital Market (“Nasdaq”).
Corporate Information
Our principal executive offices are located at 1185 S. 1800 West,
Suite 3, Woods Cross, Utah 84087, and our telephone number is (702)
941-8047. Our website is located at www.cleanspark.com.
Information contained on our website or that can be accessed
through our website is not incorporated by reference into this
prospectus supplement.
Where You Can Find More Information
For additional information as to our business, properties and
financial condition, please refer to the documents cited in "Where
You Can Find More Information."
The Securities We May Offer
With this prospectus, we may offer common stock, preferred stock,
debt securities, warrants, subscription rights, and/or units
consisting of some or all of these securities in any combination.
The aggregate offering price of securities that we offer with this
prospectus will not exceed $200,000,000. Each time we offer
securities with this prospectus, we will provide offerees with a
prospectus supplement that will contain the specific terms of the
securities being offered. The following is a summary of the
securities we may offer with this prospectus.
Common Stock
We may offer shares of our common stock, par value $0.001 per
share, including securities convertible into common stock.
Preferred Stock
We may offer shares of our preferred stock, par value $0.001 per
share, including securities convertible into preferred stock
Debt Securities
We may issue debt securities from time to time, in one or more
series, as either senior or subordinated debt or as senior or
subordinated convertible debt. A form of indenture has been filed
as an exhibit to the registration statement of which this
prospectus is a part, and supplemental indentures and forms of debt
securities containing the terms of the debt securities being
offered will be filed as exhibits to the registration statement of
which this prospectus is a part or will be incorporated by
reference from reports that we file with the SEC.
Warrants
We may offer warrants for the purchase shares of common stock,
preferred stock, debt securities or other securities. We may issue
warrants independently or together with other securities. Our board
of directors will determine the terms of the warrants.
Subscription Rights
We may offer subscription rights to purchase of common stock,
preferred stock, debt securities or other securities. We may issue
subscription rights independently or together with other
securities. Our board of directors will determine the terms of the
subscription rights.
Units
We may offer units consisting of some or all of the securities
described above, in any combination, including common stock,
preferred stock, debt securities, warrants and/or subscription
rights. The terms of these units will be set forth in a prospectus
supplement. The description of the terms of these units in the
related prospectus supplement will not be complete. You should
refer to the applicable form of unit and unit agreement for
complete information with respect to these units.
RISK
FACTORS
An investment in our securities involves a high degree of risk. The
prospectus supplement relating to a particular offering of
securities will contain a discussion of the risks applicable to an
investment in the securities offered. Prior to making a decision
about investing in our securities, 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. 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 may be
amended, supplemented or superseded from time to time by other
reports we file with the SEC in the future. The risks and
uncertainties we have described are not the only ones we face.
Additional risks and uncertainties not presently known to us or
that we currently deem immaterial may also affect our
operations.
FORWARD-LOOKING STATEMENTS
This prospectus and documents incorporated herein by reference
contain “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. These
forward-looking statements involve a number of risks and
uncertainties. We caution readers that any forward-looking
statement is not a guarantee of future performance and that actual
results could differ materially from those contained in the
forward-looking statement. These statements are based on current
expectations of future events. Such statements include, but are not
limited to, statements about future financial and operating
results, plans, objectives, expectations and intentions, costs and
expenses, interest rates, outcome of contingencies, financial
condition, results of operations, liquidity, cost savings,
objectives of management, business strategies, debt financing,
clinical trial timing and plans, the achievement of clinical and
commercial milestones, the advancement of our technologies and our
product candidates, and other statements that are not historical
facts. You can find many of these statements by looking for words
like “believes,” “expects,” “anticipates,” “estimates,” “may,”
“might,” “should,” “will,” “could,” “plan,” “intend,” “project,”
“seek” or similar expressions in this prospectus or in documents
incorporated by reference into this prospectus. We intend that such
forward-looking statements be subject to the safe harbors created
thereby.
These forward-looking statements are based on the current beliefs
and expectations of our management and are subject to significant
risks and uncertainties. If underlying assumptions prove inaccurate
or unknown risks or uncertainties materialize, actual results may
differ materially from current expectations and projections.
Factors that might cause such a difference include those discussed
in 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, as well as those discussed in this
prospectus and in the documents incorporated by reference into this
prospectus. You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
prospectus or, in the case of documents referred to or incorporated
by reference, the date of those documents.
All subsequent written or oral forward-looking statements
attributable to us or any person acting on our behalf are expressly
qualified in their entirety by the cautionary statements contained
or referred to in this section. We do not undertake any obligation
to release publicly any revisions to these forward-looking
statements to reflect events or circumstances after the date of
this prospectus or to reflect the occurrence of unanticipated
events, except as may be required under applicable U.S. securities
law. If we do update one or more forward-looking statements, no
inference should be drawn that we will make additional updates with
respect to those or other forward-looking statements.
WHERE YOU
CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, or the Exchange Act, and are
required to file annual, quarterly and other reports, proxy
statements and other information with the SEC. You may inspect and
copy these reports, proxy statements and other information at the
public reference facilities maintained by the SEC in Washington,
D.C., 100 F Street N.E., Washington, D.C. 20549. Copies of
such materials can be obtained from the SEC’s public reference
section at prescribed rates. You may obtain information on the
operation of the public reference rooms by calling the SEC at
(800) SEC-0330. Additionally, the SEC maintains an
Internet site (www.sec.gov) that contains reports, proxy and
information statements, and various other information about us. You
may also inspect the documents described herein upon notice at our
headquarters, 1185 South 1800 West, Suite 3, Woods Cross, UT 84087
during normal business hours.
Information about us is also available at our website
at www.cleanspark.com. However, the information on our website
is not a part of this prospectus and is not incorporated by
reference into this prospectus.
INCORPORATION OF INFORMATION BY
REFERENCE
The SEC allows us to “incorporate by reference” information that we
file with the SEC, which means that we can disclose important
information to you by referring you to those other documents. The
information incorporated by reference is an important part of this
prospectus, and information we file later with the SEC will
automatically update and supersede this information. We incorporate
by reference the documents listed below and any future filings we
make with the SEC under Section 13(a), 13(c), 14, or 15(d) of
the Exchange Act prior to the termination of any offering of
securities made by this prospectus:
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Our
Annual Report on Form 10-K for the fiscal year ended September 30,
2019, and filed with the SEC on December 16, 2019; |
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Our
Quarterly Reports on Form 10-Q for the quarters ended December 31,
2019, March 31, 2020 and June 30, 2020, and filed with the SEC on
February 10, 2020, May 11, 2020 and August 4, 2020,
respectively; |
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Our
Current Reports on Form 8-K filed with the SEC on January 29, 2020,
February 6, 2020, March 6, 2020 (amendment), March 10, 2020, March
16, 2020, April 9, 2020, May 6, 202, May 20, 2020, July 21, 2020,
August 7, 2020, August 11, 2020 and September 1, 2020; |
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the
description of our common stock contained in our registration
statement on Form 8-A filed with the SEC on January 22, 2020
under Section 12 of the Exchange Act, including any amendment
or report filed for the purpose of updating such description;
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filings
we make with the SEC pursuant to the Exchange Act after the date of
the initial registration statement, of which this prospectus is a
part, and prior to the effectiveness of the registration
statement |
Upon
written or oral request, we will provide without charge to each
person, including any beneficial owner, to whom this
prospectus is delivered, a copy of any or all of such information
that has been incorporated herein by reference (other than exhibits
to such documents unless such exhibits are specifically
incorporated by reference into the documents that this prospectus
incorporates). Written or oral requests for copies should be
directed to CleanSpark, Inc., Attn: Chief Executive Officer, 1185
S. 1800 West, Suite 3, Woods Cross, Utah 84087, telephone number
(702) 941-8047. See the section of this prospectus entitled “Where
You Can Find More Information” for information concerning how to
read and obtain copies of materials that we file with the SEC at
the SEC’s public offices.
Any statement contained in this prospectus, or in a document all or
a portion of which is incorporated by reference, shall be modified
or superseded for purposes of this prospectus to the extent that a
statement contained in this prospectus, any prospectus supplement
or any document incorporated by reference modifies or supersedes
such statement. Any such statement so modified or superseded shall
not, except as so modified or superseded, constitute a part of this
prospectus.
USE OF
PROCEEDS
We will retain broad discretion over the use of the net proceeds to
us from the sale of our securities under this
prospectus. Unless otherwise provided in the applicable
prospectus supplement, we intend to use the net proceeds from the
sale of securities under this prospectus for general corporate
purposes, which may include funding software development,
increasing our working capital and acquisitions or investments in
businesses, products or technologies that are complementary to our
own. We will set forth in the prospectus supplement our intended
use for the net proceeds received from the sale of any securities.
Pending the application of the net proceeds, we intend to invest
the net proceeds in short-term or long-term, investment-grade,
interest-bearing securities.
PLAN OF
DISTRIBUTION
We may sell the securities covered by this prospectus to one or
more underwriters for public offering and sale by them, and may
also sell the securities to investors directly or through agents.
We will name any underwriter or agent involved in the offer and
sale of securities in the applicable prospectus supplement. We have
reserved the right to sell or exchange securities directly to
investors on our own behalf in jurisdictions where we are
authorized to do so. We may distribute 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; |
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at
market prices prevailing at the time of sale; |
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at
prices related to such prevailing market prices; or |
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at
negotiated prices. |
We may directly solicit offers to purchase the securities being
offered by this prospectus. We may also designate agents to solicit
offers to purchase the securities from time to time. We will name
in a prospectus supplement any agent involved in the offer or sale
of our securities. Unless otherwise indicated in a prospectus
supplement, an agent will be acting on a best efforts basis, and a
dealer will purchase securities as a principal for resale at
varying prices to be determined by the dealer.
If we utilize an underwriter in the sale of the securities being
offered by this prospectus, we will execute an underwriting
agreement with the underwriter at the time of sale and we will
provide the name of any underwriter in the prospectus supplement
that the underwriter will use to make resales of the securities to
the public. In connection with the sale of the securities, we, or
the purchasers of securities for whom the underwriter may act as
agent, may compensate the underwriter in the form of underwriting
discounts or commissions. The underwriter may sell the securities
to or through dealers, and those dealers may receive compensation
in the form of discounts, concessions or commissions from the
underwriters or commissions from the purchasers for whom they may
act as agent.
We will provide in the applicable prospectus supplement any
compensation we pay to underwriters, dealers, or agents in
connection with the offering of the securities, and any discounts,
concessions or commissions allowed by underwriters to participating
dealers. Underwriters, dealers and agents participating in the
distribution of the securities may be deemed to be underwriters
within the meaning of the Securities Act of 1933, or the Securities
Act, and any discounts and commissions received by them and any
profit realized by them on resale of the securities may be deemed
to be underwriting discounts and commissions. We may enter into
agreements to indemnify underwriters, dealers and agents against
civil liabilities, including liabilities under the Securities Act,
and to reimburse them for certain expenses. We may grant
underwriters who participate in the distribution of our securities
under this prospectus an option to purchase additional securities
to cover any over-allotments in connection with the
distribution.
The securities we offer under this prospectus may or may not be
listed on a securities exchange. To facilitate the offering of
securities, certain persons participating in the offering may
engage in transactions that stabilize, maintain or otherwise affect
the price of the securities. This may include short sales of the
securities, which involves the sale by persons participating in the
offering of more securities than we sold to them. In these
circumstances, these persons would cover such short positions by
making purchases in the open market or by exercising their option
to purchase additional securities. In addition, these persons may
stabilize or maintain the price of the securities by bidding for or
purchasing securities in the open market or by imposing penalty
bids, whereby selling concessions allowed to dealers participating
in the offering may be reclaimed if securities sold by them are
repurchased in connection with stabilization transactions. The
effect of these transactions may be to stabilize or maintain the
market price of the securities at a level above that which might
otherwise prevail in the open market. These transactions may be
discontinued at any time.
We may engage in at the market offerings into an existing trading
market in accordance with Rule 415(a)(4) under the Securities
Act. In addition, we may enter into derivative transactions with
third parties, or sell securities not covered by this prospectus to
third parties in privately negotiated transactions. If the
applicable prospectus supplement indicates, in connection with
those derivatives, the third parties may sell securities covered by
this prospectus and the applicable prospectus supplement, including
short sale transactions. If so, the third party may use securities
pledged by us or borrowed from us or others to settle those sales
or to close out any related open borrowings of stock, and they may
use securities received from us in settlement of those derivatives
to close out any related open borrowings of stock. The third party
in these sale transactions will be an underwriter and will be
identified in the applicable prospectus supplement. In addition, we
may otherwise loan or pledge securities to a financial institution
or other third party that in turn may sell the securities short
using this prospectus. The financial institution or other third
party may transfer its economic short position to investors in our
securities or in connection with a concurrent offering of other
securities.
We will file a prospectus supplement to describe the terms of any
offering of our securities covered by this prospectus. The
prospectus supplement will disclose:
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the
terms of the offer; |
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the
names of any underwriters, including any managing underwriters, as
well as any dealers or agents; |
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the
purchase price of the securities from us; |
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the
net proceeds to us from the sale of the securities; |
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any
delayed delivery arrangements; |
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any
underwriting discounts, commissions or other items constituting
underwriters’ compensation, and any commissions paid to
agents; |
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in a
subscription rights offering, whether we have engaged
dealer-managers to facilitate the offering or subscription,
including their name or names and compensation; |
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any
public offering price; and |
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other
facts material to the transaction. |
We will bear all or substantially all of the costs, expenses and
fees in connection with the registration of our securities under
this prospectus. The underwriters, dealers and agents may engage in
transactions with us, or perform services for us, in the ordinary
course of business.
DESCRIPTION OF CAPITAL STOCK
The description below of our capital stock and provisions of our
articles of incorporation and bylaws, as amended, are summaries and
are qualified by reference to the articles of incorporation and
bylaws, as amended, and the applicable provisions of Nevada
law.
General
Our articles of incorporation authorize us to issue up to
20,000,000 shares of common stock, $0.001 par value per share, and
10,000,000 shares of preferred stock, $0.001 par value per
share.
As of September 21, 2020, there were 17,380,704 shares of common
stock outstanding and 1,750,000 shares of preferred stock
outstanding.
Common Stock
Voting rights. Each holder of our common stock
is entitled to one vote for each share on all matters submitted to
a vote of the stockholders, including the election of directors.
Our stockholders do not have cumulative voting rights in the
election of directors. As a result, the holders of a majority of
the shares of common stock entitled to vote in any election of
directors can elect all of the directors standing for election, if
they should so choose.
Dividends. Subject to preferences that may be
applicable to any then-outstanding preferred stock, holders of
common stock are entitled to receive ratably those dividends, if
any, as may be declared from time to time by our Board out of
legally available funds. We have never declared or paid any cash
dividends on our common stock. We currently intend to retain future
earnings, if any, to finance the expansion of our business. As a
result, we do not anticipate paying any cash dividends in the
foreseeable future.
Liquidation. In the event of our liquidation,
dissolution or winding up of the Company, holders of common stock
are entitled to share ratably in the net assets legally available
for distribution to stockholders after the payment of all of our
debts and other liabilities and the satisfaction of any liquidation
preference granted to the holders of any then-outstanding shares of
preferred stock.
Rights and preferences. Holders of common stock
have no preemptive, conversion or subscription rights and there are
no redemption or sinking fund provisions applicable to the common
stock. The rights, preferences and privileges of the holders of
common stock are subject to, and may be adversely affected by, the
rights of the holders of shares of any series of preferred stock
that we may designate in the future.
Fully paid and nonassessable. All of our
outstanding shares of common stock are, and the shares of common
stock to be issued in this offering, if any, will be, fully paid
and nonassessable.
Preferred Stock
Under our articles of incorporation, as amended, our Board has the
authority, without further action by the stockholders (unless such
stockholder action is required by applicable law or the rules of
any stock exchange or market on which our securities are then
traded), to designate and issue up to 10,000,000 shares of
preferred stock in one or more series, to establish from time to
time the number of shares to be included in each such series, to
fix the designations, voting powers, preferences and rights of the
shares of each wholly unissued series, and any qualifications,
limitations or restrictions thereof, and to increase or decrease
the number of shares of any such series, but not below the number
of shares of such series then outstanding.
We will fix the designations, voting powers, preferences and rights
of the preferred stock of each series, as well as the
qualifications, limitations or restrictions thereof, in a
certificate of designation relating to that series. We will file as
an exhibit to our reports, or will incorporate by reference from
reports that we file with the SEC, the form of any certificate of
designation that describes the terms of the series of preferred
stock we are offering before the issuance of that series of
preferred stock. This description will include:
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the
title and stated value; |
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the
number of shares we are offering; |
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the
liquidation preference per share; |
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the
dividend rate, period and payment date and method of calculation
for dividends; |
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whether
dividends will be cumulative or non-cumulative and, if cumulative,
the date from which dividends will accumulate; |
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the
procedures for any auction and remarketing, if any; |
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the
provisions for a sinking fund, if any; |
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the
provisions for redemption or repurchase, if applicable, and any
restrictions on our ability to exercise those redemption and
repurchase rights; |
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any
listing of the preferred stock on any securities exchange or
market; |
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whether
the preferred stock will be convertible into our common stock, and,
if applicable, the conversion price, or how it will be calculated,
and the conversion period; |
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whether
the preferred stock will be exchangeable into debt securities, and,
if applicable, the exchange price, or how it will be calculated,
and the exchange period; |
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voting
rights, if any, of the preferred stock; |
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preemptive
rights, if any; |
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restrictions
on transfer, sale or other assignment, if any; |
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whether
interests in the preferred stock will be represented by depositary
shares; |
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a
discussion of any material U.S. federal income tax considerations
applicable to the preferred stock; |
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the
relative ranking and preferences of the preferred stock as to
dividend rights and rights if we liquidate, dissolve or wind up our
affairs; |
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any
limitations on the issuance of any class or series of preferred
stock ranking senior to or on a parity with the series of preferred
stock as to dividend rights and rights if we liquidate, dissolve or
wind up our affairs; and |
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any
other specific terms, preferences, rights or limitations of, or
restrictions on, the preferred stock. |
Nevada law provides that the holders of preferred stock will have
the right to vote separately as a class (or, in some cases, as a
series) on an amendment to our articles of incorporation if the
amendment would change the par value or, unless the articles of
incorporation provided otherwise, the number of authorized shares
of the class or change the powers, preferences or special rights of
the class or series so as to adversely affect the class or series,
as the case may be. This right is in addition to any voting rights
that may be provided for in the applicable certificate of
designation.
Our Board may authorize the issuance of preferred stock with
voting, exchange or conversion rights that could adversely affect
the voting power or other rights of the holders of our common
stock. Preferred stock could be issued quickly with terms designed
to delay or prevent a change in control of our company or make
removal of management more difficult. Additionally, the issuance of
preferred stock may have the effect of decreasing the market price
of our common stock.
Series A Preferred Stock
On April 15, 2015, pursuant to Article IV of our Articles of
Incorporation, the Company’s Board of Directors voted to designate
a class of preferred stock entitled Series A Preferred Stock,
consisting of up to one million (1,000,000) shares, par value
$0.001. Under the Certificate of Designation, holders of Series A
Preferred Stock will be entitled to quarterly dividends on 2% of
our earnings before interest, taxes and amortization. The dividends
are payable in cash or common stock. The holders will also have a
liquidation preference on the state value of $0.02 per share plus
any accumulated but unpaid dividends. The holders are further
entitled to have the Company redeem their Series A Preferred Stock
for three shares of common stock in the event of a change of
control and they are entitled to vote together with the holders of
the Company’s common stock on all matters submitted to stockholders
at a rate of forty-five (45) votes for each share held.
On October 4, 2019, pursuant to Article IV of our Articles of
Incorporation, our Board of Directors voted to increase the number
of shares of preferred stock designated as Series A Preferred Stock
from one million (1,000,000) shares to two million (2,000,000)
shares, par value $0.001.
Series B Preferred Stock
On April 16, 2019, pursuant to Article IV of our Articles of
Incorporation, the Company’s Board of Directors voted to designate
a class of preferred stock entitled Series B Preferred Stock,
consisting of up to one hundred thousand (100,000) shares, par
value $0.001. Under the Certificate of Designation, the holders of
Series B Preferred Stock are entitled to the following powers,
designations, preferences and relative participating, optional and
other special rights, and the following qualifications, limitations
and restrictions, among others as set forth in the Certificate of
Designation:
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The
holders of shares of Series B Preferred Stock will have no right to
vote on any matters, questions or proceedings of the Company
including, without limitation, the election of
directors; |
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Commencing
on the date of issuance, the Series B Preferred Stock will accrue
cumulative in kind accruals (“the Accruals”) at the rate of 7.5%
per annum; |
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Upon
any liquidation, dissolution or winding up of the Company, the
holders of the Series B Preferred Stock will be entitled to be paid
out of the assets of the Company available for distribution to its
stockholders an amount with respect to each share of Series B
Preferred Stock equal to $5,000.00 (the “Face Value”), plus an
amount equal to any accrued but unpaid Accruals thereon (the
“Liquidation Value”); |
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On
maturity, the Company may redeem the Series B Preferred Stock by
paying the holder the Liquidation Value; |
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Before
maturity, the Company may redeem the Series B Preferred stock on 30
days’ notice by paying 145% of the outstanding Face Value per
share; |
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If
the Company determines to liquidate, dissolve or wind-up its
business and affairs, the Company will, within three trading days
of such determination and prior to effectuating any such action,
redeem all outstanding shares of Series B Preferred
Stock; |
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In
the event of a conversion of any shares of Series B Preferred
Stock, the Company will (a) satisfy the payment of the Conversion
Premium, which is defined as the Face Value of the shares converted
multiplied by the product of 7.5% and the number of whole years
between issuance and maturity, and (b) issue to the holder of the
shares of Series B Preferred Stock a number of conversion shares
equal to the Face Value divided by the applicable Conversion Price
(defined as 90% of the of the 5 lowest individual daily volume
weighted average prices of the Common Stock from issuance to
conversion less $0.075 per share, but no less than the Floor Price
[$1.00 prior to corporate approvals to increase the authorized
stock and approve the financing and $0.35 after approvals]) with
respect to the number of shares converted; |
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if at
any time the Company grants, issues or sells any options,
convertible securities or rights to purchase stock, warrants,
securities or other property pro rata to the record holders of any
class of shares of Common Stock (the “Purchase Rights”), then
holder will be entitled to acquire, upon the terms applicable to
such Purchase Rights, the aggregate Purchase Rights which holder
could have acquired if holder had held the number of shares of
Common Stock acquirable upon conversion of Series B Preferred
Stock; |
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At
maturity (2 years from issuance), all outstanding shares of Series
B Preferred Stock shall automatically convert into common stock at
the Conversion Price; and |
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At no
time may the holders of Series B Preferred Stock own more than
4.99% of the outstanding common stock in the Company. |
On March 10, 2020, the Company terminated the obligation to issue
any Series B Preferred Stock, has issued no Series B Preferred
Stock and has filed a withdrawal of the Series B Certificate of
Designation which was filed with the Nevada Secretary of State. No
Series B Preferred Stock was ever issued.
Stock Options
The Company sponsors a stock-based incentive compensation plan
known as the 2017 Incentive Plan (the “Plan”), which was
established by the Board of Directors of the Company on June 19,
2017. A total of 300,000 shares were initially reserved for
issuance under the 2017 Plan. As of July 20, 2020, there were
21,360 shares available for issuance under the 2017 Plan. See
Action 2 for the Plan Amendment to increase the reserved option
pool to 1,500,000 shares.
The 2017 Plan allows the Company to grant incentive stock options,
non-qualified stock options, stock appreciation right, or
restricted stock. The incentive stock options are exercisable for
up to ten years, at an option price per share not less than the
fair market value on the date the option is granted. The incentive
stock options are limited to persons who are regular full-time
employees of the Company at the date of the grant of the option.
Non-qualified options may be granted to any person, including, but
not limited to, employees, independent agents, consultants and
attorneys, who the Company’s Board believes have contributed, or
will contribute, to the success of the Company. Non-qualified
options may be issued at option prices of less than fair market
value on the date of grant and may be exercisable for up to ten
years from date of grant. The option vesting schedule for options
granted is determined by the Board of Directors at the time of the
grant. The 2017 Plan provides for accelerated vesting of unvested
options if there is a change in control, as defined in the 2017
Plan.
As of
September 21, 2020, there are options exercisable to purchase
224,757 shares of common stock in the Company and 53,191 unvested
options outstanding that cannot be exercised until vesting
conditions are met. As of September 21, 2020, the outstanding
options have a weighted average remaining term of 2.37 years and an
intrinsic value of $1,555,561.
Warrants
As of
September 21, 2020, there
are warrants exercisable to purchase 1,289,779 shares of common
stock in the Company and 24,286 unvested
warrants outstanding that cannot be exercised until vesting
conditions are met. 996,198 of
the warrants require a cash investment to exercise as
follows ,
5,000 required a cash investment of $8.00 per share, 449,865
require a cash investment of $15.00 per share, 125,000 require a
cash investment of $20.00 per share, 103,000 require a cash
investment of $25.00 per share, 200,000 require an investment of
$35.00 per share, 10,000 require an investment of $40.00 per share,
60,000 require an investment of $50.00 per share, 38,333 require a
cash investment of $75.00 per share and 5,000 require a cash
investment of $100.00 per share. 317,867 of the outstanding
warrants contain provisions allowing a cashless exercise at their
respective exercise prices.
Registration Rights
On December 28, 2018 and April 17, 2019, the Company agreed with
the Investor that it will keep a registration available to cover
the resale of the Warrant Shares issued in each of the
financings.
Listing
The Company’s Common Stock is listed on the Nasdaq Capital
Market.
Anti-Takeover Laws
Nevada Revised Statutes sections 78.378 to 78.379 provide state
regulation over the acquisition of a controlling interest in
certain Nevada corporations unless the articles of incorporation or
bylaws of the corporation provide that the provisions of these
sections do not apply. Our articles of incorporation and bylaws do
not state that these provisions do not apply. The statute creates a
number of restrictions on the ability of a person or entity to
acquire control of a Nevada company by setting down certain rules
of conduct and voting restrictions in any acquisition attempt,
among other things. The statute is limited to corporations that are
organized in the state of Nevada and that have 200 or more
stockholders, at least 100 of whom are stockholders of record and
residents of the State of Nevada; and does business in the State of
Nevada directly or through an affiliated corporation. Because of
these conditions, the statute currently does not apply to our
company.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Action
Stock Transfer. Its address is 2469 E. Fort Union Blvd, Suite 214
Salt Lake City, UT 84121.
DESCRIPTION OF DEBT
SECURITIES
We may issue debt securities from time to time, in one or more
series, as either senior or subordinated debt or as senior or
subordinated convertible debt. While the terms we have summarized
below will apply generally to any debt securities that we may offer
under this prospectus, we will describe the particular terms of any
debt securities that we may offer in more detail in the applicable
prospectus supplement. The terms of any debt securities offered
under a prospectus supplement may differ from the terms described
below. Unless the context requires otherwise, whenever we refer to
the indenture, we also are referring to any supplemental indentures
that specify the terms of a particular series of debt
securities.
We will issue the debt securities under the indenture that we will
enter into with the trustee named in the indenture. The indenture
will be qualified under the Trust Indenture Act of 1939, as
amended, or the Trust Indenture Act. We have filed the form of
indenture as an exhibit to the registration statement of which this
prospectus is a part, and supplemental indentures and forms of debt
securities containing the terms of the debt securities being
offered will be filed as exhibits to the registration statement of
which this prospectus is a part or will be incorporated by
reference from reports that we file with the SEC.
The following summary of material provisions of the debt securities
and the indenture is subject to, and qualified in its entirety by
reference to, all of the provisions of the indenture applicable to
a particular series of debt securities. We urge you to read the
applicable prospectus supplements and any related free writing
prospectuses related to the debt securities that we may offer under
this prospectus, as well as the complete indenture that contains
the terms of the debt securities.
General
The indenture does not limit the amount of debt securities that we
may issue. It provides that we may issue debt securities up to the
principal amount that we may authorize and may be in any currency
or currency unit that we may designate. Except for the limitations
on consolidation, merger and sale of all or substantially all of
our assets contained in the indenture, the terms of the indenture
do not contain any covenants or other provisions designed to give
holders of any debt securities protection against changes in our
operations, financial condition or transactions involving us.
We may issue the debt securities issued under the indenture as
“discount securities,” which means they may be sold at a discount
below their stated principal amount. These debt securities, as well
as other debt securities that are not issued at a discount, may be
issued with “original issue discount,” or OID, for U.S. federal
income tax purposes because of interest payment and other
characteristics or terms of the debt securities. Material U.S.
federal income tax considerations applicable to debt securities
issued with OID will be described in more detail in any applicable
prospectus supplement.
We will describe in the applicable prospectus supplement the terms
of the series of debt securities being offered, including:
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the
title of the series of debt securities; |
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any
limit upon the aggregate principal amount that may be
issued; |
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the
maturity date or dates; |
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the
form of the debt securities of the series; |
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the
applicability of any guarantees; |
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whether
or not the debt securities will be secured or unsecured, and the
terms of any secured debt; |
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whether
the debt securities rank as senior debt, senior subordinated debt,
subordinated debt or any combination thereof, and the terms of any
subordination; |
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if
the price (expressed as a percentage of the aggregate principal
amount thereof) at which such debt securities will be issued is a
price other than the principal amount thereof, the portion of the
principal amount thereof payable upon declaration of acceleration
of the maturity thereof, or if applicable, the portion of the
principal amount of such debt securities that is convertible into
another security or the method by which any such portion shall be
determined; |
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the
interest rate or rates, which may be fixed or variable, or the
method for determining the rate and the date interest will begin to
accrue, the dates interest will be payable and the regular record
dates for interest payment dates or the method for determining such
dates; |
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our
right, if any, to defer payment of interest and the maximum length
of any such deferral period; |
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if
applicable, the date or dates after which, or the period or periods
during which, and the price or prices at which, we may, at our
option, redeem the series of debt securities pursuant to any
optional or provisional redemption provisions and the terms of
those redemption provisions; |
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the
date or dates, if any, on which, and the price or prices at which
we are obligated, pursuant to any mandatory sinking fund or
analogous fund provisions or otherwise, to redeem, or at the
holder’s option to purchase, the series of debt securities and the
currency or currency unit in which the debt securities are
payable; |
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the
denominations in which we will issue the series of debt securities,
if other than denominations of $1,000 and any integral multiple
thereof; |
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any
and all terms, if applicable, relating to any auction or
remarketing of the debt securities of that series and any security
for our obligations with respect to such debt securities and any
other terms which may be advisable in connection with the marketing
of debt securities of that series; |
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whether
the debt securities of the series shall be issued in whole or in
part in the form of a global security or securities; the terms and
conditions, if any, upon which such global security or securities
may be exchanged in whole or in part for other individual
securities; and the depositary for such global security or
securities; |
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if
applicable, the provisions relating to conversion or exchange of
any debt securities of the series and the terms and conditions upon
which such debt securities will be so convertible or exchangeable,
including the conversion or exchange price, as applicable, or how
it will be calculated and may be adjusted, any mandatory or
optional (at our option or the holders’ option) conversion or
exchange features, the applicable conversion or exchange period and
the manner of settlement for any conversion or
exchange; |
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additions
to or changes in the covenants applicable to the particular debt
securities being issued, including, among others, the
consolidation, merger or sale covenant; |
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additions
to or changes in the events of default with respect to the
securities and any change in the right of the trustee or the
holders to declare the principal, premium, if any, and interest, if
any, with respect to such securities to be due and
payable; |
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additions
to or changes in or deletions of the provisions relating to
covenant defeasance and legal defeasance; |
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additions
to or changes in the provisions relating to satisfaction and
discharge of the indenture; |
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additions
to or changes in the provisions relating to the modification of the
indenture both with and without the consent of holders of debt
securities issued under the indenture; |
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the
currency of payment of debt securities if other than U.S. dollars
and the manner of determining the equivalent amount in U.S.
dollars; |
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whether
interest will be payable in cash or additional debt securities at
our or the holders’ option and the terms and conditions upon which
the election may be made; |
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the
terms and conditions, if any, upon which we will pay amounts in
addition to the stated interest, premium, if any, and principal
amounts of the debt securities of the series to any holder that is
not a “United States person” for federal tax purposes; |
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any
restrictions on transfer, sale or assignment of the debt securities
of the series; and |
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any
other specific terms, preferences, rights or limitations of, or
restrictions on, the debt securities, any other additions or
changes in the provisions of the indenture, and any terms that may
be required by us or advisable under applicable laws or
regulations |
Conversion Or Exchange Rights
We will set forth in the applicable prospectus supplement the terms
on which a series of debt securities may be convertible into or
exchangeable for our common stock or our other securities. We will
include provisions as to settlement upon conversion or exchange and
whether conversion or exchange is mandatory, at the option of the
holder or at our option. We may include provisions pursuant to
which the number of shares of our common stock or our other
securities that the holders of the series of debt securities
receive would be subject to adjustment.
Consolidation, Merger Or Sale
Unless we provide otherwise in the prospectus supplement applicable
to a particular series of debt securities, the indenture will not
contain any covenant that restricts our ability to merge or
consolidate, or sell, convey, transfer or otherwise dispose of our
assets as an entirety or substantially as an entirety. However, any
successor to or acquirer of such assets (other than a subsidiary of
ours) must assume all of our obligations under the indenture or the
debt securities, as appropriate.
Events Of Default Under The Indenture
Unless we provide otherwise in the prospectus supplement applicable
to a particular series of debt securities, the following are events
of default under the indenture with respect to any series of debt
securities that we may issue:
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if we
fail to pay any installment of interest on any series of debt
securities, as and when the same shall become due and payable, and
such default continues for a period of 90 days; provided, however,
that a valid extension of an interest payment period by us in
accordance with the terms of any indenture supplemental thereto
shall not constitute a default in the payment of interest for this
purpose; |
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if we
fail to pay the principal of, or premium, if any, on any series of
debt securities as and when the same shall become due and payable
whether at maturity, upon redemption, by declaration or otherwise,
or in any payment required by any sinking or analogous fund
established with respect to such series; provided, however, that a
valid extension of the maturity of such debt securities in
accordance with the terms of any indenture supplemental thereto
shall not constitute a default in the payment of principal or
premium, if any; |
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if we
fail to observe or perform any other covenant or agreement
contained in the debt securities or the indenture, other than a
covenant specifically relating to another series of debt
securities, and our failure continues for 90 days after we receive
written notice of such failure, requiring the same to be remedied
and stating that such is a notice of default thereunder, from the
trustee or holders of at least 25% in aggregate principal amount of
the outstanding debt securities of the applicable series;
and |
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if
specified events of bankruptcy, insolvency or reorganization
occur. |
If an event of default with respect to debt securities of any
series occurs and is continuing, other than an event of default
specified in the last bullet point above, the trustee or the
holders of at least 25% in aggregate principal amount of the
outstanding debt securities of that series, by notice to us in
writing, and to the trustee if notice is given by such holders, may
declare the unpaid principal of, premium, if any, and accrued
interest, if any, of such series of debt securities due and payable
immediately. If an event of default specified in the last bullet
point above occurs with respect to us, the principal amount of and
accrued interest, if any, of each issue of debt securities then
outstanding shall be due and payable without any notice or other
action on the part of the trustee or any holder.
The holders of a majority in principal amount of the outstanding
debt securities of an affected series may waive any default or
event of default with respect to the series and its consequences,
except defaults or events of default regarding payment of
principal, premium, if any, or interest, unless we have cured the
default or event of default in accordance with the indenture. Any
waiver shall cure the default or event of default.
Subject to the terms of the indenture, if an event of default under
an indenture shall occur and be continuing, the trustee will be
under no obligation to exercise any of its rights or powers under
such indenture at the request or direction of any of the holders of
the applicable series of debt securities, unless such holders have
offered the trustee reasonable indemnity. The holders of a majority
in principal amount of the outstanding debt securities of any
series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the trustee,
or exercising any trust or power conferred on the trustee, with
respect to the debt securities of that series, provided that:
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the
direction so given by the holder is not in conflict with any law or
the applicable indenture; and |
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subject
to its duties under the Trust Indenture Act, the trustee need not
take any action that might involve it in personal liability or
might be unduly prejudicial to the holders not involved in the
proceeding. |
A holder of the debt securities of any series will have the right
to institute a proceeding under the indenture or to appoint a
receiver or trustee, or to seek other remedies only if:
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the
holder has given written notice to the trustee of a continuing
event of default with respect to that series; |
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the
holders of at least 25% in aggregate principal amount of the
outstanding debt securities of that series have made written
request; |
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such
holders have offered to the trustee indemnity satisfactory to it
against the costs, expenses and liabilities to be incurred by the
trustee in compliance with the request; and |
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the
trustee does not institute the proceeding, and does not receive
from the holders of a majority in aggregate principal amount of the
outstanding debt securities of that series other conflicting
directions within 90 days after the notice, request and
offer. |
These limitations do not apply to a suit instituted by a holder of
debt securities if we default in the payment of the principal,
premium, if any, or interest on, the debt securities.
We will periodically file statements with the trustee regarding our
compliance with specified covenants in the indenture.
Modification Of Indenture; Waiver
Unless we provide otherwise in the prospectus supplement applicable
to a particular series of debt securities, we and the trustee may
change an indenture without the consent of any holders with respect
to specific matters:
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to
cure any ambiguity, defect or inconsistency in the indenture or in
the debt securities of any series; |
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to
comply with the provisions described above under “Description of
Debt Securities—Consolidation, Merger or Sale;” |
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to
provide for uncertificated debt securities in addition to or in
place of certificated debt securities; |
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to
add to our covenants, restrictions, conditions or provisions such
new covenants, restrictions, conditions or provisions for the
benefit of the holders of all or any series of debt securities, to
make the occurrence, or the occurrence and the continuance, of a
default in any such additional covenants, restrictions, conditions
or provisions an event of default or to surrender any right or
power conferred upon us in the indenture; |
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to
add to, delete from or revise the conditions, limitations, and
restrictions on the authorized amount, terms, or purposes of issue,
authentication and delivery of debt securities, as set forth in the
indenture; |
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to
make any change that does not adversely affect the interests of any
holder of debt securities of any series in any material
respect; |
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to
provide for the issuance of and establish the form and terms and
conditions of the debt securities of any series as provided above
under “Description of Debt Securities—General” to establish the
form of any certifications required to be furnished pursuant to the
terms of the indenture or any series of debt securities, or to add
to the rights of the holders of any series of debt
securities; |
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o
evidence and provide for the acceptance of appointment under any
indenture by a successor trustee; or |
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to
comply with any requirements of the SEC in connection with the
qualification of any indenture under the Trust Indenture
Act. |
In addition, under the indenture, the rights of holders of a series
of debt securities may be changed by us and the trustee with the
written consent of the holders of at least a majority in aggregate
principal amount of the outstanding debt securities of each series
that is affected. However, unless we provide otherwise in the
prospectus supplement applicable to a particular series of debt
securities, we and the trustee may make the following changes only
with the consent of each holder of any outstanding debt securities
affected:
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extending
the fixed maturity of any debt securities of any
series; |
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reducing
the principal amount, reducing the rate of or extending the time of
payment of interest, or reducing any premium payable upon the
redemption of any series of any debt securities; or |
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reducing
the percentage of debt securities, the holders of which are
required to consent to any amendment, supplement, modification or
waiver. |
Discharge
The indenture provides that we can elect to be discharged from our
obligations with respect to one or more series of debt securities,
except for specified obligations, including obligations to:
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register
the transfer or exchange of debt securities of the
series; |
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replace
stolen, lost or mutilated debt securities of the
series; |
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pay
principal of and premium and interest on any debt securities of the
series; |
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maintain
paying agencies; |
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hold
monies for payment in trust; |
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recover
excess money held by the trustee; |
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compensate
and indemnify the trustee; and |
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appoint
any successor trustee. |
In order to exercise our rights to be discharged, we must deposit
with the trustee money or government obligations sufficient to pay
all the principal of, any premium, if any, and interest on, the
debt securities of the series on the dates payments are due.
Form, Exchange And Transfer
We will issue the debt securities of each series only in fully
registered form without coupons and, unless we provide otherwise in
the applicable prospectus supplement, in denominations of $1,000
and any integral multiple thereof. The indenture provides that we
may issue debt securities of a series in temporary or permanent
global form and as book-entry securities that will be deposited
with, or on behalf of, The Depository Trust Company, or DTC, or
another depositary named by us and identified in the applicable
prospectus supplement with respect to that series. To the extent
the debt securities of a series are issued in global form and as
book-entry, a description of terms relating to any book-entry
securities will be set forth in the applicable prospectus
supplement.
At the option of the holder, subject to the terms of the indenture
and the limitations applicable to global securities described in
the applicable prospectus supplement, the holder of the debt
securities of any series can exchange the debt securities for other
debt securities of the same series, in any authorized denomination
and of like tenor and aggregate principal amount.
Subject to the terms of the indenture and the limitations
applicable to global securities set forth in the applicable
prospectus supplement, holders of the debt securities may present
the debt securities for exchange or for registration of transfer,
duly endorsed or with the form of transfer endorsed thereon duly
executed if so required by us or the security registrar, at the
office of the security registrar or at the office of any transfer
agent designated by us for this purpose. Unless otherwise provided
in the debt securities that the holder presents for transfer or
exchange, we will impose no service charge for any registration of
transfer or exchange, but we may require payment of any taxes or
other governmental charges.
We will name in the applicable prospectus supplement the security
registrar, and any transfer agent in addition to the security
registrar, that we initially designate for any debt securities. We
may at any time designate additional transfer agents or rescind the
designation of any transfer agent or approve a change in the office
through which any transfer agent acts, except that we will be
required to maintain a transfer agent in each place of payment for
the debt securities of each series.
If we elect to redeem the debt securities of any series, we will
not be required to:
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issue,
register the transfer of, or exchange any debt securities of that
series during a period beginning at the opening of business 15 days
before the day of mailing of a notice of redemption of any debt
securities that may be selected for redemption and ending at the
close of business on the day of the mailing; or |
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register
the transfer of or exchange any debt securities so selected for
redemption, in whole or in part, except the unredeemed portion of
any debt securities we are redeeming in part. |
Information Concerning The Trustee
The trustee, other than during the occurrence and continuance of an
event of default under an indenture, undertakes to perform only
those duties as are specifically set forth in the applicable
indenture. Upon an event of default under an indenture, the trustee
must use the same degree of care as a prudent person would exercise
or use in the conduct of his or her own affairs. Subject to this
provision, the trustee is under no obligation to exercise any of
the powers given it by the indenture at the request of any holder
of debt securities unless it is offered reasonable security and
indemnity against the costs, expenses and liabilities that it might
incur.
Payment And Paying Agents
Unless we otherwise indicate in the applicable prospectus
supplement, we will make payment of the interest on any debt
securities on any interest payment date to the person in whose name
the debt securities, or one or more predecessor securities, are
registered at the close of business on the regular record date for
the interest.
We will pay principal of and any premium and interest on the debt
securities of a particular series at the office of the paying
agents designated by us, except that unless we otherwise indicate
in the applicable prospectus supplement, we will make interest
payments by check that we will mail to the holder or by wire
transfer to certain holders. Unless we otherwise indicate in the
applicable prospectus supplement, we will designate the corporate
trust office of the trustee as our sole paying agent for payments
with respect to debt securities of each series. We will name in the
applicable prospectus supplement any other paying agents that we
initially designate for the debt securities of a particular series.
We will maintain a paying agent in each place of payment for the
debt securities of a particular series.
All money we pay to a paying agent or the trustee for the payment
of the principal of or any premium or interest on any debt
securities that remains unclaimed at the end of two years after
such principal, premium or interest has become due and payable will
be repaid to us, and the holder of the debt security thereafter may
look only to us for payment thereof.
Governing Law
The indenture and the debt securities, and any claim, controversy
or dispute arising under or related to the indenture or the debt
securities, will be governed by and construed in accordance with
the laws of the State of Nevada, except to the extent that the
Trust Indenture Act of 1939 is applicable.
DESCRIPTION OF WARRANTS
General
We may issue warrants for the purchase of our common stock,
preferred stock, debt securities, any other securities registered
herein, or any combination thereof. Warrants may be issued
independently or together with our securities or common stock and
may be attached to or separate from any offered securities. Each
series of warrants will be issued under a separate warrant
agreement to be entered into between us and a bank or trust
company, as warrant agent. The warrant agent will act solely as our
agent in connection with the warrants. The warrant agent will not
have any obligation or relationship of agency or trust for or with
any holders or beneficial owners of warrants. This summary of
certain provisions of the warrants is not complete. For the terms
of a particular series of warrants, you should refer to the
prospectus supplement for that series of warrants and the warrant
agreement for that particular series.
Warrant Terms
The prospectus supplement relating to a particular series of
warrants to purchase our common stock, preferred stock, debt
securities or other securities will describe the terms of the
warrants, including the following:
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the
title of the warrants; |
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the
offering price for the warrants, if any; |
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the
aggregate number of warrants; |
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the
designation and terms of the common stock that may be purchased
upon exercise of the warrants; |
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if
applicable, the designation and terms of the securities with which
the warrants are issued and the number of warrants issued with each
security; |
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if
applicable, the date from and after which the warrants and any
securities issued with the warrants will be separately
transferable; |
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the
number of shares of common stock that may be purchased upon
exercise of a warrant and the exercise price for the
warrants; |
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the
dates on which the right to exercise the warrants shall commence
and expire; |
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if
applicable, the minimum or maximum amount of the warrants that may
be exercised at any one time; |
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the
currency or currency units in which the offering price, if any, and
the exercise price are payable; |
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if
applicable, a discussion of material U.S. federal income tax
considerations; |
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the
antidilution provisions of the warrants, if any; |
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the
redemption or call provisions, if any, applicable to the
warrants; |
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any
provisions with respect to a holder’s right to require us to
repurchase the warrants upon a change in control or similar event;
and |
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any
additional terms of the warrants, including 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 stockholders with respect to any meeting of stockholders
for the election of our directors or any other matter;
or |
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exercise
any rights as stockholders. |
DESCRIPTION OF RIGHTS
General
We may issue rights to our stockholders to purchase shares of our
common stock, preferred stock, debt securities or the other
securities described in this prospectus. We may offer rights
separately or together with one or more additional rights, common
stock, preferred stock, debt securities or warrants, or any
combination of those securities in the form of units, as described
in the applicable prospectus supplement. Each series of rights will
be issued under a separate rights agreement to be entered into
between us and a bank or trust company, as rights agent. The rights
agent will act solely as our agent in connection with the
certificates relating to the rights of the series of certificates
and will not assume any obligation or relationship of agency or
trust for or with any holders of rights certificates or beneficial
owners of rights. The following description sets forth certain
general terms and provisions of the rights to which any prospectus
supplement may relate. The particular terms of the rights to which
any prospectus supplement may relate and the extent, if any, to
which the general provisions may apply to the rights so offered
will be described in the applicable prospectus supplement. To the
extent that any particular terms of the rights, rights agreement or
rights certificates described in a prospectus supplement differ
from any of the terms described below, then the terms described
below will be deemed to have been superseded by that prospectus
supplement. We encourage you to read the applicable rights
agreement and rights certificate for additional information before
you decide whether to purchase any of our rights. We will provide
in a prospectus supplement the following terms of the rights being
issued:
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the
date of determining the stockholders entitled to the rights
distribution; |
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the
aggregate number of shares of common stock, preferred stock, debt
securities or other securities purchasable upon exercise of the
rights; |
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the
exercise price; |
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the
aggregate number of rights issued; |
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whether
the rights are transferrable and the date, if any, on and after
which the rights may be separately transferred; |
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the
date on which the right to exercise the rights will commence, and
the date on which the right to exercise the rights will
expire; |
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the
method by which holders of rights will be entitled to
exercise; |
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the
conditions to the completion of the offering, if any; |
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the
withdrawal, termination and cancellation rights, if
any; |
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whether
there are any backstop or standby purchaser or purchasers and the
terms of their commitment, if any; |
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whether
stockholders are entitled to oversubscription rights, if
any; |
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any
applicable material U.S. federal income tax considerations;
and |
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any
other terms of the rights, including terms, procedures and
limitations relating to the distribution, exchange and exercise of
the rights, as applicable. |
Each right will entitle the holder of rights to purchase for
cash the principal amount of shares of common stock, preferred
stock, debt securities or other securities at the exercise price
provided in the applicable prospectus supplement. Rights may be
exercised at any time up to the close of business on the expiration
date for the rights provided in the applicable prospectus
supplement.
Holders may exercise rights as described in the applicable
prospectus supplement. Upon receipt of payment and the rights
certificate properly completed and duly executed at the corporate
trust office of the rights agent or any other office indicated in
the prospectus supplement, we will, as soon as practicable, forward
the shares of common stock, preferred stock, debt securities or
other securities, as applicable, purchasable upon exercise of the
rights. If less than all of the rights issued in any rights
offering are exercised, we may offer any unsubscribed securities
directly to persons other than stockholders, to or through agents,
underwriters or dealers or through a combination of such methods,
including pursuant to standby arrangements, as described in the
applicable prospectus supplement.
Rights Agent
The rights agent for any rights we offer will be set forth in the
applicable prospectus supplement.
DESCRIPTION OF UNITS
We may issue units consisting of some or all of the securities
described above, in any combination, including common stock,
preferred stock, debt securities, warrants and/or subscription
rights. The terms of these units will be set forth in a prospectus
supplement. The description of the terms of these units in the
related prospectus supplement will not be complete. You should
refer to the applicable form of unit and unit agreement for
complete information with respect to these units.
LEGAL
MATTERS
Procopio, Cory, Hargreaves & Savitch LLP, San Diego,
California, will issue an opinion about certain legal matters with
respect to the securities. Any underwriters or agents will be
advised about legal matters relating to any offering by their own
counsel.
EXPERTS
The consolidated financial statements of CleanSpark, Inc. as of and
for the year ended September 30, 2019 incorporated by reference in
this prospectus, have been so incorporated in reliance on the
report of MaloneBailey, LLP, an independent registered public
accounting firm, given on the authority of said firm as experts in
auditing and accounting.

$200,000,000
COMMON STOCK
PREFERRED STOCK
DEBT SECURITIES
WARRANTS
RIGHTS
UNITS
PROSPECTUS
,
2020
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and
Distribution
The following table sets forth estimated expenses in connection
with the issuance and distribution of the securities being
registered:
SEC
registration fee |
|
$ |
25,960.00 |
Printing
and engraving |
|
|
* |
Legal
fees and expenses |
|
|
* |
Accounting
fees and expenses |
|
|
* |
Transfer
agent and registrar fees and expenses |
|
|
* |
Miscellaneous
expenses |
|
|
* |
Total |
|
$ |
* |
|
* |
These
fees are calculated based on the type of securities offered and the
number of issuances and accordingly, cannot be estimated at this
time. |
Item 15. Indemnification of Officers and Directors
Our officers and directors are indemnified as provided by the
Nevada Revised Statutes and our bylaws.
Under the governing Nevada statutes, director immunity from
liability to a company or its shareholders for monetary liabilities
applies automatically unless it is specifically limited by a
company's articles of incorporation. Our articles of
incorporation do not contain any limiting language regarding
director immunity from liability. Excepted from this immunity
are:
|
1. |
a
willful failure to deal fairly with the company or its shareholders
in connection with a matter in which the director has a material
conflict of interest; |
|
2. |
a
violation of criminal law (unless the director had reasonable cause
to believe that his or her conduct was lawful or no reasonable
cause to believe that his or her conduct was unlawful); |
|
3. |
a
transaction from which the director derived an improper personal
profit; and |
Our bylaws provide that we will indemnify our directors and
officers to the fullest extent not prohibited by Nevada law;
provided, however, that we may modify the extent of such
indemnification by individual contracts with our directors and
officers; and, provided, further, that we shall not be required to
indemnify any director or officer in connection with any proceeding
(or part thereof) initiated by such person unless:
|
1. |
such
indemnification is expressly required to be made by
law; |
|
2. |
the
proceeding was authorized by our Board of Directors; |
|
3. |
such
indemnification is provided by us, in our sole discretion, pursuant
to the powers vested us under Nevada law; or; |
|
4. |
such
indemnification is required to be made pursuant to the
bylaws. |
Our bylaws provide that we will advance to any person who was or is
a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact
that he is or was a director or officer, of the company, or is or
was serving at the request of the company as a director or
executive officer of another company, partnership, joint venture,
trust or other enterprise, prior to the final disposition of the
proceeding, promptly following request therefore, all expenses
incurred by any director or officer in connection with such
proceeding upon receipt of an undertaking by or on behalf of such
person to repay said amounts if it should be determined ultimately
that such person is not entitled to be indemnified under our bylaws
or otherwise.
Our bylaws provide that no advance shall be made by us to an
officer of the company, except by reason of the fact that such
officer is or was a director of the company in which event this
paragraph shall not apply, in any action, suit or proceeding,
whether civil, criminal, administrative or investigative, if a
determination is reasonably and promptly made: (a) by the board of
directors by a majority vote of a quorum consisting of directors
who were not parties to the proceeding, or (b) if such quorum is
not obtainable, or, even if obtainable, a quorum of disinterested
directors so directs, by independent legal counsel in a written
opinion, that the facts known to the decision-making party at the
time such determination is made demonstrate clearly and
convincingly that such person acted in bad faith or in a manner
that such person did not believe to be in or not opposed to the
best interests of the company.
We maintain a general liability insurance policy that covers
certain liabilities of directors and officers of our corporation
arising out of claims based on acts or omissions in their
capacities as directors or officers.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933, as amended (the “Securities Act”), may be
permitted to directors, officers or controlling persons of ours,
pursuant to the foregoing provisions, or otherwise, we have been
informed that, in the opinion of the SEC, such indemnification is
against public policy as expressed in the Securities Act and is
therefore unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such a director,
officer or controlling person in connection with the securities
being registered, we will, unless in the opinion of our counsel the
matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such
indemnification by us is against public policy as expressed hereby
in the Securities Act and we will be governed by the final
adjudication of such issue.
In any underwriting agreement we enter into in connection with the
sale of common stock being registered hereby, the underwriters will
agree to indemnify, under certain conditions, us, our directors,
our officers and persons who control us within the meaning of the
Securities Act of 1933, as amended, or Securities Act, against
certain liabilities.
Item 16. Exhibits
The exhibits listed in the accompanying Exhibit Index are filed
(except where otherwise indicated) as part of this Registration
Statement.
Item 17. Undertakings
|
(a) |
The
undersigned Registrant hereby undertakes: |
|
(1) |
To
file, during any period in which offers or sales are being made, a
post-effective amendment to this registration
statement: |
|
(i) |
to
include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933; |
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|
|
|
(ii) |
to
reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post- effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of
the estimated maximum offering range may be reflected in the form
of prospectus filed with the Securities and Exchange Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in
the maximum aggregate offering price set forth in the “Calculation
of Registration Fee” table in the effective registration statement;
and |
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|
|
|
(iii) |
to
include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement; |
provided, however, that
subparagraphs (i),(ii), and (iii) do not apply if the
information required to be included in a post-effective amendment
by those paragraphs is contained in reports filed with or furnished
to the Securities and Exchange Commission by the Registrant
pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
registration statement, or is contained in a form of prospectus
filed pursuant to Rule 424(b) that is part of the registration
statement.
|
(2) |
That,
for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering
thereof. |
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|
|
|
(3) |
To
remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering. |
|
(4) |
That,
for the purpose of determining liability under the Securities Act
of 1933 to any purchaser: |
|
(i) |
Each
prospectus filed by the Registrant pursuant to Rule 424(b)(3)
shall be deemed to be part of the registration statement as of the
date the filed prospectus was deemed part of and included in the
registration statement; and |
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|
|
|
(ii) |
Each
prospectus required to be filed pursuant to Rule 424(b)(2),
(b)(5), or (b)(7) as part of a registration statement in reliance
on Rule 430B relating to an offering made pursuant to
Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing
the information required by Section 10(a) of the Securities
Act of 1933 shall be deemed to be part of and included in the
registration statement as of the earlier of the date such form of
prospectus is first used after effectiveness or the date of the
first contract of sale of securities in the offering described in
the prospectus. As provided in Rule 430B, for liability
purposes of the issuer and any person that is at that date an
underwriter, such date shall be deemed to be a new effective date
of the registration statement relating to the securities in the
registration statement to which that prospectus relates, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof. Provided,
however, that no statement made in a registration
statement or prospectus that is part of the registration statement
or made in a document incorporated or deemed incorporated by
reference into the registration statement or prospectus that is
part of the registration statement will, as to a purchaser with a
time of contract of sale prior to such effective date, supersede or
modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in
any such document immediately prior to such effective
date. |
|
(5) |
That,
for the purpose of determining liability of the Registrant under
the Securities Act of 1933 to any purchaser in the initial
distribution of the securities, the undersigned Registrant
undertakes that in a primary offering of securities of the
undersigned Registrant pursuant to this registration statement,
regardless of the underwriting method used to sell the securities
to the purchaser, if the securities are offered or sold to such
purchaser by means of any of the following communications, the
undersigned Registrant will be a seller to the purchaser and will
be considered to offer or sell such securities to such
purchaser: |
|
(i) |
any
preliminary prospectus or prospectus of the undersigned Registrant
relating to the offering required to be filed pursuant to
Rule 424; |
|
|
|
|
(ii) |
any
free writing prospectus relating to the offering prepared by or on
behalf of the undersigned Registrant or used or referred to by the
undersigned Registrant; |
|
|
|
|
(iii) |
the
portion of any other free writing prospectus relating to the
offering containing material information about the undersigned
Registrant or its securities provided by or on behalf of the
undersigned Registrant; and |
|
|
|
|
(iv) |
any
other communication that is an offer in the offering made by the
undersigned Registrant to the purchaser. |
|
(b) |
That
for purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant’s annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange
Act of 1934 (and, where applicable, each filing of an employee
benefit plan’s annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof. |
|
(c) |
The
undersigned Registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the
prospectus is sent or given, the latest annual report, to security
holders that is incorporated by reference in the prospectus and
furnished pursuant to and meeting the requirements of
Rule 14a-3 or Rule 14c-3 under the Securities Exchange
Act of 1934; and, where interim financial information required to
be presented by Article 3 of Regulation S-X is not set
forth in the prospectus, to deliver, or cause to be delivered to
each person to whom the prospectus is sent or given, the latest
quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial
information. |
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|
|
|
(d) |
Insofar
as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers, and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act of 1933
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer,
or controlling person of the Registrant in the successful defense
of any action, suit, or proceeding) is asserted by such director,
officer, or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Securities Act of 1933 and will be governed by the final
adjudication of such issue. |
|
(e) |
If
and when applicable, the Registrant hereby further undertakes to
file an application for the purpose of determining the eligibility
of the trustee to act under subsection (a) of Section 310
of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Securities and Exchange Commission
under Section 305(b)(2) of the Trust Indenture
Act. |
EXHIBIT INDEX
Exhibit Number |
Description |
1.1** |
|
Form
of Underwriting Agreement |
|
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|
3.1 |
Articles
of Incorporation, incorporated by reference to Exhibit 3.1 to the
Company’s Registration Statement on Form 10-12G, filed with the
Securities and Exchange Commission on November 17,
2008. |
3.2 |
Amendment
to Articles of Incorporation, incorporated by reference to Exhibit
3.2 to the Company’s Registration Statement on Form 10-12G, filed
with the Securities and Exchange Commission on November 17,
2008. |
3.3 |
Bylaws,
incorporated by reference to Exhibit 3.3 to the Company’s
Registration Statement on Form 10-12G, filed with the Securities
and Exchange Commission on November 17, 2008. |
3.4 |
Amended
Bylaws, incorporated by reference to Exhibit 3.1 to the Company’s
Current Report on Form 8-K, filed with the Securities and Exchange
Commission on March 12, 2013. |
3.5 |
Certificate
of Change, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on March 26, 2013. |
3.6 |
Articles
of Merger, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on December 1, 2014. |
3.7 |
Certificate
of Change, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on November 12, 2015. |
3.8 |
Certificate
of Amendment and Certificate of Designation, incorporated by
reference to Exhibits 3.1 and 3.2 to the Company’s Current Report
on Form 8-K, filed with the Securities and Exchange Commission on
April 16, 2015. |
3.9 |
Certificate
of Change, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on May 13, 2015. |
3.10 |
Articles
of Merger, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on November 14, 2016. |
3.11 |
Amendment
to Certificate of Designation, incorporated by reference to Exhibit
3.1 to the Company’s Current Report on Form 8-K, filed with the
Securities and Exchange Commission on October 9, 2019. |
3.12 |
Certificate
of Designation, dated April 16, 2019, incorporated by reference to
Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed with
the Securities and Exchange Commission on April 18,
2019. |
3.13 |
Articles
of Merger, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on November 14, 2016. |
3.14 |
Certificate
of Change, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on December 10, 2019. |
3.15 |
Certificate
of Withdrawal of Series B Preferred Stock Certificate of
Designation, incorporated by reference to Exhibit 3.1 to the
Company’s Current Report on Form 8-K, filed with the Securities and
Exchange Commission on March 10, 2020. |
4.1* |
Form
of Senior Indenture |
4.2* |
Form
of Subordinated Indenture |
5.1* |
Opinion
of Procopio, Cory, Hargreaves & Savitch LLP |
23.1* |
Consent
of Independent Registered Public Accounting Firm |
23.2* |
Consent
of Procopio, Cory, Hargreaves & Savitch LLP (included in
Exhibit 5.1) |
24.1* |
Power
of Attorney (included on the signature page hereto) |
25.1*** |
Form
T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 under the Senior Indenture and the
Subordinated Indenture*** |
|
** |
To be
filed by amendment or as an exhibit to a report pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934,
as amended and incorporated herein by reference.
|
|
*** |
To
be filed separately pursuant to Section 305(b)(2) of the Trust
Indenture Act of 1939, if applicable.
|
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and
has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Woods Cross, State of Utah, on September 23, 2020.
|
CLEANSPARK,
INC. |
|
|
|
|
By: |
/s/
Zachary K. Bradford |
|
|
Zachary
K. Bradford |
|
|
President
and Chief Executive Officer |
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose
signature appears below hereby constitutes and appoints Zachary K.
Bradford and Lori Love, or each one of them individually, as the
undersigned’s true and lawful attorney-in- fact and agents, with
full power of substitution and resubstitution for such person and
in such person’s name, place and stead, in any and all capacities,
to sign any and all amendments (including post-effective
amendments, exhibits thereto, and other documents in connection
therewith to this Registration Statement and any later registration
statement filed by the registrant under Rule 462(b) of the
Securities Act of 1933, which relates to this Registration
Statement) and to file the same with exhibits thereto and other
documents in connection therewith with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent full
power and authority to do and perform each and every act and thing
requisite and necessary to be done, as fully to all intents and
purposes as such person might or could do in person, hereby
ratifying and confirming all that each of said attorney-in-fact and
agent, or their substitute or substitutes may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as
amended, this registration statement has been signed below by the
following persons on behalf of the registrant in the capacities and
on the dates indicated.
Signature |
|
Title |
|
Date |
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|
|
/s/ Zachary
K. Bradford |
|
President, Chief Executive Officer and Director
(Principal Executive Officer)
|
|
September
23, 2020 |
Zachary
K. Bradford |
|
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|
|
/s/ Lori
Love |
|
Chief Financial Officer
(Principal Financial Officer)
|
|
September
23, 2020 |
Lori
Love |
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/s/ S.
Matthew Schultz |
|
Chairman
of the Board of Directors |
|
September
23, 2020 |
S.
Matthew Schultz |
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/s/ Larry
McNeill |
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Director |
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September
23, 2020 |
Larry
McNeill |
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/s/ Dr.
Thomas L. Wood |
|
Director |
|
September
23, 2020 |
Dr.
Thomas L. Wood |
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|
/s/ Roger
P. Beynon |
|
Director |
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September
23, 2020 |
Roger
P. Beynon |
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