### S-1 - FORM S-1
S-1
1
liqt20260518c_s1.htm
FORM S-1
liqt20260518c_s1.htm
Table of Contents
As filed with the Securities and Exchange Commission on May 26, 2026
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
LiqTech International, Inc.
(Exact Name of Registrant as Specified in its Charter)
Nevada
|
|
3590
|
|
20-1431677
|
(State or other jurisdiction of
incorporation or organization)
|
|
(Primary Standard Industrial
Classification Code Number)
|
|
(I.R.S. Employer
Identification No.)
|
Industriparken 22C
DK 2750 Ballerup
Denmark
+45 3131 5941
(Address, including zip code, and telephone number, including area code, of registrant ’ s principal executive office)
Fei Chen
Chief Executive Officer
LiqTech International, Inc.
Industriparken 22C
DK 2750 Ballerup
Denmark
+45 3131 5941
(Name, address, including zip code, and telephone number, including area code, of agent for service)
Copies to:
Clayton Parker, Esq.
K&L Gates LLP
200 South Biscayne Boulevard, Suite 3900
Miami, FL 33131
(305) 539-3300
|
Stephen E. Older, Esq.
McGuireWoods LLP
1251 Avenue of the Americas
20th Floor
New York, New York 10020
(212) 548-2100
|
Approximate date of commencement of proposed sale to public: As soon as practicable after the effective date of this registration statement.
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, 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, 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 post-effective amendment filed pursuant to Rule 462(d) 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. ☐
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. ☐
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, as amended, or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine.
Table of Contents
The information contained in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the Registration Statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state or jurisdiction where the offer or sale is not permitted.
PRELIMINARY PROSPECTUS
|
SUBJECT TO COMPLETION
|
DATED MAY 26 , 2026
|
$20,000,000
Shares of Common Stock
Pre-Funded Warrants to Purchase Shares of Common Stock
Shares of Common Stock Issuable Upon Exercise of Pre-Funded Warrants
LiqTech International, Inc.
We are offering $20,000,000 of shares of our common stock, par value $0.001 per share (our “common stock”). We are also offering to those purchasers, if any, whose purchase of common stock in this offering would otherwise result in any such purchaser, together with its affiliates, beneficially owning more than 4.99% (or, at the election of such purchaser, 9.99%) of our outstanding common stock immediately following the consummation of this offering, the opportunity to purchase pre-funded warrants in lieu of shares of our common stock that would otherwise result in such purchaser’s beneficial ownership exceeding 4.99% (or, at the election of such purchaser, 9.99%) of our outstanding common stock. The purchase price for each pre-funded warrant will equal the public offering price for the common stock in this offering, less the $0.001 per share exercise price of each such pre-funded warrant. Each pre-funded warrant will be exercisable upon issuance and will not expire prior to exercise. For each pre-funded warrant we sell, the number of shares of common stock we are offering will be decreased on a one-for-one basis.
Our common stock is listed on the Nasdaq Capital Market under the symbol “LIQT”. On May 22, 2026, the last reported sale price of our common stock on the Nasdaq Capital Market was $1.80 per share. All offering share and pre-funded warrant numbers are based on an assumed public offering price per share used throughout this prospectus of $1.80 per share. The actual public offering price will be determined between us and the underwriter at the time of pricing and may be at a discount to this assumed public offering price. Therefore, the assumed public offering price used throughout this prospectus may not be indicative of the final offering price, and the number of securities actually issued in this offering may differ from the illustrative amounts presented herein.
There is no established trading market for the pre-funded warrants and we do not expect a market to develop. In addition, we do not intend to list the pre-funded warrants on The Nasdaq Capital Market, any other national securities exchange or any other trading system. Without an active trading market, the liquidity of the pre-funded warrants may be limited.
We have engaged Konik Capital Partners, LLC, a division of T.R. Winston and Company, LLC (the “underwriter”), to act as underwriter in connection with this offering. We have agreed to issue warrants to the underwriter or its designees to purchase up to an aggregate number of shares of common stock equal to 4% of the aggregate number of shares of common stock and pre-funded warrants sold in this offering at an exercise price equal to 125% of the public offering price per share to be sold in this offering (the “underwriter warrants”). The underwriter warrants will be exercisable at any time, and from time to time, in whole or in part, after issuance and expire three years after the commencement of sales in this offering. The registration statement of which this prospectus is a part registers the underwriter warrants and the shares of our common stock underlying the underwriter warrants. For additional information regarding the total compensation to be received by the underwriter, see “Underwriting” on page 12.
In a concurrent private placement expected to be consummated upon the closing of the offering of the securities registered hereby, we have agreed to issue to affiliates of Bleichroeder L.P., 21 April Fund, L.P., and 21 April Fund, Ltd. (collectively, the “Note Holders”) a number of shares of our common stock determined based on a deemed issuance price per share equal to the public offering price per share to be sold in this offering, in exchange for the cancellation of $3.0 million of the aggregate principal amount of the senior promissory notes issued to the Note Holders on June 22, 2022, as amended on October 13, 2023 and March 26, 2025 (collectively, the “Senior Promissory Notes”), pursuant to a debt cancellation agreement (the “Debt Cancellation Agreement”). The shares to be issued to the Note Holders have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), nor are they being offered pursuant to this prospectus. The shares are being offered pursuant to the exemption provided in Section 4(a)(2) of the Securities Act and Rule 506(b) promulgated thereunder.
Table of Contents
We intend to use the net proceeds from this offering (i) to repay the remaining $3.0 million of the aggregate principal amount of our Senior Promissory Notes, including any accrued and unpaid interest thereon, after the cancellation by the Note Holders of $3.0 million of the aggregate principal amount of the Senior Promissory Notes pursuant to the Debt Cancellation Agreement in a concurrent private placement, (ii) to repay $1.1 million in aggregate principal amount of our 9.09% original issue discount senior promissory notes (the “9.09% OID Notes”) and (iii) for working capital and general corporate purposes.
We are a “smaller reporting company” as defined in the federal securities laws and will be subject to reduced public company reporting requirements. See “Prospectus Summary — Implications of Being a Smaller Reporting Company”.
Investing in our common stock involves a high degree of risk. See “ Risk Factors ” beginning on page 7 of this prospectus and under similar headings in the documents incorporated by reference into this prospectus for a discussion of information that should be considered in connection with an investment in our securities.
|
|
Per Share
|
|
|
Per Pre-Funded
Warrant
|
|
|
Total
|
|
Public offering price
|
|
$ |
|
|
|
|
|
|
|
$ |
|
|
Underwriting discounts and commissions (1)
|
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds to us, before expenses (2)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Does not include the reimbursement of certain expenses of the underwriter we have agreed to pay. Please see “Underwriting” beginning on page 13 for additional information regarding the total compensation to be received by the underwriter. |
We have granted the underwriter a 45-day over-allotment option to purchase up to an additional $3,000,000 of shares of common stock (equal to 15% of the total number of shares of common stock and pre-funded warrants sold in this offering) from us at the public offering price, less underwriting discounts and commissions, solely to cover over-allotments, if any. If the underwriter exercises this option in full, the total underwriting discounts and commissions payable will be $ and the total proceeds to us, before expenses, will be $ .
The underwriter expects to deliver the securities on or about , 2026.
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.
Konik Capital Partners
A division of T.R. Winston & Co.
The date of this prospectus is , 2026
Table of Contents
TABLE OF CONTENTS
|
|
Page
|
ABOUT THIS PROSPECTUS
|
|
1
|
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
|
|
2
|
PROSPECTUS SUMMARY
|
|
4
|
RISK FACTORS
|
|
7
|
USE OF PROCEEDS
|
|
10
|
DILUTION
|
|
11
|
DESCRIPTION OF CAPITAL STOCK
|
|
12
|
SHARES ELIGIBLE FOR FUTURE SALE |
|
14 |
UNDERWRITING
|
|
16
|
LEGAL MATTERS
|
|
20
|
EXPERTS
|
|
20
|
WHERE YOU CAN FIND MORE INFORMATION
|
|
20
|
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
|
|
20
|
ABOUT THIS PROSPECTUS
The registration statement we filed with the Securities and Exchange Commission (the “SEC”) includes exhibits that provide more detail about the matters discussed in this prospectus. You should read this prospectus, the related exhibits filed with the SEC, and the documents incorporated by reference herein before making your investment decision. In addition, this prospectus contains summaries of certain provisions contained in some of the documents described herein, but reference is made to the actual documents for complete information. All of the summaries are qualified in their entirety by the actual documents. Copies of some of the documents referred to herein have been filed, will be filed or will be incorporated by reference as exhibits to the registration statement of which this prospectus is a part, and you may obtain copies of those documents as described below under the heading “ Where You Can Find More Information .”
We have not, and the underwriter has not, authorized anyone to provide any information or to make any representations other than those contained in this prospectus or the documents incorporated by reference herein to which we have referred you. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. The information contained in this prospectus or the documents incorporated by reference herein is current only as of its date, regardless of its time of delivery or any sale of our securities. Our business, financial condition, results of operations and prospects may have changed since that date.
This prospectus is an offer to sell only the securities offered hereby, and only under circumstances and in jurisdictions where it is lawful to do so. We are not, and the underwriter is not, making an offer to sell these securities in any state or jurisdiction where the offer or sale is not permitted.
All trademarks, trade names and service marks appearing in this prospectus or the documents incorporated by reference herein are the property of their respective owners. Use or display by us of other parties’ trademarks, trade dress or products is not intended to and does not imply a relationship with, or endorsements or sponsorship of, us by the trademark or trade dress owner. Solely for convenience, some trademarks, tradenames and service marks referred to in this prospectus appear without the ® and ™ symbols, but those references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights or that the applicable owner will not assert its rights, to these trademarks and trade names.
1
Table of Contents
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as: “anticipate,” “intend,” “plan,” “goal,” “seek,” “believe,” “project,” “estimate,” “expect,” “continuing,” “ongoing,” “strategy,” “future,” “likely,” “may,” “should,” “could,” “will” and similar references to future periods. Examples of forward-looking statements include, among others, statements we make regarding expected operating results, such as anticipated revenue; anticipated levels of capital expenditures for our current fiscal year; our belief that we have, or will have, sufficient liquidity to fund our business operations during the next 12 months; strategy for gaining customers, growth, product development, market position, financial results and reserves.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs, expectations, and assumptions regarding the future of our business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Our actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements.
Forward-looking statements include, but are not limited to, statements concerning:
●
|
Our expectations regarding our liquidity, cash flows and uses of cash and ability to continue as a going concern;
|
●
|
The potential adverse effects on our operations and financial performance from armed conflicts or geopolitical tensions;
|
●
|
The potential adverse impact of global trade restrictions, tariffs and geopolitical tensions on our business and supply chain;
|
●
|
The potential negative impact of prolonged energy market volatility and supply disruptions on our business;
|
●
|
The potential adverse impact of health crises, pandemics, and public health emergencies on our business, financial condition, and operations;
|
●
|
Our dependence on a few major customers and the ability to maintain future relationships with one or more of these major customers;
|
●
|
Our ability to operate with financial stability and secure access to external financing and adequate liquidity;
|
●
|
Our ability to secure and source supplies of raw materials and key components in due time and at competitive prices;
|
●
|
Our ability to achieve revenue growth and penetrate new markets;
|
●
|
Our dependence on the expertise and experience of our management team and the retention of key employees;
|
●
|
Our reliance and access to qualified personnel to expand our business;
|
●
|
Our ability to adapt to potentially adverse changes in legislative, regulatory and political frameworks;
|
●
|
Changes in interest rates or tightening of debt capital markets;
|
●
|
Changes in emissions and environmental regulations, and potential further tightening of emission standards;
|
●
|
The exposure to potentially adverse tax consequences;
|
2
Table of Contents
●
|
Our ability to compete under changing governmental standards by which our products are evaluated;
|
●
|
The financial impact from the fluctuation and volatility of foreign currencies;
|
●
|
The potential monetary costs of defending our intellectual property rights;
|
●
|
Our ability to successfully protect our intellectual property rights and manufacturing know-how;
|
●
|
The possibility of a dispute over intellectual property developed in conjunction with third parties with whom we have contractual relationships;
|
●
|
The possibility that we could become subject to litigation that could be costly, limit or cancel our intellectual property rights or divert time and efforts away from our business operations;
|
●
|
The potential negative impact to the sale of our products caused by technological advances of our competitors;
|
●
|
The potential liability for environmental harm or damages resulting from technical faults or failures of our products;
|
●
|
The possibility that an investor located within the United States may not be able to, or find it difficult to, enforce any judgments obtained in United States courts because a significant portion of our assets and some of our officers and directors may be located outside of the United States;
|
●
|
The possibility that we may not be able to develop and maintain an effective system of internal controls over financial reporting, leading to inaccurate reports of our financial results;
|
●
|
The possibility of breaches in the security of our information technology systems;
|
●
|
The liability risk associated with our compliance to environmental laws and regulations; and
|
●
|
The potential negative impact of more stringent environmental laws and regulations as governmental agencies seek to improve minimum standards.
|
The foregoing list of important factors does not include all such factors, nor necessarily present them in order of importance. In addition, you should consult other disclosures made by the Company (such as in our other filings with the SEC or in Company press releases) for other factors that may cause actual results to differ materially from those projected by the Company. Please refer to the section titled “ Risk Factors ” elsewhere in this prospectus and under “ Risk Factors ” in our Annual Report on Form 10-K for the year ended December 31, 2025, as amended (the “2025 Annual Report”), in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2026 and any subsequent Quarterly Report on Form 10-Q, which are incorporated by reference into this prospectus, additional information regarding factors that could affect the Company’s results of operations, financial condition and liquidity. Any forward-looking statements, which we make in this prospectus, speak only as of the date of such statement, and we undertake no obligation to update such statements, except as otherwise required by applicable law. We can give no assurance that such forward-looking statements will prove to be correct. An occurrence of, or any material adverse change in, one or more of the risk factors or risks and uncertainties referred to in this report or included in our other periodic reports filed with the SEC incorporated by reference herein could materially and adversely impact our operations and our future financial results. Comparisons of results for current and any prior periods are not intended to express any future trends or indications of future performance, unless expressed as such, and should only be viewed as historical data.
Any public statements or disclosures made by us following this report that modify or impact any of the forward-looking statements contained in or accompanying this prospectus will be deemed to modify or supersede such outlook or other forward-looking statements in or accompanying this prospectus.
3
Table of Contents
PROSPECTUS SUMMARY
This summary highlights information contained in greater detail elsewhere or incorporated by reference in this prospectus and does not contain all of the information that you should consider before deciding to invest in our common stock. You should read the entire prospectus carefully, including the “ Risk Factors, ” “ Management ’ s Discussion and Analysis of Financial Condition and Results of Operations ” and our consolidated financial statements and the related notes incorporated by reference in this prospectus, before making an investment decision. Some of the statements included in this prospectus and the information incorporated by reference herein constitute forward-looking statements. See “ Cautionary Note Regarding Forward-Looking Statements. ” The terms “ LiqTech ” , “ we ” , “ our ” , “ us ” , the “ Company ” or any derivative thereof, as used herein, refer to LiqTech International, Inc., a Nevada corporation, together with its direct and indirect wholly-owned subsidiaries, which we collectively refer to herein as our “ Subsidiaries. ”
Overview
LiqTech International, Inc. is a clean technology company that provides state-of-the-art gas and liquid purification products by manufacturing ceramic silicon carbide filters and membranes as well as developing industry-leading and fully automated filtration solutions and systems. For more than two decades, we have developed and manufactured products of re-crystallized silicon carbide. We specialize in three business areas: ceramic membranes and membrane incorporated liquid filtration systems, ceramic diesel particulate filters (DPFs) to control soot exhaust particles and black carbon emission from diesel engines, and plastic components for usage across various industries. Using nanotechnology, we develop proprietary products using patented silicon carbide technology. Our products are based on innovative silicon carbide membranes that facilitate new applications and improve existing technologies. We market our products from our offices in Denmark and through local representatives and distributors. The products are shipped directly to customers from our production facilities in Denmark.
The terms “LiqTech”, “we”, “our”, “us”, the “Company” or any derivative thereof, as used herein, refer to LiqTech International, Inc., a Nevada corporation, together with its direct and indirect wholly-owned subsidiaries, which we collectively refer to herein as our “Subsidiaries”.
At present, we conduct our operations in the Kingdom of Denmark, the U.S. and China, with locations in the Copenhagen area, Hobro, Fort Worth, Texas and Nantong.
Our Strategy
Our strategy is to leverage our core competencies in material science, advanced filtration, systems integration, and application knowledge, creating differentiated products with compelling value propositions to penetrate attractive end markets with customer needs and regulatory tailwinds. Essential imperatives associated with our strategy include the following:
●
|
Develop and reinforce new products and applications to provide clean water and reduce pollution. We currently provide water filtration systems for commercial pool owners, dual fuel marine vessels, shipowners, and ship operators as well as tailored filtration systems for oil & gas operators, industrial operators and services companies. We are expanding our range of products to better leverage existing customer relationships and develop new relationships within the oil & gas, marine, chemical, and other industries. |
●
|
Better penetration of existing end markets where our value proposition is strong. We have successfully sold products and installed systems into several end market segments--including automotive/transportation, clean water and pool filtration, marine, industrial wastewater, chemical/petrochemical, and oil & gas applications. We are focused on targeting and developing new customers in these end markets while working with distributors, agents, and partners to access other important geographic markets. |
●
|
Develop new end markets for our core products and applications . Our existing products and systems are relevant for and valuable to other end markets, and we regularly evaluate opportunities to develop strategic partners to perfect new applications and validate associated value propositions. |
Recent Developments
On May 22, 2026, we issued and sold 9.09% original discount promissory notes in an aggregate principal amount of $1.1 million (the “OID Notes”) to affiliates of Bleichroeder L.P. and Laurence W. Lytton (together, the “Investors”), pursuant to a note purchase agreement entered into with the Investors (the “Note Purchase Agreement”). The OID Notes were issued for a purchase price of $1,000,000 and reflect an original issue discount of $100,000. The Note Purchase Agreement contains customary representations, warranties, and covenants of the Company and Investors as detailed therein. The OID Notes have a term of two months and do not bear interest during this period. However, if the OID Notes are not repaid by maturity date, the OID Notes will thereafter bear interest of 10% per annum, which will increase by 1% each month the OID Notes remain unpaid, up to a maximum of 16% per annum, payable monthly. Proceeds from the OID Notes shall be used for working capital and general corporate purposes.
We filed our Articles of Incorporation on July 1, 2004, and are incorporated under the laws of the State of Nevada. Our principal executive office is located at Industriparken 22C, 2750 Ballerup, Denmark, and our telephone number is +45 3131 5941. We maintain an Internet website at www.liqtech.com. Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to section 13(a) or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) are available free of charge through our website as soon as reasonably practicable after we electronically file with or furnish them to the SEC and are available in print to any stockholder who requests a copy. The information contained in, or accessible from, our website is not a part of this prospectus.
Implications of Being a Smaller Reporting Company
We are a “smaller reporting company” as defined in the Exchange Act. As a smaller reporting company, we may take advantage of specified reduced disclosure and other requirements that are otherwise applicable, in general, to public companies that are not smaller reporting companies. These provisions include (i) not being required to comply with the auditor attestation requirements of Section 404(b) of the Sarbanes Oxley Act of 2002, as amended; (ii) scaled executive compensation disclosures; and (iii) the option to provide only two years of audited financial statements, instead of three years.
We will continue to be a smaller reporting company until the last day of the fiscal year in which (i) the market value of our common stock held by non-affiliates exceeds $250 million as of the last business day of our second fiscal quarter, or (ii) our annual revenue exceeded $100 million during such completed fiscal year and the market value of our common stock held by non-affiliates exceeds $700 million as of the last business day of our second fiscal quarter.
4
Table of Contents
The Offering
Common stock offered by us
|
|
$20,000,000 of shares of common stock (or $23,000,000 of shares of common stock if the underwriter exercises its over-allotment option in full). |
|
|
|
Pre-Funded Warrants offered by us |
|
We are also offering to certain purchasers whose purchase of our common stock in this offering would otherwise result in the purchaser, together with its affiliates, beneficially owning more than 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding shares of common stock immediately following the consummation of this offering, the opportunity to purchase pre-funded warrants in lieu of common stock that would otherwise result in any such purchaser’s beneficial ownership exceeding 4.99% (or, at the election of the purchaser, 9.99%) of our outstanding shares of common stock. Each pre-funded warrant will be exercisable for one share of common stock. The purchase price of each pre-funded warrant will equal the price at which the common stock is being sold to the public in this offering, minus $0.001, and the exercise price of each pre-funded warrant will be $0.001 per share. The pre-funded warrants will be exercisable immediately and may be exercised at any time until exercised in full. For each pre-funded warrant we sell, the number of shares of common stock we are offering will be decreased on a one-for-one basis. |
|
|
|
Common stock to be outstanding after this offering |
|
21,058,952 shares (or 22,725,618 shares if the underwriter exercises its over-allotment option in full), based on the assumed issuance of 11,111,111 shares in this offering (or 12,777,777 shares if the underwriter exercises its over-allotment option in full) at an assumed public offering price of $1.80 per share, the last reported sale price of our common stock on the Nasdaq Capital Market on May 22, 2026, and assuming no sale of pre-funded warrants and excluding shares of common stock issuable upon exercise of the underwriter warrants. |
|
|
|
Over-allotment option |
|
We have granted the underwriter a 45-day over-allotment option to purchase up to an additional $3,000,000 of shares of common stock (equal to 15% of the total number of shares of common stock and pre-funded warrants sold in this offering) from us at the public offering price, less underwriting discounts and commissions, solely to cover over-allotments, if any. |
|
|
|
Underwriter Warrants |
|
The registration statement of which this prospectus is a part registers the underwriter warrants to purchase shares of our common stock to be issued to the underwriter in the offering as a portion of the compensation payable to the underwriter in connection with this offering. The underwriter warrants will be exercisable from issuance at the exercise price of $ (125% of the public offering price per share of our common stock) and expire three years after the commencement of sales in this offering. The underwriter warrants are subject to a 180-day lock-up period. See “Underwriting” on page 12. |
|
|
|
Concurrent private placement |
|
In a concurrent private placement expected to be consummated upon the closing of the offering of the securities registered hereby, we have agreed to issue to the Note Holders a number of shares of our common stock determined based on a deemed issuance price per share equal to the public offering price per share to be sold in this offering, in exchange for the cancellation of $3.0 million of the aggregate principal amount of our Senior Promissory Notes, pursuant to the Debt Cancellation Agreement. The shares to be issued to the Note Holders have not been registered under the Securities Act, nor are they being offered pursuant to this prospectus. The shares are being offered pursuant to the exemption provided in Section 4(a)(2) of the Securities Act and Rule 506(b) promulgated thereunder. |
|
|
|
Use of proceeds
|
|
We estimate that the net proceeds to us from this offering will be approximately $ (or approximately $ if the underwriter exercises its over-allotment option in full), after deducting the underwriting discounts and commissions and the estimated offering expenses payable by us.
We intend to use the net proceeds of this offering (i) to repay the remaining $3.0 million of the aggregate principal amount of our Senior Promissory Notes, including any accrued and unpaid interest thereon, after the cancellation by the Note Holders of $3.0 million of the aggregate principal amount of the Senior Promissory Notes pursuant to the Debt Cancellation Agreement in a concurrent private placement, (ii) to repay $1.1 million in aggregate principal amount of our 9.09% OID Notes, and (iii) for working capital and general corporate purposes. See “Use of Proceeds.”
|
5
Table of Contents
Risk factors
|
|
You should read the “Risk Factors” section of this prospectus beginning on page 7 of this prospectus and under similar headings in the documents incorporated by reference into this prospectus for a discussion of factors to consider carefully before deciding to invest in shares of our common stock.
|
|
|
|
Lock-up |
|
We have agreed with the underwriter that, for a period beginning on the date of the underwriting agreement and ending 90 days after the closing of this offering, we and our subsidiaries will not (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any common stock or common stock equivalents or (ii) file any registration statement or amendment or supplement thereto, as well as certain additional restrictions as set forth in the underwriting agreement, in each case subject to customary exceptions. We have also agreed at the closing of this offering not to effect or enter into an agreement to effect any issuance by us or our subsidiaries of any common stock or common stock equivalents involving a variable rate transaction (as defined in the underwriting agreement) for a period of 12 months after the closing of this offering. Pursuant to “lock-up” agreements, our directors and officers have agreed, without the prior written consent of the underwriter, not to directly or indirectly, (i) offer to sell, pledge, contract to sell, sell any option or contract to purchase, purchase any option, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, indirectly or directly, shares of capital stock of the Company, (ii) cause to be filed any registration statement relating to their resale of any shares of capital stock of the Company, or (iii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (i), (ii) or (iii) above is to be settled by delivery of shares of capital stock of the Company or other such securities, in cash or otherwise, subject to customary exceptions, for a period beginning on the date of such lock-up agreements and ending 90 days from the closing of this offering. See “Underwriting” for more information. |
|
|
|
Nasdaq Capital Market symbol
|
|
Our shares of common stock are listed on the Nasdaq Capital Market under the symbol “LIQT.” There is no established public trading market for the pre-funded warrants to be sold in this offering and we do not expect a market to develop. In addition, we do not intend to apply for listing of pre-funded warrants on the Nasdaq Capital Market, any other national securities exchange or any other trading system. |
|
|
|
Transfer Agent and Registrar
|
|
Securities Transfer Corporation.
|
The number of shares of our common stock to be outstanding immediately after this offering, assuming the maximum number of shares of our common stock is sold and assuming no sale of pre-funded warrants, is based on 9,947,841 shares of our common stock outstanding as of May 22, 2026 and excludes the following:
|
•
|
5,299,879 shares of our common stock issuable upon exercise of pre-funded warrants outstanding as of May 22, 2026, with a weight-averaged exercise price of $0.006 per share; |
|
•
|
6,091,346 shares of our common stock issuable upon exercise of warrants outstanding as of May 22, 2026, with a weight-averaged exercise price of $2.29 per share; |
|
•
|
309,527 shares of our common stock subject to restricted stock units, or RSUs, outstanding as of May 22, 2026; |
|
•
|
1,385,737 shares of our common stock reserved and available for future issuance as of May 22, 2026, under our equity incentive plans; |
|
•
|
The shares of our common stock underlying the underwriter warrants; and
|
|
•
|
The shares of our common stock issuable to the Note Holders pursuant to the Debt Cancellation Agreement in the concurrent private placement.
|
6
Table of Contents
RISK FACTORS
Investing in our securities involves a high degree of risk. You should carefully consider the risks described below and the risks described in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, which are incorporated by reference herein, as well as the financial or other information included in this prospectus or incorporated by reference in this prospectus, including our consolidated financial statements and the related notes, before you decide to buy our securities. If any of the events or developments described below were to occur, our business, prospects, operating results and financial condition could suffer materially, the trading price of our securities could decline and you could lose all or part of your investment. The risks and uncertainties described below are not the only ones we face. Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may become material and adversely affect our business.
Risks Related to this Offering
We have broad discretion in the use of the net proceeds from this offering and may not use them effectively.
Our management has broad discretion in the application of the net proceeds from this offering, and you will not have the opportunity as part of your investment decision to assess whether the net proceeds are being used appropriately. Our management could spend the net proceeds from this offering in ways that do not improve our results of operations or enhance the value of our common stock. The failure by our management to apply these funds effectively could result in financial losses that could have a material adverse effect on our business, cause the price of our common stock to decline and delay the development of our product candidates. Pending their use, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.
Future sales of our common stock in the public market could cause the market price of our common stock to drop significantly, even if our business is doing well.
Sales of a substantial number of shares of our common stock in the public market, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of our common stock and make it more difficult for you to sell your shares of our common stock at a time and price that you deem appropriate.
We may raise money through additional public or private offerings of our equity securities or equity-linked securities. Any sales of our equity or equity-linked securities could have a material adverse effect on the market price of our common stock.
In addition, we have a significant number of RSUs, warrants and pre-funded warrants outstanding, and may also choose to issue additional shares of our common stock, or securities convertible into or exchangeable for shares of our common stock, in the future in connection with a financing, an acquisition, a litigation settlement, employee arrangements or otherwise. In the event that the outstanding RSUs, warrants or pre-funded warrants are exercised, or that we make additional issuances of shares of our common stock or other convertible or exchangeable securities, you could experience additional dilution. Furthermore, we cannot assure you that we will be able to issue shares or other securities in any other offering at a price per share that is equal to or greater than the price per share paid by investors in this offering, and investors purchasing our securities in the future may have rights superior to investors purchasing shares in this offering.
7
Table of Contents
There is no public market for the pre-funded warrants to purchase common stock in this offering.
There is no established public trading market for the pre-funded warrants that are being offered in this offering, and we do not expect a market to develop. In addition, we do not intend to apply to list the pre-funded warrants on any national securities exchange or other trading market. Without an active market, the liquidity of the pre-funded warrants will be limited.
We may not receive any additional funds upon the exercise of the pre-funded warrants.
Each pre-funded warrant may be exercised by way of a cashless exercise, meaning that the holder may not pay a cash purchase price upon exercise, but instead would receive upon such exercise the net number of shares of our common stock determined according to the formula set forth in the pre-funded warrants. Accordingly, we may not receive any additional funds upon the exercise of the pre-funded warrants.
Significant holders or beneficial holders of our common stock may not be permitted to exercise pre-funded warrants that they hold.
A holder of a pre-funded warrant will not be entitled to exercise any portion of any pre-funded warrants which, upon giving effect to such exercise, would cause the aggregate number of shares of our common stock beneficially owned by the holder (together with its affiliates) to exceed 4.99% (or, at the election of the purchaser, 9.99%) of the number of shares of our common stock outstanding immediately after giving effect to the exercise. Such percentage may be increased or decreased by written notice by the holder of the pre-funded warrants to any other percentage not in excess of 9.99%. Such increase or decrease will not be effective until the sixty-first (61st) day after such notice is delivered to us. As a result, you may not be able to exercise your pre-funded warrants for shares of our common stock at a time when it would be financially beneficial for you to do so. In such circumstance, you could seek to sell your pre-funded warrants to realize value, but you may be unable to do so in the absence of an established trading market for the pre-funded warrants.
The holders of the pre-funded warrants will have no rights as common stockholders until such holders exercise their pre-funded warrants and acquire shares of our common stock.
Except by virtue of such holder’s ownership of shares of our common stock, the holder of a pre-funded warrant will not have the rights or privileges of a holder of our common stock, including any voting rights, until such holder exercises the pre-funded warrant. Upon exercise of the pre-funded warrant, the holders will be entitled to exercise the rights of a stockholder of common stock only as to matters for which the record date occurs after the exercise date.
If you purchase our common stock in this offering, you may incur immediate and substantial dilution in the book value of your shares of our common stock.
Investors purchasing shares of our common stock and pre-funded warrants in this offering will pay a price per share that substantially exceeds the as-adjusted book value per share of our tangible assets after subtracting our liabilities. As a result, investors purchasing shares of our common stock or pre-funded warrants in this offering will incur immediate dilution of approximately $0.58 per share, representing the difference between the assumed public offering price of $1.80 per share and our as adjusted net tangible book value as of March 31, 2026.
8
Table of Contents
This dilution is due to the substantially lower price paid by our investors who purchased shares prior to this offering as compared to the price offered to the public in this offering. In addition, as of May 22, 2026, we had outstanding 5,299,879 pre-funded warrants with a weighted average exercise price of $0.006 per share and 6,091,346 warrants with a weighted average exercise price of $2.29 per share; the exercise of any of these options would result in additional dilution. As a result of the dilution to investors purchasing shares in this offering, investors may receive significantly less than the purchase price paid in this offering, if anything, in the event of our liquidation. See the section of this prospectus titled “Dilution” for a more detailed description of these factors.
Following this offering, our largest stockholders will continue to control a significant percentage of our voting power and be able to exert significant control over the direction of our business.
Upon the closing of this offering and the concurrent private placement with the Note Holders, our largest stockholders, Bleichroeder LP (“Bleichroeder”), Laurence W. Lytton and Ben Andrews will, in the aggregate, own or control shares representing approximately 30.1% of the outstanding shares of our common stock, assuming the sale of all shares of common stock offered hereby and no sale of pre-funded warrants (28.0% if the underwriter exercises its option to purchase additional shares in full) and the issuance of 1,666,667 shares of our common stock to the Note Holders pursuant to the Debt Cancellation Agreement in the concurrent private placement, at an assumed public offering price and deemed issuance price, respectively, of $1.80 per share. As a result, if these stockholders were to choose to act together, they would be able to exert significant influence over matters submitted to our stockholders for approval, as well as our management and affairs. The interests of this group of stockholders may not always coincide with our corporate interests or the interests of other stockholders, and they may act in a way in which you may not agree with or in a way that may not be in the best interests of other stockholders. This concentration of voting power could delay or prevent an acquisition of our company on terms that other stockholders may desire or otherwise discourage a potential acquirer from attempting to obtain control of us, which in turn could have a material adverse effect on our share price.
Resales of our shares of our common stock in the public market by our stockholders as a result of this offering may cause the market price of our common stock to fall.
Sales of substantial amounts of our shares of our common stock in the public market, or the perception that such sales might occur, could adversely affect the market price of our shares of our common stock. The issuance of new shares of our common stock could result in resales of shares of our common stock by our current stockholders concerned about the potential ownership dilution of their holdings. Furthermore, in the future, we may issue additional shares of our common stock or other equity or debt securities exercisable or convertible into shares of our common stock. Any such issuance could result in substantial dilution to our existing stockholders and could cause our stock price to decline.
We may not receive any additional funds upon the exercise of the underwriter warrants.
Each underwriter warrant may be exercised by way of a cashless exercise if permitted by the terms of such warrants, meaning that the holder may not pay a cash purchase price upon exercise, but instead would receive upon such exercise the net number of shares of our common stock determined according to the formula set forth in the underwriter warrants, as applicable. Accordingly, we may not receive any additional funds upon the exercise of the underwriter warrants or if the underwriter warrants altogether are not exercised at all.
9
Table of Contents
USE OF PROCEEDS
We estimate that our net proceeds from the sale of shares of our common stock in this offering will be approximately $ (or approximately $ if the underwriter exercises its over-allotment option in full), after deducting the underwriting discounts and commissions and estimated offering expenses payable by us.
We intend to use the net proceeds from this offering (i) to repay the remaining $3.0 million of the aggregate principal amount of our Senior Promissory Notes, including any accrued and unpaid interest thereon, after the cancellation by the Note Holders of $3.0 million of the aggregate principal amount of the Senior Promissory Notes pursuant to the Debt Cancellation Agreement in a concurrent private placement, (ii) to repay the $1.1 million in aggregate principal amount of our 9.09% OID Notes and (iii) for working capital and general corporate purposes. After the application of the net proceeds to repay the remaining aggregate principal amount of our Senior Promissory Notes, including any accrued and unpaid interest thereon, our Senior Promissory Notes will no longer be outstanding. In addition, after the application of net proceeds to repay the aggregate principal amount of our 9.09% OID Notes, our 9.09% OID Notes will no longer be outstanding.
As of March 31, 2026, the outstanding aggregate principal amount of the Senior Promissory Notes was $6.0 million. Beginning on January 1, 2026, the Senior Promissory Notes bear interest at a rate of 10% per annum, payable semiannually. Prior to January 1, 2026, the Senior Promissory Notes did not bear interest. The Senior Promissory Notes will mature on May 1, 2027 (the “Maturity Date”). In the event of a default under the Senior Promissory Notes or if the Senior Promissory Notes are not repaid on or before the Maturity Date, the interest rate increases to 13% per annum, with a monthly 1% step-up up to a cap of 16% per annum, payable monthly.
On May 22, 2026, we issued and sold the 9.09% OID Notes in an aggregate principal amount of $1.1 million to the Note Holders and Laurence W. Lytton. The OID Notes were issued for a purchase price of $1,000,000 and reflect an original issue discount of $100,000. The OID Notes have a term of two months and do not bear interest during this period. However, if the OID Notes are not repaid by maturity date, the OID Notes will thereafter bear interest of 10% per annum, which will increase by 1% each month the OID Notes remain unpaid, up to a maximum of 16% per annum, payable monthly.
In the event that any net proceeds are not immediately applied, we may temporarily hold them as cash, deposit them in banks or invest them in cash equivalents or securities.
Our management will have broad discretion in the application of the net proceeds of this offering, and investors will be relying on our judgment regarding the application of the net proceeds. In addition, we might decide to postpone or not pursue certain activities if the net proceeds from this offering and our other sources of cash are less than expected. See “Risk Factors” on page 6.
10
Table of Contents
DILUTION
If you invest in our common stock in this offering, your interest will be diluted to the extent of the difference between the public offering price per share of our common stock and the as adjusted net tangible book value per share of our common stock immediately after the closing of this offering.
Our historic net tangible book value of our common stock as of March 31, 2026 was approximately $7.6 million, or $0.76 per share, based on the number of shares of our common stock outstanding as of March 31, 2026. Historic net tangible book value per share represents our total tangible assets less our total liabilities, divided by the number of outstanding shares of common stock.
After giving effect to the sale of 11,111,111 shares of our common stock in this offering at the assumed public offering price of $1.80 per share, which was the last reported sale price of our common stock on The Nasdaq Capital Market on May 22, 2026, and after deducting the underwriting discounts and commissions and estimated offering expenses payable by us, and assuming no sale of pre-funded warrants, our as adjusted net tangible book value as of March 31, 2026 would have been approximately $25.6 million, or approximately $1.22 per share. This represents an immediate increase in as adjusted net tangible book value of approximately $0.46 per share to our existing stockholders and an immediate dilution of approximately $0.58 per share to investors purchasing shares of our common stock in this offering.
We calculate dilution per share to new investors by subtracting the historic net tangible book value per share from the public offering price paid by the new investor. The information above is illustrative only and will adjust based on the actual public offering price, the actual number of shares that we offer in this offering and other terms of this offering determined at pricing.
The following table illustrates this calculation on a per share basis assuming the sale of all shares of our common stock offered hereby:
Assumed public offering price per share
|
|
|
|
|
|
$ |
1.80 |
|
Historic net tangible book value per share as of March 31, 2026
|
|
$ |
0.76 |
|
|
|
|
|
Increase in net tangible book value per share attributable to new investors in this offering
|
|
$ |
0.46 |
|
|
|
|
|
As adjusted net tangible book value per share after giving effect to this offering
|
|
|
|
|
|
$ |
1.22 |
|
Dilution in net tangible book value per share to new investors in this offering
|
|
|
|
|
|
$ |
0.58 |
|
The foregoing tables and calculations are based on 9,947,841 shares of our common stock outstanding as of March 31, 2026, excludes the following:
|
•
|
5,299,879 shares of our common stock issuable upon exercise of pre-funded warrants outstanding as of March 31, 2026, with a weight-averaged exercise price of $0.006 per share; |
|
•
|
6,091,346 shares of our common stock issuable upon exercise of warrants outstanding as of March 31, 2026, with a weight-averaged exercise price of $2.29 per share; |
|
•
|
309,527 shares of our common stock subject to restricted stock units, or RSUs, outstanding as of March 31, 2026; |
|
•
|
1,385,737 shares of our common stock reserved and available for future issuance as of March 31, 2026, under our equity incentive plans; |
|
•
|
The shares of our common stock underlying the underwriter warrants; and
|
|
•
|
The shares of our common stock issuable to the Note Holders pursuant to the Debt Cancellation Agreement in the concurrent private placement.
|
11
Table of Contents
DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to our Articles of Incorporation, as amended (the “articles of incorporation”) and our Amended and Restated Bylaws (the “bylaws”), each of which are incorporated by reference to this prospectus. We encourage you to read our articles of incorporation, our bylaws and the applicable provisions of the Nevada Revised Statutes for additional information.
General
Our authorized capital stock consists of 50,000,000 shares of common stock, par value $0.001 per share, and 2,500,000 shares of preferred stock, par value $0.001 per share. As of May 22, 2026, we had 9,947,841 shares of our common stock issued and outstanding and no shares of preferred stock issued or outstanding.
Common Stock
Voting -- Holders of our common stock are entitled to one vote for each share held of record on each matter submitted to a vote of stockholders, including the election of directors, and do not have any right to cumulate votes in the election of directors.
Dividends -- Subject to the rights and preferences of the holders of any series of preferred stock which may at the time be outstanding, holders of our common stock are entitled to receive ratably such dividends as our Board of Directors from time to time may declare out of funds legally available.
Liquidation Rights -- In the event of any liquidation, dissolution or winding-up of affairs of the Company, after payment of all of our debts and liabilities and subject to the rights and preferences of the holders of any outstanding shares of any series of our preferred stock, the holders of our common stock will be entitled to share ratably in the distribution of any of our remaining assets.
Other Matters -- Holders of our common stock have no conversion, preemptive or other subscription rights, and there are no redemption rights or sinking fund provisions with respect to our common stock. All of the issued and outstanding shares of our common stock on the date of this report are validly issued, fully paid and non-assessable.
Underwriter Warrants
See “Underwriting” on page 12 of this prospectus for a description of the material terms of the underwriter warrants.
Nevada Anti-Takeover Law and Charter and Bylaw Provisions
Nevada Revised Statutes sections 78.378 to 78.3793 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. The statute creates a number of restrictions on the ability of a person or entity to acquire control of a Nevada corporation by setting down certain rules of conduct and voting restrictions in any acquisition attempt, among other things. Our articles of incorporation and bylaws provide that these sections do not apply.
There are no provisions in our articles of incorporation or our bylaws that would delay, defer or prevent a change in control of our Company.
Indemnification of Directors and Executive Officers and Limitation on Liability
The articles of incorporation provide that no director or officer of the Company shall be personally liable to the Company or any of its stockholders for damages for breach of fiduciary duty as a director or officer; provided, however, that the foregoing provision shall not eliminate or limit the liability of a director or officer (i) for acts or omissions which involve intentional misconduct, fraud or knowing violation of law, or (ii) the payment of dividends in violation of Section 78.300 of the Nevada Revised Statutes.
12
Table of Contents
The bylaws provide that 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 such person is or was a director, officer, employee or agent of the Company (or is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise) shall be indemnified and held harmless by the Company to the fullest extent permitted by Nevada law against expenses including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such proceeding; provided that such person (a) did not breach, through intentional misconduct, fraud, or a knowing violation of law, such person’s fiduciary duties as a director or officer to act in good faith and in the interests of the Company, and (b) acted in good faith and in a manner that such person reasonably believed to be in or not opposed to the best interests of the Company and, with respect to any criminal action or proceeding, had no reasonable cause to believe that such person’s conduct was unlawful.
The bylaws provide that the Company must pay the costs incurred by any person entitled to indemnification in defending a proceeding as such costs are incurred and in advance of the final disposition of a proceeding; provided however, that the Company must pay such costs only upon receipt of an undertaking by or on behalf of such person to repay the amount if it is ultimately determined by a court of competent jurisdiction that such person is not entitled to be indemnified by the Company.
The bylaws provide that the Company may purchase and maintain insurance or make other financial arrangements on behalf of any person who is or was a director, officer or employee, or agent of the Company, or is or was serving at the request of the Company as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise in accordance with Section 78.752 of the Nevada Revised Statutes.
Nevada Revised Statutes 78.751 and 78.7502 have provisions that provide for discretionary and mandatory indemnification of officers, directors, employees, and agents of a corporation. Under these provisions, such persons may be indemnified by a corporation against expenses, including attorney’s fees, judgment, fines and amounts paid in settlement, actually and reasonably incurred by him in connection with the action, suit or proceeding, if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation and with respect to any criminal action or proceeding had no reasonable cause to believe his conduct was unlawful.
To the extent that a director, officer, employee or agent has been successful on the merits or otherwise in defense of any action, suit or proceeding, or in defense of any claim, issue or matter, the Nevada Revised Statues provide that he must be indemnified by the Company against expenses, including attorney’s fees, actually and reasonably incurred by him in connection with the defense.
Section 78.7502 of the Nevada Revised Statues also provides that any discretionary indemnification, unless ordered by a court or advanced by the Company, may be made only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances. The determination must be made: by the stockholders; by the Company’s Board of Directors by majority vote of a quorum consisting of directors who were not parties to that act, suit or proceeding; if a majority vote of a quorum consisting of directors who were not parties to the act, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion; or if a quorum consisting of directors who were not parties to the act, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion.
Listing
Shares of our common stock are listed on the Nasdaq Capital Market under the symbol “LIQT”.
Dividend Policy
We have no current plans to pay dividends on our common stock.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Securities Transfer Corporation. The transfer agent and registrar’s address is 2901 N. Dallas Parkway, Suite 380, Plano, TX 75093.
13
Table of Contents
SHARES ELIGIBLE FOR FUTURE SALE
Future sales of substantial amounts of shares of our common stock in the public market could adversely affect market prices prevailing from time to time. Furthermore, because only a limited number of shares of our common stock will be available for sale shortly after this offering due to existing contractual and legal restrictions on resale as described below, there may be sales of substantial amounts of shares of our common stock in the public market after such restrictions lapse. This may adversely affect the prevailing market price of our common stock and our ability to raise equity capital in the future.
Upon completion of this offering (assuming the sale of 100% of the shares of our common stock offered hereby and assuming no sale of pre-funded warrants) and the issuance of the shares of our common stock to the Note Holders pursuant to the Debt Cancellation Agreement in the concurrent private placement (at an assumed public offering price and deemed issuance price, respectively, of $1.80 per share), we will have 22,725,618 shares of our common stock outstanding (or 24,392,284 shares if the underwriter exercises its over-allotment option to purchase additional shares in full) in each case excluding shares of common stock issuable upon exercise of the underwriter warrants.
Lock-Up Restrictions
We have agreed with the underwriter that, for a period beginning on the date of the underwriting agreement and ending 90 days after the closing of this offering, we and our subsidiaries will not (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any common stock or common stock equivalents or (ii) file any registration statement or amendment or supplement thereto, as well as certain additional restrictions as set forth in the underwriting agreement, in each case subject to customary exceptions. We have also agreed at the closing of this offering not to effect or enter into an agreement to effect any issuance by us or our subsidiaries of any common stock or common stock equivalents involving a variable rate transaction (as defined in the underwriting agreement) for a period of 12 months after the closing of this offering.
Pursuant to “lock-up” agreements, our directors and officers have agreed, without the prior written consent of the underwriter, not to directly or indirectly, (i) offer to sell, pledge, contract to sell, sell any option or contract to purchase, purchase any option, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, indirectly or directly, shares of capital stock of the Company, (ii) cause to be filed any registration statement relating to their resale of any shares of capital stock of the Company, or (iii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (i), (ii) or (iii) above is to be settled by delivery of shares of capital stock of the Company or other such securities, in cash or otherwise, subject to customary exceptions, for a period beginning on the date of such lock-up agreements and ending 90 days from the closing of this offering.
DESCRIPTION OF PRE-FUNDED WARRANTS
The following is a brief summary of certain terms and conditions of the pre-funded warrants being offered by this prospectus. The following description is subject in all respects to the provisions contained in the pre-funded warrants.
Form
The pre-funded warrants will be issued as individual warrant agreements to the investors. The form of pre-funded warrant is filed as an exhibit to the registration statement of which this prospectus forms a part.
Term
The pre-funded warrants do not expire.
14
Table of Contents
Exercisability
The pre-funded warrants are exercisable at any time after their original issuance. The pre-funded warrants will be exercisable, at the option of each holder, in whole or in part by delivering to us a duly executed exercise notice and by payment in full of the exercise price in immediately available funds for the number of shares of common stock purchased upon such exercise. As an alternative to payment in immediately available funds, the holder may elect to exercise the pre-funded warrant through a cashless exercise, in which the holder would receive upon such exercise the net number of shares of common stock determined according to the formula set forth in the pre-funded warrant. No fractional shares of common stock will be issued in connection with the exercise of a pre-funded warrant.
Exercise Limitations
Under the pre-funded warrants, we may not effect the exercise of any pre-funded warrant, and a holder will not be entitled to exercise any portion of any pre-funded warrant, which, upon giving effect to such exercise, would cause (i) the aggregate number of shares of our common stock beneficially owned by the holder (together with its affiliates) to exceed 4.99% (or, at the election of the holder, 9.99%) of the number of shares of our common stock outstanding immediately after giving effect to the exercise, or (ii) the combined voting power of our securities beneficially owned by the holder (together with its affiliates) to exceed 4.99% (or, at the election of the holder, 9.99%) of the combined voting power of all of our securities then outstanding immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the pre-funded warrants. However, any holder may increase or decrease such percentage to any other percentage not in excess of 9.99% upon at least 61 days’ prior notice from the holder to us.
Exercise Price
The exercise price per whole share of our common stock purchasable upon the exercise of the pre-funded warrants is $0.001 per share of common stock. The exercise price of the pre-funded warrants and the number of shares of our common stock issuable upon exercise of the pre-funded warrants is subject to appropriate adjustment in the event of certain stock dividends and distributions, stock splits, stock combinations, reclassifications or similar events affecting our common stock. The exercise price will not be adjusted below the par value of our common stock.
Transferability
Subject to applicable laws, the pre-funded warrants may be offered for sale, sold, transferred or assigned without our consent.
Exchange Listing
There is no established public trading market for the pre-funded warrants and we do not expect a market to develop. We do not intend to list the pre-funded warrants on The Nasdaq Capital Market, any other national securities exchange or any other nationally recognized trading system. Without an active market, the liquidity of the pre-funded warrants will be limited.
15
Table of Contents
UNDERWRITING
We have entered into an underwriting agreement dated , 2026 with Konik Capital Partners, LLC, a division of T.R. Winston & Company, LLC, to act as underwriter in this offering. Subject to the terms and conditions of the underwriting agreement, we have agreed to sell to the underwriter, and the underwriter has agreed to purchase from us, shares of our common stock and pre-funded warrants at the public offering price, less the underwriting discounts and commissions set forth on the cover page of this prospectus. The underwriting agreement provides that the underwriter is obligated to purchase all of the shares of common stock and pre-funded warrants offered by this prospectus if any of the securities are purchased, other than those securities covered by the over-allotment option described below. The underwriter reserves the right to withdraw, cancel or modify offers to the public and to reject orders in whole or in part.
We have agreed to indemnify the underwriter against certain liabilities, including certain liabilities arising under the Securities Act, or to contribute to payments the underwriter may be required to make in respect of those liabilities. The underwriter is offering the shares of common stock, subject to prior sale, when, as and if issued to and accepted by it, subject to approval of legal matters by its counsel and other conditions contained in the underwriting agreement.
The underwriter proposes to offer the shares of common stock and pre-funded warrants directly to the public at the public offering price set forth on the cover page of this prospectus. After the initial offering, the public offering price or any other term of the offering may be changed.
16
Table of Contents
Discounts, Commissions and Expenses
We will pay the underwriter an underwriting discount equal to 7% of the aggregate gross proceeds to us from this offering. We will reimburse the underwriter for its accountable expenses including road show expenses, costs relating to the use of book-building and compliance software for this offering, reasonable fees of the underwriter’s counsel up to $100,000, background checks for our officers and directors, and preparation of bound volumes and Lucite cube mementos in such quantities as the underwriter may request. We have also agreed to pay a non-accountable expense allowance to the underwriter equal to 0.5% of the aggregate gross proceeds raised in this offering and its clearing expense in an amount up to $12,900 in connection with this offering.
We have agreed to pay the underwriter an advance of $25,000 upon execution of the underwriting agreement to be credited against the accountable out-of-pocket expenses actually incurred by the underwriter. The underwriter, in accordance with the Financial Industry Regulatory Authority, Inc. (“FINRA”), will return any portion of the advance not used to pay for accountable out-of-pocket expenses actually incurred. We will reimburse the underwriter for all of its fees and expenses relating to this offering, including, but not limited to, (i) registration of the securities in this offering with the SEC, (ii) FINRA, (iii) Nasdaq, (iv) registration, qualification or exemption of our common stock under the securities laws of such foreign jurisdictions necessary, (v) mailing and printing offering materials, (vi) the transfer agent, and (vii) taxes related to transfer of shares of our common stock to the underwriter. In accordance with FINRA Rule 5110, the reimbursed FINRA filing fee is deemed underwriting compensation for this offering.
The following table shows the per share and total public offering price, underwriting discounts and commissions, and proceeds before expenses to us.
|
|
Per Share
|
|
|
Pre-Funded Warrant |
|
|
Total
|
|
Public offering price
|
|
$ |
— |
|
|
|
— |
|
|
$ |
— |
|
Underwriting discounts and commissions (7%) |
|
$ |
— |
|
|
|
— |
|
|
$ |
— |
|
Proceeds, before expenses, to us
|
|
$ |
— |
|
|
|
— |
|
|
$ |
— |
|
We estimate that our total offering expenses for this offering, net of the underwriting discounts and commissions, will be approximately $0.6 million.
Over-Allotment Option
We have granted to the underwriter an option, exercisable no later than 45 days after the date of the underwriting agreement, to purchase up to an additional $3,000,000 of shares of common stock (equal to 15% of the total number of shares of common stock and pre-funded warrants sold in this offering) from us at the public offering price, less the underwriting discounts and commissions, solely to cover over-allotments, if any. If the underwriter exercises all or part of this option, the underwriter will purchase shares covered by the option at the public offering price that appears on the cover page of this prospectus, less the underwriting discounts and commissions.
Underwriter Warrants
Upon the closing of this offering, we have agreed to sell to the underwriter warrants to purchase up to an aggregate number of shares of common stock equal to 4% of the aggregate number of shares of our common stock and pre-funded warrants sold in this offering. The underwriter warrants will be exercisable at any time (which may be done on a cashless basis in certain circumstances as specified in such warrants), and from time to time, in whole or in part, after issuance at an exercise price equal to 125% of the public offering price per share of our common stock in this offering and will expire three years after commencement of sales in this offering. The underwriter warrants have been deemed compensation by FINRA and are therefore subject to a 180-day lock-up pursuant to FINRA Rule 5110(e). Except as permitted by Rule 5110(e), the underwriter (or permitted assignees under Rule 5110(e)) will not sell, transfer, assign, pledge, or hypothecate the underwriter warrants or the securities underlying the underwriter warrants, nor will any, of them engage in any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of the option or the underlying securities for a period of 180 days from the commencement of sales under this prospectus. In addition, the underwriter will not transfer the underwriter warrants or shares of our common stock underlying the underwriter warrants during the one year following the closing of this offering, except to the underwriter’s officers, partners, or members of the selling group. The exercise price and number of shares issuable upon exercise of the underwriter warrants may be adjusted in certain circumstances including in the event of a stock dividend, extraordinary cash dividend or our recapitalization, reorganization, merger or consolidation. However, the warrant exercise price or underlying shares will not be adjusted for issuances of common stock at a price below the warrant exercise price. The underwriter warrants and the shares of our common stock underlying the underwriter warrants are being registered hereby.
17
Table of Contents
Lock-Up Agreements
We have agreed with the underwriter that, for a period beginning on the date of the underwriting agreement and ending 90 days after the closing of this offering, we and our subsidiaries will not (i) issue, enter into any agreement to issue or announce the issuance or proposed issuance of any common stock or common stock equivalents or (ii) file any registration statement or amendment or supplement thereto as well as certain additional restrictions as set forth in the underwriting agreement, in each case, subject to customary exceptions. We have also agreed at the closing of this offering not to effect or enter into an agreement to effect any issuance by us or our subsidiaries of any common stock or common stock equivalents involving a variable rate transaction (as defined in the underwriting agreement) for a period of 12 months after the closing of this offering.
Pursuant to “lock-up” agreements, our directors and officers have agreed, without the prior written consent of the underwriter, not to directly or indirectly, (i) offer to sell, pledge, contract to sell, sell any option or contract to purchase, purchase any option, grant any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, indirectly or directly, shares of capital stock of the Company, (ii) cause to be filed any registration statement relating to their resale of any shares of capital stock of the Company, or (iii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (i), (ii) or (iii) above is to be settled by delivery of shares of capital stock of the Company or other such securities, in cash or otherwise, subject to customary exceptions, for a period beginning on the date of such lock-up agreements and ending 90 days from the closing of this offering.
Price Stabilization, Short Positions and Penalty Bids
In connection with this offering, the underwriter may engage in transactions that stabilize, maintain or otherwise affect the price of our common stock, including short sales and purchases to cover positions created by short positions, stabilizing transactions, syndicate covering transactions and penalty bids. Specifically, the underwriter may over-allot in connection with this offering by selling more shares of common stock than are set forth on the cover page of this prospectus, creating a short position in our common stock. The short position may be either a covered short position or a naked short position. In a covered short position, the number of shares of common stock over-allotted by the underwriter is not greater than the number of shares of our common stock that may be purchased under the over-allotment option. In a naked short position, the number of shares involved is greater than the number of shares in the over-allotment option. To close out a short position, the underwriter may elect to exercise all or part of the over-allotment option or purchase shares in the open market. The underwriter may also impose a penalty bid, which occurs when a particular dealer repays selling concessions allowed to it because the underwriter repurchases that security in stabilizing or short covering transactions. These activities may stabilize or maintain the market price of our common stock at a price that is higher than the price that might otherwise exist in the absence of these activities. The underwriter is not required to engage in these activities and may discontinue any of these activities at any time without notice. In connection with this offering, the underwriter may also engage in passive market making transactions in our common stock in accordance with Rule 103 of Regulation M under the Exchange Act, during a period before the commencement of offers or sales of the shares and extending through the completion of the distribution.
Discretionary Accounts
The underwriter does not intend to confirm sales of the shares offered hereby to any accounts over which it exercises discretionary authority in excess of 5% of the shares of our common stock being offered in this offering.
Determination of Public Offering Price
The public offering price of shares of our common stock and pre-funded warrants offered by this prospectus was determined by negotiation between us and the underwriter. Among the factors that were considered in determining the public offering price were as follows:
|
●
|
the trading price of our common stock prior to this offering;
|
|
●
|
our history and our prospects;
|
|
●
|
the industry in which we operate;
|
|
●
|
our past and present operating results;
|
|
●
|
the previous experience of our executive officers; and
|
|
●
|
the general condition of the securities markets at the time of this offering.
|
The public offering price stated on the cover page of this prospectus should not be considered an indication of the actual value of the shares of our common stock and/or pre-funded warrants sold in this offering. That price is subject to change as a result of market conditions and other factors and we cannot assure you that shares of our common stock sold in this offering can be resold at or above the public offering price.
18
Table of Contents
Other Relationships
In the ordinary course of their business activities, the underwriter and its affiliates may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative securities) and financial instruments (including bank loans) for their own account and for the accounts of their customers. Such investments and securities activities may involve security and/or instruments of ours or our affiliates. The underwriter and its affiliates may also make investment recommendations and/or publish or express independent research views in respect of such securities or financial instruments and may hold, or recommend to clients that they acquire, long and/or short positions in such securities and instruments.
Electronic Distribution
This prospectus may be made available in electronic format on websites or through other online services maintained by the underwriter or by its affiliates. In those cases, prospective investors may view offering terms online and prospective investors may be allowed to place orders online. Other than this prospectus in electronic format, the information on the underwriter’s websites or our website and any information contained in any other websites maintained by the underwriter or by us is not part of this prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the underwriter in its capacity as underwriter, and should not be relied upon by investors.
Offer Restrictions Outside of the United States
Other than in the United States, no action has been taken by us or the underwriter that would permit a public offering of the shares of our common stock offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to the offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful.
Exchange Listing
Shares of our common stock are listed on the Nasdaq Capital Market under the symbol “LIQT”.
The last reported sales price of our common stock on May 22, 2026, was $1.80 per share. The actual public offering price was determined between us and the underwriter, and may be at a discount to the current market price of our common stock.
Transfer Agent and Registrar
The transfer agent and registrar for our common stock is Securities Transfer Corporation.
19
Table of Contents
LEGAL MATTERS
The validity of the shares of our common stock offered hereby (including the shares of our common stock underlying the pre-funded warrants and the underwriter warrants) will be passed upon for us by Snell and Wilmer, L.L.P., Reno, Nevada. The validity of the pre-funded warrants and the underwriter warrants will be passed upon for us by K&L Gates LLP. McGuireWoods LLP is acting as counsel for the underwriter.
EXPERTS
The financial statements incorporated in this prospectus by reference to the 2025 Annual Report have been so incorporated in reliance on the report of Sadler, Gibb & Associates, LLC, independent registered certified public accountants, given on the authority of said firm as experts in auditing and accounting.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other information with the SEC. Our SEC filings are available to the public over the internet at the SEC’s website at www.sec.gov. Copies of certain information filed by us with the SEC are also available on our website at www.liqtech.com. The information on our website, however, is not, and should not be deemed to be, a part of or incorporated by reference in this prospectus.
This prospectus is a part of a registration statement on Form S-1 that we filed with the SEC and does not contain all of the information in the registration statement. This prospectus omits some information contained in the registration statement in accordance with SEC rules and regulations. The full registration statement may be obtained from the SEC or us, as provided below. Other documents establishing the terms of the offered securities are or may be filed as exhibits to the registration statement. Statements in this prospectus about these documents are summaries and each statement is qualified in all respects by reference to the document to which it refers. You should refer to the actual documents for a more complete description of the relevant matters. You may inspect a copy of the registration statement through the SEC’s website, as provided above.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us to “incorporate by reference” the information we have filed with it, which means that we can disclose important information to you by referring you to those documents. The information we incorporate by reference is an important part of this prospectus, and later information that we file with the SEC will automatically update and supersede this information. We incorporate by reference the documents listed below and any future documents (excluding information furnished pursuant to Items 2.02 and 7.01 of Form 8-K) we file with the SEC pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this prospectus and prior to the termination of this offering:
(1)
|
the 2025 Annual Report filed with the SEC on February 27, 2026 , as amended on March 19, 2026 ;
|
(2)
|
our Quarterly Report on Form 10-Q filed with the SEC on May 13, 2026 ; |
(3)
|
our Current Reports on Form 8-K (other than portions thereof furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits accompanying such reports that relate to such items) filed with the SEC on February 18, 2026 and May 26, 2026 ; |
(4)
|
all other reports filed pursuant to Section 13(a) or 15(d) of the Exchange Act and all proxy or information statements filed pursuant to Section 14 of the Exchange Act since the end of the fiscal year covered by the 2025 Annual Report referenced in (1) above; and |
(5)
|
the description of our common stock contained in our registration on Form 8-A filed with the SEC on April 15, 2019 , as supplemented by Exhibit 4.3 of the 2025 Annual Report, including any amendment or reports filed for the purpose of updating such. |
20
Table of Contents
We are not, however, incorporating, in each case, any documents or information that we are deemed to furnish and not filed in accordance with SEC rules.
Any statement contained in any document incorporated by reference herein will be deemed to be modified or superseded for purposes of this prospectus to the extent that a statement contained in this prospectus or any prospectus supplement modifies or supersedes such statement. Any statement so modified or superseded will not be deemed, except as so modified or superseded, to constitute a part of this prospectus.
All reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination of this offering, including all such documents we may file with the SEC after the date of the initial registration statement and prior to the effectiveness of the registration statement, but excluding any information furnished to, rather than filed with, the SEC, will also be incorporated by reference into this prospectus and deemed to be part of this prospectus from the date of the filing of such reports and documents.
We will provide without charge to each person, including any beneficial owner, to whom this prospectus is delivered, upon written or oral request, a copy of any or all documents that are incorporated by reference into this prospectus, but not delivered with the prospectus, other than exhibits to such documents unless such exhibits are specifically incorporated by reference into the documents that this prospectus incorporates. You may request, and we will provide you with, a copy of these filings at no cost by calling us at +45 3131 5941, by writing to us as the following address: Industriparken 22C, DK 2750, Ballerup, Denmark or by emailing us at info@liqtech.com. You may also access these documents, free of charge on the SEC’s website at www.sec.gov or on the “Investor” page of our website at www.liqtech.com. The information found on our website, or that may be accessed by links on our website, is not part of this prospectus. We have included our website address solely as an inactive textual reference. Investors should not rely on any such information in deciding whether to purchase our common stock.
21
Table of Contents
$20,000,000
Shares of Common Stock
Pre-Funded Warrants to Purchase Shares of Common Stock
Shares of Common Stock Issuable Upon Exercise of the Pre-Funded Warrants
LiqTech International, Inc.
PRELIMINARY PROSPECTUS
Konik Capital Partners
A division of T.R. Winston & Co.
, 2026
Table of Contents
PART II — INFORMATION NOT REQUIRED IN PROSPECTUS
Item 13. Other Expenses of Issuance and Distribution.
The following table sets forth all costs and expenses, other than underwriter discounts and commissions, paid or payable by us in connection with the sale of shares of our common stock and pre-funded warrants being registered. All amounts shown are estimates except for the SEC registration fee and the FINRA filing fee.
|
|
Amount Paid
or to be Paid
|
|
SEC registration fee
|
|
$ |
3,336 |
|
FINRA filing fee
|
|
|
3,500 |
|
Legal fees and expenses
|
|
|
350,000 |
|
Accounting fees and expenses
|
|
|
25,000 |
|
Miscellaneous fees and expenses |
|
|
163,000 |
|
Total
|
|
$ |
544,836 |
|
Item 14. Indemnification of Directors and Officers.
Our Company’s charter provides that, to the fullest extent that limitations on the liability of directors and officers are permitted by the Nevada Revised Statutes, no director or officer of the Company shall have any liability to the Company or its stockholders for monetary damages. The Nevada Revised Statutes provide that a corporation’s charter may include a provision which restricts or limits the liability of its directors or officers to the corporation or its stockholders for money damages except: (1) to the extent that it is provided that the person actually received an improper benefit or profit in money, property or services, for the amount of the benefit or profit in money, property or services actually received, or (2) to the extent that a judgment or other final adjudication adverse to the person is entered in a proceeding based on a finding in the proceeding that the person’s action, or failure to act, was the result of active and deliberate dishonesty and was material to the cause of action adjudicated in the proceeding. The Company’s charter and bylaws provide that the Company shall indemnify and advance expenses to its currently acting and its former directors to the fullest extent permitted by the Nevada Revised Statutes and that the Company shall indemnify and advance expenses to its officers to the same extent as its directors and to such further extent as is consistent with law.
The charter and bylaws provide that the Company will indemnify our directors and officers and may indemnify our employees or agents to the fullest extent permitted by law against liabilities and expenses incurred in connection with litigation in which they may be involved because of their offices with the Company. To the extent that a director has been successful in defense of any proceeding, the Nevada Revised Statutes provide that he shall be indemnified against reasonable expenses incurred in connection therewith.
Our Company maintains a policy of directors’ and officers’ liability insurance that insures its directors and officers against the cost of defense, settlement or payment of a judgment under some circumstances.
Nevada Revised Statutes 78.751 and 78.7502 have provisions that provide for discretionary and mandatory indemnification of officers, directors, employees, and agents of a corporation. Under these provisions, such persons may be indemnified by a corporation against expenses, including attorney’s fees, judgment, fines and amounts paid in settlement, actually and reasonably incurred by him in connection with the action, suit or proceeding, if he acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interests of the corporation and with respect to any criminal action or proceeding had no reasonable cause to believe his conduct was unlawful.
To the extent that a director, officer, employee or agent has been successful on the merits or otherwise in defense of any action, suit or proceeding, or in defense of any claim, issue or matter, the Nevada Revised Statues provide that he must be indemnified by the Company against expenses, including attorney’s fees, actually and reasonably incurred by him in connection with the defense.
II-1
Table of Contents
Section 78.7502 of the Nevada Revised Statues also provides that any discretionary indemnification, unless ordered by a court or advanced by the Company, may be made only as authorized in the specific case upon a determination that indemnification of the director, officer, employee or agent is proper in the circumstances. The determination must be made: by the stockholders; by the Company’s Board of Directors by majority vote of a quorum consisting of directors who were not parties to that act, suit or proceeding; if a majority vote of a quorum consisting of directors who were not parties to the act, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion; or if a quorum consisting of directors who were not parties to the act, suit or proceeding cannot be obtained, by independent legal counsel in a written opinion.
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 in the successful defense of any action, suit, or proceeding) is asserted by such director, officer, or controlling person connected 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 it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Company pursuant to the foregoing provisions, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public policy and is, therefore, unenforceable.
Item 15. Recent Sales of Unregistered Securities.
In the three years preceding the filing of this registration statement, we have issued the following securities that were not registered under the Securities Act:
On October 13, 2023, the Company and certain investors entered into an amendment to a note and warrant purchase Agreement (the “Amendment”) and allonges to each of the notes issued thereunder, pursuant to which the Company issued to the purchasers additional warrants to purchase an aggregate of 531,250 shares of our common stock at an exercise price of $5.20 per share, subject to adjustment as provided therein (the “2023 Warrants”). The 2023 Warrants are exercisable at any time prior to the five-year anniversary of the initial exercise date of September 30, 2023. The Amendment entitles the Purchasers to registration rights with respect to the shares of our common stock issuable upon exercise of the 2023 Warrants pursuant to the existing Registration Rights Agreement, dated June 22, 2022, by and between the Company and the purchasers. The 2023 Warrants, and any shares issuable upon exercise of the 2023 Warrants, have not been registered under the Securities Act or applicable state securities laws and may not be offered or sold in the United States absent registration under the Securities Act or an exemption from such registration requirements.
On September 27, 2024, the Company entered into a securities purchase agreement with certain investors, pursuant to which the Company agreed to issue and sell an aggregate of 3,630,129 shares of our common stock, 1,369,871 pre-funded warrants to purchase shares of our common stock and warrants to purchase up to an aggregate of 5,000,000 shares of our common stock, for gross proceeds of up to $10 million. The combined purchase price of one share of our common stock and one accompanying warrant to purchase one share of our common stock was $2.00. The combined purchase price of one pre-funded warrant and one accompanying warrant to purchase one share of common stock under the Purchase Agreement was $1.999. The warrants have an exercise price of $2.00 per share of our common stock and the prefunded warrants have an exercise price of $0.001 per share of our common stock. The Company agreed to issue shares of our common stock, warrants, and pre-funded warrants in two tranches: (i) a first tranche comprised of 29,227 shares of our common stock, 555,302 pre-funded warrants, and warrants to purchase an aggregate of 584,529 shares of our common stock (collectively, the “First Tranche Securities”); and (ii) a second tranche comprised of 3,600,902 shares of our common stock, 814,569 pre-funded warrants, and warrants to purchase an aggregate of 4,415,471 shares of our common stock (collectively, the “Second Tranche Securities”). On September 27, 2024, in connection with the closing of the first tranche, the Company sold and issued the First Tranche Securities for gross proceeds of approximately $1.2 million. On November 12, 2024, in connection with the closing of the second tranche, the Company sold and issued the Second Tranche Securities for gross proceeds of approximately $8.8 million. The First Tranche Securities and Second Tranche Securities have not been registered under the Securities Act in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act.
In a concurrent private placement expected to be consummated upon the closing of the offering of the securities registered hereby, we have agreed to issue to affiliates of Bleichroeder L.P., 21 April Fund, L.P., and 21 April Fund, Ltd. (collectively, the “Note Holders”) a number of shares of our common stock determined based on a deemed issuance price per share equal to the public offering price per share to be sold in this offering, in exchange for the cancellation of $3.0 million of the aggregate principal amount of the senior promissory notes issued to the Note Holders on June 22, 2022, as amended on October 13, 2023 and March 26, 2025, pursuant to a debt cancellation agreement. The shares to be issued to the Note Holders have not been registered under the Securities Act nor are they being offered pursuant to this registration statement. The shares are being offered pursuant to the exemption provided in Section 4(a)(2) of the Securities Act and Rule 506(b) promulgated thereunder.
On May 22, 2026, the Company issued and sold 9.09% original issue discount promissory notes in an aggregate principal amount of $1,100,000 (the “OID Notes”) to affiliates of Bleichroeder L.P. and Laurence W. Lytton, pursuant to a note purchase agreement. The OID Notes were issued for a purchase price of $1,000,000, reflecting an original issue discount of $100,000. The OID Notes have a term of two months, maturing on July 22, 2026, constitute senior obligations of the Company, and do not bear interest prior to maturity. The OID Notes were offered and sold in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act and Rule 506(b) promulgated thereunder. No underwriter was involved in the transaction, and the Company did not engage in any general solicitation or advertising in connection with the sale.
II-2
Table of Contents
Item 16. Exhibits.
(a) Exhibits
The following documents are filed as exhibits to this registration statement:
Exhibit
No.
|
|
Description
|
|
Location
|
|
|
|
|
|
|
|
|
|
|
1.1
|
|
Form of Underwriting Agreement |
|
Filed herewith |
|
|
|
|
|
3.1
|
|
Articles of Incorporation, as amended as of November 13, 2023
|
|
Incorporated by reference to Exhibit 3.1 to the Company’s Annual Report on Form 10-K as filed with the SEC on March 22, 2024
|
|
|
|
|
|
3.2
|
|
Amended and Restated Bylaws
|
|
Incorporated by reference to Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q as filed with the SEC on May 14, 2025
|
|
|
|
|
|
4.1
|
|
Form of Pre-Funded Warrant
|
|
Incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K as filed with the SEC on June 2, 2020
|
|
|
|
|
|
4.2
|
|
Form of Amendment to Pre-Funded Warrant
|
|
Incorporated by reference to Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q as filed with the SEC on November 9, 2020
|
|
|
|
|
|
4.3
|
|
Description of our Common Stock
|
|
Incorporated by reference to Exhibit 4.3 to the Company’s Annual Report on Form 10-K as filed with the SEC on March 30, 2020
|
|
|
|
|
|
4.4
|
|
Form of Pre-Funded Warrant
|
|
Incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K as filed with the SEC on August 20, 2021
|
|
|
|
|
|
4.5
|
|
Form of Pre-Funded Warrant
|
|
Incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K as filed with the SEC on May 17, 2022
|
|
|
|
|
|
4.6
|
|
Form of Warrant
|
|
Incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K as filed with the SEC on October 19, 2023
|
|
|
|
|
|
4.7
|
|
Form of Pre-Funded Warrant
|
|
Incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K as filed with the SEC on September 27, 2024
|
II-3
Table of Contents
4.8
|
|
Form of Warrant
|
|
Incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K as filed with the SEC on September 27, 2024
|
|
|
|
|
|
4.9
|
|
Form of Amended and Restated Warrant
|
|
Included in Exhibit 10.17
|
|
|
|
|
|
4.10 |
|
Form of Underwriter Warrant |
|
Filed herewith |
|
|
|
|
|
4.11 |
|
Form of Pre-Funded Warrant |
|
Filed herewith |
|
|
|
|
|
5.1
|
|
Legal Opinion of Snell and Wilmer, L.L.P.
|
|
Filed herewith |
|
|
|
|
|
5.2 |
|
Legal Opinion of K&L Gates LLP |
|
Filed herewith |
|
|
|
|
|
10.1
|
|
Lease Agreement for Industriparken 22C, 2750 Ballerup, Denmark
|
|
Incorporated by reference to Exhibit 10.6 to the Company’s Current Report on Form 8-K/A as filed with the SEC on November 15, 2011 (translated in English)
|
|
|
|
|
|
10.2
|
|
Form of Registration Rights Agreement, by and among the Company and the investors named therein
|
|
Incorporated by reference to Exhibit 10.2 to the Company’s Form 8-K as filed with the SEC on June 2, 2020
|
|
|
|
|
|
10.3
|
|
Lease Contract for Benshoej Industrivej 24, 9500 Hobro
|
|
Incorporated by reference to Exhibit 10.1 to the Company’s Form 8-K as filed with the SEC on December 5, 2019
|
|
|
|
|
|
10.4*
|
|
LiqTech International, Inc. 2013 Share Incentive Plan
|
|
Incorporated by reference to Exhibit 99.1 to the Company’s Form S-8 as filed with the SEC on January 27, 2014
|
|
|
|
|
|
10.5
|
|
Note and Warrant Purchase Agreement, by and among the Company and the Purchasers
|
|
Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the SEC on June 27, 2022
|
|
|
|
|
|
10.6
|
|
Form of Note
|
|
Incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K as filed with the SEC on June 27, 2022
|
|
|
|
|
|
10.7
|
|
Registration Rights Agreement, by and among the Company and the Purchasers
|
|
Incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K as filed with the SEC on June 27, 2022
|
|
|
|
|
|
10.8
|
|
First Amendment to Note and Warrant Purchase Agreement
|
|
Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 19, 2023
|
|
|
|
|
|
10.9
|
|
Form of Allonge No. 1
|
|
Included in Exhibit 10.8 |
II-4
Table of Contents
10.10*
|
|
Executive Service Agreement, dated July 26, 2022, by and between LiqTech Holdings A/S and Fei Chen
|
|
Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the SEC on August 1, 2022
|
|
|
|
|
|
10.11*
|
|
LiqTech International, Inc. 2022 Equity Incentive Plan
|
|
Incorporated by reference to Annex A to the Company’s Proxy Statement pursuant to Section 14(a) of the Exchange Act filed with the SEC on October 3, 2022
|
|
|
|
|
|
10.12
|
|
Exclusivity Agreement for Collaboration, Marketing and Deployment of Products and Associated Services, dated November 11, 2022, by and between the Company and NESR
|
|
Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the SEC on November 17, 2022
|
|
|
|
|
|
10.13 †
|
|
Securities Purchase Agreement, by and among the Company and the investors named therein
|
|
Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the SEC on September 27, 2024
|
|
|
|
|
|
10.14
|
|
Registration Rights Agreement, by and among the Company and the investors named therein
|
|
Incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K as filed with the SEC on September 27, 2024
|
|
|
|
|
|
10.15*
|
|
Service Agreement between Liqtech Holding A/S and David Kowalczyk, dated January 27, 2025.
|
|
Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the SEC on January 31, 2025
|
|
|
|
|
|
10.16*
|
|
Separation Agreement between Liqtech Holding A/S and Phillip Massie Price, dated March 20, 2025
|
|
Incorporated by reference to Exhibit 10.18 to the Company’s Annual Report on Form 10-K as filed with the SEC on March 28, 2025
|
|
|
|
|
|
10.17
|
|
Second Amendment to Note and Warrant Purchase Agreement
|
|
Incorporated by reference to Exhibit 10.19 to the Company’s Annual Report on Form 10-K as filed with the SEC on March 28, 2025
|
|
|
|
|
|
10.18
|
|
Form of Allonge No. 2
|
|
Included in Exhibit 10.17
|
II-5
Table of Contents
10.19*
|
|
Amendment No. 1 to LiqTech International, Inc. 2022 Equity Incentive Plan, as approved by the Company’ s stockholders on June 5, 2025
|
|
Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K as filed with the SEC on June 6, 2025
|
|
|
|
|
|
10.20 |
|
Form of Debt Cancellation Agreement |
|
Filed herewith |
|
|
|
|
|
10.21 |
|
Note Purchase Agreement, by and among the Company and the Investors, dated May 22, 2026 |
|
Incorporated herein by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K as filed with the SEC on May 26, 2026 |
|
|
|
|
|
10.22 |
|
Form of Note |
|
Incorporated herein by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K as filed with the SEC on May 26, 2026 |
|
|
|
|
|
21.1
|
|
List of Subsidiaries
|
|
Incorporated herein by reference to Exhibit 21.1 to the Company’s Annual Report on Form 10-K, filed with the SEC on March 28, 2025 |
|
|
|
|
|
23.1
|
|
Consent of Sadler, Gibb
|
|
Filed herewith
|
|
|
|
|
|
107
|
|
Filing Fee Table
|
|
Filed herewith |
*
|
Denotes a management contract or compensatory plan or arrangement.
|
|
|
†
|
Schedules and similar attachments to this Exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company agrees to furnish supplementally a copy of such omitted materials to the SEC upon request.
|
(b) Financial Statement Schedules
All schedules have been omitted because the information required to be set forth in the schedules is either not applicable or is shown in the financial statements or notes thereto.
Item 17. Undertakings.
The undersigned registrant hereby undertakes:
(a)(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by section 10(a)(3) of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the SEC pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of Filing Fee Tables” or “Calculation of Registration Fee” table, as applicable, in the effective registration statement; and
II-6
Table of Contents
(iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.
provided, however , that paragraphs (1)(i), (1)(ii) and (1)(iii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the SEC by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in the registration statement, or is contained in a form of prospectus filed pursuant to Rule 424(b) that is part of the registration statement.
|
(2)
|
That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
|
(3)
|
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of this offering.
|
|
(4)
|
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 this offering required to be filed pursuant to Rule 424;
|
|
(ii)
|
Any free writing prospectus relating to this 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 this 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 this offering made by the undersigned registrant to the purchaser.
|
(b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to section 13(a) or section 15(d) of the Exchange Act (and, where applicable, each filing of an employee benefit plan's annual report pursuant to section 15(d) of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c) The undersigned registrant hereby undertakes that:
|
(1)
|
For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.
|
|
(2)
|
For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and this offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
|
(d) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.
II-7
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Ballerup, Denmark, on the 26th day of May, 2026.
|
LIQTECH INTERNATIONAL, INC.
|
|
|
|
By:
|
/s/ Fei Chen
|
|
|
Fei Chen
|
|
|
Chief Executive Officer and Principal Executive Officer
|
POWER OF ATTORNEY
Each of the undersigned officers and directors of LiqTech International, Inc. hereby severally constitutes and appoints Fei Chen and David Kowalczyk, and each of them singly (with full power to each of them to act alone), as his or her true and lawful attorney-in-fact and agents, with full power of substitution and re-substitution in each of them, for him or her and in his or her name, place and stead, and in any and all capacities, to file and sign any and all amendments, including post-effective amendments, to this registration statement and any other registration statement for the same offering that is to be effective under Rule 462(b) of the Securities Act of 1933, and to file the same, with all exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith and about the premises as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof. This power of attorney shall be governed by and construed with the laws of the State of Nevada and applicable federal securities laws.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.
SIGNATURE
|
|
TITLE
|
|
DATE
|
|
|
|
|
|
/s/ Fei Chen
|
|
Chief Executive Officer and Director
|
|
May 26, 2026
|
Fei Chen
|
|
(Principal executive officer)
|
|
|
|
|
|
|
|
/s/ David Noerby Foss Kowalcyzk
|
|
Chief Financial Officer and Chief Operating Officer
|
|
May 26, 2026 |
David Noerby Foss Kowalcyzk
|
|
(Principal financial and accounting officer)
|
|
|
|
|
|
|
|
/s/ Alexander Buehler
|
|
Chairman of the Board of Directors
|
|
May 26, 2026 |
Alexander Buehler
|
|
|
|
|
|
|
|
|
|
/s/ Peyton Boswell
|
|
Director
|
|
May 26, 2026 |
Peyton Boswell
|
|
|
|
|
|
|
|
|
|
/s/ Martin Kunz
|
|
Director
|
|
May 26, 2026 |
Martin Kunz
|
|
|
|
|
|
|
|
|
|
/s/ Robert Wowk
|
|
Director
|
|
May 26, 2026 |
Robert Wowk
|
|
|
|
|
II-8
### EX-4.10 - EXHIBIT 4.10
EX-4.10
3
ex_965296.htm
EXHIBIT 4.10
ex_965296.htm
Exhibit 4.10
UNDERWRITER ’ S COMMON STOCK PURCHASE WARRANT
LIQTECH INTERNATIONAL, INC.
Warrant Shares: _______ |
Initial Exercise Date: |
Issue Date:
THIS UNDERWRITER’S COMMON STOCK PURCHASE WARRANT (the “ Warrant ”) certifies that, for value received, _____________ or its assigns (the “ Holder ”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time or times on or after, 2026 1 (the “ Initial Exercise Date ”) and on or prior to 5:00 p.m. (New York City time) on, 2029 (the “ Termination Date ”) but not thereafter, to subscribe for and purchase from LiqTech International, Inc., a Nevada corporation (the “ Company ”), up to ______ 2 shares of common stock (as subject to adjustment hereunder, the “ Warrant Shares ”). The purchase price of one share of common stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b) . This Warrant is being issued pursuant to that certain Underwriting Agreement, dated as of, 2026, by and between the Company and Konik Capital Partners LLC, a division of T.R. Winston & Company, LLC (the “ Underwriting Agreement ”).
Section 1 . Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings set forth in the Underwriting Agreement.
Section 2 . Exercise.
(a) Exercise of Warrant . Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company of a duly executed facsimile copy or PDF copy submitted by e-mail (or e-mail attachment) of the Notice of Exercise in the form annexed hereto as Exhibit A (the “ Notice of Exercise ”). Within the earlier of (i) one (1) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the aggregate Exercise Price for the number of Warrant Shares specified in the applicable Notice of Exercise by wire transfer of immediately available funds or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. The Company may reasonably rely on the authenticity of the information provided by the Holder in the Notice of Exercise and shall have no obligation to inquire with respect to or otherwise confirm the authenticity of the signature(s) contained on any Notice of Exercise nor the authority of the person so executing such Notice of Exercise. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, at which time, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares available hereunder by the number of Warrant Shares equal to the applicable number of Warrant Shares purchased in connection with such partial exercise. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Trading Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
1 Note to Draft: The warrants are immediately exercisable but they will be subject to a 180 day lock up period. The term of the warrant is 3 years.
2 Note to Draft: To be 4% of the common stock sold in the offering.
(b) Exercise Price . The exercise price per share of common stock under this Warrant shall be $ 3 , subject to adjustment hereunder (the “ Exercise Price ”).
(c) Cashless Exercise . Notwithstanding anything to the contrary set forth herein, if at the time of exercise hereof there is no effective registration statement registering, or the prospectus contained therein is not available for the issuance of, the Warrant Shares to the Holder, then this Warrant may only be exercised, in whole or in part, at such time by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by multiplying (X) by [(A-B)/ (A)], where:
(A) = the Fair Market Value
(B) = the Exercise Price of this Warrant, as adjusted hereunder; and
(X) = the number of Warrant Shares with respect to which this Warrant is being exercised.
If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c) .
“ Fair Market Value ” means the closing price of the Common Stock as reported by the Nasdaq Capital Market, or if listed on another national securities exchange or quoted on an automated quotation service, such national securities exchange or automated quotation service, on the date immediately prior to the Exercise Date. If the Common Stock is not then listed on a national stock exchange or quoted on any other quotation system or association, the Fair Market Value of one share of Common Stock as of the date of determination, shall be as determined in good faith by the Board of Directors of the Company and the Holder. If the Common Stock is not then listed on a national securities exchange, the OTC Bulletin Board or such other quotation system or association, the Board of Directors of the Company shall respond promptly, in writing, to an inquiry by the Holder prior to the exercise hereunder as to the fair market value of a share of Common Stock as determined by the Board of Directors of the Company. In the event that the Board of Directors of the Company and the Holder are unable to agree upon the fair market value, the Company and the Holder shall jointly select an appraiser, who is experienced in such matters. The decision of such appraiser shall be final and conclusive, and the cost of such appraiser shall be borne equally by the Company and the Holder. Such adjustment shall be made successively whenever such a payment date is fixed.
3 To be 125% of the public offering price per share.
2
“ Trading Day ” means any day on which the Trading Market is open for trading, including any day on which the Trading Market is open for trading for a period of time less than the customary time.
(d) Mechanics of Exercise .
i. Delivery of Warrant Shares Upon Exercise . Warrant Shares purchased hereunder shall be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian System (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) the Warrant Shares are eligible for resale by the Holder without volume or manner-of-sale limitations pursuant to Rule 144, and otherwise by physical delivery of a certificate or evidence that the Warrant Shares have been electronically issued in “book-entry” form, in each case, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that the earliest of (i) two (2) Trading Days after the delivery to the Company of the Notice of Exercise, (ii) is one (1) Trading Day after delivery of the aggregate Exercise Price to the Company, and (iii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “Warrant Share Delivery Date”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received by the Warrant Share Delivery Date. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the Fair Market Value on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third Trading Day after the Warrant Share Delivery Date) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent (the “Transfer Agent”) that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “Standard Settlement Period” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. Nothwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 9:00 a.m. (New York City time) on the Initial Exercise Date, which may be delivered at any time after the execution of the Underwriting Agreement, the Company agrees to deliver, or cause to be delivered, the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date, and the Initial Exercise Date shall b e the Warrant Share Delivery Date for purposes hereunder, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received by such Warrant Share Delivery Date. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time will be less than the amount stated on the face hereof.
3
ii. Delivery of New Warrants Upon Exercise . If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.
iii. Rescission Rights . If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
iv. Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise . In addition to any other rights available to the Holder, if the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) above pursuant to an exercise on or before the Warrant Share Delivery Date, and if after such date the Holder is required by its broker to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, common stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder anticipated receiving upon such exercise (a “ Buy-In ”), then the Company shall (A) pay in cash to the Holder the amount, if any, by which (x) the Holder’s total purchase price (including brokerage commissions, if any) for the Warrant Shares so purchased exceeds (y) the amount obtained by multiplying (1) the number of Warrant Shares that the Company was required to deliver to the Holder in connection with the exercise at issue times (2) the price at which the sell order giving rise to such purchase obligation was executed, and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of common stock that would have been issued had the Company timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases shares of common stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of Warrants with an aggregate sale price giving rise to such purchase obligation of $10,000, under clause (A) of the immediately preceding sentence the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence satisfactory to the Company with respect to the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver Warrant Shares upon exercise of the Warrant as required pursuant to the terms hereof.
4
v. No Fractional Shares or Scrip . No fractional Warrant Shares or scrip representing fractional Warrant Shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election and in lieu of the issuance of such fractional Warrant Share, either (i) pay cash in an amount equal to such fraction multiplied by the Exercise Price or (ii) round up to the next whole Warrant Share.
vi. Charges, Taxes and Expenses . The issuance and delivery of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that, in the event that Warrant Shares are to be issued in a name other than the name of the Holder, the Notice of Exercise shall be accompanied by the Assignment Form, attached hereto as Exhibit B , duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto and this Warrant shall be surrendered to the Company and, if any portion of this Warrant remains unexercised, a new Warrant in the form hereof shall be delivered to the assignee. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
vii. Closing of Books . The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.
(e) Holder ’ s Exercise Limitations . The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise all or any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance upon exercise as set forth on the applicable Notice of Exercise, the Holder (together with (i) the Holder’s Affiliates, (ii) any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates, and (iii) any other Persons whose beneficial ownership of the shares of common stock would or could be aggregated with the Holder’s for the purposes of Section 13(d) (such Persons, “ Attribution Parties ”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of common stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of shares of common stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of the Warrant Shares which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e) , beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e) , in determining the number of outstanding shares of common stock, a Holder may rely on the number of outstanding shares of common stock as reflected in (X) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (Y) a more recent public announcement by the Company or (Z) a more recent written notice by the Company or the Transfer Agent setting forth the number of shares of common stock outstanding. Upon the written or oral request of a Holder, the Company shall within one Trading Day confirm orally and in writing to the Holder the number of shares of common stock then outstanding. In any case, the number of outstanding shares of common stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of common stock was reported. The “ Beneficial Ownership Limitation ” shall be 4.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of Warrant Shares issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e) , provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of common stock outstanding immediately after giving effect to the issuance of Warrant Shares upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
5
Section 3 . Certain Adjustments.
(a) Stock Dividends and Splits . If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of common stock or any other equity or equity equivalent securities payable in shares of common stock (which, for avoidance of doubt, shall not include any Warrant Shares issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of common stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of common stock into a smaller number of shares, or (iv) issues by reclassification of shares of common stock into shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of common stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of common stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant remains unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or reclassification.
(b) Subsequent Rights Offerings . In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells any Common Stock Equivalents or rights to purchase stock, warrants, securities or other property pro rata to the record holders of any class of common stock (the “ Purchase Rights ”), then the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of common stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of common stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, that, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of common stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
6
(c) Pro Rata Distributions . During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of common stock, by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “ Distribution ”), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of common stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of common stock are to be determined for the participation in such Distribution (provided, however, that, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of common stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
(d) Fundamental Transaction . If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company (or any Subsidiary), directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of the Company’s assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of shares of common stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding common stock of the Company, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of shares of common stock or any compulsory share exchange pursuant to which the shares of common stock are effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off, merger or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the voting power of the common stock of the Company (each a “ Fundamental Transaction ”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of common stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “ Alternate Consideration ”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of common stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of common stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of shares of common stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it will receive upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “ Successor Entity ”) to assume in writing all of the obligations of the Company under this Warrant and the other Transaction Documents in accordance with the provisions of this Section 3(d) pursuant to written agreements in form and substance reasonably satisfactory to the Holder prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of common stock of such Successor Entity (or its parent entity) equivalent to the shares of common stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the common stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant and the other Transaction Documents referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant and the other Transaction Documents with the same effect as if such Successor Entity had been named as the Company herein.
7
(e) Calculations . All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share of common stock, as the case may be. For purposes of this Section 3 , the number of shares of common stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of common stock (excluding treasury shares, if any) issued and outstanding.
(f) Notice to Holder .
i. Adjustment to Exercise Price . Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3 , the Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
ii. Notice to Allow Exercise by Holder . If (A) the Company declares a dividend (or any other distribution in whatever form) on the common stock, (B) the Company declares a special nonrecurring cash dividend on or a redemption of the common stock, (C) the Company authorizes the granting to all holders of the shares of common stock rights or warrants to subscribe for or purchase any shares of common stock of any class or of any rights, (D) the approval of any shareholders of the Company is required in connection with a Fundamental Transaction, or (E) the Company authorizes the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least five (5) Trading Days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the shares of common stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the shares of common stock of record shall be entitled to exchange their shares of common stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice. To the extent that any notice provided in this Warrant constitutes, or contains, material, non-public information regarding the Company or any of the Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Holder shall remain entitled to exercise this Warrant during the period commencing on the date of such notice to the effective date of the event triggering such notice except as may otherwise be expressly set forth herein.
8
Section 4 . Transfer of Warrant.
(a) Transferability .
i. Pursuant to FINRA Rule 5110(e)(1), neither this Warrant nor any Warrant Shares issued upon exercise of this Warrant shall be sold, transferred, assigned, pledged, or hypothecated, or be the subject of any hedging, short sale, derivative, put, or call transaction that would result in the effective economic disposition of the securities by any person for a period of one hundred and eighty (180) days immediately following the commencement of sales of the offering pursuant to which this Warrant is being issued, except the transfer of any security:
(1) by operation of law or by reason of reorganization of the Company;
(2) to any FINRA member firm participating in the offering and the officers or partners thereof, if all securities so transferred remain subject to the lock-up restriction in this Section 4(a) for the remainder of the one hundred and eighty (180) day time period specified above;
9
(3) if the aggregate amount of securities of the Company beneficially owned by the Holder or related person does not exceed one percent (1%) of the securities being offered;
(4) that is beneficially owned on a pro-rata basis by all equity owners of an investment fund, provided that no participating member manages or otherwise directs investments by the fund, and participating members in the aggregate do not own more than ten percent (10%) of the equity in the fund;
(5) the exercise or conversion of any security, if all securities received remain subject to the lock-up restriction in this Section 4(a)(i) for the remainder of the one hundred and eighty (180) day time period specified above; or
(6) the transfer or sale of any security back to the Company in a transaction exempt from registration with the Securities and Exchange Commission.
ii. During the one (1) year period following the Closing Date, the Underwriter will not transfer the Warrants or the Warrant Shares, except to the Underwriter’s officers, partners or members of the selling group.
For the avoidance of doubt, the Holder shall bear any reasonable costs or expenses in connection with any permitted transfer of this Warrant.
(b) New Warrants . This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a) , as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the initial issuance date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto. For the avoidance of doubt, the Holder shall bear any reasonable costs or expenses in connection with the issuance of any new Warrant.
(c) Warrant Register . The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “ Warrant Register ”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.
Section 5 . Miscellaneous.
(a) No Rights as Stockholder Until Exercise; No Settlement in Cash . This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i) , except as expressly set forth in Section 3 . Without limiting any rights of a Holder to receive Warrant Shares on a “cashless exercise” pursuant to Section 2(c) or to receive cash payments pursuant to Section 2(d)(i) and Section 2(d)(iv) herein, in no event shall the Company be required to net cash settle an exercise of this Warrant.
10
(b) Loss, Theft, Destruction or Mutilation of Warrant . The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate. For the avoidance of doubt, the Holder shall bear any reasonable costs or expenses in connection with the making or delivery of a new Warrant or stock certificate.
(c) Saturdays, Sundays, Holidays, etc . If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Trading Day, then such action may be taken or such right may be exercised on the next succeeding Trading Day.
(d) Authorized Shares . The Company covenants that, during the period the Warrant is outstanding, it will reserve from its authorized and unissued shares of common stock a sufficient number of shares to provide for the issuance of the Warrant Shares underlying this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued, and the Warrant Shares, delivered, as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the common stock may be listed. The Company covenants that all Warrant Shares underlying this Warrant, which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any common stock above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable shares of common stock upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
11
Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.
(e) Jurisdiction . All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be determined in accordance with the provisions of the Underwriting Agreement.
(f) Restrictions . The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and if the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
(g) Nonwaiver and Expenses . No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this Warrant, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
(h) Notices . Any notice, request or other document required or permitted to be given or delivered to the Holder by the Company shall be delivered in accordance with the notice provisions of the Underwriting Agreement.
(i) Limitation of Liability . No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any common stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
(j) Remedies . The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.
12
(k) Successors and Assigns . Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.
(l) Amendment . This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.
(m) Severability . Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
(n) Headings . The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
********************
(Signature Page Follows)
13
Exhibit 4.10
IN WITNESS WHEREOF, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
LIQTECH INTERNATIONAL, INC.
|
|
|
|
|
|
By:
|
|
|
|
Name:
|
|
|
|
Title:
|
|
EXHIBIT A
NOTICE OF EXERCISE
TO: LIQTECH INTERNATIONAL, INC.
(1) The undersigned hereby elects to purchase ________ Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
(2) Payment shall take the form of (check applicable box):
[] in lawful money of the United States; or
[] if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).
(3) Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
|
|
|
|
The Warrant Shares shall be delivered to:
|
|
|
[SIGNATURE OF HOLDER]
|
|
|
|
Name of Investing Entity:
|
|
|
|
Signature of Authorized Signatory of Investing Entity:
|
|
|
|
Name of Authorized Signatory
|
|
|
|
Title of Authorized Signature:
|
|
|
|
Date
|
|
EXHIBIT B
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name:
|
|
|
(Please Print)
|
|
|
Address:
|
|
|
(Please Print)
|
|
|
Phone Number
|
|
|
|
Email Address:
|
|
|
|
Dated: _______________ ____, _______
|
|
|
|
Holder’s Signature
|
|
|
|
Holder’s Address
|
|
|
|
### EX-4.11 - EXHIBIT 4.11
EX-4.11
4
ex_965222.htm
EXHIBIT 4.11
ex_965222.htm
Exhibit 4.11
PRE-FUNDED COMMON STOCK PURCHASE WARRANT
LIQTECH INTERNATIONAL, INC.
Warrant Shares: [ ] |
Initial Exercise Date: [ ], 2026
Issue Date: [ ], 2026
|
THIS PRE-FUNDED WARRANT TO PURCHASE COMMON STOCK (the “ Warrant ”) certifies that, for value received, [ ] or its assigns (the “ Holder ”) is entitled, upon the terms and subject to the limitations on exercise and the conditions hereinafter set forth, at any time on or after [ ], 2026 (the “ Initial Exercise Date ”) until this Warrant is exercised in full (the “ Termination Date ”) but not thereafter, to subscribe for and purchase from LiqTech International, Inc., a Nevada corporation (the “ Company ”), up to [ ] shares (as subject to adjustment hereunder, the “ Warrant Shares ”) of Common Stock. The purchase price of one share of Common Stock under this Warrant shall be equal to the Exercise Price, as defined in Section 2(b).
1. Definitions . Capitalized terms used and not otherwise defined herein shall have the meanings set forth in that certain Underwriting Agreement (the “Underwriting Agreement”), dated [●], 2026, between the Company and Konik Capital Partners LLC, a division of T.R. Winston & Company, LLC, as the underwriter. In addition to the terms defined in the Underwriting Agreement and elsewhere in this Warrant, the following terms have the meanings indicated in this Section 1:
“ Affiliate ” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used in and construed under Rule 405 under the Securities Act.
“ Bid Price ” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the bid price of the Common Stock for the time in question (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the “ Pink Sheets ” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
“ Business Day ” means any day except any Saturday, any Sunday, any day which is a federal legal holiday in the United States or any day on which banking institutions in the State of New York are authorized or required by law or other governmental action to close.
“ Commission ” means the United States Securities and Exchange Commission.
“ Common Stock ” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such securities may hereafter be reclassified or changed.
“ Common Stock Equivalents ” means any securities of the Company or any subsidiaries of the Company which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“ Person ” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“ Trading Day ” means a day on which the Common Stock is traded on a Trading Market.
“ Trading Market ” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market or the New York Stock Exchange (or any successors to any of the foregoing).
“ Transfer Agent ” means Securities Transfer Corporation, the current transfer agent of the Company with a mailing address of 2901 N. Dallas Parkway, Suite 380, Plano, TX 75093 and a telephone number of 469.633.0101, and any successor transfer agent of the Company.
“ VWAP ” means, for any date, the price determined by the first of the following clauses that applies: (a) if the Common Stock is then listed or quoted on a Trading Market, the daily volume weighted average price of the Common Stock for such date (or the nearest preceding date) on the Trading Market on which the Common Stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)), (b) if OTCQB or OTCQX is not a Trading Market, the volume weighted average price of the Common Stock for such date (or the nearest preceding date) on OTCQB or OTCQX as applicable, (c) if the Common Stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the Common Stock are then reported in the “Pink Sheets” published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the most recent bid price per share of the Common Stock so reported, or (d) in all other cases, the fair market value of a share of Common Stock as determined by an independent appraiser selected in good faith by the Holders of a majority in interest of the Warrants then outstanding and reasonably acceptable to the Company, the fees and expenses of which shall be paid by the Company.
|
2.
|
Exercise .
|
(a) Exercise of Warrants . Exercise of the purchase rights represented by this Warrant may be made, in whole or in part, at any time or times on or after the Initial Exercise Date and on or before the Termination Date by delivery to the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Holder at the address of the Holder appearing on the books of the Company) of a duly executed facsimile copy (or e-mail attachment) of the Notice of Exercise in the form annexed hereto (the “ Notice of Exercise ”). Within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period (as defined in Section 2(d)(i) herein) following the date of exercise as aforesaid, the Holder shall deliver the unpaid portion of the aggregate Exercise Price to the Company for the Warrant Shares specified in the applicable Notice of Exercise by wire transfer or cashier’s check drawn on a United States bank unless the cashless exercise procedure specified in Section 2(c) below is specified in the applicable Notice of Exercise. No ink-original Notice of Exercise shall be required, nor shall any medallion guarantee (or other type of guarantee or notarization) of any Notice of Exercise be required. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company until the Holder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which case, the Holder shall surrender this Warrant to the Company for cancellation within three (3) Trading Days of the date on which the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Holder and the Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases. The Company shall deliver any objection to any Notice of Exercise within one (1) Business Day of receipt of such notice. The Holder and any assignee, by acceptance of this Warrant, acknowledge and agree that, by reason of the provisions of this paragraph, following the purchase of a portion of the Warrant Shares hereunder, the number of Warrant Shares available for purchase hereunder at any given time may be less than the amount stated on the face hereof.
2
Without limiting the rights of a Holder to receive Warrant Shares on a “cashless exercise” and without limiting the liquidated damages provision in Section 2(d)(i) and the buy-in provision in Section 2(d)(iv), in no event will the Company be required to net cash settle a Warrant exercise.
(b) Exercise Price . The aggregate exercise price of this Warrant, except for a nominal exercise price of $0.001 per Warrant Share, was pre-funded to the Company on or prior to the Initial Exercise Date and no additional consideration (other than the nominal exercise price of $0.001 per Warrant Share) shall be required to be paid by the Holder to any Person to effect any exercise of this Warrant. The remaining unpaid exercise price per Warrant Share under this Warrant shall be $0.001 subject to adjustment hereunder (the “ Exercise Price ”).
(c) Cashless Exercise . This Warrant may be exercised, in whole or in part, by means of a “cashless exercise” in which the Holder shall be entitled to receive a number of Warrant Shares equal to the quotient obtained by dividing [(A-B) (C)] by (A), where:
(A) = as applicable: (i) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise if such Notice of Exercise is (1) both executed and delivered pursuant to Section 2(a) hereof on a day that is not a Trading Day or (2) both executed and delivered pursuant to Section 2(a) hereof on a Trading Day prior to the opening of “regular trading hours” (as defined in Rule 600(b)(64) of Regulation NMS promulgated under the federal securities laws) on such Trading Day, (ii) at the option of the Holder, either (y) the VWAP on the Trading Day immediately preceding the date of the applicable Notice of Exercise or (z) the Bid Price of the Common Stock on the principal Trading Market as reported by Bloomberg L.P. as of the time of the Holder’s execution of the applicable Notice of Exercise if such Notice of Exercise is executed during “regular trading hours” on a Trading Day and is delivered within two (2) hours thereafter (including until two (2) hours after the close of “regular trading hours” on a Trading Day) pursuant to Section 2(a) hereof or (iii) the VWAP on the date of the applicable Notice of Exercise if the date of such Notice of Exercise is a Trading Day and such Notice of Exercise is both executed and delivered pursuant to Section 2(a) hereof after the close of “regular trading hours” on such Trading Day;
(B) = the Exercise Price, as adjusted hereunder; and
(C) = the number of Warrant Shares that would be issuable upon exercise of this Warrant in accordance with the terms of this Warrant if such exercise were by means of a cash exercise rather than a cashless exercise.
If Warrant Shares are issued in such a cashless exercise, the parties acknowledge and agree that in accordance with Section 3(a)(9) of the Securities Act, the Warrant Shares shall take on the registered characteristics of the Warrants being exercised. The Company agrees not to take any position contrary to this Section 2(c).
(d) Mechanics of Exercise .
(i) Delivery of Warrant Shares Upon Exercise . The Company shall cause the Warrant Shares purchased hereunder to be transmitted by the Transfer Agent to the Holder by crediting the account of the Holder’s or its designee’s balance account with The Depository Trust Company through its Deposit or Withdrawal at Custodian system (“ DWAC ”) if the Transfer Agent is then a participant in such system and either (A) there is an effective registration statement permitting the issuance of the Warrant Shares to or resale of the Warrant Shares by the Holder or (B) this Warrant is being exercised via cashless exercise and otherwise by physical delivery of a certificate, registered in the Company’s share register in the name of the Holder or its designee, for the number of Warrant Shares to which the Holder is entitled pursuant to such exercise to the address specified by the Holder in the Notice of Exercise by the date that is the earlier of (i) the earlier of (A) two (2) Trading Days after the delivery to the Company of the Notice of Exercise and (B) one (1) Trading Day after delivery of the aggregate Exercise Price to the Company and (ii) the number of Trading Days comprising the Standard Settlement Period after the delivery to the Company of the Notice of Exercise (such date, the “ Warrant Share Delivery Date ”). Upon delivery of the Notice of Exercise, the Holder shall be deemed for all corporate purposes to have become the holder of record of the Warrant Shares with respect to which this Warrant has been exercised, irrespective of the date of delivery of the Warrant Shares, provided that payment of the aggregate Exercise Price (other than in the case of a cashless exercise) is received within the earlier of (i) two (2) Trading Days and (ii) the number of Trading Days comprising the Standard Settlement Period following delivery of the Notice of Exercise. If the Company fails for any reason to deliver to the Holder the Warrant Shares subject to a Notice of Exercise by the Warrant Share Delivery Date, the Company shall pay to the Holder, in cash, as liquidated damages and not as a penalty, for each $1,000 of Warrant Shares subject to such exercise (based on the VWAP of the Common Stock on the date of the applicable Notice of Exercise), $10 per Trading Day (increasing to $20 per Trading Day on the third (3 rd ) Trading Day after such liquidated damages begin to accrue) for each Trading Day after such Warrant Share Delivery Date until such Warrant Shares are delivered or Holder rescinds such exercise. The Company agrees to maintain a transfer agent that is a participant in the FAST program so long as this Warrant remains outstanding and exercisable. As used herein, “ Standard Settlement Period ” means the standard settlement period, expressed in a number of Trading Days, on the Company’s primary Trading Market with respect to the Common Stock as in effect on the date of delivery of the Notice of Exercise. Notwithstanding the foregoing, with respect to any Notice(s) of Exercise delivered on or prior to 12:00 p.m. (New York City time) on the Initial Exercise Date, which may be delivered at any time after the time of execution of the Underwriting Agreement, the Company agrees to deliver the Warrant Shares subject to such notice(s) by 4:00 p.m. (New York City time) on the Initial Exercise Date.
3
(ii) Delivery of New Warrants Upon Exercise . If this Warrant shall have been exercised in part, the Company shall, at the request of a Holder and upon surrender of this Warrant certificate, at the time of delivery of the Warrant Shares, deliver to the Holder a new Warrant evidencing the rights of the Holder to purchase the unpurchased Warrant Shares called for by this Warrant, which new Warrant shall in all other respects be identical with this Warrant.
(iii) Rescission Rights . If the Company fails to cause the Transfer Agent to transmit to the Holder the Warrant Shares pursuant to Section 2(d)(i) by the Warrant Share Delivery Date, then the Holder will have the right to rescind such exercise.
(iv) Compensation for Buy-In on Failure to Timely Deliver Warrant Shares Upon Exercise . In addition to any other rights available to the Holder, if the Company fails for any reason to deliver to the Holder the Warrant Shares in accordance with the provisions of Section 2(d)(i) by the third Trading Day following the Warrant Share Delivery Date, and if after such Warrant Share Delivery Date the Holder is required by its brokerage firm to purchase (in an open market transaction or otherwise) or the Holder’s brokerage firm otherwise purchases, shares of Common Stock to deliver in satisfaction of a sale by the Holder of the Warrant Shares which the Holder was entitled to receive upon the exercise relating to such Warrant Share Delivery Date (a “ Buy-In ”), then the Company shall (A) pay in cash to the Holder (in addition to any other remedies available to or elected by the Holder) the amount, if any, by which (x) the Holder’s total purchase price (including any brokerage commissions) for the Common Stock so purchased exceeds (y) the product of (1) the aggregate number of Warrant Shares that the Holder was entitled to receive from the exercise at issue multiplied by (2) the actual sale price at which the sell order giving rise to such purchase obligation was executed (including any brokerage commissions), and (B) at the option of the Holder, either reinstate the portion of the Warrant and equivalent number of Warrant Shares for which such exercise was not honored (in which case such exercise shall be deemed rescinded) or deliver to the Holder the number of shares of Common Stock that would have been issued if the Company had timely complied with its exercise and delivery obligations hereunder. For example, if the Holder purchases Common Stock having a total purchase price of $11,000 to cover a Buy-In with respect to an attempted exercise of shares of Common Stock with respect to which the actual sale price of the Warrant Shares (including any brokerage commissions) giving rise to such purchase obligation was a total of $10,000 under clause (A) of the immediately preceding sentence, the Company shall be required to pay the Holder $1,000. The Holder shall provide the Company written notice indicating the amounts payable to the Holder in respect of the Buy-In and, upon request of the Company, evidence of the amount of such loss. Nothing herein shall limit a Holder’s right to pursue any other remedies available to it hereunder, at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief with respect to the Company’s failure to timely deliver shares of Common Stock upon exercise of the Warrant as required pursuant to the terms hereof.
(v) No Fractional Shares or Scrip . No fractional shares or scrip representing fractional shares shall be issued upon the exercise of this Warrant. As to any fraction of a share which the Holder would otherwise be entitled to purchase upon such exercise, the Company shall, at its election, either pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Exercise Price or round up to the next whole share.
4
(vi) Charges, Taxes and Expenses . Issuance of Warrant Shares shall be made without charge to the Holder for any issue or transfer tax or other incidental expense in respect of the issuance of such Warrant Shares, all of which taxes and expenses shall be paid by the Company, and such Warrant Shares shall be issued in the name of the Holder or in such name or names as may be directed by the Holder; provided, however, that in the event that Warrant Shares are to be issued in a name other than the name of the Holder, this Warrant when surrendered for exercise shall be accompanied by the Assignment Form attached hereto duly executed by the Holder and the Company may require, as a condition thereto, the payment of a sum sufficient to reimburse it for any transfer tax incidental thereto. The Company shall pay all Transfer Agent fees required for same-day processing of any Notice of Exercise and all fees to the Depository Trust Company (or another established clearing corporation performing similar functions) required for same-day electronic delivery of the Warrant Shares.
(vii) Closing of Books . The Company will not close its stockholder books or records in any manner which prevents the timely exercise of this Warrant, pursuant to the terms hereof.
(e) Holder ’ s Exercise Limitations . The Company shall not effect any exercise of this Warrant, and a Holder shall not have the right to exercise any portion of this Warrant, pursuant to Section 2 or otherwise, to the extent that after giving effect to such issuance after exercise as set forth on the applicable Notice of Exercise, the Holder (together with the Holder’s Affiliates, and any other Persons acting as a group together with the Holder or any of the Holder’s Affiliates (such Persons, “ Attribution Parties ”)), would beneficially own in excess of the Beneficial Ownership Limitation (as defined below). For purposes of the foregoing sentence, the number of shares of Common Stock beneficially owned by the Holder and its Affiliates and Attribution Parties shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which such determination is being made, but shall exclude the number of shares of Common Stock which would be issuable upon (i) exercise of the remaining, nonexercised portion of this Warrant beneficially owned by the Holder or any of its Affiliates or Attribution Parties and (ii) exercise or conversion of the unexercised or nonconverted portion of any other securities of the Company (including, without limitation, any other Common Stock Equivalents) subject to a limitation on conversion or exercise analogous to the limitation contained herein beneficially owned by the Holder or any of its Affiliates or Attribution Parties. Except as set forth in the preceding sentence, for purposes of this Section 2(e), beneficial ownership shall be calculated in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder, it being acknowledged by the Holder that the Company is not representing to the Holder that such calculation is in compliance with Section 13(d) of the Exchange Act and the Holder is solely responsible for any schedules required to be filed in accordance therewith. To the extent that the limitation contained in this Section 2(e) applies, the determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable shall be in the sole discretion of the Holder, and the submission of a Notice of Exercise shall be deemed to be the Holder’s determination of whether this Warrant is exercisable (in relation to other securities owned by the Holder together with any Affiliates and Attribution Parties) and of which portion of this Warrant is exercisable, in each case subject to the Beneficial Ownership Limitation, and the Company shall have no obligation to verify or confirm the accuracy of such determination. In addition, a determination as to any group status as contemplated above shall be determined in accordance with Section 13(d) of the Exchange Act and the rules and regulations promulgated thereunder. For purposes of this Section 2(e), in determining the number of outstanding shares of Common Stock, a Holder may rely on the number of outstanding shares of Common Stock as reflected in (A) the Company’s most recent periodic or annual report filed with the Commission, as the case may be, (B) a more recent public announcement by the Company or (C) a more recent written notice by the Company or the Transfer Agent setting forth the number of shares of Common Stock outstanding. Upon the written or oral request of a Holder, the Company shall within one (1) Trading Day confirm orally and in writing to the Holder the number of shares of Common Stock then outstanding. In any case, the number of outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company, including this Warrant, by the Holder or its Affiliates or Attribution Parties since the date as of which such number of outstanding shares of Common Stock was reported. The “ Beneficial Ownership Limitation ” shall be 4.99% (or, upon election by a Holder prior to the issuance of any Warrants, 9.99%) of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock issuable upon exercise of this Warrant. The Holder, upon notice to the Company, may increase or decrease the Beneficial Ownership Limitation provisions of this Section 2(e), provided that the Beneficial Ownership Limitation in no event exceeds 9.99% of the number of shares of the Common Stock outstanding immediately after giving effect to the issuance of shares of Common Stock upon exercise of this Warrant held by the Holder and the provisions of this Section 2(e) shall continue to apply. Any increase in the Beneficial Ownership Limitation will not be effective until the 61st day after such notice is delivered to the Company. The provisions of this paragraph shall be construed and implemented in a manner otherwise than in strict conformity with the terms of this Section 2(e) to correct this paragraph (or any portion hereof) which may be defective or inconsistent with the intended Beneficial Ownership Limitation herein contained or to make changes or supplements necessary or desirable to properly give effect to such limitation. The limitations contained in this paragraph shall apply to a successor holder of this Warrant.
5
3. Certain Adjustments .
(a) Stock Dividends and Splits . If the Company, at any time while this Warrant is outstanding: (i) pays a stock dividend or otherwise makes a distribution or distributions on shares of its Common Stock or any other equity or equity equivalent securities payable in shares of Common Stock (which, for avoidance of doubt, shall not include any shares of Common Stock issued by the Company upon exercise of this Warrant), (ii) subdivides outstanding shares of Common Stock into a larger number of shares, (iii) combines (including by way of reverse stock split) outstanding shares of Common Stock into a smaller number of shares, or (iv) issues by reclassification of shares of the Common Stock any shares of capital stock of the Company, then in each case the Exercise Price shall be multiplied by a fraction of which the numerator shall be the number of shares of Common Stock (excluding treasury shares, if any) outstanding immediately before such event and of which the denominator shall be the number of shares of Common Stock outstanding immediately after such event, and the number of shares issuable upon exercise of this Warrant shall be proportionately adjusted such that the aggregate Exercise Price of this Warrant shall remain unchanged. Any adjustment made pursuant to this Section 3(a) shall become effective immediately after the record date for the determination of stockholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision, combination or re-classification.
(b) Subsequent Rights Offerings . In addition to any adjustments pursuant to Section 3(a) above, if at any time the Company grants, issues or sells any Common Stock Equivalents 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 the Holder will be entitled to acquire, upon the terms applicable to such Purchase Rights, the aggregate Purchase Rights which the Holder could have acquired if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date on which a record is taken for the grant, issuance or sale of such Purchase Rights, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the grant, issue or sale of such Purchase Rights (provided, however, to the extent that the Holder’s right to participate in any such Purchase Right would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Purchase Right to such extent (or beneficial ownership of such shares of Common Stock as a result of such Purchase Right to such extent) and such Purchase Right to such extent shall be held in abeyance for the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
(c) Pro Rata Distributions . During such time as this Warrant is outstanding, if the Company shall declare or make any dividend or other distribution of its assets (or rights to acquire its assets) to holders of shares of Common Stock other than as set forth in Section 3(a), by way of return of capital or otherwise (including, without limitation, any distribution of cash, stock or other securities, property or options by way of a dividend, spin off, reclassification, corporate rearrangement, scheme of arrangement or other similar transaction) (a “ Distribution ”), at any time after the issuance of this Warrant, then, in each such case, the Holder shall be entitled to participate in such Distribution to the same extent that the Holder would have participated therein if the Holder had held the number of shares of Common Stock acquirable upon complete exercise of this Warrant (without regard to any limitations on exercise hereof, including without limitation, the Beneficial Ownership Limitation) immediately before the date of which a record is taken for such Distribution, or, if no such record is taken, the date as of which the record holders of shares of Common Stock are to be determined for the participation in such Distribution (provided, however, to the extent that the Holder’s right to participate in any such Distribution would result in the Holder exceeding the Beneficial Ownership Limitation, then the Holder shall not be entitled to participate in such Distribution to such extent (or in the beneficial ownership of any shares of Common Stock as a result of such Distribution to such extent) and the portion of such Distribution shall be held in abeyance for the benefit of the Holder until such time, if ever, as its right thereto would not result in the Holder exceeding the Beneficial Ownership Limitation).
6
(d) Fundamental Transaction . If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions effects any merger or consolidation of the Company with or into another Person, (ii) the Company, directly or indirectly, effects any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by the Company or another Person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted into or exchanged for other securities, cash or property, or (v) the Company, directly or indirectly, in one or more related transactions consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization, recapitalization, spin-off or scheme of arrangement) with another Person or group of Persons whereby such other Person or group acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other Person or other Persons making or party to, or associated or affiliated with the other Persons making or party to, such stock or share purchase agreement or other business combination) (each a “ Fundamental Transaction ”), then, upon any subsequent exercise of this Warrant, the Holder shall have the right to receive, for each Warrant Share that would have been issuable upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Holder (without regard to any limitation in Section 2(e) on the exercise of this Warrant), the number of shares of Common Stock of the successor or acquiring corporation or of the Company, if it is the surviving corporation, and any additional consideration (the “ Alternate Consideration ”) receivable as a result of such Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately prior to such Fundamental Transaction (without regard to any limitation in Section 2(e) on the exercise of this Warrant). For purposes of any such exercise, the determination of the Exercise Price shall be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate Consideration. If holders of Common Stock are given any choice as to the securities, cash or property to be received in a Fundamental Transaction, then the Holder shall be given the same choice as to the Alternate Consideration it receives upon any exercise of this Warrant following such Fundamental Transaction. The Company shall cause any successor entity in a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing all of the obligations of the Company under this Warrant in accordance with the provisions of this Section 3(d) pursuant to written agreements in form and substance reasonably satisfactory to the Holder and approved by the Holder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option of the Holder, deliver to the Holder in exchange for this Warrant a security of the Successor Entity evidenced by a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock (but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably satisfactory in form and substance to the Holder. Upon the occurrence of any such Fundamental Transaction, the Successor Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions of this Warrant referring to the “Company” shall refer instead to the Successor Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this Warrant with the same effect as if such Successor Entity had been named as the Company herein.
(e) Calculations . All calculations under this Section 3 shall be made to the nearest cent or the nearest 1/100th of a share, as the case may be. For purposes of this Section 3, the number of shares of Common Stock deemed to be issued and outstanding as of a given date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.
7
(f) Notice to Holder .
(i) Adjustment to Exercise Price . Whenever the Exercise Price is adjusted pursuant to any provision of this Section 3, the Company shall promptly deliver to the Holder by facsimile or email a notice setting forth the Exercise Price after such adjustment and any resulting adjustment to the number of Warrant Shares and setting forth a brief statement of the facts requiring such adjustment.
(ii) Notice to Allow Exercise by Holder . If (A) the Company shall declare a dividend (or any other distribution in whatever form) on the Common Stock, (B) the Company shall declare a special nonrecurring cash dividend on or a redemption of the Common Stock, (C) the Company shall authorize the granting to all holders of the Common Stock rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights, (D) the approval of any stockholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property, or (E) the Company shall authorize the voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, then, in each case, the Company shall cause to be delivered by facsimile or email to the Holder at its last facsimile number or email address as it shall appear upon the Warrant Register of the Company, at least 20 calendar days prior to the applicable record or effective date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, rights or warrants, or if a record is not to be taken, the date as of which the holders of the Common Stock of record to be entitled to such dividend, distributions, redemption, rights or warrants are to be determined or (y) the date on which such reclassification, consolidation, liquidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of the Common Stock of record shall be entitled to exchange their shares of the Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, liquidation, merger, sale, transfer or share exchange; provided that the failure to deliver such notice or any defect therein or in the delivery thereof shall not affect the validity of the corporate action required to be specified in such notice.
4. Transfer of Warrant .
(a) Transferability . This Warrant and all rights hereunder (including, without limitation, any registration rights) are transferable, in whole or in part, upon surrender of this Warrant at the principal office of the Company or its designated agent, together with a written assignment of this Warrant substantially in the form attached hereto duly executed by the Holder or its agent or attorney and funds sufficient to pay any transfer taxes payable upon the making of such transfer. Upon such surrender and, if required, such payment, the Company shall execute and deliver a new Warrant or Warrants in the name of the assignee or assignees, as applicable, and in the denomination or denominations specified in such instrument of assignment, and shall issue to the assignor a new Warrant evidencing the portion of this Warrant not so assigned, and this Warrant shall promptly be cancelled. Notwithstanding anything herein to the contrary, the Holder shall not be required to physically surrender this Warrant to the Company unless the Holder has assigned this Warrant in full, in which case, the Holder shall surrender this Warrant to the Company within two (2) Trading Days of the date on which the Holder delivers an assignment form to the Company assigning this Warrant in full. The Warrant, if properly assigned in accordance herewith, may be exercised by a new holder for the purchase of Warrant Shares without having a new Warrant issued.
(b) New Warrants . This Warrant may be divided or combined with other Warrants upon presentation hereof at the aforesaid office of the Company, together with a written notice specifying the names and denominations in which new Warrants are to be issued, signed by the Holder or its agent or attorney. Subject to compliance with Section 4(a), as to any transfer which may be involved in such division or combination, the Company shall execute and deliver a new Warrant or Warrants in exchange for the Warrant or Warrants to be divided or combined in accordance with such notice. All Warrants issued on transfers or exchanges shall be dated the Issue Date of this Warrant and shall be identical with this Warrant except as to the number of Warrant Shares issuable pursuant thereto.
(c) Warrant Register . The Company shall register this Warrant, upon records to be maintained by the Company for that purpose (the “ Warrant Register ”), in the name of the record Holder hereof from time to time. The Company may deem and treat the registered Holder of this Warrant as the absolute owner hereof for the purpose of any exercise hereof or any distribution to the Holder, and for all other purposes, absent actual notice to the contrary.
8
5. Miscellaneous .
(a) No Rights as Stockholder Until Exercise . This Warrant does not entitle the Holder to any voting rights, dividends or other rights as a stockholder of the Company prior to the exercise hereof as set forth in Section 2(d)(i), except as expressly set forth in Section 3.
(b) Loss, Theft, Destruction or Mutilation of Warrant . The Company covenants that upon receipt by the Company of evidence reasonably satisfactory to it of the loss, theft, destruction or mutilation of this Warrant or any stock certificate relating to the Warrant Shares, and in case of loss, theft or destruction, of indemnity or security reasonably satisfactory to it (which, in the case of the Warrant, shall not include the posting of any bond), and upon surrender and cancellation of such Warrant or stock certificate, if mutilated, the Company will make and deliver a new Warrant or stock certificate of like tenor and dated as of such cancellation, in lieu of such Warrant or stock certificate.
(c) Saturdays, Sundays, Holidays, etc . If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then, such action may be taken or such right may be exercised on the next succeeding Business Day.
(d) Authorized Shares . The Company covenants that during the period the Warrant is outstanding, it will reserve from its authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the exercise of any purchase rights under this Warrant. The Company further covenants that its issuance of this Warrant shall constitute full authority to its officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the purchase rights under this Warrant. The Company will take all such reasonable action as may be necessary to assure that such Warrant Shares may be issued as provided herein without violation of any applicable law or regulation, or of any requirements of the Trading Market upon which the Common Stock may be listed. The Company covenants that all Warrant Shares which may be issued upon the exercise of the purchase rights represented by this Warrant will, upon exercise of the purchase rights represented by this Warrant and payment for such Warrant Shares in accordance herewith, be duly authorized, validly issued, fully paid and nonassessable and free from all taxes, liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring contemporaneously with such issue).
Except and to the extent as waived or consented to by the Holder, the Company shall not by any action, including, without limitation, amending its certificate of incorporation or through any reorganization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of Holder as set forth in this Warrant against impairment. Without limiting the generality of the foregoing, the Company will (i) not increase the par value of any Warrant Shares above the amount payable therefor upon such exercise immediately prior to such increase in par value, (ii) take all such action as may be necessary or appropriate in order that the Company may validly and legally issue fully paid and nonassessable Warrant Shares upon the exercise of this Warrant and (iii) use commercially reasonable efforts to obtain all such authorizations, exemptions or consents from any public regulatory body having jurisdiction thereof, as may be, necessary to enable the Company to perform its obligations under this Warrant.
Before taking any action which would result in an adjustment in the number of Warrant Shares for which this Warrant is exercisable or in the Exercise Price, the Company shall obtain all such authorizations or exemptions thereof, or consents thereto, as may be necessary from any public regulatory body or bodies having jurisdiction thereof.
9
(e) Jurisdiction . All questions concerning the construction, validity, enforcement and interpretation of this Warrant shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Warrant (whether brought against a party hereto or their respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Warrant and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If either party shall commence an action, suit or proceeding to enforce any provisions of this Warrant, the prevailing party in such action, suit or proceeding shall be reimbursed by the other party for their reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.
(f) Restrictions . The Holder acknowledges that the Warrant Shares acquired upon the exercise of this Warrant, if not registered, and the Holder does not utilize cashless exercise, will have restrictions upon resale imposed by state and federal securities laws.
(g) Nonwaiver and Expenses . No course of dealing or any delay or failure to exercise any right hereunder on the part of Holder shall operate as a waiver of such right or otherwise prejudice the Holder’s rights, powers or remedies. Without limiting any other provision of this Warrant or the Underwriting Agreement, if the Company willfully and knowingly fails to comply with any provision of this Warrant, which results in any material damages to the Holder, the Company shall pay to the Holder such amounts as shall be sufficient to cover any costs and expenses including, but not limited to, reasonable attorneys’ fees, including those of appellate proceedings, incurred by the Holder in collecting any amounts due pursuant hereto or in otherwise enforcing any of its rights, powers or remedies hereunder.
(h) Notices . Any and all notices or other communications or deliveries to be provided by the Holders hereunder including, without limitation, any Notice of Exercise, shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service, addressed to the Company, at Industriparken 22C, Ballerup, Denmark, DK-2750, Attention: Fei Chen, Chief Executive Officer, e-mail: fch@liqtech.com, or such email address or address as the Company may specify for such purposes by notice to the Holders. Any and all notices or other communications or deliveries to be provided by the Company hereunder shall be in writing and delivered personally, by e-mail, or sent by a nationally recognized overnight courier service addressed to each Holder at the e‑mail address or address of such Holder appearing on the books of the Company. Any notice or other communication or deliveries hereunder shall be deemed given and effective on the earliest of (i) the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section prior to 5:30 p.m. (New York City time) on any date, (ii) the next Trading Day after the date of transmission, if such notice or communication is delivered via e-mail at the e-mail address set forth in this Section on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (iii) the second Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service, or (iv) upon actual receipt by the party to whom such notice is required to be given. To the extent that any notice provided hereunder constitutes, or contains, material, non-public information regarding the Company or any subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.
(i) Limitation of Liability . No provision hereof, in the absence of any affirmative action by the Holder to exercise this Warrant to purchase Warrant Shares, and no enumeration herein of the rights or privileges of the Holder, shall give rise to any liability of the Holder for the purchase price of any Common Stock or as a stockholder of the Company, whether such liability is asserted by the Company or by creditors of the Company.
(j) Remedies . The Holder, in addition to being entitled to exercise all rights granted by law, including recovery of damages, will be entitled to specific performance of its rights under this Warrant. The Company agrees that monetary damages would not be adequate compensation for any loss incurred by reason of a breach by it of the provisions of this Warrant and hereby agrees to waive and not to assert the defense in any action for specific performance that a remedy at law would be adequate.
10
(k) Successors and Assigns . Subject to applicable securities laws, this Warrant and the rights and obligations evidenced hereby shall inure to the benefit of and be binding upon the successors and permitted assigns of the Company and the successors and permitted assigns of Holder. The provisions of this Warrant are intended to be for the benefit of any Holder from time to time of this Warrant and shall be enforceable by the Holder or holder of Warrant Shares.
(l) Amendment . This Warrant may be modified or amended or the provisions hereof waived with the written consent of the Company and the Holder.
(m) Severability . Wherever possible, each provision of this Warrant shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Warrant shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provisions or the remaining provisions of this Warrant.
(n) Headings . The headings used in this Warrant are for the convenience of reference only and shall not, for any purpose, be deemed a part of this Warrant.
(Signature Page Follows)
11
In Witness Whereof, the Company has caused this Warrant to be executed by its officer thereunto duly authorized as of the date first above indicated.
|
LIQTECH INTERNATIONAL, INC.
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
|
Fei Chen
|
|
|
|
Chief Executive Officer
|
|
NOTICE OF EXERCISE
TO: LIQTECH INTERNATIONAL, INC.
(1)
|
The undersigned hereby elects to purchase Warrant Shares of the Company pursuant to the terms of the attached Warrant (only if exercised in full), and tenders herewith payment of the exercise price in full, together with all applicable transfer taxes, if any.
|
(2)
|
Payment shall take the form of (check applicable box):
|
|
☐
|
in lawful money of the United States; or
|
|
☐
|
if permitted the cancellation of such number of Warrant Shares as is necessary, in accordance with the formula set forth in subsection 2(c), to exercise this Warrant with respect to the maximum number of Warrant Shares purchasable pursuant to the cashless exercise procedure set forth in subsection 2(c).
|
(3)
|
Please issue said Warrant Shares in the name of the undersigned or in such other name as is specified below:
|
The Warrant Shares shall be delivered to the following DWAC Account Number:
[SIGNATURE OF HOLDER]
Name of Investing Entity: |
|
|
|
Signature of Authorized Signatory of Investing Entity: |
|
|
|
Name of Authorized Signatory: |
|
|
|
Title of Authorized Signatory: |
|
|
|
Date: |
|
Notice of Exercise-1
EXHIBIT A
ASSIGNMENT FORM
(To assign the foregoing Warrant, execute this form and supply required information. Do not use this form to purchase shares.)
FOR VALUE RECEIVED, the foregoing Warrant and all rights evidenced thereby are hereby assigned to
Name: |
|
|
(Please Print) |
|
|
Address: |
|
|
|
|
|
Phone Number: |
|
|
|
Email Address: |
|
|
|
Dated: |
|
|
|
|
|
Holder’s Signature: |
|
|
|
Holder’s Address: |
|
|
|
|
|
### EX-5.1 - EXHIBIT 5.1
EX-5.1
5
ex_968625.htm
EXHIBIT 5.1
ex_968625.htm
Exhibit 5.1
May 26, 2026
LiqTech International, Inc.
c/o LiqTech North America, Inc.
1804 Buerkle Road
White Bear Lake, MN 55110
|
Re:
|
Form S-1 Registration Statement
|
Ladies and Gentlemen:
We have acted as your special counsel in connection with the registration statement on Form S-1 and the related Preliminary Prospectus (collectively, the “Registration Statement”), which is being filed with the Securities and Exchange Commission (the “Commission”) as of the date of this letter under the Securities Act of 1933, as amended (the “Securities Act”), relating to the registration of (i) $20,000,000 of shares of the authorized but unissued shares (the “Shares”) of common stock of the Company, par value $0.001 per share (the “Common Stock”), that may be sold to Konik Capital Partners, LLC, a division of T.R. Winston & Co. (the “Underwriter”) pursuant to the terms of the that certain Underwriting Agreement to be entered into by and between the Company and the Underwriter in the form filed by the Company as Exhibit 1.1 to the Registration Statement (the “Underwriting Agreement”), (ii) pre-funded warrants to purchase some or all of the Shares (the “Pre-Funded Warrants”), (iii) up to an additional $3,000,000 of shares of the Common Stock of the Company or pre-funded warrants that may be purchased by the Underwriter pursuant to its over-allotment option in the Underwriting Agreement (the “Over-Allotment Shares”), and (iv) shares of Common Stock of the Company underlying the Underwriter’s Common Stock Purchase Warrant (the “Underwriter Warrants”) issued by the Company pursuant to the Underwriting Agreement (the “Underwriter Warrant Shares”) in an amount equal to 4% of all Shares (including Over-Allotment Shares and any Shares underlying Pre-Funded Warrants) sold pursuant to the Underwriting Agreement. Capitalized terms used but not defined in this opinion letter have the meanings given to those terms in the Registration Statement.
Snell & Wilmer | 5520 Kietzke Lane | Suite 200 | Reno, NV 89511-3041 |
SWLAW.COM |
|
LiqTech International, Inc.
May 26, 2026
Page 2
|
You have requested our opinion as to the matters set forth below in connection with the Registration Statement. For purposes of rendering this opinion, we have examined the Registration Statement, the Underwriting Agreement, a form of the Underwriter Warrants, the Company’s articles of incorporation, as amended, bylaws, as amended, the unanimous written consent by the Company’s board of directors (the “Board”) dated May 15, 2026, the unanimous written consent by the Board dated May 19, 2026, and we have made such other investigation as we have deemed appropriate. We have examined and relied upon certificates of public officials and, as to certain matters of fact that are material to our opinion, we have also relied upon certificates made by officers of the Company. In rendering our opinion, in addition to the assumptions that are customary in opinion letters of this kind, we have assumed (i) the genuineness of signatures on the documents we have examined, (ii) the legal capacity and authority of the persons signing the documents we have examined, (iii) the truth and accuracy of all representations and warranties, (iv) the conformity to authentic documents of all documents submitted to us as copies, and (v) that the Company will have sufficient authorized and unissued shares of common stock available with respect to any of the Shares, the Pre-Funded Warrants, the Over-Allotment Shares, and the Underwriter Warrant Shares issued after the date of this letter. We have not verified any of these assumptions.
This opinion is rendered as of the date of this letter and is limited to matters of Nevada corporate law, including applicable provisions of the Nevada Constitution and reported judicial decisions interpreting those laws. We express no opinion as to the laws of any other state, the federal law of the United States, or the effect of any federal or state securities laws.
Based on the foregoing, and subject to the assumptions, qualifications, and limitations stated in this letter, we are of the opinion that:
1. Upon payment for and issuance and delivery of the Shares in accordance with the Underwriting Agreement, the Shares will be validly issued, fully paid and non-assessable.
2. Upon payment for and issuance and delivery of the Pre-Funded Warrants in accordance with the Underwriting Agreement, the Pre-Funded Warrants will be validly issued, fully paid and non-assessable.
3. Upon payment for and issuance and delivery of the Over-Allotment Shares in accordance with the Underwriting Agreement, the Over-Allotment Shares will be validly issued, fully paid and non-assessable.
4. Upon payment for and issuance and delivery of the Underwriter Warrant Shares in accordance with the Underwriter Warrants and the Underwriting Agreement, the Underwriter Warrant Shares will be validly issued, fully paid and non-assessable.
We consent to the filing of this opinion as an exhibit to the Registration Statement or a Form 8-K related to the Underwriting Agreement and to the reference to this firm in the Registration Statement under the caption “Legal Matters.” In giving our consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations under such act.
Very truly yours,
/s/ Snell & Wilmer L.L.P.
Snell & Wilmer L.L.P.
### EX-5.2 - EXHIBIT 5.2
EX-5.2
6
ex_965223.htm
EXHIBIT 5.2
ex_965223.htm
Exhibit 5.2
May 26, 2026
LiqTech International, Inc.
c/o LiqTech North America, Inc.
1804 Buerkle Road
White Bear Lake, MN 55110
Ladies and Gentlemen:
We have acted as counsel to LiqTech International, Inc., a Nevada corporation (the “ Company ”), in connection with the filing by the Company of a Registration Statement on Form S-1 with the Securities and Exchange Commission on the date hereof (the “ Registration Statemen t”) under the Securities Act of 1933, as amended (the “ Securities Ac t”), relating to the proposed offering and sale by the Company of (a) shares of the Company’s common stock, $0.001 par value per share (“ Common Stock ”) and pre-funded warrants (the “ Pre-Funded Warrants ”) to purchase shares (the “ Pre-Funded Warrant Shares ”) of Common Stock to be evidenced by the form of pre-funded warrant instrument attached as Exhibit 4.11 to the Registration Statement (the “ Pre-Funded Warrant Instrument ”), pursuant to the Underwriting Agreement to be entered into by and between the Company and Konik Capital Partners LLC, a division of T.R. Winston & Company, LLC, as the Underwriter (as defined therein and hereinafter referred to as the “ Underwriter ”), in the form filed by the Company as Exhibit 1.1 to the Registration Statement (the “ Underwriting Agreement ”), and (b) warrants (the “ Underwriter Warrants ” and, together with the Pre-Funded Warrants, the “ Warrants ”) to the Underwriter to purchase shares (the “ Underwriter Warrant Shares ” and, together with the Pre-Funded Warrant Shares, the “ Warrant Shares ”) of Common Stock to be evidenced by the form of warrant instrument attached as Exhibit 4.10 to the Registration Statement (the “ Underwriter Warrant Instrument ” and, together with the Pre-Funded Warrant Instrument, the “ Warrant Instruments ”), each in such amounts as specified in the Registration Statement and to be sold or issued, as applicable, by the Company. This opinion is being furnished to you in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act.
You have requested our opinion as to the matters set forth below in connection with the Registration Statement and the offering of the Warrants thereunder. For purposes of rendering these opinions, we have examined: (i) the Registration Statement; (ii) the Underwriting Agreement; (iii) the Warrant Instruments attached as Exhibits 4.10 and 4.11 to the Registration Statement; and (iv) a certificate of an officer of the Company, dated as of the date hereof. Other than our examination of the documents listed in (i) through (iv) above, we have not examined any other documents or made any independent investigation for the purpose of rendering this opinion.
May 26, 2026
Page 2
For purposes of rendering our opinions below, we have not examined any document other than the documents listed above and assume there exists no provision in any document relating to the matters covered by our opinions below that we have not examined that is inconsistent with the documents listed above or our opinions below. We have conducted no independent factual investigation of our own but rather have relied on the documents listed above, the statements and information set forth therein and the additional matters recited or assumed herein, all of which we assume to be true, complete and accurate in all respects.
For purposes of this opinion letter, we have assumed that: (a) each document examined by us is accurate and complete; (b) each such document that is an original is authentic; (c) each such document that is a copy conforms to an authentic original; (d) all signatures on each such document are genuine; (e) the Company is and shall remain at all times a corporation duly incorporated, validly existing and in good standing under the laws of the State of Nevada, and (f) the Company’s issuance of the Warrants and the Warrant Shares issuable on exercise thereof have been fully authorized by all necessary action of the Company and its Board of Directors under the law of the State of Nevada, and those actions and resolutions have not been and will not be revoked, modified or amended. We have further assumed (i) the legal capacity of natural persons, and (ii) that each party to the documents we have examined has the legal capacity or authority and has satisfied all legal requirements that are applicable to that party to the extent necessary to make such documents enforceable against that party. We have not verified any of the foregoing assumptions.
In rendering our opinions below, we also have assumed that (i) the Warrants will be offered in the manner and on the terms identified or referred to in the Registration Statement and the prospectus included in the Registration Statement (the “ Prospectus ”), including all supplements and amendments thereto, (ii) the Underwriting Agreement constitutes the valid and binding agreement of the parties thereto, enforceable against the parties thereto in accordance with its terms, and (iv) the exercise price for the Warrant Shares upon the exercise of the Warrants in accordance with the terms of the applicable Warrant Instrument, in each case, will equal or exceed the then par value of a share of Common Stock. We have not verified any of the foregoing assumptions.
Our opinions set forth below in numbered paragraphs 1 and 2 are limited to the laws of the State of New York. We express no opinion with respect to Nevada law.
Based upon and subject to the foregoing, it is our opinion that:
1. When the Underwriter Warrant Instrument has been executed and delivered by the Company and the Underwriter Warrants have been issued to the Underwriter as contemplated by the Registration Statement, the Prospectus and the Underwriting Agreement, the Underwriter Warrant Instrument will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.
2. When the Pre-Funded Warrant Instrument has been executed and delivered by the Company and the Pre-Funded Warrants have been issued as contemplated by the Registration Statement, the Prospectus and the Underwriting Agreement, the Pre-Funded Warrant Instrument will constitute a valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.
May 26, 2026
Page 3
Our opinions in numbered paragraphs 1 and 2 above are subject to the effects of applicable bankruptcy, insolvency, orderly liquidation or resolution, fraudulent transfer and conveyance, preference, reorganization, receivership, conservatorship, moratorium, and other similar laws affecting the rights and remedies of creditors or secured parties generally, and to the effects of general principles of equity, whether considered in a proceeding at law or equity, including but not limited to principles limiting the availability of specific performance and injunctive relief, and concepts of materiality, reasonableness, good faith and fair dealing and the public policy against indemnification for violations of United States securities law.
We hereby consent to the filing of this opinion letter as Exhibit 5.2 to the Registration Statement, and to the reference to this firm in the Prospectus under the caption “Legal Matters.” In giving our consent, we do not hereby admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations thereunder. This opinion is expressed as of the date hereof, and we disclaim any undertaking to advise of any subsequent changes in the facts stated or assumed herein or any subsequent changes in law.
|
Yours truly,
/s/ K&L Gates LLP
|
### EX-10.20 - EXHIBIT 10.20
EX-10.20
7
ex_965224.htm
EXHIBIT 10.20
ex_965224.htm
Exhibit 10.20
DEBT CANCELLATION AND EXCHANGE AGREEMENT
This DEBT CANCELLATION AND EXCHANGE AGREEMENT (this “ Agreement ”), effective as of May 22, 2026, is made by and among LiqTech International, Inc., a Nevada corporation (the “ Company ”), and each of the holders set forth Schedule I hereto (each, a “ Holder ” and, collectively, the “ Holders ”). The Company and the Holders are each individually referred to herein as a “ Party ” and are collectively referred to herein as the “ Parties ”.
WHEREAS , on June 22, 2022, the Company issued an aggregate principal amount of $6,000,000 of Promissory Notes, dated June 22, 2022, as amended pursuant to the Allonge #1 to Promissory Note, effective as of September 30, 2023, and the Allonge #2 to Promissory Note, effective as of March 26, 2025 (each, a “ Note ” and, collectively, the “ Notes ”), to the Holders;
WHEREAS , capitalized terms used but not defined herein shall have the meanings ascribed to such terms in the Note and Warrant Purchase Agreement, dated June 22, 2022, by and among the Company and the Holders;
WHEREAS , each of the Holders agrees to cancel the portion of the outstanding principal amount (but not the interest accrued thereon) of the Note held by such Holder as set forth opposite such Holder’s name on Schedule I hereto (collectively, the “ Cancelled Debt Obligations ” with such remaining principal amount other than the Cancelled Debt Obligations referred to herein as the “ Remaining Notes ”) in exchange for shares of the Company’s common stock, par value $0.001 par share (“ Common Stock ”), and the Company is willing and able to issue such shares of Common Stock to the Holders, in each case, on the terms set forth herein;
WHEREAS , at the Closing (as defined in Section 2 hereof), the Parties will execute and deliver a Registration Rights Agreement, substantially in the form attached hereto as Exhibit A (the “ Registration Rights Agreement ”), pursuant to which the Company will agree to provide certain registration rights in respect of the Shares (as defined in Section 1 hereof) under the Securities Act of 1933, as amended (the “ Securities Act ”); and
WHEREAS, the Company proposes to issue and sell shares of Common Stock pursuant to the Registration Statement on Form S-1 filed by the Company with the U.S. Securities and Exchange Commission (the “ SEC ”) on May 26, 2026, in an offering (the “ Offering ”) registered under the Securities Act.
NOW, THEREFORE , in consideration of the mutual covenants and promises herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:
1. Cancellation of Cancelled Debt Obligations; Issuance of Shares . At the Closing and subject to the terms and conditions of this Agreement, (i) all of the Cancelled Debt Obligations shall be cancelled, (ii) the Company shall pay to each Holder in cash in immediately available funds the amount of interest accrued on Cancelled Debt Obligations as of immediately prior to the cancellation of the outstanding principal amount of the Cancelled Debt Obligations (the “ Accrued Interest ”), (iii) the Company shall pay to each holder in cash in immediately available funds the principal amount of the Remaining Notes and any accrued interest thereon and (iv) the Company shall issue to each Holder shares of Common Stock (collectively, the “ Shares ”) in an amount equal to (a) the outstanding principal amount of the Note held by such Holder set forth on Schedule I hereto, divided by (b) the public offering price per share in the Offering, rounded up to the nearest whole share, in each case, credited to book-entry accounts maintained by the transfer agent of the Company.
2. Closing; Delivery of Shares . The closing of the transactions contemplated hereby (the “ Closing ”) shall take place simultaneously with the closing of the Offering, or on such other date and time as the Parties may otherwise agree, upon the satisfaction or waiver of the conditions set forth in Section 5 . The Closing shall take place via the delivery and exchange of signatures by electronic transmission. The date on which the Closing occurs shall be referred to herein as the “ Closing Date ”.
3. Representations and Warranties of the Company . The Company hereby represents and warrants to the Holders as of the date hereof and as of the Closing Date as follows:
(a) Organization; Good Standing; Qualification . The Company and each of its wholly owned subsidiaries is duly incorporated, validly existing, and in good standing under the laws of the jurisdiction of its organization. Each of the Company and its subsidiaries has all requisite power and authority to own and operate its respective properties and assets and to carry on its respective business as presently conducted and as proposed to be conducted. The Company and each of its wholly-owned subsidiaries is qualified to do business as a foreign entity in every jurisdiction in which the failure to be so qualified would have, or would reasonably be expected to have, a material adverse effect, individually or in the aggregate, upon the business, properties, tangible and intangible assets, liabilities, operations, condition (financial or otherwise) or results of operation of the Company and its subsidiaries or the ability of the Company or any of its subsidiaries to timely perform their respective obligations under this Agreement (a “ Material Adverse Effect ”). As used herein, references to any “subsidiary” of a specified Person shall refer to an Affiliate controlled by such Person directly, or indirectly through one or more intermediaries, as such terms are used in and construed under Rule 405 under the Securities Act (which, for the avoidance of doubt, shall include the Company’s controlled joint ventures, including shared-controlled joint ventures).
(b) Power . The Company has all requisite corporate power and authority to execute and deliver this Agreement, the Registration Rights Agreement and any ancillary agreements and instruments to be entered into by the Company hereunder (collectively, the “ Transaction Documents ”), to sell and issue the Shares, and to carry out and perform its obligations under the Transaction Documents.
(c) Authorization . The execution, delivery, and performance of the Transaction Documents by the Company has been duly authorized by all requisite corporate or other action on the part of the Company and its officers, directors and stockholders, and, assuming the execution and delivery of this Agreement and the other Transaction Documents by the Holders, this Agreement constitutes, and the other Transaction Documents will constitute, legal, valid, and binding obligations of the Company enforceable against the Company in accordance with their terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.
(d) Capitalization . Except as contemplated with respect to the Offering, the Company has not issued any capital stock since its most recently filed Annual Report on Form 10-K for the fiscal year ended December 31, 2025, other than (i) pursuant to the exercise of stock options, restricted stock units or other similar awards under the Company’s stock option plans or (ii) to consultants, employees and other service providers of the Company in transactions approved by the Company’s Board of Directors. No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Other than as disclosed in the schedules, forms, statements, reports and other documents filed by the Company with the SEC since January 1, 2025 (the “ SEC Documents ”), there are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.
2
(e) Consents and Approvals . The Company is not required to give any notice to, make any filing with, or obtain any authorization, consent, or approval of any regulatory body, self-regulatory organization, stock exchange or market government or governmental agency in order to consummate the transactions contemplated by the Transaction Documents, other than (i) filings if required by state securities laws, (ii) if required, the filing of a Notice of Sale of Securities on Form D with the SEC under Regulation D of the Securities Act, (iii) the filings required in accordance with the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), and (iv) those that have been made or obtained prior to the date of this Agreement.
(f) Non-Contravention . The execution and delivery of the Transaction Documents, the issuance, sale and delivery of the Shares to the Holders, the performance by the Company of its obligations under the Transaction Documents and the consummation of the transactions contemplated hereby and thereby will not (i) conflict with, result in the breach or violation of, or constitute (with or without the giving of notice or the passage of time or both) a violation of, or default under, (1) any bond, debenture, note or other evidence of indebtedness, or under any lease, license, franchise, permit, indenture, mortgage, deed of trust, loan agreement, joint venture or other agreement or instrument to which the Company or any subsidiary is a party or by which it or its properties may be bound or affected, (2) the Company’s Articles of Incorporation, as amended and as in effect on the date hereof, the Company’s Bylaws, as amended and as in effect on the date hereof, or the equivalent document with respect to any subsidiary, as amended and as in effect on the date hereof, or (3) any statute or law, judgment, decree, rule, regulation, ordinance or order of any court or governmental or regulatory body (including The Nasdaq Stock Market), governmental agency, arbitration panel or authority applicable to the Company, any of its subsidiaries or their respective properties, except in the case of clause (1) for such conflicts, breaches, violations or defaults that would not be likely to have, individually or in the aggregate, a Material Adverse Effect, or (ii) result in the creation or imposition of any lien, encumbrance, claim, security interest or restriction whatsoever upon any of the material properties or assets of the Company or any of its subsidiaries or an acceleration of indebtedness pursuant to any obligation, agreement or condition contained in any material bond, debenture, note or any other evidence of indebtedness or any material indenture, mortgage, deed of trust or any other agreement or instrument to which the Company or any if its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company is subject. For purposes of this Section 3(f) the term “material” shall apply to agreements, understandings, instruments, contracts or proposed transactions to which the Company is a party or by which it is bound involving obligations (contingent or otherwise) of, or payments to, the Company in excess of $500,000 in a consecutive 12-month period.
(g) Shares . The Shares have been duly authorized by all necessary corporate action and, when issued and paid for in accordance with the terms of this Agreement, will be validly issued, fully paid, and nonassessable, and will be free of any lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other material restriction with respect to the issuance thereof; provided, however, that such Shares shall be subject to restrictions on transfer under state or federal securities laws as set forth in this Agreement, or as otherwise may be required under state or federal securities laws as set forth in this Agreement at the time a transfer is proposed.
(h) No Registration . Assuming the accuracy of each of the representations and warranties of the Holders herein, the issuance by the Company of the Shares pursuant to this Agreement will be exempt from registration under the Securities Act.
3
(i) Application of Takeover Protections . The Company has taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement), or other similar anti-takeover provision pursuant to its charter documents or the laws of its state of incorporation that is applicable to the Holders as a result of the Holders and the Company fulfilling their obligations or exercising their rights pursuant to the Transaction Documents.
(j) Material Changes . Since the date of filing of the Quarterly Report on Form 10-Q for the quarter ended March 31, 2026, there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect. Except for the issuance of the Shares contemplated by this Agreement, no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least one (1) business day prior to the date that this representation is made.
4. Representation and Warranties of Holders . Each Holder hereby represents and warrants to the Company severally, but not jointly, as of the date hereof and as of the Closing Date as follows:
(a) Authorization . Such Holder has full power and authority to enter into the Transaction Documents, and the Transaction Documents constitute valid and legally binding obligations of such Holder, enforceable in accordance with their respective terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, and (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.
(b) Purchase Entirely for Own Account . This Agreement is made with such Holder in reliance upon such Holder’s representation to the Company, which by such Holder’s execution of this Agreement such Holder hereby confirms, that the Shares set forth opposite such Holder’s name in Schedule I hereto will be acquired for investment for such Holder’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that such Holder has no present intention of selling, granting any participation in, or otherwise distributing the same. Such Holder does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participation in any of the Shares to any third person.
(c) Reliance upon Holders ’ Representations . Such Holder understands that the Shares are not registered under the Securities Act on the ground that the sale provided for in this Agreement and the issuance of securities hereunder is exempt from registration under the Securities Act and that the Company’s reliance on such exemption is based on the Holders’ representations set forth herein. Such Holder realizes that the basis for such exemption may not be present if, notwithstanding such representations, such Holder has in mind merely acquiring the Shares for a fixed or determinable period in the future, or for a market rise, or for sale if the market does not rise. Such Holder has no such intention.
(d) Receipt of Information . Such Holder believes it has received all the information it considers necessary or appropriate for deciding whether to purchase the Shares. Such Holder further represents that it has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the offering of the Shares, and the business, properties, prospects and financial condition of the Company and to obtain additional information (to the extent the Company possessed such information or could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to it or to which it had access. The foregoing, however, does not limit or modify the representations and warranties of the Company in this Agreement or the right of the Holders to rely thereon.
4
(e) Investment Experience . Such Holder is experienced in evaluating and investing in securities of companies in the development stage and is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial and business matters that it is capable of evaluating the merits and risks of the investment in the Shares and is able, without impairing such Holder’s financial condition, to hold the Shares for an indefinite period of time and to suffer a complete loss of such Holder’s investment. If other than an individual, such Holder also represents it has not been organized for the purpose of acquiring the Shares.
(f) Accredited Investor . Such Holder is an “accredited investor,” as such term is defined in Rule 501(a) of Regulation D under the Securities Act.
(g) Restricted Securities . Such Holder understands that the Shares must be held indefinitely unless subsequently registered under the Securities Act or unless an exemption from registration is otherwise available.
(h) Independent Investment Decisio n. Each of the Holders understands and agrees that the Shares shall be endorsed with the legend set forth below, and such Holder covenants that, except to the extent such restrictions are waived by the Company, such Holder shall not transfer the Shares represented by any such certificate without complying with the restrictions on transfer described in such legend (except that the Company shall not require an opinion of counsel in connection with a transfer to an affiliated entity or pursuant to Rule 144):
“THESE SECURITIES HAVE NOT BEEN REGISTERED OR QUALIFIED UNDER THE SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY STATE, AND MAY BE OFFERED AND SOLD ONLY IF REGISTERED AND QUALIFIED PURSUANT TO THE RELEVANT PROVISIONS OF FEDERAL AND STATE SECURITIES LAWS OR IF THE COMPANY IS PROVIDED AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY THAT REGISTRATION AND QUALIFICATION UNDER FEDERAL AND STATE SECURITIES LAWS IS NOT REQUIRED.”
(i) Foreign Investor . If such Holder is not a United States person (as defined by Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended), such Holder hereby represents that it has satisfied itself as to the full observance of the laws of its jurisdiction in connection with the purchase of the Shares and this Agreement, including (i) any foreign exchange restrictions applicable to such purchase, (ii) any governmental or other consents that may be required, and (iii) any tax consequences that may be relevant to the purchase, holding, redemption, sale or transfer of the Shares. Such Holder’s subscription and payment for and continued beneficial ownership of the Shares will not violate any applicable securities or other laws of such Holder’s jurisdiction.
(j) Disqualification . Such Holder represents that such Holder is not subject to any Disqualification Event (as defined in Rule 506(d)(1)(i) through (viii) under the Securities Act), except for Disqualification Events covered by Rule 506(d)(2)(ii) or (iii) or (d)(3) under the Securities Act and disclosed reasonably in advance of the Closing in writing in reasonable detail to the Company.
5
5. Conditions .
(a) The obligations of the Company to consummate the transactions contemplated hereby are subject to the satisfaction or waiver of the following conditions:
i. the representations and warranties of each Holder set forth in Section 4 shall be true and correct as of the Closing Date;
ii. the Company shall have received the Registration Rights Agreement from the Holders duly executed by each Holder;
iii. each Holder shall have performed and complied with in all material respects all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing;
iv. each Holder shall have delivered to the Company evidence reasonably satisfactory to the Company of the cancellation in full of the Cancelled Debt Obligations effective as of the Closing; and
v. the closing of the Offering shall occur substantially concurrently with the closing of the transactions contemplated by this Agreement.
(b) The obligations of each Holder to consummate the transactions contemplated hereby are subject to the satisfaction or waiver of the following conditions:
i. the representations and warranties of the Company set forth in Section 3 shall be true and correct as of the Closing Date;
ii. such Holder shall have received the Registration Rights Agreement from the Company duly executed by the Company;
iii. the Company shall have performed and complied with in all material respects all agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing;
iv. the Company shall have delivered to each Holder evidence, in form reasonably satisfactory to such Holder, of the issuance of such Holder’s Shares in restricted book-entry form by the transfer agent of the Company;
v. substantially concurrently with the closing of the transactions contemplated by this Agreement, the Company shall (i) pay the Accrued Interest to the applicable Holder in immediately available funds and (ii) repay the principal amount of the Remaining Notes and accrued interest thereon to the applicable Holder in immediately available funds; and
vi. the closing of the Offering shall occur substantially concurrently with the closing of the transactions contemplated by this Agreement.
6. Miscellaneous .
(a) Entire Agreement . This Agreement and the documents referred to herein constitute the entire agreement among the Parties with respect to the subject matter hereof and thereof and no Party shall be liable or bound to any other Party in any manner by any warranties, representations or covenants except as specifically set forth herein or therein.
6
(b) Survival of Warranties . The warranties, representations and covenants of the Company and each Holder contained in or made pursuant to this Agreement with respect to the Closing shall survive the execution and delivery of this Agreement and such Closing.
(c) Assignment; Successors and Assigns . This Agreement may not be assigned by any Party without the prior written consent of the other Parties. Except as otherwise provided herein, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the Parties. Nothing in this Agreement, express or implied, is intended to confer upon any Person other than the Parties or their respective successors and assigns, any rights, remedies, obligations or liabilities under this Agreement, except as expressly provided in this Agreement.
(d) Governing Law; Jurisdiction . This Agreement shall be governed by and construed under the laws of the State of New York as applied to agreements among New York residents entered into and to be performed entirely within New York. With respect to any disputes arising out of or related to this Agreement, the Parties consent to the exclusive jurisdiction of the New York County Supreme Court or, in the event that such court does not have jurisdiction over the dispute, to the federal district court of the Southern District of New York or to the state courts of the State of New York.
(e) Counterparts; Electronic Signatures . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be executed and delivered by facsimile, electronic mail (including pdf or any electronic signature complying with the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act or other applicable law) or other transmission method and upon such delivery any such signature shall be deemed to have the same effect as if the original signature had been delivered to the other Party.
(f) Titles and Subtitles . The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.
(g) Notices . Unless otherwise provided, any notice required or permitted under this Agreement shall be given in writing, addressed (i) if to a Holder, as indicated on Schedule I hereto, or at such other address as such Holder shall have furnished to the Company in writing at least five (5) days prior to any notice to be given hereunder, or (ii) if to the Company, at its principal office, Attention: Chief Executive Officer, or at such other address as the Company shall furnish to each Holder in writing at least five (5) days prior to any notice to be given hereunder. All such notices and other written communications shall be deemed effectively given upon personal delivery to the Party to be notified (or upon the date of attempted delivery where delivery is refused) or, if sent by facsimile, upon receipt of appropriate written confirmation of receipt, or five (5) days after deposit with the United States Postal Service, by registered or certified mail, or one (1) day after deposit with next day air courier, with postage and fees prepaid and addressed to the Party entitled to such notice, or, if sent by electronic mail, when directed to any electronic mail address set forth on Schedule I hereto.
(h) Amendments and Waivers . Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the Holders. Any amendment or waiver so effected shall be binding upon each holder of any Shares purchased under this Agreement at the time outstanding, each future holder of all such Shares and the Company.
7
(i) Expenses . Each Holder shall individually bear such Holder’s full costs and expenses incurred with respect to the negotiation, execution, delivery and performance of this Agreement.
(j) Delays or Omissions . No delay or omission to exercise any right, power or remedy accruing to any Party, upon any breach or default of any other Party under this Agreement shall impair any such right, power or remedy of such non-defaulting Party, nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default therefore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any Party of any breach or default under this Agreement or any waiver on the part of any Party of any provisions or conditions of this Agreement must be made in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any Party, shall be cumulative and not alternative.
(k) Further Assurances . The Parties agree to execute and deliver all such further documents, agreements and instruments and take such other and further action as may be necessary or appropriate to carry out the purposes and intent of this Agreement.
(l) Severability . If any provision of this Agreement is held to be illegal or unenforceable under applicable law, such provision shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.
(m) California Corporate Securities Law . THE SALE OF THE SECURITIES WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION FOR SUCH SECURITIES PRIOR TO SUCH QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.
[Remainder of this page intentionally left blank.]
8
IN WITNESS WHEREOF, the Parties enter into this Agreement and, by so signing, represent and warrant that they have the authority to sign on behalf of the person or entity for whom they are signing.
|
|
|
COMPANY:
|
|
LIQTECH INTERNATIONAL, INC.
|
By:
|
/s/ Fei Chen |
Name:
|
Fei Chen
|
Title:
|
Chief Executive Officer
|
[ Signature page to Debt Cancellation Agreement ]
IN WITNESS WHEREOF, the Parties enter into this Agreement and, by so signing, represent and warrant that they have the authority to sign on behalf of the person or entity for whom they are signing.
HOLDERS:
|
|
21 APRIL FUND, LTD.
|
|
|
|
|
By:
|
/s/ Michael Kellen |
Name:
|
Michael Kellen
|
Title:
|
Portfolio Manager
|
|
21 APRIL FUND, LP.
|
|
|
|
|
By:
|
/s/ Michael Kellen |
Name:
|
Michael Kellen
|
Title:
|
Portfolio Manager
|
[ Signature page to Debt Cancellation Agreement ]
SCHEDULE I
SCHEDULE OF HOLDERS
Name and Address
|
Principal Amount of Note to be Cancelled
|
21 April Fund, Ltd.
Goldman Sachs & Co. LLC
F/A/O 21 April Fund, L.P. (AXE4)
200 West Street
New York, NY 10282
Attn: Oscar Garcia
ogarcia@btig.com
with a copy to:
Bleichroeder LP
1345 Avenue of the Americas, 47th Fl.
New York, NY 10105
Attn: Michael Kellen
212-698-3191
michael.kellen@bleichroederlp.com; ag@bleichroederlp.com; ops@bleichroederlp.com
with a copy (which shall not constitute notice) to:
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019
Attn: Michael Brandt
Email: mbrandt@willkie.com
|
$2,125,000
|
21 April Fund, LP
Goldman Sachs & Co. LLC
F/A/O 21 April Fund, L.P. (AXE3)
200 West Street
New York, NY 10282
Attn: Oscar Garcia
ogarcia@btig.com
with a copy to:
Bleichroeder LP
1345 Avenue of the Americas, 47th Fl.
New York, NY 10105
Attn: Michael Kellen
212-698-3191
Michael.kellen@bleichroederlp.com; ag@bleichroederlp.com; ops@bleichroederlp.com
with a copy (which shall not constitute notice) to:
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019
Attn: Michael Brandt
Email: mbrandt@willkie.com
|
$875,000
|
Total:
|
$3,000,000
|
EXHIBIT A
FORM OF REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this “ Agreement ”) is made and entered into as of May [●], 2026 by and among LiqTech International, Inc., a Nevada corporation (the “ Company ”), and the “Investors” named in that certain Debt Cancellation and Exchange Agreement, dated as of May [●], 2026, by and among the Company and such Investors (the “ Debt Cancellation Agreement ”). Capitalized terms used herein have the respective meanings ascribed thereto in the Debt Cancellation Agreement unless otherwise defined herein.
The parties hereby agree as follows:
Certain Definitions .
As used in this Agreement, the following terms shall have the following meanings:
“ Affiliate ” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used in and construed under Rule 405 under the Securities Act.
“ Investors ” means the Investors set forth on Schedule I of the Debt Cancellation Agreement.
“ Person ” means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof or any other entity.
“ Prospectus ” means (i) any prospectus (preliminary or final) included in any Registration Statement, as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Securities covered by such Registration Statement and by all other amendments and supplements to the prospectus, including post-effective amendments and all material incorporated by reference in such prospectus, and (ii) any “free writing prospectus” as defined in Rule 405 under the Securities Act.
“ Register ,” “ registered ” and “ registration ” refer to a registration made by preparing and filing a Registration Statement or similar document in compliance with the Securities Act, and the declaration or ordering of effectiveness of such Registration Statement or document.
“ Registrable Securities ” means the shares of Common Stock to be issued to the Investors in exchange for the cancellation of the Debt Obligations pursuant to the Debt Cancellation Agreement and any other securities issued or issuable with respect to or in exchange for such shares of Common Stock, whether by merger, charter amendment or otherwise; provided, that, any such security shall cease to be a Registrable Security (and the Company shall not be required to maintain the effectiveness of any, or file another, Registration Statement hereunder with respect thereto) for so long as (a) a Registration Statement with respect to the sale of such Registrable Securities is declared effective by the SEC under the Securities Act and such Registrable Securities have been disposed of by the holder thereof in accordance with such effective Registration Statement, (b) such Registrable Securities have been previously sold in accordance with Rule 144, or (c) such securities become eligible for resale without volume or manner-of-sale restrictions and without current public information pursuant to Rule 144 as set forth in a written opinion letter to such effect, addressed, delivered and acceptable to the transfer agent of the Company and the affected holders (assuming that such securities and any securities issuable upon exercise, conversion or exchange of which, or as a dividend upon which, such securities were issued or are issuable, were at no time held by any Affiliate of the Company), as reasonably determined by the Company, upon the advice of counsel to the Company and the transfer agent of the Company has issued certificates for such Registrable Securities to the holder thereof, or as such holder may direct, without any restrictive legend.
“ Registration Statement ” means any registration statement of the Company filed under the Securities Act that covers the resale of any of the Registrable Securities pursuant to the provisions of this Agreement, amendments and supplements to such Registration Statement, including post-effective amendments, all exhibits and all material incorporated by reference in such Registration Statement.
“ Required Investors ” means the Investors beneficially owning a majority of the Registrable Securities.
Registration .
Demand Registration . At any time following the Closing Date, the Required Investors may request that the Company prepare and file with the SEC one Registration Statement on Form S-1 or S-3 (if available), covering the resale of the Registrable Securities (the “ Demand ”). Subject to any SEC comments, such Registration Statement shall include the plan of distribution attached hereto as Exhibit A ; provided, however, that no Investor shall be named as an “underwriter” in the Registration Statement without the Investor’s prior written consent. Such Registration Statement also shall cover, to the extent allowable under the Securities Act and the rules promulgated thereunder (including Rule 416), such indeterminate number of additional shares of Common Stock resulting from stock splits, stock dividends or similar transactions with respect to the Registrable Securities. Such Registration Statement shall not include any shares of Common Stock or other securities for the account of any other holder without the prior written consent of the Required Investors. The Registration Statement (and each amendment or supplement thereto, and each request for acceleration of effectiveness thereof) shall be provided in accordance with Section 3(c) to the Investors and their counsel prior to its filing or other submission. The Company shall promptly, but no later than sixty (60) days following receipt of the Demand, file the Registration Statement with the SEC.
Expenses . The Company will pay all expenses associated with effecting the registration of the Registrable Securities, including filing and printing fees, the Company’s counsel and accounting fees and expenses, costs associated with clearing the Registrable Securities for sale under applicable state securities laws, listing fees, fees, and the reasonable and documented fees and disbursements of a single counsel to the Investors in an amount not to exceed $10,000 in the aggregate.
Effectiveness .
The Company shall use commercially reasonable efforts to have any Registration Statement declared effective as soon as practicable. The Company shall notify the Investors by facsimile or e-mail as promptly as practicable, and in any event, within twenty-four (24) hours, after any Registration Statement is declared effective and shall simultaneously provide the Investors with copies of any related Prospectus to be used in connection with the sale or other disposition of the securities covered thereby.
For not more than twenty (20) consecutive days or for a total of not more than forty-five (45) days in any twelve (12) month period, the Company may suspend the use of any Prospectus included in any Registration Statement contemplated by this Section in the event that the Company determines in good faith that such suspension is necessary to (A) delay the disclosure of material non-public information concerning the Company, the disclosure of which at the time is not, in the good faith opinion of the Company, in the best interests of the Company or (B) amend or supplement the affected Registration Statement or the related Prospectus so that such Registration Statement or Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the case of the Prospectus in light of the circumstances under which they were made, not misleading (an “ Allowed Delay ”); provided, that the Company shall promptly (a) notify each Investor in writing of the commencement of an Allowed Delay, but shall not (without the prior written consent of an Investor) disclose to such Investor any material non-public information giving rise to an Allowed Delay, (b) advise the Investors in writing to cease all sales under the Registration Statement until the end of the Allowed Delay and (c) use commercially reasonable efforts to terminate an Allowed Delay as promptly as practicable.
Rule 415; Cutback . If at any time the SEC takes the position that the offering of some or all of the Registrable Securities in a Registration Statement is not eligible to be made on a delayed or continuous basis under the provisions of Rule 415 under the Securities Act or requires any Investor to be named as an “underwriter”, the Company shall use its reasonable best efforts to persuade the SEC that the offering contemplated by a Registration Statement is a bona fide secondary offering and not an offering “by or on behalf of the issuer” as defined in Rule 415 and that none of the Investors is an “underwriter”. The Investors shall have the right to participate or have their counsel participate in any meetings or discussions with the SEC regarding the SEC’s position and to comment or have their counsel comment on any written submission made to the SEC with respect thereto. No such written submission shall be made to the SEC to which the Investors’ counsel reasonably objects. In the event that, despite the Company’s reasonable best efforts and compliance with the terms of this Section 2(d), the SEC refuses to alter its position, the Company shall (i) remove from the Registration Statement such portion of the Registrable Securities and/or (ii) agree to such restrictions and limitations on the registration and resale of the Registrable Securities as the SEC may require to assure the Company’s compliance with the requirements of Rule 415 (collectively, the “ SEC Restrictions ”); provided, however, that the Company shall not agree to name any Investor as an “underwriter” in such Registration Statement without the prior written consent of such Investor. Any cut-back imposed on the Investors pursuant to this Section 2(d) shall be allocated among the Investors on a pro rata basis, unless the SEC Restrictions otherwise require or provide or the Investors otherwise agree.
Right to Piggyback Registration .
If at any time following the date of this Agreement that any Registrable Securities remain outstanding and are not freely tradable under Rule 144 (A) there is not one or more effective Registration Statements covering all of the Registrable Securities and (B) the Company proposes for any reason to register any shares of Common Stock under the Securities Act (other than pursuant to a registration statement on Form S-4 or Form S-8 (or a similar or successor form)) with respect to an offering of Common Stock by the Company for its own account or for the account of any of its stockholders, it shall at each such time promptly give written notice to the holders of the Registrable Securities of its intention to do so (but in no event less than ten (10) business days before the anticipated filing date) and, to the extent permitted under the provisions of Rule 415 under the Securities Act, include in such registration all Registrable Securities with respect to which the Company has received written requests for inclusion therein within fifteen (15) business days after receipt of the Company’s notice (a “ Piggyback Registration ”). Such notice shall offer the holders of the Registrable Securities the opportunity to register such number of shares of Registrable Securities as each such holder may request and shall indicate the intended method of distribution of such Registrable Securities.
If the managing underwriter of any underwritten offering shall inform the Company by letter of its belief that the number of Registrable Securities requested to be included in such registration pursuant to this Section 2(e), when added to the number of other securities to be offered in such registration by the Company, would materially adversely affect such offering, then the Company shall include in such registration, to the extent of the total number of securities which the Company is so advised can be sold in (or during the time of) such offering without so materially adversely affecting such offering, securities in the following priority: (x) first, all Common Stock or securities convertible into, or exchangeable or exercisable for, Common Stock that the Company proposes to register for its own account; and (y) second, the Investors on a pro rata basis based on the number of Registrable Securities subject to registration rights owned by each holder requesting inclusion in relation to the number of Registrable Securities then owned by all holders requesting inclusion.
Notwithstanding the foregoing, (A) if such registration involves an underwritten public offering, the Investors must sell their Registrable Securities to, if applicable, the underwriter(s) at the same price and subject to the same underwriting discounts and commissions that apply to the other securities sold in such offering (it being acknowledged that the Company shall be responsible for other expenses as set forth in Section 2(b)) and subject to the Investors entering into customary underwriting documentation for selling stockholders in an underwritten public offering, and (B) if, at any time after giving written notice of its intention to register any Registrable Securities pursuant to Section 2(e)(i) and prior to the effective date of the registration statement filed in connection with such registration, the Company shall determine for any reason not to cause such registration statement to become effective under the Securities Act, the Company shall deliver written notice to the Investors and, thereupon, shall be relieved of its obligation to register any Registrable Securities in connection with such registration; provided, however, that nothing contained in this Section 2(e)(iii) shall limit the Company’s liabilities and/or obligations under this Agreement, including, without limitation, the obligation to pay liquidated damages under this Section 2.
Company Obligations . The Company will use commercially reasonable efforts to effect the registration of the Registrable Securities in accordance with the terms hereof, and pursuant thereto the Company will, as expeditiously as possible:
use commercially reasonable efforts to cause such Registration Statement to become effective and to remain continuously effective for a period that will terminate upon the earlier of (i) the date on which all Registrable Securities covered by such Registration Statement as amended from time to time, have been sold or otherwise disposed of pursuant to the Registration Statement or in a transaction in which the transferee receives freely tradable shares, and (ii) the date on which the Registrable Securities no longer constitute “Registrable Securities” pursuant to the definition thereof (the “ Effectiveness Period ”);
prepare and file with the SEC such amendments and post-effective amendments to the Registration Statement and the Prospectus as may be necessary to keep the Registration Statement effective for the Effectiveness Period and to comply with the provisions of the Securities Act and the Exchange Act, with respect to the distribution of all of the Registrable Securities covered thereby;
provide copies to and permit counsel designated by the Investors to review each Registration Statement and all amendments and supplements thereto no fewer than two (2) business days prior to their filing with the SEC and not file any document to which such counsel reasonably objects;
furnish to the Investors and their legal counsel (i) promptly after the same is prepared and publicly distributed, filed with the SEC, or received by the Company (but not later than two (2) business days after the filing date, receipt date or sending date, as the case may be) one (1) copy of each letter written by or on behalf of the Company to the SEC or the staff of the SEC, and each item of correspondence from the SEC or the staff of the SEC, in each case relating to such Registration Statement (other than any portion thereof which contains information for which the Company has sought confidential treatment), and (ii) such number of copies of a Prospectus, including a preliminary prospectus, and all amendments and supplements thereto and such other documents as each Investor may reasonably request in order to facilitate the disposition of the Registrable Securities owned by such Investor that are covered by the related Registration Statement;
notify the Investors, promptly after the Company receives notice thereof, of the time when such registration statement has been declared effective or a supplement to a prospectus forming a part of such registration statement has been filed;
(i) use commercially reasonable efforts to prevent the issuance of any stop order or other suspension of effectiveness, (ii) notify the Investors as soon as reasonably practicable after notice thereof is received by the Company of the issuance by the SEC of any stop order suspending the effectiveness of such registration statement or any order by the SEC or any other regulatory authority preventing or suspending the use of any preliminary or final prospectus or the initiation or threatening of any proceedings for such purposes, or any notification with respect to the suspension of the qualification of the Registrable Securities for offering or sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose and (iii) use commercially reasonable efforts to obtain the withdrawal of any such order at the earliest possible moment;
prior to any public offering of Registrable Securities, use commercially reasonable efforts to register or qualify or cooperate with the Investors and their counsel in connection with the registration or qualification of such Registrable Securities for offer and sale under the securities or blue sky laws of such jurisdictions requested by the Investors and do any and all other commercially reasonable acts or things necessary or advisable to enable the distribution in such jurisdictions of the Registrable Securities covered by the Registration Statement ; provided, however, that the Company shall not be required in connection therewith or as a condition thereto to (i) qualify to do business in any jurisdiction where it would not otherwise be required to qualify but for this Section 3(g), (ii) subject itself to general taxation in any jurisdiction where it would not otherwise be so subject but for this Section 3(g), or (iii) file a general consent to service of process in any such jurisdiction;
immediately notify the Investors, at any time prior to the end of the Effectiveness Period, upon discovery that, or upon the happening of any event as a result of which, the Prospectus includes an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and promptly prepare, file with the SEC and furnish to such holder a supplement to or an amendment of such Prospectus as may be necessary so that such Prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing;
otherwise use commercially reasonable efforts to comply with all applicable rules and regulations of the SEC under the Securities Act and the Exchange Act, including, without limitation, Rule 172 under the Securities Act, file any final Prospectus, including any supplement or amendment thereof, with the SEC pursuant to Rule 424 under the Securities Act, promptly inform the Investors in writing if, at any time during the Effectiveness Period, the Company does not satisfy the conditions specified in Rule 172 and, as a result thereof, the Investors are required to deliver a Prospectus in connection with any disposition of Registrable Securities and take such other actions as may be reasonably necessary to facilitate the registration of the Registrable Securities hereunder;
cause the Registrable Securities covered by such registration statement to be listed with any securities exchange on which the Common Stock is then listed;
in the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering;
in the case of an underwritten offering, obtain for delivery to the underwriters, if any, an opinion or opinions from counsel for the Company, dated the effective date of the Registration Statement or, in the event of an underwritten offering, the date of the closing under the underwriting agreement, in customary form, scope and substance, which opinions shall be reasonably satisfactory to such underwriters and their respective counsel;
in the case of an underwritten offering, obtain for delivery to the Company and the underwriters, a cold comfort letter from the Company’s independent certified public accountants in customary form and covering such matters of the type customarily covered by cold comfort letters as managing underwriter or underwriters reasonably request, dated the date of execution of the underwriting agreement and brought down to the closing under the underwriting agreement; and
with a view to making available to the Investors the benefits of Rule 144 (or its successor rule) and any other rule or regulation of the SEC that may at any time permit the Investors to sell shares of Common Stock to the public without registration, the Company covenants and agrees to: (i) make and keep public information available, as those terms are understood and defined in Rule 144, until the earlier of (A) six (6) months after such date as all of the Registrable Securities may be sold without restriction by the holders thereof pursuant to Rule 144 or any other rule of similar effect or (B) such date as all of the Registrable Securities shall have been resold pursuant to a Registration Statement, Rule 144 or otherwise in a transaction in which the transferee receives freely tradable shares; (ii) file with the SEC in a timely manner all reports and other documents required of the Company under the Exchange Act; and (iii) furnish to each Investor such other information as may be reasonably requested in order to avail such Investor of any rule or regulation of the SEC that permits the selling of any such Registrable Securities without registration.
Obligations of the Investors .
Each Investor shall furnish in writing to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of the Registrable Securities held by it, as shall be reasonably required to effect the registration of such Registrable Securities and shall execute such documents in connection with such registration as the Company may reasonably request. At least five (5) business days prior to the first anticipated filing date of any Registration Statement, the Company shall notify each Investor of the information the Company requires from such Investor if such Investor elects to have any of the Registrable Securities included in the Registration Statement. An Investor shall provide such information to the Company at least two (2) business days prior to the first anticipated filing date of such Registration Statement if such Investor elects to have any of the Registrable Securities included in the Registration Statement.
Each Investor, by its acceptance of the Registrable Securities agrees to cooperate with the Company as reasonably requested by the Company in connection with the preparation and filing of a Registration Statement hereunder, unless such Investor has notified the Company in writing of its election to exclude all of its Registrable Securities from such Registration Statement.
Each Investor agrees that, upon receipt of any notice from the Company of either (i) the commencement of an Allowed Delay pursuant to Section 2(c)(ii) or (ii) the happening of an event pursuant to Section 3(h) hereof, such Investor will immediately discontinue disposition of Registrable Securities pursuant to the Registration Statement covering such Registrable Securities, until the Investor is advised by the Company that such dispositions may again be made.
Each Investor agrees that it will not sell, dispose or otherwise transfer its Registrable Securities other than (i) pursuant to the Plan of Distribution contained in the Registration Statement covering such Registrable Securities, (ii) in accordance with the requirements of Rule 144 or (iii) in a transaction exempt from the registration requirements of the Securities Act and as to which the Company has received an opinion of counsel reasonably satisfactory to it that such transfer may lawfully be made without registration under the Securities Act.
Indemnification .
Indemnification by the Company . The Company will indemnify and hold harmless each Investor and its officers, directors, members, equityholders, managers, partners, trustees, employees and agents and other representatives, successors and permitted assigns, and each other Person, if any, who controls such Investor within the meaning of the Securities Act, against any losses, claims, damages or liabilities, joint or several, to which they may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon: (i) any untrue statement or alleged untrue statement or omission or alleged omission of any material fact contained in any Registration Statement, any Prospectus, or other similar document (including any related registration statement, notification, or the like, including any amendments or supplements thereto) incident to any such registration, qualification or compliance; (ii) any blue sky application or other document executed by the Company specifically for that purpose or based upon written information furnished by the Company filed in any state or other jurisdiction in order to qualify any or all of the Registrable Securities under the securities laws thereof (any such application, document or information herein called a “ Blue Sky Application ”); (iii) the omission or alleged omission to state in any Registration Statement, any Prospectus, or other similar document (including any related registration statement, notification, or the like, including any amendments or supplements thereto) incident to any such registration, qualification or compliance, a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances in which they were made; or (iv) any violation by the Company or its agents of any rule or regulation promulgated under the Securities Act applicable to the Company or its agents and relating to action or inaction required of the Company in connection with such registration and will reimburse such Investor, and each such officer, director or member and each such controlling Person for any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability or action; provided , however , that the Company will not be liable in any such case if and to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission so made in conformity with information furnished by such Investor or any such controlling person in writing specifically for use in such Registration Statement or Prospectus.
Indemnification by the Investors . Each Investor agrees, severally but not jointly, to indemnify and hold harmless, to the fullest extent permitted by law, the Company, its directors, officers, employees, stockholders and each person who controls the Company (within the meaning of the Securities Act) against any losses, claims, damages, liabilities and expense (including reasonable attorney fees) resulting from any untrue statement of a material fact or any omission of a material fact required to be stated in the Registration Statement or Prospectus or amendment or supplement thereto or necessary to make the statements therein not misleading in light of the circumstances in which they were made, to the extent, but only to the extent that such untrue statement or omission is contained in any information furnished in writing by such Investor to the Company specifically for inclusion in such Registration Statement or Prospectus or amendment or supplement thereto. In no event shall the liability of an Investor be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such Investor in connection with any claim relating to this Section 5 and the amount of any damages such Investor has otherwise been required to pay by reason of such untrue statement or omission) received by such Investor upon the sale of the Registrable Securities included in the Registration Statement giving rise to such indemnification obligation.
Conduct of Indemnification Proceedings . Any person entitled to indemnification hereunder shall (i) give prompt notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party; provided that any person entitled to indemnification hereunder shall have the right to employ separate counsel and to participate in the defense of such claim, but the fees and expenses of such counsel shall be at the expense of such person unless (a) the indemnifying party has agreed to pay such fees or expenses, or (b) the indemnifying party shall have failed to assume the defense of such claim and employ counsel reasonably satisfactory to such person or (c) in the reasonable judgment of any such person, based upon written advice of its counsel, a conflict of interest exists between such person and the indemnifying party with respect to such claims (in which case, if the person notifies the indemnifying party in writing that such person elects to employ separate counsel at the expense of the indemnifying party, the indemnifying party shall not have the right to assume the defense of such claim on behalf of such person); and provided , further , that the failure of any indemnified party to give notice as provided herein shall not relieve the indemnifying party of its obligations hereunder, except to the extent that such failure to give notice shall materially adversely affect the indemnifying party in the defense of any such claim or litigation. It is understood that the indemnifying party shall not, in connection with any proceeding in the same jurisdiction, be liable for fees or expenses of more than one separate firm of attorneys at any time for all such indemnified parties. No indemnifying party will, except with the consent of the indemnified party, consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation.
Contribution . If for any reason the indemnification provided for in the preceding paragraphs (a) and (b) is unavailable to an indemnified party or insufficient to hold it harmless, other than as expressly specified therein, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnified party and the indemnifying party, as well as any other relevant equitable considerations. No person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of the Securities Act shall be entitled to contribution from any person not guilty of such fraudulent misrepresentation. In no event shall the contribution obligation of a holder of Registrable Securities be greater in amount than the dollar amount of the proceeds (net of all expenses paid by such holder in connection with any claim relating to this Section 5 and the amount of any damages such holder has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission) received by it upon the sale of the Registrable Securities giving rise to such contribution obligation.
Miscellaneous .
Amendments and Waivers . Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Required Investors.
Notices . All notices and other communications provided for or permitted hereunder shall be made as set forth in Section 6(g) of the Debt Cancellation Agreement.
Assignments and Transfers by Investors . The provisions of this Agreement shall be binding upon and inure to the benefit of the Investors and their respective successors and assigns. An Investor may transfer or assign, in whole or from time to time in part, to one or more persons its rights hereunder in connection with the transfer of Registrable Securities by such Investor to such person, provided that such Investor complies with all laws applicable thereto and provides written notice of assignment to the Company promptly after such assignment is effected.
Assignments and Transfers by the Company . This Agreement may not be assigned by the Company (whether by operation of law or otherwise) without the prior written consent of the Required Investors; provided, however , that in the event that the Company is a party to a merger, consolidation, share exchange or similar business combination transaction in which the Common Stock is converted into the equity securities of another Person, from and after the effective time of such transaction, such Person shall, by virtue of such transaction, be deemed to have assumed the obligations of the Company hereunder, the term “Company” shall be deemed to refer to such Person and the term “Registrable Securities” shall be deemed to include the securities received by the Investors in connection with such transaction unless such securities are otherwise freely tradable by the Investors after giving effect to such transaction.
Benefits of the Agreement . The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties. Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.
Counterparts . This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. This Agreement may be delivered via any form of electronic communication, which shall be deemed an original.
Titles and Subtitles . The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.
Severability . Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof but shall be interpreted as if it were written so as to be enforceable to the maximum extent permitted by applicable law, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, the parties hereby waive any provision of law which renders any provisions hereof prohibited or unenforceable in any respect.
Further Assurances . The parties shall execute and deliver all such further instruments and documents and take all such other actions as may reasonably be required to carry out the transactions contemplated hereby and to evidence the fulfillment of the agreements herein contained.
Entire Agreement . This Agreement is intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. This Agreement supersedes all prior agreements and understandings between the parties with respect to such subject matter.
Governing Law; Jurisdiction; Jury Trial . The laws of the state of Nevada shall govern all issues concerning the relative rights of the Company and its stockholders. All other questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by the internal laws of the State of New York, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of New York or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of New York. The Company hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in The City of New York, Borough of Manhattan, for the adjudication of any dispute hereunder or in connection herewith or under the Debt Cancellation Agreement or with any transaction contemplated hereby or thereby, and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is brought in an inconvenient forum or that the venue of such suit, action or proceeding is improper. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof to such party at the address for such notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any manner permitted by law. Nothing contained herein shall be deemed or operate to preclude any Investor from bringing suit or taking other legal action against the Company in any other jurisdiction to collect on the Company’s obligations to such Investor or to enforce a judgment or other court ruling in favor of such Investor. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR UNDER ANY OTHER TRANSACTION DOCUMENT OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR THEREBY.
IN WITNESS WHEREOF, the parties have executed this Agreement or caused their duly authorized officers to execute this Agreement as of the date first above written.
The Company:
|
LIQTECH INTERNATIONAL, INC.
|
|
|
|
|
|
|
|
|
|
|
By:
|
|
|
|
Name: Fei Chen |
|
|
Title: Chief Executive Officer |
|
[Signature Page to Registration Rights Agreement]
The Investors:
21 APRIL FUND, LTD.
|
|
|
|
|
By:
|
|
Name:
|
Michael Kellen
|
Title:
|
Portfolio Manager
|
|
21 APRIL FUND, LP.
|
|
|
|
|
By:
|
|
Name:
|
Michael Kellen
|
Title:
|
Portfolio Manager
|
[Signature Page to Registration Rights Agreement]
Exhibit A
Plan of Distribution
The selling stockholders, which, as used herein, includes donees, pledgees, transferees or other successors-in-interest selling shares of common stock or interests in shares of common stock received after the date of this prospectus from a selling stockholder as a gift, pledge, partnership distribution or other transfer, may, from time to time, sell, transfer or otherwise dispose of any or all of their shares of common stock or interests in shares of common stock on any stock exchange, market or trading facility on which the shares are traded or in private transactions. These dispositions may be at fixed prices, at prevailing market prices at the time of sale, at prices related to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices.
The selling stockholders may use any one or more of the following methods when disposing of shares or interests therein:
ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers;
block trades in which the broker-dealer will attempt to sell the shares as agent, but may position and resell a portion of the block as principal to facilitate the transaction;
purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
an exchange distribution in accordance with the rules of the applicable exchange;
privately negotiated transactions;
short sales effected after the date the registration statement of which this Prospectus is a part is declared effective by the SEC;
through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise;
broker-dealers may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;
a combination of any such methods of sale; and
any other method permitted by applicable law.
The selling stockholders may, from time to time, pledge or grant a security interest in some or all of the shares of common stock owned by them and, if they default in the performance of their secured obligations, the pledgees or secured parties may offer and sell the shares of common stock, from time to time, under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3) or other applicable provision of the Securities Act amending the list of selling stockholders to include the pledgee, transferee or other successors in interest as selling stockholders under this prospectus. The selling stockholders also may transfer the shares of common stock in other circumstances, in which case the transferees, pledgees or other successors in interest will be the selling beneficial owners for purposes of this prospectus.
In connection with the sale of our common stock or interests therein, the selling stockholders may enter into hedging transactions with broker-dealers or other financial institutions, which may in turn engage in short sales of the common stock in the course of hedging the positions they assume. The selling stockholders may also sell shares of our common stock short and deliver these securities to close out their short positions, or loan or pledge the common stock to broker-dealers that in turn may sell these securities. The selling stockholders may also enter into option or other transactions with broker-dealers or other financial institutions or the creation of one or more derivative securities which require the delivery to such broker-dealer or other financial institution of shares offered by this prospectus, which shares such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The aggregate proceeds to the selling stockholders from the sale of the common stock offered by them will be the purchase price of the common stock less discounts or commissions, if any. Each of the selling stockholders reserves the right to accept and, together with their agents from time to time, to reject, in whole or in part, any proposed purchase of common stock to be made directly or through agents. We will not receive any of the proceeds from this offering.
The selling stockholders also may resell all or a portion of the shares in open market transactions in reliance upon Rule 144 under the Securities Act, provided that they meet the criteria and conform to the requirements of that rule.
The selling stockholders and any underwriters, broker-dealers or agents that participate in the sale of the common stock or interests therein may be "underwriters" within the meaning of Section 2(11) of the Securities Act. Any discounts, commissions, concessions or profit they earn on any resale of the shares may be underwriting discounts and commissions under the Securities Act. Selling stockholders who are "underwriters" within the meaning of Section 2(11) of the Securities Act will be subject to the prospectus delivery requirements of the Securities Act.
To the extent required, the shares of our common stock to be sold, the names of the selling stockholders, the respective purchase prices and public offering prices, the names of any agents, dealer or underwriter, any applicable commissions or discounts with respect to a particular offer will be set forth in an accompanying prospectus supplement or, if appropriate, a post-effective amendment to the registration statement that includes this prospectus.
In order to comply with the securities laws of some states, if applicable, the common stock may be sold in these jurisdictions only through registered or licensed brokers or dealers. In addition, in some states the common stock may not be sold unless it has been registered or qualified for sale or an exemption from registration or qualification requirements is available and is complied with.
We have advised the selling stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of shares in the market and to the activities of the selling stockholders and their affiliates. In addition, to the extent applicable we will make copies of this prospectus (as it may be supplemented or amended from time to time) available to the selling stockholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The selling stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the shares against certain liabilities, including liabilities arising under the Securities Act.
We are required to pay all fees and expenses incident to the registration of the shares of common stock. We have agreed to indemnify the selling stockholders against liabilities, including liabilities under the Securities Act and state securities laws, relating to the registration of the shares offered by this prospectus.
We have agreed with the selling stockholders to keep the registration statement of which this prospectus constitutes a part effective until the earlier of (i) the date that such securities become eligible for resale without volume or manner-of-sale restrictions and without current public information pursuant to Rule 144 and certain other conditions have been satisfied, or (ii) all of the securities have been sold or otherwise disposed of pursuant to the registration statement of which this prospectus forms a part or in a transaction in which the transferee receives freely tradable shares.
### EX-23.1 - EXHIBIT 23.1
EX-23.1
8
ex_964531.htm
EXHIBIT 23.1
ex_964531.htm
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
As independent registered public accountants, we hereby consent to the incorporation by reference of our report dated February 27, 2026, with respect to the financial statements of LiqTech International, Inc. for the years ended December 31, 2025 and 2024, in its registration statement on Form S-1, relating to the registration of common stock and warrants on the date filed hereof.
We also consent to the reference of our firm under the caption “interests of named experts and counsel” in the registration statement.
/s/ Sadler, Gibb and Associates, LLC
Draper, UT
May 26, 2026
### EX-FILING FEES - EXHIBIT FILING FEES
EX-FILING FEES
0001307579
2026-05-26
2026-05-26
0001307579
1
2026-05-26
2026-05-26
0001307579
2
2026-05-26
2026-05-26
0001307579
3
2026-05-26
2026-05-26
0001307579
4
2026-05-26
2026-05-26
0001307579
5
2026-05-26
2026-05-26
iso4217:USD
xbrli:pure
xbrli:shares
Calculation of Filing Fee Tables
|
S-1
|
LIQTECH INTERNATIONAL INC
|
Table 1: Newly Registered and Carry Forward Securities
|
☐Not Applicable
|
|
|
Security Type
|
Security Class Title
|
Fee Calculation or Carry Forward Rule
|
Amount Registered
|
Proposed Maximum Offering Price Per Unit
|
Maximum Aggregate Offering Price
|
Fee Rate
|
Amount of Registration Fee
|
Carry Forward Form Type
|
Carry Forward File Number
|
Carry Forward Initial Effective Date
|
Filing Fee Previously Paid in Connection with Unsold Securities to be Carried Forward
|
Newly Registered Securities
|
Fees to be Paid
|
1
|
Equity
|
Common stock
|
457(o)
|
|
|
$
23,000,000.00
|
0.0001381
|
$
3,176.30
|
|
|
|
|
Fees to be Paid
|
2
|
Equity
|
Pre-Funded Warrants
|
Other
|
|
|
|
0.0001381
|
$
0.00
|
|
|
|
|
Fees to be Paid
|
3
|
Equity
|
Common stock underlying Pre-Funded Warrants
|
457(o)
|
|
|
$
0.00
|
0.0001381
|
$
0.00
|
|
|
|
|
Fees to be Paid
|
4
|
Equity
|
Warrants to be issued to the underwriter
|
Other
|
|
|
|
0.0001381
|
$
0.00
|
|
|
|
|
Fees to be Paid
|
5
|
Equity
|
Common stock underlying warrants to be issued to the underwriter
|
457(o)
|
|
|
$
1,150,000.00
|
0.0001381
|
$
158.81
|
|
|
|
|
Fees Previously Paid
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Carry Forward Securities
|
Carry Forward Securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Offering Amounts:
|
|
$
24,150,000.00
|
|
$
3,335.11
|
|
|
|
|
|
|
|
Total Fees Previously Paid:
|
|
|
|
$
0.00
|
|
|
|
|
|
|
|
Total Fee Offsets:
|
|
|
|
$
0.00
|
|
|
|
|
|
|
|
Net Fee Due:
|
|
|
|
$
3,335.11
|
|
|
|
|
Offering Note
|
1
|
(a) In accordance with Rule 416 under the Securities Act of 1933, as amended (the "Securities Act"), this registration statement shall be deemed to cover an indeterminate number of additional shares of Common Stock to be offered or issued from stock splits, stock dividends or similar transactions. (b) The proposed maximum aggregate offering price has been estimated solely to calculate the registration fee in accordance with Rule 457(o) under the Securities Act. (c) Includes the price of additional shares of common stock that may be issued upon exercise of the over-allotment option granted to the underwriters to cover over-allotments, if any. (d) The proposed maximum aggregate offering price of the common stock will be reduced on a dollar-for-dollar basis based on the offering price of any pre-funded warrants issued in the offering, and the proposed maximum aggregate offering price of the pre-funded warrants to be issued in the offering will be reduced on a dollar-for-dollar basis based on the offering price of any common stock issued in the offering. Accordingly, the proposed maximum aggregate offering price of the common stock and pre-funded warrants (including the common stock issuable upon exercise of the pre-funded warrants), if any, is $23,000,000.
|
|
2
|
Included above
(a) In accordance with Rule 416 under the Securities Act, this registration statement shall be deemed to cover an indeterminate number of additional shares of Common Stock to be offered or issued from stock splits, stock dividends or similar transactions. (b) The proposed maximum aggregate offering price has been estimated solely to calculate the registration fee in accordance with Rule 457(o) under the Securities Act. (c) Includes the price of additional shares of common stock that may be issued upon exercise of the over-allotment option granted to the underwriters to cover over-allotments, if any. (d) The proposed maximum aggregate offering price of the common stock will be reduced on a dollar-for-dollar basis based on the offering price of any pre-funded warrants issued in the offering, and the proposed maximum aggregate offering price of the pre-funded warrants to be issued in the offering will be reduced on a dollar-for-dollar basis based on the offering price of any common stock issued in the offering. Accordingly, the proposed maximum aggregate offering price of the common stock and pre-funded warrants (including the common stock issuable upon exercise of the pre-funded warrants), if any, is $23,000,000. (e) No registration fee required pursuant to Rule 457(g).
|
|
3
|
included above
(a) In accordance with Rule 416 under the Securities Act, this registration statement shall be deemed to cover an indeterminate number of additional shares of Common Stock to be offered or issued from stock splits, stock dividends or similar transactions. (b) The proposed maximum aggregate offering price has been estimated solely to calculate the registration fee in accordance with Rule 457(o) under the Securities Act. (d) The proposed maximum aggregate offering price of the common stock will be reduced on a dollar-for-dollar basis based on the offering price of any pre-funded warrants issued in the offering, and the proposed maximum aggregate offering price of the pre-funded warrants to be issued in the offering will be reduced on a dollar-for-dollar basis based on the offering price of any common stock issued in the offering. Accordingly, the proposed maximum aggregate offering price of the common stock and pre-funded warrants (including the common stock issuable upon exercise of the pre-funded warrants), if any, is $23,000,000.
|
|
4
|
(a) In accordance with Rule 416 under the Securities Act, this registration statement shall be deemed to cover an indeterminate number of additional shares of Common Stock to be offered or issued from stock splits, stock dividends or similar transactions. (b) The proposed maximum aggregate offering price has been estimated solely to calculate the registration fee in accordance with Rule 457(o) under the Securities Act. (c) No registration fee required pursuant to Rule 457(g).
|
|
5
|
(a) In accordance with Rule 416 under the Securities Act, this registration statement shall be deemed to cover an indeterminate number of additional shares of Common Stock to be offered or issued from stock splits, stock dividends or similar transactions. (b) The proposed maximum aggregate offering price has been estimated solely to calculate the registration fee in accordance with Rule 457(o) under the Securities Act. (d) We have agreed to issue to the underwriter the underwriters warrants to purchase shares of common stock representing up to 4% of the common stock issued in the offering. The underwriter's warrants are exercisable at a per share exercise price equal to 125% of the public offering price per share of the common stock offered hereby.
|
|
Table 2: Fee Offset Claims and Sources
|
☑Not Applicable
|
|
|
Registrant or Filer Name
|
Form or Filing Type
|
File Number
|
Initial Filing Date
|
Filing Date
|
Fee Offset Claimed
|
Security Type Associated with Fee Offset Claimed
|
Security Title Associated with Fee Offset Claimed
|
Unsold Securities Associated with Fee Offset Claimed
|
Unsold Aggregate Offering Amount Associated with Fee Offset Claimed
|
Fee Paid with Fee Offset Source
|
Rules 457(b) and 0-11(a)(2)
|
Fee Offset Claims
|
|
|
|
|
|
|
|
|
|
|
|
|
Fee Offset Sources
|
|
|
|
|
|
|
|
|
|
|
|
|
Rule 457(p)
|
Fee Offset Claims
|
|
|
|
|
|
|
|
|
|
|
|
|
Fee Offset Sources
|
|
|
|
|
|
|
|
|
|
|
|
|
Table 3: Combined Prospectuses
|
☑Not Applicable
|
|
Security Type
|
Security Class Title
|
Amount of Securities Previously Registered
|
Maximum Aggregate Offering Price of Securities Previously Registered
|
Form Type
|
File Number
|
Initial Effective Date
|
|
|
|
|
|
|
|
|