Annual report pursuant to Section 13 and 15(d)

Subsequent Events

v3.21.1
Subsequent Events
12 Months Ended
Dec. 31, 2020
Subsequent Events [Abstract]  
Subsequent Events

NOTE 16. SUBSEQUENT EVENTS

 

On January 25, 2021, AYRO entered into a Securities Purchase Agreement with certain institutional and accredited investors, pursuant to which AYRO agreed to issue and sell in a registered direct offering (the “January 2021 Offering”) an aggregate of 3,333,334 shares of common stock of AYRO, par value $0.0001 per share, at an offering price of $6.00 per share, for gross proceeds of approximately $20.0 million before the deduction of fees and offering expenses. Each purchaser was also granted a warrant to purchase, between July 26, 2021 and July 26, 2023, additional shares of common stock (the “Additional Shares”) equal to the full amount of the common stock it purchased at the initial closing, or an aggregate of 3,333,334 shares (“Investor Warrants”), at an exercise price of $6.93 per share. The Investor Warrants are exercisable six months following issuance and terminate two and a half years following issuance and are exercisable at an exercise price of $6.93 per share.

 

Palladium Capital Group, LLC (“Palladium”) is acting as the placement agent for the January 2021 Offering. AYRO will pay Palladium a fee equal to 8.0% of the gross proceeds of the offering. Additionally, AYRO issued Palladium a warrant to purchase 233,334 shares of Common Stock (which equals 7.0% of the aggregate number of shares of Common Stock placed in the Offering (the “Palladium Warrants” and together with the Investor Warrants, the “Warrants”). The Palladium Warrants will have the same terms as the Investor Warrants.

 

On February 11, 2021, AYRO entered into a Securities Purchase Agreement with certain institutional and accredited investors, pursuant to which AYRO agreed to issue and sell in a registered direct offering (the “February 2021 Offering”) an aggregate of 4,400,001 shares of common stock of AYRO, par value $0.0001 per share, at an offering price of $9.50 per share, for gross proceeds of approximately $41.8 million before the deduction of fees and offering expenses. Each purchaser was also granted an option to purchase, on or before February 16, 2022, additional shares of common stock equal to the full amount of 75% of the common stock it purchased at the initial closing, or an aggregate of 3,300,000 shares, at an exercise price of $11.50 per share.

 

Palladium and Spartan Capital Securities, LLC (“Spartan,”) or collectively with Palladium, the “Financial Advisors” acted as Financial Advisors in connection with the February 2021 Offering. The Financial Advisors are entitled to a fee equal to 8% of the gross proceeds raised in the February 2021 Offering, or an aggregate of approximately $3,344,001, and warrants (the “February 2021 Warrants”) to purchase an aggregate of 271,158 shares of Common Stock at an exercise price of $10.925 per share and 35,885 shares of Common Stock at an exercise price of $10.45 per share. The February 2021 Warrants are exercisable immediately following issuance and terminate five years following issuance.

 

On March 17, 2021, in connection with a certain Agreement and Plan of Merger dated December 19, 2019, whereby certain former stockholders of AYRO Operating entered into lock-up agreements (collectively, the “May Lock-Up Agreements”) pursuant to which they agreed to certain restrictions on the transfer or sale of shares of the Company’s common stock for the one-year period following the Merger, AYRO modified the May Lock-Up Agreements to allow each stockholder party to a May Lock-Up Agreement to (i) sell up to 5% of such stockholder’s holdings in the Company’s common stock on any trading day (with such 5% limitation to be measured as of the date of each sale) and (ii) allow for unlimited sales of the Company’s common stock for any sales made at $10.00 per share or greater.

 

Pursuant to the Securities Purchase Agreement dated July 21, 2020, between January 1, 2021 and March 30, 2021, investors had elected to purchase 302,500 of the Additional Shares of common stock of AYRO, par value $0.0001 per share, at an offering price of $5.00 per share, for gross proceeds of approximately $1.51 million before the deduction of fees and offering expenses.

 

During March 2021, the Company subleased additional office space to support the Company’s expansion plan. The term is for 16 months with a total lease obligation of $131,408.