As filed with the Securities and Exchange Commission
on January 10, 2022
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
AKERNA CORP.
(Exact Name of Registrant as Specified in its Charter)
Delaware
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83-2242651
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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1550 Larimer Street #246
Denver, Colorado 80202
1-888-932-6537
(Address, including zip
code, and telephone number,
including area code, of principal executive offices)
Corporation Service Company
251 Little Falls Drive
Wilmington, Delaware 19807
(302) 636-5400
(Name, address, including zip code, and telephone
number,
including area code, of agent for service)
Copies to:
Jason K Brenkert, Esq.
Dorsey & Whitney LLP
1400 Wewatta Street, Suite 400
Denver, Colorado 80202
Telephone: (303) 352-1133
Fax Number: (303) 629-3450
From time to time after the effective date of
this registration statement
(Approximate
date of commencement of proposed sale to public)
If the only securities being registered on this
Form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. ☐
If any of the securities being registered on
this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment plans, please check the following box. ☒
If this Form is filed to register additional
securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed
pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. ☐
If this Form is a registration statement pursuant
to General Instruction I.D. or a post-effective amendment thereto that shall become effective upon filing with the Commission pursuant
to Rule 462(e) under the Securities Act, check the following box. ☐
If this Form is a post-effective amendment to
a registration statement filed pursuant to General Instruction I.D. filed to register additional securities or additional classes of
securities pursuant to Rule 413(b) under the Securities Act, check the following box. ☐
Indicate by check mark whether the registrant
is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company.
See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company”
and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
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☐
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Accelerated filer
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☐
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Non-accelerated filer
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☒
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Smaller reporting company
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☒
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Emerging Growth Company
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☒
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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 Securities Act. ☐
CALCULATION OF REGISTRATION FEE
Title of Each Class of Securities to be Registered
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Amount
to be
Registered(1)
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Proposed
Maximum
Offering
Price Per
Share
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Proposed Maximum
Aggregate Offering
Price
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Amount of
Registration
Fee
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Common Stock, par value $0.0001 per share, offered by selling stockholders
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4,685,762
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$
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1.72
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(2)
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$
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8,059,510.64
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(2)
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$
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747.12
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Total
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4,685,762
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$
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1.72
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$
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8,059,510.64
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$
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747.12
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(3)
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(1)
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Pursuant to Rule 416 under the Securities Act of 1933, as amended
(the “Securities Act”), the shares of common stock being registered hereunder include such indeterminate number of shares
as may be issuable with respect to the shares being registered hereunder as a result of stock splits, stock dividends or similar transactions.
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(2)
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Estimated solely for the purpose of calculating the amount of
registration fee pursuant to Rule 457(c) under the Securities Act. The proposed maximum offering price per share and proposed maximum
aggregate offering price are based upon the average of the high and low prices of the shares of common stock as of January 7, 2022 as
quoted on the Nasdaq Capital Market of $1.72.
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(3)
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The filing fee of $747.12 is being paid concurrently with the
filing of this registration statement on Form S-3.
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(4)
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Pursuant to Rule 429 under the Securities Act and as
further described below under the heading “Statement Pursuant to Rule 429(b),” the prospectus contained in this Registration
Statement covers 3,316,300 shares of common stock previously registered under the registrant’s Registration Statement on Form S-1
filed by the registrant on January 15, 2021 (File No. 333-252178) which was declared effective on January 25, 2021 (the “Prior
Registration Statement”). These shares have not yet been sold by the selling stockholders described in the Prior Registration Statement
and are included in the prospectus contained in this Registration Statement. See “Statement Pursuant to Rule 429(b)” below.
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STATEMENT PURSUANT TO RULE 429(b)
This registration statement also acts as a post-effective amendment
to the registrant’s registration statement on Form S-1 (333-252178) related to the resale of up to 6,119,091 shares of common stock
by selling stockholders. The registrant is filing a single prospectus in this registration statement, pursuant to Rule 429 under the Securities
Act, in order to satisfy the requirements of the Securities Act for the offering in its Registration Statement on Form S-1 (No. 333-252178)
(the “Prior Registration Statement”). The prospectus in this Registration Statement is a combined prospectus for (i) 4,685,762
shares of common stock being newly registered hereunder and (ii) 3,316,300 shares of common stock remaining for resale under the Form
S-1 (333-252178). The combined prospectus in this registration statement constitutes a post-effective amendment to the prior Registration
Statement, which shall hereafter become effective concurrently with the effectiveness of this registration statement. The post-effective
amendment is being filed by the Registrant to (i) reflect that 2,802,791 shares of common stock, including 18,000 shares of common stock
acquired upon exercise of warrants, were previously sold by selling stockholders named in the Prior Registration Statement on Form S-1
(333-252178) and Form S-3 (333-232694), (ii) add its financial statements for the six-month transition period ended December 31, 2020,
for the three-month period ended March 31, 2021, for the three- and six-month ended June 30, 2021 and for the nine-month period ended
September 30, 2021, (iii) update the related management’s discussion and analysis of financial condition and results of operations
and (iv) to reflect recent material events. If any securities previously registered under the Prior Registration Statement are offered
and sold before the effective date of this registration statement, the amount of previously registered securities so sold will not be
included in the prospectus that is a part of this registration statement.
Pursuant to Rule 416, this Registration Statement
also covers additional securities that may be offered as a result of anti-dilution provisions regarding stock splits, stock dividends,
or similar transactions relating to the shares of common stock issuable upon exercise of warrants covered by this registration statement.
The Registrant previously paid a registration
fee of $271.22 in connection with the filing of the initial registration statement on Form S-1 (No. 333-242474) filed with the Securities
and Exchange Commission on August 7, 2020, to register 314,684 shares of common stock. The Registrant previously paid a registration fee
of $4,047.17 in connection with the filing of the amended registration statement on Form S-3/A (No. 333-232694) filed with the Securities
and Exchange Commission on October 18, 2019 to register 5,446,042 shares of common stock and 243,750 shares of common stock underlying
warrants of the Company. The Registrant previously paid a registration fee of $1,935.83 in connection with the filing of the initial registration
statement on Form S-1 (No. 333-252178) filed with the Securities and Exchange Commission on January 15, 2021, to register 2,717,245 shares
of common stock. The Registrant is paying concurrently herewith the registration fee of $747.12 in connection with the registration of
4,685,762 shares of common stock.
We hereby amend this registration statement
on such date or dates as may be necessary to delay our effective date until we will file a further amendment which specifically states
that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until
this Registration Statement will become effective on such date as the Securities and Exchange Commission, in accordance with Section 8(a)
may determine.
The information in this prospectus is not complete
and may be changed. Akerna Corp. may not sell the securities until the Registration Statement filed with the Securities and Exchange Commission,
of which this prospectus is a part, is effective. This prospectus is not an offer to sell these securities and is not soliciting an offer
to buy these securities in any state where the offer or sale is not permitted.
Subject to Completion: Dated January 10, 2022
PRELIMINARY PROSPECTUS
AKERNA CORP.
8,002,062 SHARES OF COMMON STOCK
This prospectus covers up to 8,002,062 shares
of our common stock that may be offered for resale or otherwise disposed of by the selling stockholders set forth under the caption “Selling
Stockholders” beginning on page 11 of this prospectus, including their pledges, assignees or successors-in-interest. The 8,002,062
shares of our common stock includes:
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3,571,429
shares of common stock issued to certain selling stockholders on a private placement basis in connection to our acquisition of The NAV
People Inc., a Delaware corporation d/b/a “365 Cannabis” (“365 Cannabis”) in exchange for the capital stock of
365 Cannabis held by such selling stockholders;
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83,333
shares of common stock issued to certain selling stockholders on a private placement basis on August 11, 2021 for the acquisition of
certain assets;
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616,784
shares of common stock issued to certain selling stockholders on a private placement basis on January 15, 2020 and July 31, 2020 in connection
with the Company’s acquisition of solo sciences inc. (“Solo”) in exchange for the capital stock of Solo held by such
selling stockholders;
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1,031,000
shares of common stock issued to a selling stockholder on a private placement basis on April 1, 2021 in connection with the Company’s
acquisition of Viridian Sciences, Inc. (“Viridian”) in exchange for capital stock of Viridian held by such selling stockholder;
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163,103
shares of common stock issued to certain selling stockholders on a private placement basis on April 9, 2020, in connection with the Company’s
acquisition of Trellis Solutions, Inc. (“Trellis”) in exchange for the capital stock of Trellis held by such selling stockholder;
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827,907 shares of common stock issued to certain selling stockholders
in a private placement consummated in connection with our business combination which closed on June 17, 2019 and transferred to ceratin
selling stockholders in connection with such private placement;
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1,482,871 shares issued to “affiliates” of the Company (as that
term is defined in Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”)) and former affiliates in
the business combination; and
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225,635
shares of common stock underlying warrants issued to affiliates and former affiliates of the Company in the business combination.
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The selling stockholders may offer all or part
of the shares registered hereby for resale from time to time through public or private transactions, at either prevailing market prices
or at privately negotiated prices. Our registration of the shares of common stock covered by this prospectus does not mean that the selling
stockholders will offer or sell any of the shares. With regard only to the shares the selling stockholders sell for their own behalf,
such selling stockholder may be deemed an “underwriter” within the meaning of the Securities Act of 1933, as amended (the
“Securities Act”).
The Company has paid all of the registration expenses
incurred in connection with the registration of the shares. We will not pay any of the selling commissions, brokerage fees and related
expenses. We will not receive any proceeds from the resale of any of the shares of common stock by the selling stockholders being
registered hereby.
Our common stock is listed on the Nasdaq Capital
Market under the symbol “KERN”. On January 7, 2022, the last reported sale price of our common stock on the Nasdaq Capital
Market was $$1.72 per share.
Investing in our common stock involves
risks. See “Risk Factors” beginning on page 3 of this prospectus and under similar headings in the other documents that
are incorporated by reference into this prospectus. You should carefully read and consider these risk factors before you invest in
our securities..
We are an “emerging growth company,”
as defined under the federal securities laws, and, as such, may elect to comply with certain reduced public company reporting requirements
for future filings.
These securities have not been approved or
disapproved by the SEC or any state securities commission nor has the SEC or any state securities commission passed upon the accuracy
or adequacy of this prospectus. Any representation to the contrary is a criminal offense.
PROSPECTUS DATED
, 2022
TABLE OF CONTENTS
ABOUT THIS PROSPECTUS
The registration statement of which this prospectus
forms a part that we have filed with the Securities and Exchange Commission, or SEC, includes and incorporates by reference exhibits that
provide more detail of the matters discussed in this prospectus. You should read this prospectus together with the documents incorporated
herein by reference under “Documents Incorporated by Reference” and the additional information described below under “Where
You Can Find More Information.”
You should rely only on the information contained
in or incorporated by reference in this prospectus and in any free writing prospectus prepared by or on behalf of us. We
have not authorized anyone to provide you with information different from, or in addition to, that contained in or incorporated by
reference in this prospectus or any related free writing prospectus. This prospectus is an offer to sell only the securities
offered hereby but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in or incorporated
by reference in this prospectus is current only as of its date. Our business, financial condition, results of operations and
prospects may have changed since that date.
We are not offering to sell or seeking offers
to purchase these securities in any jurisdiction where the offer or sale is not permitted. We have not done anything that would permit
this offering or possession or distribution of this prospectus in any jurisdiction where action for that purpose is required, other than
in the United States. Persons outside the United States who come into possession of this prospectus and any free writing prospectus related
to this offering in jurisdictions outside the United States are required to inform themselves about and to observe any restrictions relating
to this offering and the distribution of this prospectus and any such free writing prospectus applicable to that jurisdiction.
Unless otherwise indicated, any reference to Akerna,
or as “we”, “us”, or “our” refers to Akerna Corp. and its consolidated subsidiaries (“Akerna”
or the “Company”).
PROSPECTUS SUMMARY
The following highlights certain information
contained elsewhere in this prospectus. It does not contain all the details concerning the Offering, including information that may be
important to you. You should carefully review this entire prospectus including the section entitled “Risk Factors” and documents,
including financial statements incorporated herein by reference. See “Documents Incorporated by Reference” and “Where
You Can Find More Information.”
Summary of Our Business
Akerna is a leading provider of enterprise
software solutions within the cannabis industry. Cannabis businesses face significant complexity due to the stringent regulations and
restrictions that shift based on regional, state, and national governing bodies. As the first to market more than ten years
ago, Akerna’s family of software platforms enable regulatory compliance and inventory management across the entire
supply chain. When the legal cannabis market started to grow, we identified a need for organic material tracking and regulatory compliance
software as a service (SaaS) solution customized specifically for the unique needs of the industry. By providing an integrated ecosystem
of applications and services that enables compliance, regulation, consumer safety and taxation, Akerna is building the technology
backbone of the cannabis industry. While designed specifically for the unique needs of the cannabis market, our solutions are adaptable
for other industries requiring government regulatory oversight, or where the tracking of organic materials from seed or plant to end
products is desired.
Executing upon our expansion strategy, we acquire complementary cannabis brands to grow the scope of Akerna’s cannabis ecosystem.
Throughout 2019 and 2021, we integrated five new brands into the Akerna product and service offering. Our first acquisition, solo sciences,
was initiated in the fall of 2019, with the full acquisition completed in July 2020. We added Trellis Solutions to our portfolio
on April 10, 2020 and finalized the acquisition of Ample Organics and Last Call Analytics on July 7, 2020. On April 1, 2021, we completed
our acquisition of Viridian. On October 1, 2021, we completed our acquisition 365 Cannabis. Through our growing family of companies, Akerna provides
highly versatile platforms that equip our clients with a central data management system for tracking regulated products. Our solutions
also provide clients with integrated security, transparency, and scalability capabilities, all while maintaining compliance with their
governing regulations.
On the commercial side, our products help
state-licensed businesses operate in compliance with applicable regional laws. Our integrated ecosystem provides integrations with third-party
vendors and add-ons that enhance the capabilities of our commercial software platforms. On the regulatory side, we provide track
and trace solutions that allow state governments to monitor compliance of licensed cannabis businesses. To date, our software has
helped monitor the compliance of more than $20 billion in legal cannabis. While our software facilitates the success of legal cannabis
businesses, we do not handle any cannabis-related material, do not process cannabis sales transactions within the United States,
and our revenue is generated from a fixed-fee based subscription model and is not related to the type or amount of sales made by
our clients.
We drive revenue growth through the development
of our product line, our acquisitions and from continued expansion of the cannabis, hemp, and CBD industry. Businesses across the
regulated cannabis industry use our solutions. The brand recognition of our existing products, our ability
to provide services in all areas of the seed-to-sale life cycle, and our wealth of relevant experience attracts cultivation, manufacturing,
and dispensary clients who are seeking comprehensive business optimization solutions. Our software solutions are designed to be scalable,
and while mid-market and smaller customers have historically been our primary target segment, we are focused on extending
our customer reach to address the needs of the emerging enterprise level operator. We believe these larger multi-state/multi-vertical
operations represent significant long-term future growth opportunities as the cannabis industry continues to consolidate at a rapid rate.
The sophistication of our platform accommodates the complexities of both multi-vertical and multi-state business needs, making us critical
partners and allowing us to cultivate long-term, successful relationships with our clients.
Our principal executive offices are located at
1550 Larimer Street #246, Denver, Colorado 80202, and our telephone number is (888) 932-6537 and our Internet website address is www.akerna.com.
The information on our website is not a part of, or incorporated in, this prospectus. The transfer agent and registrar for our common
stock is Continental Stock Transfer & Trust Company, located at One State Street Plaza, 30th Floor, New York, NY 10004-1561.
The Offering
Shares offered by the selling stockholders:
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8,002,062 shares of common stock of Akerna, par value $0.0001
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Offering Price:
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Determined at the time of sale by the selling stockholders
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Common stock outstanding prior to
the offering:
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31,001,884 shares of common stock (1)
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Common stock outstanding after
the offering:
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31,227,519 shares of common stock(1)
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Use of Proceeds:
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We will not receive any proceeds from the sale of the shares by selling stockholders covered by this prospectus. We may receive proceeds upon the exercise of warrants for 225,635 shares registered for resale hereunder, which we will use for working capital purposes and general corporate expenses.
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Listing of Common Stock:
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Our common stock is listed on the Nasdaq Capital Market under the symbol “KERN”.
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Dividend policy:
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We currently intend to retain any future earnings to fund the development and growth of our business. Therefore, we do not currently anticipate paying cash dividends on our common stock.
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Risk Factors:
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An investment in our company is highly speculative and involves a significant degree of
risk. See “Risk Factors” on page 3 of this prospectus and other information included in this prospectus for a
discussion of factors you should carefully consider before deciding to invest in shares of our common stock.
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(1)
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The number of shares of common stock
shown above to be outstanding is based on the 31,001,884 shares outstanding as of January 5, 2022 and, for the common stock outstanding
after the offering assumes issuance of 225,635 shares registered hereunder upon exercise of warrants. The number of shares of common
stock outstanding excluding the following as of such date:
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683,767 shares of common
stock issuable upon vesting of outstanding restricted stock units;
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5,813,804 shares of common
stock issuable upon the exercise of warrants outstanding at a weighted average exercise price of $11.50 per share;
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309,286 shares of common stock
issuable upon conversion of exchangeable shares; and
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459,539 shares of common stock
reserved for future issuance under our equity incentive plan.
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37,037,037 shares of common
stock reserved for issuance upon conversion of our outstanding convertible notes. As previously reported, this is an estimate of the
number of shares of our common stock underlying the Senior Convertible Notes, with such amount equal to the maximum number of shares
issuable upon conversion of the Senior Convertible Notes, assuming for purposes hereof that (x) the Senior Convertible Notes are convertible
at $0.54 per share, the conversion floor price, and (y) without taking into account the limitations on the conversion of the Senior Convertible
Notes issued by us in a private placement on October 5, 2021. The actual number of shares issued upon conversion of the Senior Convertible
Notes may be more or less than this amount. See “Risk Factors” on page 3.
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RISK FACTORS
An investment in our common stock involves
a high degree of risk. You should carefully consider the risks described below and discussed under the section captioned “Risk
Factors” contained in our transition report on Form 10-KT for the six-month transition period ended December 31, 2020, and in our
quarterly reports on Form 10-Q for the periods ended March 31, 2021, June 30, 2021, and September 30, 2021, which reports are incorporated
by reference in this prospectus, together with all of the other information included in this prospectus or incorporated by reference herein,
including any documents subsequently filed and incorporated by reference, before making an investment decision with regard to our securities.
See “Documents Incorporated by Reference” and “Where You Can Find More Information” below.
The statements contained in this prospectus
that are not historic facts are forward-looking statements that are subject to risks and uncertainties that could cause actual results
to differ materially from those set forth in or implied by forward-looking statements. If any of the following risks actually occurs,
our business, financial condition or results of operations could suffer.
Summary of Risk Factors
The following is a short description of the risks
and uncertainties you should carefully consider in evaluating our business and us which are more fully described in our transition report
on Form 10-KT for the six-month transition period ended December 31, 2020 and in our quarterly report on Form 10-Q for the period ended
March 31, 2021, June 30, 2021, and September 30, 2021, which reports are incorporated by reference in this prospectus. The factors listed
below and in the transition report and quarterly report, represent certain important factors that we believe could cause our business
results to differ. These factors are not intended to represent a complete list of the general or specific risks that may affect us. It
should be recognized that other risks may be significant, presently or in the future, and the risks set forth below may affect us to a
greater extent than indicated. If any of the following risks occur, our business, financial condition or results of operations could be
materially and adversely affected.
Risks Relating to
Our Financial Condition and Operating History
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We have a history of losses, expect to continue to incur losses in the near term and may not achieve or sustain profitability in the future.
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We have a relatively short operating history, which makes it difficult to evaluate our business and future prospects.
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Our long-term results of operations are difficult to predict and depend on the commercial success of our clients, the continued growth of the cannabis industry generally, and the regulatory environment within which the cannabis industry operates.
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Direct and indirect consequences of the COVID-19 pandemic may have material adverse consequences.
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Risks Related to the Cannabis Industry
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As a company whose clients operate in the cannabis industry,
we face many unique and evolving risks.
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Marijuana remains illegal under United States federal law
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Uncertainty of federal enforcement
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We could become subject to racketeering laws
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Banking regulations could limit access to banking services
and expose us to risk
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Dividends and distributions could be prevented if our receipt
of payments from clients is deemed to be proceeds of crime
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Further legislative development beneficial to our operations
is not guaranteed
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The cannabis industry could face strong opposition from
other industries
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The legality of marijuana could be reversed in one or more
states
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Changing legislation and evolving interpretations of the
law
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Dependence on client licensing
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The cannabis industry is an evolving industry and we must
anticipate and respond to changes.
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Risks related to Our
Business
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A significant portion of our business is and is expected
to be, from government contracts, which present certain unique risks.
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Our operations may be adversely affected by disruptions to
our information technology, or IT, systems, including disruptions from cybersecurity breaches of our IT infrastructure.
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Privacy regulation is an evolving area and compliance with
applicable privacy regulations may increase our operating costs or adversely impact our ability to service our clients and market our
products and services.
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We rely on third parties for certain services made available
to users of our platforms, which could limit our control over the quality of the user experience and our cost of providing services.
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Acquisitions and integration issues may expose us to risks.
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To grow and be successful, we need to attract and retain
qualified personnel.
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We are smaller and less diversified than many of our potential
competitors.
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Our business and stock price may suffer as a result of our
limited public company operating experience and if securities or industry analysts do not publish or cease publishing research or reports
about us, our business, or our market, or if they change their recommendations regarding our common stock in an adverse manner, the price
and trading volume of our common stock could decline.
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Risks related to Intellectual Property
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Protecting and defending against intellectual property claims
may have a material adverse effect on our business.
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Our success depends in part upon our ability to protect our
core technology and intellectual property.
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Others may assert intellectual property infringement claims
against us.
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Protecting and defending against intellectual property claims
may have a material adverse effect on our business.
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Our success depends in part upon our ability to protect our
core technology and intellectual property.
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Others may assert intellectual property infringement claims
against us.
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Risks related to Our
Charter Documents
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Anti-takeover provisions contained in our amended and restated
certificate of incorporation and amended and restated bylaws, as well as provisions of Delaware law, could impair a takeover attempt
and limit the price investors might be willing to pay in the future for our common stock and could entrench management.
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Our corporate opportunity provisions in our Amended and Restated
Certificate of Incorporation could enable management to benefit from corporate opportunities that might otherwise be available to us.
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Our amended and restated certificate of incorporation provides,
subject to limited exceptions, that the Court of Chancery of the State of Delaware will be the sole and exclusive forum for certain stockholder
litigation matters, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our
directors, officers, employees or stockholders.
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Risks Relating to our Accounting for Certain
Warrants
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Certain of our warrants are accounted for as liabilities
and are recorded at fair value upon issuance with any changes in fair value each period reported in our statement of operations, which
may have an adverse effect on the market price of our securities.
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We may face additional risks, including regulatory, litigation,
stockholder or other actions and negative impacts on our stock price, as a result of the material weakness in our internal control over
financial reporting and revisions to our financial statements.
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Risks Relating to Our Common Stock
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We may seek to raise additional funds, finance acquisitions,
or develop strategic relationships by issuing securities that would dilute investors’ ownership. Depending on the terms available
to us, if these activities result in significant dilution, it may negatively impact the trading price of our shares of common stock.
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Warrants are exercisable for our common stock, which could
increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders.
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The market price of our shares of common stock is particularly
volatile given our status as a relatively new public company with a generally small and thinly traded public float, which could lead
to wide fluctuations in our share price. Stockholders may be unable to sell their shares of common stock at or above their purchase price,
which may result in substantial losses to them.
|
|
●
|
The market price of our common stock is still likely to be
highly volatile and subject to wide fluctuations, and stockholders may be unable to resell shares of common stock at or above the price
at which they are acquired.
|
|
●
|
We have not paid dividends in the past and do not expect
to pay dividends for the foreseeable future, and any return on investment may be limited to potential future appreciation in the value
of our common stock.
|
General Risks
|
●
|
We may not be able to timely and effectively implement controls
and procedures required by Section 404 of the Sarbanes-Oxley Act of 2002.
|
|
●
|
Failure to remediate material weaknesses in internal controls
over financial reporting could result in material misstatements in our financial statements.
|
|
●
|
The requirements of being a public company may strain our
resources and divert management’s attention.
|
|
●
|
We are an “emerging growth company” and we cannot
be certain if the reduced disclosure requirements applicable to emerging growth companies will make our shares of common stock less attractive
to investors.
|
|
●
|
Our ability to utilize our net operating loss carryforwards
and certain other tax attributes may be limited.
|
|
●
|
Our operations could be adversely affected by events outside
of our control, such as natural disasters, wars, or health epidemics.
|
Additional Risks
Risks Relating to the Senior Convertible Notes
The issuance of shares of our common stock
pursuant to our Senior Convertible Notes may result in significant dilution to our stockholders.
The conversion of our outstanding Senior Convertible
Notes, issued on October 5, 2021, could result in the issuance of a significant number of shares of our common stock. Currently, the $20
million principal amount of Senior Convertible Notes is convertible at a price of $4.05 per share, which would result in the issuance
of 4,938,272 shares of our common stock upon the conversion of the Senior Convertible Notes in full. At the option of Akerna, the installment
payments on the Senior Convertible Notes can be converted into shares of common stock of Akerna at a price per share equal to the lower
of (i) the conversion price then in effect, or (ii) the greater of (x) the floor price of $0.54 and (y) 90% of the lower of (A) the volume-weighted
average price of the common stock as of the trading day immediately preceding the applicable date of determination and (B) the quotient
of (I) the sum of the volume-weighted average price of the common stock for each of the two (2) trading days with the lowest volume-weighted
average price of the common stock during the ten consecutive trading day period ending on and including the trading day immediately prior
to the applicable date of determination, divided by (II) two.
Due to the variable nature of the adjustments
of installment conversion prices and the formula that sets certain conversion prices of these securities based on a discount to the then-current
market price, we could issue up to 37,037,037 shares of common stock upon conversion of the Senior Convertible Notes at the floor price,
which may result in significant dilution to our stockholders and could negatively impact the trading price of our common stock.
Our obligations to the holders of our Senior
Convertible Notes are secured by a security interest in substantially all of our assets, if we default on those obligations, the Senior
Convertible Note holders could foreclose on our assets.
Our obligations under the Senior Convertible Notes,
issued on October 5, 2021, and the related transaction documents are secured by a security interest in substantially all of our assets.
As a result, if we default on our obligations under such Senior Convertible Notes, the collateral agent on behalf of the holders of the
Senior Convertible Notes could foreclose on the security interests and liquidate some or all of our assets, which would harm our business,
financial condition and results of operations and could require us to reduce or cease operations and investors may lose all or part of
your investment.
Events of default under the Senior Convertible
Notes include: (i) the failure of the registration statement to which this prospectus relates (under the registration rights agreement
between the Company and the holders) to be filed with the SEC or the failure of the applicable registration statement to be declared effective
by the SEC by deadlines set forth in the registration rights agreement; (ii) (x) the effectiveness of the applicable registration statement
lapses for any reason or such registration statement is unavailable to any holder of registrable securities and Rule 144 (subject to certain
conditions) is not unavailable to any holder of the conversion shares; (iii) suspension of trading of the Company’s common stock
on a national securities exchange for five days; (iv) uncured conversion failure; (v) failure by the Company to maintain required share
allocations for the conversion of the Senior Convertible Notes; (vi) failure by the Company to pay principal when due; (vii) failure of
the Company to remove restricted legends from shares issued to a holder upon conversion of the Senior Convertible Notes; (viii) the occurrence
of any default under, redemption of or acceleration prior to maturity of at least an aggregate of $50,000 of indebtedness of the Company;
(ix) bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings for the relief of debtors shall be instituted
by or against the Company or any subsidiary and not dismissed within 45 days of initiation; (x) the commencement by the Company or any
subsidiary of a voluntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization or
other similar law; (xi) the entry by a court of a decree, order, judgment or other similar document in respect of the Company or any subsidiary
of a voluntary or involuntary case or proceeding under any applicable federal, state or foreign bankruptcy, insolvency, reorganization
or other similar law; (xii) final judgment for the payment of money aggregating in excess of $50,000 are rendered against the Company
or any subsidiary of the Company and not bonded or discharged within 30 days; (xiii) failure of the Company or any subsidiary to pay when
due any debts in excess of $50,000 due to any third party; (xiv) breaches by the Company or any subsidiary of any representations or warranties
in the securities purchase agreement for the Senior Convertible Notes or any document contemplated thereby; (xv) a false or inaccurate
certification by the Company that either (A) the “Equity Conditions” (as defined in the Senior Convertible Notes) are satisfied,
(B) there has been no “Equity Conditions Failure,” (as defined in the Senior Convertible Notes) or (C) as to whether any Event
of Default has occurred; (xvi) failure of the Company or any subsidiary to comply with certain of the covenants in the Senior Convertible
Notes; (xvii) the occurrence of (A) at any time after the six month anniversary of the issuance date, any current public information failure
that remains outstanding for a period of twenty (20) trading days or (B) any restatement of any financial statements of the Company filed
with the SEC; (xviii) any material adverse effect occurring; (xix) any provision of any transaction document shall at any time for any
reason cease to be valid and binding or enforceable; (xx) any security document shall for any reason (other than pursuant to the express
terms thereof or due to any failure or omission of the collateral agent) fail or cease to create a separate valid and perfected and, except
to the extent permitted by the terms hereof or thereof, first priority lien; (xxi) any material damage to, or loss, theft or destruction
of, any collateral, that is material to the business of the Company or any subsidiary and is not reimbursed by insurance; or (xxii) any
Event of Default occurs under any other Senior Convertible Notes.
The holders of the Senior Convertible Notes
have certain additional rights upon an event of default under such Senior Convertible Notes, which could harm our business, financial
condition, and results of operations and could require us to reduce or cease our operations.
Under the Senior Convertible Notes, the holders
have certain rights upon an event of default. Such rights include (i) the remaining principal amount of the Senior Convertible Notes bearing
interest at a rate of 15% per annum, (ii) during the event of default the holders of the Senior Convertible Notes will be entitled to
convert all or any portion of the Senior Convertible Notes at an alternate conversion price equal to the lower of (i) the conversion price
then in effect, and (ii) 80% of the lower of (x) the volume weighted average price of the common stock as of the trading day immediately
preceding the applicable date of determination and (y) the quotient of (A) the sum of the volume weighted average price of the common
stock for each of the two (2) trading days with the lowest volume weighted average price of the common stock during the ten consecutive
trading day period ending and including the trading day immediately prior to the applicable date of determination, divided by (B) two,
but not less than the floor price, and (iii) the holder having the right to demand redemption of all or a portion of the Senior Convertible
Notes, as described below. At any time after certain notice requirements for an event of default are triggered, a holder of Senior Convertible
Notes may require us to redeem all or any portion of the convertible note by delivering written notice. The redemption price will equal
the greater of (i) 115% of the outstanding principal of the convertible note to be redeemed and accrued and unpaid interest and unpaid
late charges thereon, and (ii) an amount equal to the market value of the shares of the common stock underlying the Senior Convertible
Notes, as determined in accordance with the Senior Convertible Notes. Upon the occurrence of certain events of default relating to the
bankruptcy of Akerna, whether occurring prior to or following the maturity date, Akerna will be required to immediately redeem the Senior
Convertible Notes, in cash, for an amount equal to 115% of the outstanding principal of the Senior Convertible Notes, and accrued and
unpaid interest and unpaid late charges thereon, without the requirement for any notice or demand or other action by any holder or any
other person or entity. We may not have sufficient funds to settle the redemption price and, as described above, this could trigger rights
under the security interest granted to the holders and result in the foreclosure of their security interests and liquidation of some or
all of our assets.
The exercise of any of these rights upon an event
of default could substantially harm our financial condition, substantially dilute our other shareholders and force us to reduce or cease
operations and investors may lose all or part of their investment.
FORWARD-LOOKING STATEMENTS
This prospectus, the documents incorporated by
reference herein and the exhibits attached hereto contain “forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995, including statements regarding future events or our future results of operations, financial condition,
business, strategies, financial needs, and the plans and objectives of management, are forward-looking statements. In some cases forward-looking
statements can be identified because they contain words such as “anticipate,” “believe,” “continue,”
“could,” “estimate,” “expect,” “intend,” “may,” “might,” “likely,”
“plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,”
“will,” “would,” or similar expressions and the negatives of those terms. Forward-looking statements are based
on information available to our management as of the date of this prospectus and our management’s good faith belief as of such date
with respect to future events and are subject to a number of risks, uncertainties, and assumptions that could cause actual performance
or results to differ materially from those expressed in or suggested by the forward-looking statements, in particular the substantial
risks and uncertainties related to the ongoing COVID-19 pandemic. Important factors that could cause such differences include, but are
not limited to:
|
●
|
our ability to sustain our revenue growth rate, to achieve or maintain profitability, and to effectively manage our anticipated growth;
|
|
|
|
|
●
|
our short operating history makes it difficult to evaluate our business and future prospects;
|
|
|
|
|
●
|
our dependence on the commercial success of our clients, the continued growth of the cannabis industry and the regulatory environment in which the cannabis industry operates;
|
|
|
|
|
●
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our ability to attract new clients on a cost-effective basis and the extent to which existing clients renew and upgrade their subscriptions;
|
|
|
|
|
●
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the timing of our introduction of new solutions or updates to existing solutions;
|
|
|
|
|
●
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our ability to successfully diversify our solutions by developing or introducing new solutions or acquiring and integrating additional businesses, products, services, or content;
|
|
|
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|
●
|
our ability to respond to changes within the cannabis industry;
|
|
|
|
|
●
|
the effects of adverse changes in, or the enforcement of, federal laws regarding our clients’ cannabis operations or our receipt of proceeds from such operations;
|
|
|
|
|
●
|
our ability to manage unique risks and uncertainties related to government contracts;
|
|
|
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|
●
|
our ability to manage and protect our information technology systems;
|
|
|
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|
●
|
our ability to maintain and expand our strategic relationships with third parties;
|
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|
|
●
|
our ability to deliver our solutions to clients without disruption or delay;
|
|
|
|
|
●
|
our exposure to liability from errors, delays, fraud, or system failures, which may not be covered by insurance;
|
|
|
|
|
●
|
our ability to expand our international reach;
|
|
|
|
|
●
|
our ability to retain or recruit officers, key employees, and directors;
|
|
|
|
|
●
|
our ability to raise additional capital or obtain financing in the future;
|
|
|
|
|
●
|
our ability to successfully integrate acquired businesses with Akerna’s business within anticipated timelines and at their expected costs;
|
|
●
|
our ability to complete planned acquisitions on time or at all due to failure to obtain stockholder approval or governmental or regulatory clearances, or the failure to satisfy other conditions to completion, or the failure of completion for any other reason;
|
|
|
|
|
●
|
our response to adverse developments in the general market, business, economic, labor, regulatory, and political conditions, including worldwide demand for cannabis and the spot price and long-term contract price of cannabis;
|
|
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|
●
|
our response to competitive risks;
|
|
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|
●
|
our ability to protect our intellectual property;
|
|
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|
●
|
the market reaction to negative publicity regarding cannabis;
|
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|
|
●
|
our ability to manage the requirements of being a public company;
|
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|
●
|
our ability to service our convertible debt;
|
|
|
|
|
●
|
our accounting treatment of certain of our private warrants;
|
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|
●
|
our ability to effectively manage any disruptions to our business and/or any negative impact to our financial performance caused by the economic and social effects of the COVID-19 pandemic and measures taken in response; and
|
|
|
|
|
●
|
other factors discussed in other sections of this prospectus, including the section titled “Risk Factors,” and in the Company’s transition report for the six-month period ended December 31, 2020 on Form 10-KT, incorporated herein by reference, including the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
|
Should one or more of these risks or uncertainties
materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, believed, estimated
or expected. We caution readers not to place undue reliance on any such forward-looking statements, which speak only as of the date made.
We disclaim any obligation subsequently to revise any forward-looking statements to reflect events or circumstances after the date of
such statements or to reflect the occurrence of anticipated or unanticipated events.
We qualify all the forward-looking statements
contained in this prospectus by the foregoing cautionary statements.
RECENT DEVELOPMENTS
At the Market Equity
Program
On July 23, 2021, we
entered into an Equity Distribution Agreement with Oppenheimer & Co. Inc. and A.G.P./Alliance Global Partners. Pursuant to the terms
of the Agreement, we may offer and sell from time to time, up to $25 million of shares of our common stock. While no assurance can be
provided that we will be able to raise capital under such program, we intend to use the net proceeds from the sale of our shares of common
stock, if any, for general corporate purposes, including working capital, marketing, product development, capital expenditures and merger
and acquisition activities.
As of January 5, 2022,
we have raised $1.9 million through the issuance of 556,388 shares through the above program.
Acquisition of 365 Cannabis
On October 1, 2021, we
closed our previously announced the 365 Agreement with the shareholders (the “Sellers”) of 365 Cannabis pursuant to which
we acquired all right, title and interest in 100% of the issued and outstanding capital stock of 365 Cannabis (calculated on a fully diluted
basis), free and clear of all liens. The 365 Agreement was previously described in and filed with our Current Report on Form 8-K, filed
with the SEC on September 21, 2021.
The consideration amount
under the 365 Agreement was $17 million (the “Purchase Price). As previously reported, the Purchase Price was payable as (a) at
least $4 million of cash (the “Cash Consideration”) and (b) a number of fully paid and nonassessable shares of our common
stock, par value $0.0001 per share, that is equal to the Purchase Price less the Cash Consideration divided by $3.36, with the Cash Consideration
being subject to upward adjustment by us in our sole discretion at closing. At the closing, we elected to pay $4.5 million in Cash Consideration,
and the parties agreed to approximately $500,000 of Cash Consideration being moved to 12 months after the closing. Therefore, we issued
3,571,429 shares of common stock (the “Stock Consideration”), representing an aggregate value of approximately $12 million.
357,143 shares of the Stock Consideration will be held in escrow for a period of, and will be released from escrow after a period of,
12 months, subject to certain indemnity claims under the 365 Agreement. The shares of common stock are also subject to a lock-up agreement
between us and the Sellers and will be released from lock-up as follows: (a) 50% of the Stock Consideration six months from the date of
the closing, (b) 25% of the Stock Consideration nine months from the date of closing and (c) the remaining 25% of the Stock Consideration
one year from the date of the closing.
Convertible Note Financing
On October 5, 2021, we entered into a Securities Purchase Agreement
(the “SPA”) with two institutional investors (each a “Holder” and collectively the “Holders”) to sell
a new series of senior secured convertible notes the “Senior Convertible Notes”) of the Company in a private placement to
the Holders, in the aggregate principal amount of $20,000,000.
On October 5, 2021, we issued the Senior Convertible
Notes to the Holders in an aggregate original principal amount of $20,000,000, in reliance upon the exemption from securities registration
afforded by Section 4(a)(2) of the Securities Act, and Rule 506(b) of Regulation D under the Securities Act, based in part on the representations
of the Holders in the SPA.
In connection with the issuance of the Senior
Convertible Notes, on October 5, 2021, the following agreements were entered into by us and other parties: (1) we entered into the Security
and Pledge Agreement with the lead investor, in its capacity as collateral agent (in such capacity, the “Collateral Agent”)
for all holders of the Notes; (2) certain subsidiaries of the Company entered into the Guaranty Agreement with the Collateral Agent; (3)
we entered into a Voting Agreement with certain shareholders of the Company; and (4) we entered into a Registration Rights Agreement with
the Holders.
Also in connection with the issuance of the Senior
Convertible Notes, on October 5, 2021, we used approximately $3.3 million of the proceeds from the sale of the Senior Convertible Notes
to payoff the remaining amounts payable under the Company’s prior convertible notes issued to the Holders on June 9, 2020 (the “2020
Notes”). Pursuant to the payment of all amounts payable thereunder the 2020 Notes were extinguished and cancelled and the related
securities purchase agreement dated June 8, 2020 has terminated.
USE OF PROCEEDS
This prospectus relates to the sale or other
disposition of shares of our shares by the selling stockholders listed under “Selling Stockholders” section below,
and their transferees. We will not receive any proceeds from any sale of the shares by the selling stockholders. We may receive proceeds
upon the exercise of warrants for 225,635 shares registered for resale hereunder, which we will use for working capital purposes and general
corporate expenses.
DETERMINATION OF OFFERING PRICE
The selling stockholders will offer common stock
at the prevailing market prices or privately negotiated price as they may determine from time to time.
The offering price of our common stock to be sold
by the selling stockholders does not necessarily bear any relationship to our book value, assets, past operating results, financial condition
or any other established criteria of value. The facts considered in determining the offering price were our financial condition and prospects,
our limited operating history and the general condition of the securities market.
In addition, there is no assurance that our common
stock will trade at market prices in excess of the offering price as prices for common stock in any public market will be determined in
the marketplace and may be influenced by many factors, including the depth and liquidity.
SELLING
STOCKHOLDERS
The
following table sets forth certain information as of January 5, 2022, regarding the selling stockholders and the shares offered by them in
this prospectus. In computing the number of shares owned by a person and the percentage ownership of that person in the table below,
securities that are currently exercisable into shares of our common stock that are being offered in this prospectus are deemed outstanding.
Such shares, however, are not deemed outstanding for the purposes of computing the percentage ownership of any other person. Except as
indicated in the footnotes to the following table, each selling stockholder named in the table has sole voting and investment power with
respect to the shares set forth opposite such stockholder’s name. The percentage of ownership of each selling stockholder in
the following table is based upon 31,001,884 shares of common stock outstanding as of January 5, 2022.
Except
as set forth below, no selling stockholder has held a position as an officer or director of the Company, nor has any material relationship
of any kind with us or any of our affiliates. All information with respect to share ownership has been furnished by the selling stockholders.
The common stock being offered is being registered to permit secondary trading of the shares and the selling stockholders may offer all
or part of the common stock owned for resale from time to time. Except as set forth below, none of the selling stockholders have
any family relationships with our officers, directors or controlling stockholders. Furthermore, none of the selling stockholders are
a registered broker-dealer or an affiliate of a registered broker-dealer.
The
term “selling stockholder” also includes any transferees, assignees, pledges, donees, or other successors in interest (including
equity holders of entities listed below) to the selling stockholder named in the table below. To our knowledge, subject to applicable
community property laws, each person named in the table has sole voting and investment power with respect to the common stock set forth
opposite such person’s name. We will file a supplement to this prospectus (or a post-effective amendment hereto, if necessary)
to name successors to any named selling stockholder who is able to use this prospectus to resell the securities registered hereby.
Name of
Selling Stockholder
|
|
Number
of
Shares of
Common Stock
Owned Prior
to Offering
|
|
|
Maximum
Number of
Shares of
Common
Stock to be
Sold
Pursuant to
this
prospectus
|
|
|
Number
of
Shares of
Common
Stock Owned
After
Offering
Assuming
All Shares
are Sold (1)
|
|
|
Percentage
of Common
Stock Owned
After
Offering
Assuming All
Shares are
Sold (1)
|
|
Tilt
Holdings, Inc. (2)
|
|
|
58,293
|
|
|
|
58,293
|
|
|
|
–
|
|
|
|
–
|
|
1
GG LP (3)
|
|
|
11,080
|
|
|
|
9,750
|
|
|
|
1,330
|
|
|
|
*
|
|
Jeffrey
Lam
|
|
|
2,769
|
|
|
|
2,437
|
|
|
|
332
|
|
|
|
*
|
|
Gena
Douzdjan
|
|
|
5,540
|
|
|
|
4,875
|
|
|
|
665
|
|
|
|
*
|
|
Vikram
Abraham
|
|
|
5,540
|
|
|
|
4,875
|
|
|
|
665
|
|
|
|
*
|
|
Argonautic
Ventures Master SPC for and on behalf of Argonautic Vertical Series Global Alternative Special Situations Fund I SP (4)
|
|
|
55,397
|
|
|
|
48,748
|
|
|
|
6,649
|
|
|
|
*
|
|
Ryan
Wald
|
|
|
11,079
|
|
|
|
9,750
|
|
|
|
1,329
|
|
|
|
*
|
|
Danny
Wirianto
|
|
|
5,539
|
|
|
|
4,875
|
|
|
|
664
|
|
|
|
*
|
|
Future
Shape LLC (5)
|
|
|
22,159
|
|
|
|
19,500
|
|
|
|
2,659
|
|
|
|
*
|
|
Jessica
Billingsley Living Trust (6)
|
|
|
1,183,161
|
|
|
|
975,802
|
|
|
|
207,359
|
|
|
|
*
|
|
Seam
Capital, LLC (7)
|
|
|
609,821
|
|
|
|
261,340
|
|
|
|
348,481
|
|
|
|
1.12
|
%
|
Khitan
LLC (8)
|
|
|
380,890
|
|
|
|
380,890
|
|
|
|
–
|
|
|
|
–
|
|
Alan
Docter
|
|
|
24,258
|
|
|
|
24,258
|
|
|
|
–
|
|
|
|
–
|
|
Daniel
Marx
|
|
|
32,647
|
|
|
|
32,647
|
|
|
|
–
|
|
|
|
–
|
|
LJM
Group Investment III LLC (9)
|
|
|
8,162
|
|
|
|
8,162
|
|
|
|
–
|
|
|
|
–
|
|
ACS
Pedersen LLC (10)
|
|
|
10,000
|
|
|
|
10,000
|
|
|
|
–
|
|
|
|
–
|
|
Cresco
Capital Partners II LLC (11)
|
|
|
246,024
|
|
|
|
130,590
|
|
|
|
115,434
|
|
|
|
*
|
|
Tahira
Rehmatullah (12)
|
|
|
58,553
|
|
|
|
49,251
|
|
|
|
9,302
|
|
|
|
*
|
|
Anthony
Georgiadis
|
|
|
7,500
|
|
|
|
7,500
|
|
|
|
–
|
|
|
|
*
|
|
Trophy
Hunter Investments, Inc. (13)
|
|
|
416,689
|
|
|
|
416,689
|
|
|
|
–
|
|
|
|
*
|
|
Scott
Sozio (14)
|
|
|
265,112
|
|
|
|
233,915
|
|
|
|
31,197
|
|
|
|
*
|
|
Shelly
Mayse
|
|
|
5,369
|
|
|
|
5,369
|
|
|
|
–
|
|
|
|
–
|
|
Alfred
Kahn
|
|
|
3,795
|
|
|
|
3,794
|
|
|
|
1
|
|
|
|
*
|
|
Andrzej
Henryk Moczydlowski
|
|
|
759
|
|
|
|
759
|
|
|
|
–
|
|
|
|
–
|
|
Bailey
Venture Partners XIX, LLC (15)
|
|
|
20,449
|
|
|
|
20,449
|
|
|
|
–
|
|
|
|
–
|
|
Banyan
Holdings, LLC (16)
|
|
|
27,781
|
|
|
|
27,781
|
|
|
|
–
|
|
|
|
–
|
|
Only
One Degree, LLC (17)
|
|
|
3,795
|
|
|
|
3,794
|
|
|
|
1
|
|
|
|
*
|
|
Chirag
Patel
|
|
|
839
|
|
|
|
839
|
|
|
|
–
|
|
|
|
–
|
|
Chirag
Vipin Shah
|
|
|
759
|
|
|
|
759
|
|
|
|
–
|
|
|
|
–
|
|
Christopher
W Battis (18)
|
|
|
104
|
|
|
|
104
|
|
|
|
–
|
|
|
|
–
|
|
Claudia
Bernett
|
|
|
379
|
|
|
|
379
|
|
|
|
–
|
|
|
|
–
|
|
Clothing
IQ, LLC (19)
|
|
|
51,122
|
|
|
|
51,122
|
|
|
|
–
|
|
|
|
–
|
|
Cody
Barbierri
|
|
|
126
|
|
|
|
126
|
|
|
|
–
|
|
|
|
–
|
|
Daniel
Marx
|
|
|
20,449
|
|
|
|
20,449
|
|
|
|
–
|
|
|
|
–
|
|
Gordon
Wade
|
|
|
345
|
|
|
|
345
|
|
|
|
–
|
|
|
|
–
|
|
Hadrian
Irrevocable Trust (20)
|
|
|
51,122
|
|
|
|
51,122
|
|
|
|
–
|
|
|
|
–
|
|
Isabelle
A. Shah
|
|
|
190
|
|
|
|
190
|
|
|
|
–
|
|
|
|
–
|
|
Jamie
Leo Creative LLC (21)
|
|
|
2,000
|
|
|
|
2,000
|
|
|
|
–
|
|
|
|
–
|
|
Jeffrey
T, Herlyn
|
|
|
20,449
|
|
|
|
20,449
|
|
|
|
–
|
|
|
|
–
|
|
Kimberly
Macleod
|
|
|
6,748
|
|
|
|
6,748
|
|
|
|
–
|
|
|
|
–
|
|
Leif
Pedersen
|
|
|
113
|
|
|
|
113
|
|
|
|
–
|
|
|
|
–
|
|
LJM
Group Investment #1 LLC (22)
|
|
|
10,224
|
|
|
|
10,224
|
|
|
|
–
|
|
|
|
–
|
|
Logan
Kelly
|
|
|
126
|
|
|
|
126
|
|
|
|
–
|
|
|
|
–
|
|
Maria
Viches
|
|
|
253
|
|
|
|
253
|
|
|
|
–
|
|
|
|
–
|
|
MDB4L
Investments, LLC (23)
|
|
|
25,931
|
|
|
|
25,931
|
|
|
|
–
|
|
|
|
–
|
|
Mello
LLC (24)
|
|
|
5,112
|
|
|
|
5,112
|
|
|
|
–
|
|
|
|
–
|
|
Parviz
Yedidsion
|
|
|
10,224
|
|
|
|
10,224
|
|
|
|
–
|
|
|
|
–
|
|
Richard
A. Kreisel-Kilstock
|
|
|
10,224
|
|
|
|
10,224
|
|
|
|
–
|
|
|
|
–
|
|
The
Primus Group LLC (25)
|
|
|
50,549
|
|
|
|
50,549
|
|
|
|
–
|
|
|
|
–
|
|
Tony
Greenberg
|
|
|
3,427
|
|
|
|
3,427
|
|
|
|
–
|
|
|
|
–
|
|
TOTB
LLC (26)
|
|
|
20,449
|
|
|
|
20,449
|
|
|
|
–
|
|
|
|
–
|
|
Verdande
Pedersen
|
|
|
190
|
|
|
|
190
|
|
|
|
–
|
|
|
|
–
|
|
Vijay
Mehta
|
|
|
10,224
|
|
|
|
10,224
|
|
|
|
–
|
|
|
|
–
|
|
Viridis
Advisors LLC (27)
|
|
|
759
|
|
|
|
759
|
|
|
|
–
|
|
|
|
–
|
|
VSC
Consulting Services Inc (28)
|
|
|
10,224
|
|
|
|
10,224
|
|
|
|
–
|
|
|
|
–
|
|
Warren
Renee Marcus
|
|
|
10,224
|
|
|
|
10,224
|
|
|
|
–
|
|
|
|
–
|
|
Packworks,
LLC (29)
|
|
|
51,355
|
|
|
|
51,355
|
|
|
|
–
|
|
|
|
–
|
|
Carraig,
LLC (30)
|
|
|
28,000
|
|
|
|
28,000
|
|
|
|
–
|
|
|
|
–
|
|
Forays,
LLC (31)
|
|
|
2,716
|
|
|
|
2,716
|
|
|
|
–
|
|
|
|
–
|
|
Ronoc
Ltd. (32)
|
|
|
13,931
|
|
|
|
13,931
|
|
|
|
–
|
|
|
|
–
|
|
Jeffrey
Seligman
|
|
|
10,154
|
|
|
|
10,154
|
|
|
|
–
|
|
|
|
–
|
|
James
McGeady
|
|
|
2,159
|
|
|
|
2,159
|
|
|
|
–
|
|
|
|
–
|
|
David
Koss Caplan
|
|
|
30,724
|
|
|
|
30,724
|
|
|
|
–
|
|
|
|
–
|
|
Tamara
Nina Dalcourt
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Philip
R. and Amy K. Wiser Family Trust (33)
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Lateral
Lined LLC (34)
|
|
|
9,571
|
|
|
|
9,571
|
|
|
|
–
|
|
|
|
–
|
|
RitaLynne
Brechner
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Revocable
Trust of Charles Primus
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Lawrence
E Scott
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Bleckrock
LLC (35)
|
|
|
9,571
|
|
|
|
9,571
|
|
|
|
–
|
|
|
|
–
|
|
GPEC
Venture Partners LLC (36)
|
|
|
9,571
|
|
|
|
9,571
|
|
|
|
–
|
|
|
|
–
|
|
Debbie
Cucullo
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Barbara
A Battis
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
MAI
Investments, LLC (37)
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Stacie
A Yonkin
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Suzanne
Macaitis
|
|
|
9,571
|
|
|
|
9,571
|
|
|
|
–
|
|
|
|
–
|
|
Robert
Morton
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Michael
Mills
|
|
|
6,693
|
|
|
|
6,693
|
|
|
|
–
|
|
|
|
–
|
|
Jeremy
Levine
|
|
|
4,793
|
|
|
|
4,793
|
|
|
|
–
|
|
|
|
–
|
|
Rafael
Sabbagh
|
|
|
79,166
|
|
|
|
79,166
|
|
|
|
–
|
|
|
|
–
|
|
Rodrigo
Botran
|
|
|
4,167
|
|
|
|
4,167
|
|
|
|
–
|
|
|
|
–
|
|
Quartermain
Investment, Ltd. (38)
|
|
|
1,156,168
|
|
|
|
1,156,168
|
|
|
|
–
|
|
|
|
–
|
|
Stewart
IDF LLC (39)
|
|
|
513,958
|
|
|
|
513,958
|
|
|
|
–
|
|
|
|
–
|
|
Keypad
Finance Limited (40)
|
|
|
394,869
|
|
|
|
394,869
|
|
|
|
–
|
|
|
|
–
|
|
Bradley
Woods & Co. Ltd. (41)
|
|
|
23,810
|
|
|
|
23,810
|
|
|
|
–
|
|
|
|
–
|
|
Jeff
Kiehn (42)
|
|
|
483,929
|
|
|
|
483,929
|
|
|
|
–
|
|
|
|
–
|
|
Ian
Humphries
|
|
|
512,151
|
|
|
|
512,151
|
|
|
|
–
|
|
|
|
–
|
|
Matthew
Dredge
|
|
|
384,114
|
|
|
|
384,114
|
|
|
|
–
|
|
|
|
–
|
|
David
Walker
|
|
|
102,430
|
|
|
|
102,430
|
|
|
|
–
|
|
|
|
–
|
|
Navigator
Acquisition Corp. (43)
|
|
|
1,031,000
|
|
|
|
1,031,000
|
|
|
|
–
|
|
|
|
–
|
|
Octopus
Holdings LLC (44)
|
|
|
583
|
|
|
|
583
|
|
|
|
–
|
|
|
|
–
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
|
|
|
8,728,130
|
|
|
|
8,002,062
|
|
|
|
726,068
|
|
|
|
2.33
|
%
|
|
*
|
The
percentage of common stock own is less than 1%.
|
|
(1)
|
Assumes
the sale of all shares offering pursuant to this prospectus.
|
|
(2)
|
Tilt
Holdings, Inc., a British Columbia corporation, as the sole member to Sea Hunter Holdings,
LLC holds the shares. Timothy Conder as President of Tilt Holdings, Inc. has sole dispositive
and voting power over the shares.
|
|
(3)
|
1
GG LP, a Delaware limited partnership. Daniel Lemon as manager for 1 GG LP has sole dispositive
and voting power over the shares.
|
|
(4)
|
Argonautic
Ventures Master SPC for and on behalf of Argonautic Vertical Series Global Alternative Special
Situations Fund I SP, a Cayman Islands Exempted Segregated Portfolio Company. Argonautic
Investment Management Ltd. is the managing shareholder of Argonautic Ventures Master SPC.
The following individuals as owners of Argonautic Investment Management Ltd., Howard Liu,
Rita Chiu and Viken Douzdjian, have joint dispositive and voting power over the shares.
|
|
(5)
|
Future
Shape LLC, a Delaware limited liability company. Anthony Fadeel and Danielle Lambert, authorized
individuals, each have sole dispositive and voting power over the shares.
|
|
(6)
|
Jessica.
Billingsley, the trustee of the Jessica Billingsley Living Trust, has sole and dispositive
power over the shares held by the Jessica Billingsley Living Trust. Represents 1,078,290
shares held by Jessica Billingsley Living Trust and 104,871 shares held directly by Ms. Billingsley.
Does not reflect 35,000 restricted stock units issued pursuant to Akerna’s Incentive
Plan, which vest as follows: 7,500 units shall vest on July 1 2022; 5,000 units shall vest
on December 1, 2022; 7,500 units shall vest on July 1, 2023; 5,000 units shall vest on December
1, 2023; 5,000 units shall vest on July 1, 2024; and 5,000 units shall vest on December 1,
2024. Ms. Billingsley is the Chairman of the Board of Directors of the Company and its Chief
Executive Officer.
|
|
(7)
|
Matthew
Kane, a director of the Company, is a manager of Seam Capital, LLC, and as such, Mr. Kane
has sole and dispositive power of the shares held by Seam Capital, LLC. Includes 261,340
shares held by Seam Capital, LLC and 348,481 shares held directly by Mr. Kane.
|
|
(8)
|
Emery
Johnathon Huang, a former director of the Company, is a manager of Khitan LLC and as such,
Mr. Huang has sole and dispositive power of the shares held by Khitan LLC.
|
|
(9)
|
Stephen
M. Dowicz is the investment manager of LJM Group LLC, which is the investment manager of
LJM Group Investment # 1 LLC, which is the investment manager of LJM Group Investment III
LLC, and as such, Mr. Dowicz has sole and dispositive power over the shares held by LJM Group
Investment III LLC. In connection with the June 2019 private placement, LJM Group Investment
III LLC purchased 146,914 shares of Common Stock. In connection with the MTech Sponsor Stock
Transfer Agreement, MTech Sponsor transferred 16,324 shares of Common Stock to LJM Group
Investment III LLC.
|
|
(10)
|
Ashesh
C. Shah, a former director and officer of the Company and current 5% shareholder, and Palle
Pedersen are the managing members of ACS Pedersen LLC (d/b/a The London Fund SPV 10, LLC)
and as such, Messrs. Shah and Pedersen have joint voting and dispositive power over the shares
held by ACS Pedersen LLC (d/b/a The London Fund SPV 10, LLC).
|
|
(11)
|
Matthew
K. Hawkins is a manager of Cresco Capital Management II, LLC, which is the sole manager of
Cresco Capital Partners II LLC, and as such, has dispositive power over the shares held by
Cresco Capital Partners II LLC.
|
|
(12)
|
53,426
shares held by Tahira Rehmatullah and 5,127 shares issuable upon exercise of warrants held
by Tahira Rehmatullah. T3 Capital Ventures LLC received 41,751 of such shares and shares
acquirable upon exercise of warrants through a transfer by SS FL, LLC to T3 Capital Ventures
LLC as a member of SS FL, LLC. Ms. Rehmatullah is the sole member of T3 Capital Ventures
and elected to receive such shares and warrants directly in her own name. Tahira Rehmatullah
received 7,500 such shares through a distribution by MTech Sponsor LLC to its members. Beneficial
ownership of shares not being offered for sale under this prospectus includes 4,175 shares
held by Ms. Rehmatullah. Ms. Rehmatullah is a director of Akerna Corp.
|
|
(13)
|
Shares
held by Trophy Hunter Investments, Inc. and shares issuable upon exercise of warrants held
by Trophy Hunter Investments, Inc. Trophy Hunter Investments, Inc. received such shares and
warrants through a transfer by SS FL, LLC to Trophy Hunter Investments, Inc. as a member
of SS FL, LLC. Steven Van Dyke is the Managing Member of Trophy Hunter Investments, Ltd.
and has sole voting and dispositive power over the securities.
|
|
(14)
|
Shares
held by Scott Sozio and shares issuable upon exercise of warrants held by Scott Sozio. Rowayton
Capital LLC received such shares and warrants through a transfer by SS FL, LLC to Rowayton
Capital LLC as a member of SS FL, LLC. Mr. Sozio is the sole member of Rowayton Capital LLC
and elected to receive such shares and warrants directly in his own name. Mr. Sozio is a
director of Akerna Corp.
|
|
(15)
|
Shares
held by Bailey Venture Partners XIX, LLC, a Delaware limited liability company. James Bailey
as manager of Bailey Venture Partners XIX, LLC holds voting and dispositive control over
the shares.
|
|
(16)
|
Shares
held by Banyan Holdings, LLC, a Texas limited liability company. Lokesh Chugh as manager
of Banyan Holdings, LLC holds voting and dispositive control over the shares.
|
|
(17)
|
Shares
held by Only One Degree, LLC, a Delaware limited liability company. William Marcus as managing
member of Only One Degree, LLC holds voting and dispositive control over the shares.
|
|
(18)
|
Represents
12,596 shares held by Mr. Battis directly and 7,829 shares held by Seabatt Digital LLC. Mr.
Battis as the sole member of Seabatt Digital LLC has sole voting and dispositive control
over the shares.
|
|
(19)
|
Shares
held by Clothing IQ, LLC, a Delaware limited liability company. William Yuen as sole member
of Clothing IQ, LLC holds voting and dispositive control over the shares.
|
|
(20)
|
Shares
held by Hadrian Irrevocable Trust, a Florida irrevocable trust. John J. Sicilian as trustee
holds voting and dispositive control over the shares.
|
|
(21)
|
Shares
held by Jamie Leo Creative LLC, a New York limited liability company. Jamie Leo as principal
of Jamie Leo Creative LLC holds voting and dispositive control over the shares.
|
|
(22)
|
Shares
held by LJM Group Investment #1 LLC, a New Jersey limited liability company. Stephen Dowicz
as managing member of LJM Group Investment #1 LLC holds voting and dispositive control over
the shares.
|
|
(23)
|
Shares
held by MDB4 Investments, LLC. Dr. Ankit Desai as manager of MDB4 Investments, LLC holds
voting and dispositive control over the shares.
|
|
(24)
|
Shares
held by Mello LLC, an Indiana limited liability company. Melissa O’Brien as manager
of Mello LLC holds voting and dispositive control over the shares.
|
|
(25)
|
Shares
held by The Primus Group LLC, a Massachusetts limited liability company. Aryeh Primus as
manager of The Primus Group LLC holds voting and dispositive control over the shares.
|
|
(26)
|
Shares
held by TOTB LLC. Ken Rubin as manager of TOTB LLC holds voting and dispositive control over
the shares.
|
|
(27)
|
Shares
held by Viridis Advisors LLC.
|
|
(28)
|
Shares
held by VSC Consulting Services Inc, a Delaware corporation. Vijay Chattha as Chief Executive
Officer of VSC Consulting Services Inc. holds voting and dispositive control over the shares.
|
|
(29)
|
Shares
held by Packworks, LLC, a New York limited liability company. Kinda Younes and Philippe P.
Asseily as managers of Packworks, LLC hold joint voting and dispositive control over the
shares.
|
|
(30)
|
Shares
held by Carraig, LLC, a New Jersey limited liability company. Angus Miller and Dana Miller
as managers of Carraig, LLC hold joint voting and dispositive control over the shares.
|
|
(31)
|
Shares
held by Forays, LLC, a Pennsylvania limited liability company. Albert Hughes as managing
member of Forays, LLC holds voting and dispositive control over the shares.
|
|
(32)
|
Shares
held by Ronoc Ltd, a Cypress limited liability company. Michael Madden as sole owner of Ronoc
Ltd. holds voting and dispositive control over the shares.
|
|
(33)
|
Shares
held by Philip R. and Amy K. Wiser Family Trust. Philip R. Wiser as trustee holds voting
and dispositive control over the shares.
|
|
(34)
|
Shares
held by Lateral Lined LLC, a New Hampshire limited liability company. David Robertson Wilich
as manager of Lateral Lined LLC holds voting and dispositive control over the shares.
|
|
(35)
|
Shares
held by Bleckrock LLC, a Massachusetts limited liability company. Timothy Slavin as manager
of Bleckrock LLC holds voting and dispositive control over the shares.
|
|
(36)
|
Shares
held by GPEC Venture Partners LLC. Gerard Miller as manager of GPEC Venture Partners LLC
holds voting and dispositive control over the shares.
|
|
(37)
|
Shares
held by MAI Investments, LLC. Mark Giaquinto as manager of MAI Investments, LLC holds voting
and dispositive control over the shares.
|
|
(38)
|
Shares
held by Quartermain Investment Holdings, Ltd. Quartermain Investment Holdings, Ltd. is funded
by The Prism Income SP Ltd, an Special Purpose Vehicle of Skybound Capital Partners PPC.
LC Abelheim Ltd. is the administrative agent of Quartermain Investment Holdings Ltd. Jabir
Sardharwalla, Chief Strategist of Skybound Capital Partners PPC; Theodore Shou, Chief Investment
Officer for Skybound Capital Partners PPC; and Roshan Bissessur, Chief Financial Officer
for LC Abelheim Ltd. jointly hold voting and dispositive control over the shares.
|
|
(39)
|
Shares
held by Steward IDF LLC. Caroline Fuchsloch as manager of Steward IDF LLC holds voting and
dispositive control over the shares.
|
|
(40)
|
Shares
held by Keypad Finance Limited. Matthew Dredge, Ian Humphries, and David Walker as directors
of Keypad Finance Limited hold joint voting and dispositive control over the shares.
|
|
(41)
|
Shares
held by Bradley Woods & Co. Ltd. Daniel Ripp as sole owner of Bradley Woods & Co.
Ltd. holds voting and dispositive control over the shares.
|
|
(42)
|
Shares
held by Jeff Kiehn consist of 126,786 shares beneficially owned by Jeff Kiehn and 357,143
shares held by Jeff Kiehn as the seller’s representative pursuant to certain escrow
agreement in connection to the 365 Agreement.
|
|
(43)
|
Shares
held by Navigator Acquisition Corp. James A. Unruh as president of Navigator Acquisition
Corp. holds voting and dispositive control over the shares.
|
|
(44)
|
Shares
held by Octopus Holdings LLC, a California limited liability company. Owen Dyke-Ruh as president
of Octopus Holdings LLC holds voting and dispositive control over the shares.
|
DIVIDEND
POLICY
We
do not intend to pay dividends for the foreseeable future. In addition, our ability to pay dividends is restricted by agreements governing
Akerna’s and its subsidiaries’ debt, including the Company’s senior secured convertible notes. See “Risk Factors”
above.
MARKET
FOR COMMON SHARES
Our
shares of common stock trade on the Nasdaq Capital Market under the symbol “KERN”. On January 7, 2022, the last reported
sale price of the common stock on the Nasdaq Capital Market was $1.72 per share. As of January 5, 2022, there were 31,001,884 shares
of common stock issued and outstanding, and we had approximately 255 registered shareholders of record.
DESCRIPTION
OF CAPITAL STOCK
As
of January 5, 2022, our authorized common stock capital consists of 75,000,000 shares of common stock, $0.0001 par value per share, of
which 31,001,884 shares of common stock are issued and outstanding, and 5,000,000 shares of preferred stock, par value $0.0001 per share,
of which one share of special voting preferred stock is issued and outstanding with a voting equivalent of 309,286 shares of common stock.
We are a Delaware corporation and our affairs are governed by our Amended and Restated Certificate of Incorporation and Amended and Restated
By-laws. The following are summaries of material provisions of our Amended and Restated Certificate of Incorporation and Amended and
Restated By-laws insofar as they relate to the material terms of our common stock. Complete copies of our Amended and Restated Certificate
of Incorporation and Amended and Restated By-laws are filed as exhibits to our public filings.
Common
Stock
All
outstanding shares of common stock are of the same class and have equal rights and attributes. The holders of common stock are entitled
to one vote per share on all matters submitted to a vote of our stockholders. Subject to the prior rights of all classes or series of
stock at the time outstanding having prior rights as to dividends or other distributions, all stockholders are entitled to share equally
in dividends, if any, as may be declared from time to time by the Board of Directors out of funds legally available. Subject to the prior
rights of creditors of Akerna and the holders of all classes or series of stock at the time outstanding having prior rights as to distributions
upon liquidation, dissolution or winding up of Akerna, in the event of liquidation, the holders of common stock are entitled to share
ratably in all assets remaining after payment of all liabilities. The stockholders do not have cumulative, preemptive rights, or subscription
rights.
Preferred
Stock
The
board of directors is authorized, subject to any limitations prescribed by law, without further vote or action by the stockholders, to
issue from time to time shares of Preferred Stock in one or more series. Each such series of Preferred Stock shall have such number of
shares, designations, preferences, voting powers, qualifications, and special or relative rights or privileges as shall be determined
by the board of directors, which may include, among others, dividend rights, voting rights, liquidation preferences, conversion rights
and preemptive rights. Issuance of Preferred Stock by our board of directors may result in such shares having dividend and/or liquidation
preferences senior to the rights of the holders of our common stock and could dilute the voting rights of the holders of our common stock.
Prior
to the issuance of shares of each series of Preferred Stock, the board of directors is required by the Delaware General Corporation Law,
and our certificate of incorporation to adopt resolutions and file a certificate of designation with the Secretary of State of the State
of Delaware. The certificate of designation fixes for each class or series the designations, powers, preferences, rights, qualifications,
limitations and restrictions, including, but not limited to, some or all of the following:
|
●
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the number of shares
constituting that series and the distinctive designation of that series, which number may be increased or decreased (but not below
the number of shares then outstanding) from time to time by action of the board of directors;
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|
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●
|
the dividend rate and
the manner and frequency of payment of dividends on the shares of that series, whether dividends will be cumulative, and, if so,
from which date;
|
|
●
|
whether that series
will have voting rights, in addition to any voting rights provided by law, and, if so, the terms of such voting rights;
|
|
|
|
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●
|
whether that series
will have conversion privileges, and, if so, the terms and conditions of such conversion, including provision for adjustment of the
conversion rate in such events as the board of directors may determine;
|
|
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●
|
whether or not the
shares of that series will be redeemable, and, if so, the terms and conditions of such redemption;
|
|
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●
|
whether that series
will have a sinking fund for the redemption or purchase of shares of that series, and, if so, the terms and amount of such sinking
fund;
|
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●
|
whether or not the
shares of the series will have priority over or be on a parity with or be junior to the shares of any other series or class in any
respect;
|
|
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|
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●
|
the rights of the shares
of that series in the event of voluntary or involuntary liquidation, dissolution or winding up of the corporation, and the relative
rights or priority, if any, of payment of shares of that series; and
|
|
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|
|
●
|
any other relative
rights, preferences and limitations of that series.
|
Once
designated by our board of directors, each series of Preferred Stock may have specific financial and other terms that will be described
in a prospectus. The description of the Preferred Stock that is set forth in any prospectus is not complete without reference to the
documents that govern the Preferred Stock. These include our certificate of incorporation and any certificates of designation that our
board of directors may adopt.
All
shares of Preferred Stock offered hereby will, when issued, be fully paid and nonassessable, including shares of Preferred Stock issued
upon the exercise of Preferred Stock Warrants or subscription rights, if any.
Although
our board of directors has no intention at the present time of doing so, it could authorize the issuance of a series of Preferred Stock
that could, depending on the terms of such series, impede the completion of a merger, tender offer or other takeover attempt.
Special
Voting Share
The
special voting share has a par value of $0.0001 per share. The special voting share entitles the holder thereof to an aggregate number
of votes equal to the number of the Exchangeable Shares issued and outstanding from time to time and that are not owned by us or our
subsidiaries. Except as otherwise provided herein or by law, the holder of the special voting share and the holders of our common stock
will vote together as a single class on all matters submitted to a vote of Akerna’s shareholders. With respect to all meetings
of shareholders of Akerna at which holders of Akerna shares are entitled to vote, each registered holder of Exchangeable Shares shall
be entitled to instruct the trustee holding the special voting share to cast and exercise, in the manner instructed, that number of votes
equal to the “Equivalent Vote Amount” for each Exchangeable Share owned of record by such holder of Exchangeable Shares at
the close of business on the record date established by Akerna or by applicable law for such meeting, in respect of each matter, question,
proposal or proposition to be voted on at such meeting. At such time as the special voting share has no votes attached to it, the special
voting share shall be automatically cancelled.
Exchangeable
Shares
The
Exchangeable Shares of Exchangeco are intended to be substantially economically equivalent to shares of our common stock. The rights,
privileges, restrictions and conditions attaching to the Exchangeable Shares of Exchangeco include the following:
|
●
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any
holder of Exchangeable Shares of Exchangeco is entitled to require Exchangeco to redeem any or all of the Exchangeable Shares registered
in his/her name in exchange for one share of our common stock for each Exchangeable Share presented and surrendered;
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●
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in
the event Akerna declares a dividend on its common stock, the holders of Exchangeable Shares of Exchangeco are entitled to receive from
Exchangeco the same dividend, or an economically equivalent dividend, on their Exchangeable Shares;
|
|
●
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the
holders of the Exchangeable Shares of Exchangeco are not entitled to receive notice of or to attend any meeting of the shareholders of
Exchangeco or to vote at any such meeting, except as required by law or as specifically provided in the Exchangeable Share conditions;
and
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|
●
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the
holders of Exchangeable Shares of Exchangeco are entitled to instruct the Trustee to vote the special voting stock as described above.
|
Of
the 3,294,574 Exchangeable Shares that were issued to former Ample shareholders in connection with the consummation of the Arrangement,
an aggregate of 658,915 Exchangeable Shares were issued as “Closing Consideration” and an aggregate of 2,635,659 Exchangeable
Shares, constituting part of the “Escrowed Consideration” were issued into escrow pursuant to an escrow agreement (the “Escrow
Agreement, entered into on July 7, 2020 by and among the Company, ExchangeCo, John Prentice, as Shareholder Representative, and Odyssey
Trust Company. Under the Escrow Agreement, subject to unresolved claims by the Company under the Arrangement Agreement in respect of
fraud, the Escrowed Consideration shall be released to former Ample shareholders upon the six-, nine-, and twelve-month anniversaries
of the Closing Date in accordance with the following schedule – 988,372 shares on the six-month anniversary, 823,643 shares on
the nine-month anniversary, and 823,644 shares on the twelve-month anniversary. As of the date hereof, 2,985,288 shares of common stock
of Akerna have been issued on conversion of Exchangeable Shares.
Registration
Rights
We
have granted registration rights under the Securities Act to certain holders of our common stock in relation to our acquisitions of Ample
and 365 Cannabis and in relation to our issuance of the Senior Convertible Notes. In relation to Ample, we agreed to file and maintain,
until no Exchangeable Shares remain outstanding, a registration statement regarding the exchange of the Exchangeable Shares into shares
of our common stock pursuant to their terms. In relation thereto, we filed a registration statement on Form S-1 on July 9, 2020 (333-239783)
which was brought effective on August 14, 2020, as amended on January 8, 2021 and as amended on Form S-3 on May 24, 2021. In relation
to the acquisition transaction of 365 Cannabis, we have agreed to register the shares of common stock issuable upon initial closing of
the transaction and upon settlement of the earn-out provision, if any. In relation to our issuance of the Senior Convertible Notes, we
have agreed to file the registration statement of which this prospectus forms a part. We are also obligated to maintain such registration
statement until the earlier of (i) the date as of which all of the holders may sell all of the conversion shares required to be covered
by such registration statement without restriction pursuant to Rule 144 (including, without limitation, volume restrictions) and without
the need for current public information required by Rule 144(c)(1) (or Rule 144(i)(2), if applicable), (ii) the date on which the holders
shall have sold all of the registrable securities covered by such registration statement or (iii) the later of (x) ninety (90) calendar
days after the date no Senior Convertible Notes remain outstanding and (y) the first anniversary of the maturity date of the Senior Convertible
Notes. We may also be required in the future to file amendments to these registration statements to maintain effectiveness.
Election
of Directors
Our
Class I Directors hold office until the 2022 annual meeting of stockholders and are eligible for reelection at such meeting. Our Class
II Directors held office until the 2023 annual meeting of stockholders and are eligible for reelection at such meeting. Our Class III
Directors hold office until the 2024 annual meeting of stockholders and are eligible for reelection at such meeting. Directors are elected
by a plurality of the votes cast at the annual meeting by the holders of common stock present in person or represented by proxy and entitled
to vote at such meeting. There is no cumulative voting for directors.
Anti-Takeover
Provisions
Our
Amended and Restated Certificate of Incorporation contains provisions that may discourage unsolicited takeover proposals that stockholders
may consider to be in their best interests. We are also subject to anti-takeover provisions under Delaware law, which could delay or
prevent a change of control. Together these provisions may make more difficult the removal of management and may discourage transactions
that otherwise could involve payment of a premium over prevailing market prices for our securities.
These
provisions:
|
●
|
create
a staggered Board of Directors making it more difficult for stockholders to remove a majority of the Board of Directors and take control;
|
|
●
|
grant
the Board of Directors the ability to designate the terms of and issue new series of preferred shares, which can be created and issued
by the Board of Directors without prior stockholder approval, with rights senior to those of the common stock;
|
|
●
|
impose
limitations on our stockholders’ ability to call special stockholder meetings;
|
|
●
|
make
it more difficult the removal of management and may discourage transactions that otherwise could involve payment of a premium over prevailing
market prices for our securities.
|
PLAN
OF DISTRIBUTION
Selling
Stockholders
The
common stock held by the selling stockholders may be sold or distributed from time to time by the selling stockholders directly to one
or more purchasers or through brokers, dealers, or underwriters who may act solely as agents at market prices prevailing at the time
of sale, at prices related to the prevailing market prices, at negotiated prices, or at fixed prices, which may be changed on any stock
exchange, market or trading facility on which the shares are traded or in private transactions. The sale of the selling stockholders’
common stock offered by this prospectus may be effected in one or more of the following methods:
|
●
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ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers;
|
|
●
|
transactions
involving cross or block trades;
|
|
●
|
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;
|
|
●
|
in
privately negotiated transactions;
|
|
●
|
short
sales after the registration statement, of which this prospectus forms a part, becomes effective;
|
|
●
|
broker-dealers
may agree with the selling stockholders to sell a specified number of such shares at a stipulated price per share;
|
|
●
|
“at
the market” into an existing market for the common stock;
|
|
●
|
through
the writing of options on the shares;
|
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●
|
a
combination of any such methods of sale; and
|
|
●
|
any
other method permitted pursuant to applicable law.
|
With
regard only to the shares it sells for its own behalf, the selling stockholders may be deemed an “underwriter” within the
meaning of the Securities Act. Because a selling stockholder may be deemed to be an “underwriter” within the meaning
of the Securities Act, it will be subject to the prospectus delivery requirements of the Securities Act, including Rule 172 thereunder.
In
order to comply with the securities laws of certain states, if applicable, the shares of each of the selling stockholders may be sold
only through registered or licensed brokers or dealers. In addition, in certain states, such shares may not be sold unless they have
been registered or qualified for sale in the state or an exemption from the registration or qualification requirement is available and
complied with.
Each
of the selling stockholders has advised us that they have not entered into any agreements, understandings or arrangements with any underwriters
or broker-dealers regarding the sale of their shares of common stock, nor is there an underwriter or coordinating broker acting
in connection with a proposed sale of shares of common stock by any selling stockholder. If we are notified by any selling stockholder
that any material arrangement has been entered into with a broker-dealer for the sale of shares of common stock, if required, we will
file a supplement to this prospectus.
The
selling stockholders may also sell shares of common stock under Rule 144 or Rule 145, as applicable, promulgated under the Securities
Act, if available, rather than under this prospectus. In addition, the selling stockholders may transfer the shares of common stock by
other means not described in this prospectus.
The
selling stockholders may also sell the shares directly to market makers acting as principals and/or broker-dealers acting as agents for
themselves or their customers. Such broker-dealers may receive compensation in the form of discounts, concessions or commissions from
the selling stockholders and/or the purchasers of shares for whom such broker-dealers may act as agents or to whom they sell as principal
or both, which compensation as to a particular broker-dealer might be in excess of customary commissions. Market makers and block purchasers
purchasing the shares will do so for their own account and at their own risk. It is possible that a selling stockholder will attempt
to sell shares of common stock in block transactions to market makers or other purchasers at a price per share which may be below the
then market price. The selling stockholders cannot assure that all or any of the shares offered in this prospectus will be issued to,
or sold by, such selling stockholder.
Brokers,
dealers, underwriters, or agents participating in the distribution of the shares held by the selling stockholders as agents may receive
compensation in the form of commissions, discounts, or concessions from the selling stockholders and/or purchasers of the common stock
for whom the broker-dealers may act as agent. The selling stockholders may agree to indemnify any agent, dealer or broker-dealer
that participates in transactions involving sales of the shares if liabilities are imposed on that person under the Securities Act.
We
may suspend the sale of shares by the selling stockholders pursuant to this prospectus for certain periods of time for certain reasons,
including if the prospectus is required to be supplemented or amended to include additional material information.
This
offering as it relates to the selling stockholder will terminate on the date that all shares issued to such selling stockholder that
are offered by this prospectus have been sold by such selling stockholder.
Regulation
M
The
anti-manipulation rules of Regulation M under the Exchange Act of 1934, as amended (the “Exchange Act”) may apply to sales
of our common stock and activities of the selling stockholder.
We
have advised the selling stockholders that while it is engaged in a distribution of the shares included in this prospectus it is required
to comply with Regulation M promulgated under the Exchange Act. With certain exceptions, Regulation M precludes the selling stockholder,
any affiliated purchasers, and any broker-dealer or other person who participates in the distribution from bidding for or purchasing,
or attempting to induce any person to bid for or purchase any security which is the subject of the distribution until the entire distribution
is complete. Regulation M also prohibits any bids or purchases made in order to stabilize the price of a security in connection with
the distribution of that security. All of the foregoing may affect the marketability of the shares offered hereby this prospectus.
EXPERTS
The
consolidated financial statements of Akerna as of December 31, 2020, June 30, 2020 and 2019, for the six months ended December 31, 2020
and for each of the two years in the period ended June 30, 2020 included in our transition report on Form 10-KT which is incorporated
herein by reference, have been audited by Marcum LLP, independent registered public accounting firm, as set forth in their report thereon,
which is incorporated herein by reference, and are included in reliance upon such report given on the authority of such firm as experts
in accounting and auditing.
The
financial statements of Solo as of December 31, 2019 and 2018 and for years then ended included in our current report on Form 8-K as
filed with the SEC on May 29, 2020 and incorporated herein by reference, have been audited by Marcum LLP, independent auditors, as set
forth in their report thereon, which is incorporated herein by reference, and are included in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
The
financial statements of 365 Cannabis as of December 31, 2020 and for year then ended included in our current report on Form 8-K as filed
with the SEC on December 14, 2021 and incorporated herein by reference, have been audited by Marcum LLP, independent auditors, as set
forth in their report thereon, which is incorporated herein by reference, and are included in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
The
consolidated financial statements of Ample as of December 31, 2019 and 2018 and for years then ended included in our current report on
Form 8-K as filed with the SEC on July 8, 2020 and incorporated herein by reference, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon, which is incorporated herein by reference, which report includes an explanatory paragraph
as to the ability of Ample to continue as a going concern as described in Note 1 to the financial statements, and are included in reliance
on such report given upon such firm as experts in accounting and auditing.
LEGAL
MATTERS
The
validity of the securities offered hereby have been passed upon for Akerna by Dorsey & Whitney LLP.
DOCUMENTS
INCORPORATED BY REFERENCE
The
SEC allows us to “incorporate by reference” information we file with the SEC. This means that we can disclose
important information to you by referring you to those documents. Any information we reference in this manner is considered part of this
prospectus. Information we file with the SEC after the date of this prospectus will automatically update and, to the extent
inconsistent, supersede the information contained in this prospectus.
The
following documents have been filed by us with the SEC, are specifically incorporated by reference into, and form an integral part of,
this prospectus.
|
(a)
|
our
Transition Report on Form 10-KT for the six-month period ended December 31, 2020, which report contains our audited consolidated financial
statements and the notes thereto as of December 31, 2020 and June 30, 2020 and 2019 and for the six-month transition period ended December
31, 2020 and for the fiscal years ended June 30, 2020 and 2019, together with the auditors’ report thereon and the related management’s
discussion and analysis of financial condition and results of operations for the six-month period ended December 31, 2020 and the fiscal
years ended June 30, 2020 and 2019, as filed with the SEC on March 31, 2021;
|
|
(b)
|
our
Proxy Statement on Schedule 14A in connection with our June 7, 2021 annual general meeting of stockholders, to the extent such information
is specifically incorporated by reference into Part III of our Transition Report on Form 10-KT for the fiscal year ended December 31,
2020, as filed with the SEC on April 27, 2021;
|
|
(c)
|
our Quarterly Report on Form 10-Q for the
quarter ended March 31, 2021, which report contains the unaudited condensed consolidated financial statements of the Company and
the notes thereto as of March 31, 2021 and for the three months ended March 31, 2021 and 2020 and the related management’s
discussion and analysis of financial condition and results of operations for the three months ended March 31, 2021 and 2020, as filed
with the SEC on May 21, 2021;
|
|
(d)
|
our Quarterly Report on Form 10-Q for the
quarter ended June 30, 2021, which report contains the unaudited condensed consolidated financial statements of the Company and the
notes thereto as of June 30, 2021 and for the three and six months ended June 30, 2021 and 2020 and the related management’s
discussion and analysis of financial condition and results of operations for the three and six months ended June 30, 2021 and 2020,
as filed with the SEC on August 12, 2021;
|
|
|
|
|
(e)
|
our Quarterly Report on Form 10-Q
for the quarter ended September 30, 2021, which report contains the unaudited condensed consolidated financial statements of the
Company and the notes thereto as of September 30, 2021 and for the three and nine months ended September 30, 2021 and 2020 and the
related management’s discussion and analysis of financial condition and results of operations for the three and nine months
ended September 30, 2021 and 2020, as filed with the SEC on November 12, 2021;
|
|
(f)
|
Exhibit 99.1 to our Current Report on Form
8-K, as filed with the SEC on May 29, 2020, which exhibit contains the financial statements of Solo as of December 31, 2019 and 2018
and for years then ended, together with the auditor’s report thereon;
|
|
(g)
|
Exhibit 99.2 to our Current Report on Form
8-K, as filed with the SEC on July 8, 2020, which exhibit contains the consolidated financial statements of Ample as of December
31, 2019 and 2018 and for years then ended, together with the auditor’s report thereon;
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|
(h)
|
pages F-50 through F-64 and F-108 through
F-112 of our prospectus dated January 25, 2021, as filed with SEC on February 10, 2021, which pages contain, respectively (i) the
unaudited condensed consolidated financial statements of Ample Organics Inc. as of and for the three and six months ended June 30,
2020 and 2019 and (ii) the unaudited pro forma condensed combined statement of operations of Akerna, Solo and Ample for the year
ended June 30, 2020;
|
|
(i)
|
Exhibits 99.1, 99.2 and 99.3 to our Current
Report on Form 8-K/A, as filed with the SEC on December 14, 2021, which exhibits contain (i) the audited consolidated financial statements
of 365 Cannabis as of and for the year ended December 31, 2020, the related notes thereto and the independent auditor’s report
therein, (ii) the unaudited condensed consolidated financial statements of 365 Cannabis as of and for the period ended September
30, 2021 and related notes thereto, and (iii) the unaudited pro forma condensed combined financials of the Company giving effect
to the acquisition of 365 Cannabis;
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|
(j)
|
our Current Reports on Form 8-K as filed
on January 14, 2021, February 3, 2021, March 16, 2021, April 26, 2021, April 30, 2021, June 7, 2021 July 23, 2021; September 21, 2021; October 4, 2021, October 5, 2021, October 12, 2021 and December 14, 2021;
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|
(k)
|
The description of the common stock contained
in the registration statement on Form 8-A of MTech Acquisitions Corp. with the SEC on January 26, 2018, including any amendment
or report filed for purposes of updating such description. The Company is the successor issuer to MTech Acquisitions Corp.; and
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|
(l)
|
all other documents filed by us with the
SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act (excluding, unless otherwise provided therein or herein, information
furnished pursuant to Item 2.02 and Item 7.01 on any Current Report on Form 8-K), after the date of this prospectus but before the
end of the offering of the securities made by this prospectus.
|
We
also hereby specifically incorporate by reference all filings by us pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
after the date of the filing of the initial registration statement on Form S-3 to which this prospectus relates and prior to effectiveness
of such registration statement.
You
may obtain copies of any of these documents by contacting us at the address and telephone number indicated below or by contacting the
SEC as described below. You may request a copy of these documents, and any exhibits that have specifically been incorporated by reference
as an exhibit in this prospectus, at no cost, by writing or telephoning to:
AKERNA
CORP.
1550 Larimer Street #246
Denver,
Colorado 80202
Attention:
John Fowle, Secretary
Telephone:
1-888-932-6537
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed with the SEC a registration statement on Form S-3 under the Securities Act relating to the offering of these securities. The
registration statement, including the attached exhibits and schedules, contains additional relevant information about us and the securities.
This prospectus does not contain all of the information set forth in the registration statement and the exhibits and schedules thereto.
For further information respecting our company and the shares offered by this prospectus, you should refer to the registration statement,
including the exhibits and schedules thereto.
We
file annual, quarterly and other reports, proxy statements and other information with the SEC. Our Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q, and Current Reports on Form 8-K, including any amendments to those reports, and other information that we file
with or furnish to the SEC pursuant to Section 13(a) or 15(d) of the Exchange Act can be accessed free of charge through the Internet.
The SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that
file electronically with the SEC at http://www.sec.gov. You may access the registration statement, of which this prospectus is a part,
and the documents incorporated by reference herein, at the SEC’s Internet site. You may also access these documents at the Company’s
website at www.akerna.com.
PROSPECTUS
AKERNA
CORP.
January
, 2022
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
ITEM
14- OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
|
|
Amount
|
|
Securities and Exchange Commission Registration Fee
|
|
$
|
747.12
|
|
Legal Fees and Expenses
|
|
$
|
30,000
|
|
Accounting Fees and Expenses
|
|
$
|
15,000
|
|
Printing and Engraving Expenses
|
|
$
|
0
|
|
Miscellaneous Expenses
|
|
$
|
5,000
|
|
Total
|
|
$
|
50,747.12
|
|
ITEM
15- INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under
Section 145 of the DGCL, a corporation may indemnify its directors, officers, employees and agents and its former directors, officers,
employees and agents and those who serve, at the corporation’s request, in such capacities with another enterprise, against expenses
(including attorney’s fees), as well as judgments, fines and settlements, actually and reasonably incurred in connection with the
defense of any action, suit or proceeding (other than an action by or in the right of the corporation) in which they or any of them were
or are made parties or are threatened to be made parties by reason of their serving or having served in such capacity. The DGCL provides,
however, that such person must have acted in good faith and in a manner he or she reasonably believed to be in (or not opposed to) the
best interests of the corporation and, in the case of a criminal action, such person must have had no reasonable cause to believe his
or her conduct was unlawful. In addition, the DGCL does not permit indemnification in an action or suit by or in the right of the corporation,
where such person has been adjudged liable to the corporation for negligence or misconduct in the performance of his/her duty to the
corporation, unless, and only to the extent that, a court determines that such person fairly and reasonably is entitled to indemnity
for costs the court deems proper in light of liability adjudication. Indemnity is mandatory to the extent a claim, issue or matter has
been successfully defended.
Section
102(b)(7) of the DGCL permits a corporation to include in its certificate of incorporation a provision eliminating or limiting the personal
liability of a director to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director, provided
that such provision shall not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty
to the corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (iii) under Section 174 of the DGCL (relating to unlawful payment of dividends and unlawful stock purchase or
redemption) or (iv) for any transaction from which the director derived an improper personal benefit.
Article
VI of the Amended and Restated By-Laws of Akerna contains provisions which are designed to provide mandatory indemnification of directors
and officers of Akerna to the full extent permitted by law, as now in effect or later amended. The Amended and Restated By-Laws further
provide for reimbursement and advances of payment of expenses actually and reasonably incurred by a current or former director or officer
of Akerna under the circumstances contained therein.
ITEM
16- EXHIBITS
(a)
Exhibits.
See
the Exhibit Index.
(b)
Financial Statement Schedules.
None.
(c)
Reports, Opinions and Appraisals.
None.
ITEM
17- UNDERTAKINGS
The
undersigned registrant hereby undertakes:
(1)
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
(i)
To include any prospectus required by Section 10(a)(3) of the Securities Act;
(ii)
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation
of Registration Fee” table in the effective registration statement;
(iii)
To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided,
however, that the undertakings set forth in paragraphs (1)(i), (1)(ii) and (1)(iii) above do not apply if the registration statement
is on Form S-3 and the information required to be included in a post-effective amendment by those paragraphs is contained in reports
filed with or furnished to the Commission by the registrant pursuant to Section 13 or Section 15(d) of the Exchange Act that
are incorporated by reference in the registration statements 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, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3)
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4)
That, for the purpose of determining liability under the Securities Act to any purchaser:
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(i)
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If the registrant is relying on Rule 430B
(§230.430B of this chapter):
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(A)
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Each prospectus filed by the registrant
pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed
part of and included in the registration statement; and
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(B)
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Each prospectus required to be filed pursuant
to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant
to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act
shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is
first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus.
As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall
be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which
that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement
or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part
of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or
modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made
in any such document immediately prior to such effective date.
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(ii)
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Each prospectus filed pursuant to Rule 424(b)
as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than
prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date
it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus
that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior
to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the
registration statement or made in any such document immediately prior to such date of first use.
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(b)
The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of
the registrant’s annual report pursuant to section 13(a) or section 15(d) of the Securities Exchange Act (and, where applicable,
each filing of an employee benefit plan’s annual report pursuant to section 15(d) of the Securities 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 the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.
(c)
Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid
by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of
such issue.
SIGNATURES
In
accordance with the requirements of the Securities Act, as amended, the registrant certifies that it has reasonable grounds to believe
that it meets all the requirements of filing on Form S-3 and has authorized this registration statement to be signed on its behalf by
the undersigned, in the city of Denver, Colorado on January 10, 2022.
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AKERNA CORP.
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By:
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/s/ John
Fowle
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Name:
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John Fowle
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Title:
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Chief Financial Officer
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POWER
OF ATTORNEY
KNOW
ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jessica Billingsley and John Fowle
as his or her true and lawful attorney-in-fact, with full power of substitution and resubstitution for him or her and in his or her name,
place and stead, in any and all capacities to sign any and all amendments including post-effective amendments to this registration statement,
and to file the same, with all exhibits thereto, and other documents in connection therewith, with the SEC, hereby ratifying and confirming
all that said attorney-in-fact or his or her substitute, each acting alone, may lawfully do or cause to be done by virtue thereof.
Pursuant
to the requirements of the Securities Act, as amended, this Registration Statement has been signed by the following persons in the capacities
and on the dates indicated.
Signature
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Title
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Date
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/s/ Jessica
Billingsley
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Chief Executive Officer and Director
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January 10, 2022
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Jessica Billingsley
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(Principal Executive Officer)
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/s/ John
Fowle
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Chief Financial Officer
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January 10, 2022
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John Fowle
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(Principal Financial and Accounting Officer)
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/s/ Scott
Sozio
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Director
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January 10, 2022
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Scott Sozio
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/s/ Tahira
Rehmatullah
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Director
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January 10, 2022
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Tahira Rehmatullah
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/s/ Matthew
Kane
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Director
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January 10, 2022
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Matthew Kane
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/s/ Barry Fishman
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Director
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January 10, 2022
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Barry Fishman
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EXHIBIT
INDEX
Exhibit
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Number
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Description
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2.1+
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Agreement and Plan of Merger, dated as of October 10, 2018, by and among MTech Acquisition Corp., Akerna Corp., Purchaser Merger Sub Inc., Company Merger Sub LLC, MTech Sponsor LLC in the capacity as the Purchaser Representative thereunder, MJ Freeway LLC and Harold Handelsman in the capacity as the Seller Representative thereunder (incorporated by reference to Exhibit 2.1 to the registrant’s Registration Statement on Form S-4 (File No. 333-228220))
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2.2
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First Amendment to Agreement and Plan of Merger, effective as of April 17, 2019, by and among MTech Acquisition Corp., Akerna Corp., MTech Purchaser Merger Sub Inc., MTech Company Merger Sub LLC, MTech Sponsor LLC,, in the capacity as the Purchaser Representative under the Merger Agreement, MJ Freeway LLC, and Jessica Billingsley, in the capacity as the Seller Representative under the Merger Agreement (incorporated by reference to Exhibit 2.2 to the registrant’s Registration Statement on Form S-4/A (File No. 333-228220))
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2.3
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Arrangement Agreement dated December 18, 2019 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the registrant on December 18, 2019)
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2.4
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Amendment to Arrangement Agreement dated February 28, 2020 (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the registrant on March 3, 2020)
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2.5
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Amendment No. 2 to Arrangement Agreement dated May 26, 2020 (incorporated by reference to Exhibit 2.3 to the Current Report on Form 8-K filed by the registrant on July 8, 2020)
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2.6
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Amendment No. 3 to Arrangement Agreement dated June 1, 2020 (incorporated by reference to Exhibit 2.4 to the Current Report on Form 8-K filed by the registrant on July 8, 2020)
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3.1
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Amended and Restated Certificate of Incorporation of Akerna Corp. (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the registrant on June 21, 2019)
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3.2
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Amended and Restated Bylaws of Akerna Corp. (incorporated by reference to Exhibit 3.2 to the Annual Report on Form 10-KT filed by the registrant on March 31, 2021)
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3.3
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Certificate of Designation for the Special Voting Share (incorporated by reference to Exhibit 3.1 to the Current Report on Form 8-K filed by the registrant on July 8, 2020)
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4.1
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Specimen Common Stock Certificate (incorporated by reference to Exhibit 4.1 to the registrant’s Registration Statement on Form S-4 (File No. 333-228220))
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4.2
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Specimen Warrant Certificate (incorporated by reference to Exhibit 4.2 to the registrant’s Registration Statement on Form S-4 (File No. 333-228220))
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4.3
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Form of Warrant Agreement (incorporated by reference to Exhibit 4.3 on Current Report on Form 8-K filed by the registrant on June 21, 2019)
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4.4
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Form of Securities Purchase Agreement (incorporated by reference to Exhibit 10.1 to the Current Report on Form 8-K filed by the registrant on October 5, 2021)
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4.5
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Form of Secured Convertible Promissory Note (incorporated by reference to Exhibit 10.2 to the Current Report on Form 8-K filed by the registrant on October 5, 2021)
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4.6
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Form of Security Agreement (incorporated by reference to Exhibit 10.3 to the Current Report on Form 8-K filed by the registrant on October 5, 2021)
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II-6
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