tomi_424b5
Filed Pursuant to Rule 424(b)(5)
Registration No. 333-249850
PROSPECTUS SUPPLEMENT
(To the Prospectus Dated November 13, 2020)
TOMI ENVIRONMENTAL SOLUTIONS, INC.
2,869,442 Shares of Common Stock
Pursuant
to this prospectus supplement and the accompanying prospectus, we
are offering to certain institutional investors an aggregate of
2,869,442 shares of our common stock at a purchase price of $1.7425
per share.
In a
concurrent private placement (the “Private Placement”),
we are also selling to such investors unregistered warrants (the
“Warrants”) to purchase up to an aggregate of 1,434,721
shares of our common stock, at an exercise price of $1.68 per
share. The Warrants will be exercisable immediately upon issuance
and will have a term of five years from the date of issuance. The
Warrants and the shares of our common stock issuable upon the
exercise of the Warrants (the “Warrant Shares”) are
being offered pursuant to the exemptions provided in Section
4(a)(2) under the Securities Act of 1933, as amended (the
“Securities Act”) and Regulation D promulgated
thereunder, and are not being offered pursuant to this prospectus
supplement and the accompanying prospectus. There is no established
public trading market for the Warrants and we do not expect a
market to develop. In addition, we do not intend to list the
Warrants on the Nasdaq Capital Market, any other national
securities exchange or any other nationally recognized trading
system.
Our
common stock is listed on the Nasdaq Capital Market under the
symbol “TOMZ”. On September 24, 2021, the last reported
sale price per share of our common stock was $1.67 per
share.
As of
the date of this prospectus supplement, the aggregate market value
of our outstanding shares of common stock held by non-affiliates,
or our public float, was $34,214,992.20 based on a total of
16,811,513 outstanding shares of common stock, of which 13,417,644
shares of common stock were held by non-affiliates, and a price of
$2.55 per share, which was the last reported sale price of our
common stock on Nasdaq Capital Market on July 29, 2021. Pursuant to
General Instruction I.B.6. of Form S-3, in no event will we sell
securities, registered on the registration statement, of which this
prospectus supplement is a part, in a public primary offering with
a value exceeding more than one-third of the aggregate market value
of our common stock in any 12 calendar month period so long as the
aggregate market value of our outstanding common stock held by
non-affiliates remains below $75 million. Following the sale of
shares in this offering, we will have sold securities with an
aggregate market value of $5,000,002 pursuant to General
Instruction I.B.6 of Form S-3 during the 12 calendar months prior
to and including the date of this prospectus
supplement.
Investing in our securities involves a high degree of risk. See
“Risk Factors”
beginning on page S-5 of this prospectus supplement and in the
documents incorporated by reference into this prospectus
supplement.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or passed upon the adequacy or accuracy of this
prospectus supplement or the accompanying prospectus. Any
representation to the contrary is a criminal offense.
We have
engaged H.C. Wainwright & Co., LLC, or the placement agent, as
our exclusive placement agent in connection with this offering. The
placement agent has no obligation to buy any of the securities from
us or to arrange for the purchase or sale of any specific number or
dollar amount of the securities. We have agreed to pay the
placement agent the fees set forth in the table below. See
“Plan of
Distribution” beginning on page S-9 of this prospectus
supplement for more information regarding these
arrangements.
Common
Stock
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Offering
price
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$1.7425
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$5,000,002
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Placement agent
fees(1)
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$0.1045
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$300,000
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Proceeds, before
expenses, to us
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$1.6380
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$4,700,002
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(1)
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We have
also agreed to (i) issue warrants to purchase up to 172,167 shares
of common stock to the placement agent and (ii) pay the placement
agent for certain of its expenses. See “Plan of Distribution” beginning
on page S-9 for additional information with respect to the
compensation we will pay the placement agent.
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We
expect that delivery of the shares of common stock being offered
pursuant to this prospectus supplement and the accompanying
prospectus will be made on or about September 29,
2021.
H.C. Wainwright & Co.
The
date of this prospectus supplement is September 26,
2021.
TABLE OF CONTENTS
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Page
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Prospectus Supplement
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About
this Prospectus Supplement
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S-2
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Cautionary
Note Regarding Forward-Looking Statements
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S-3
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Prospectus
Supplement Summary
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S-4
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The
Offering
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S-5
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Risk
Factors
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S-6
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Use of
Proceeds
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S-8
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Dilution
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S-9
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Plan of
Distribution
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S-10
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Legal
Matters
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S-12
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Experts
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S-12
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Where
You Can Find More Information; Information Incorporated by
Reference
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S-12
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Prospectus
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About This Prospectus
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1
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About The Company
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2
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Risk Factors
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3
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Cautionary Note Regarding Forward-Looking Statements
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4
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Use of Proceeds
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5
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Description of Common Stock
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6
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Plan of Distribution
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9
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Legal Matters
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13
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Experts
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13
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Where You Can Find More Information
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13
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Incorporation of Certain Information by Reference
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13
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About this Prospectus Supplement
This
prospectus supplement and the accompanying prospectus dated
September 29, 2021, are part of a registration statement that we
filed with the Securities and Exchange Commission, or the SEC,
utilizing a “shelf” registration process. This
prospectus supplement and the accompanying prospectus relate to the
offer by us of shares of our common stock to certain investors. We
provide information to you about this offering of shares of our
common stock in two separate documents that are bound together: (1)
this prospectus supplement, which describes the specific details
regarding this offering; and (2) the accompanying prospectus, which
provides general information, some of which may not apply to this
offering. Generally, when we refer to this
“prospectus,” we are referring to both documents
combined. If information in this prospectus supplement is
inconsistent with the accompanying prospectus, you should rely on
this prospectus supplement. However, if any statement in one of
these documents is inconsistent with a statement in another
document having a later date—for example, a document
incorporated by reference in this prospectus supplement or the
accompanying prospectus—the statement in the document having
the later date modifies or supersedes the earlier statement as our
business, financial condition, results of operations and prospects
may have changed since the earlier dates. You should read this
prospectus supplement, the accompanying prospectus, the documents
and information incorporated by reference in this prospectus
supplement and the accompanying prospectus, and any free writing
prospectus that we have authorized for use in connection with this
offering when making your investment decision. You should also read
and consider the information in the documents we have referred you
to under the headings “Where
You Can Find More Information; Information Incorporated by
Reference.”
You should rely only on information contained in or incorporated by
reference into this prospectus supplement and the accompanying
prospectus. We have not, and the placement agent has not,
authorized anyone to provide you with information that is
different. We are offering to sell and seeking offers to buy shares
of our common stock only in jurisdictions where offers and sales
are permitted. The information contained in this prospectus
supplement, the accompanying prospectus, the documents and
information incorporated by reference in this prospectus supplement
and the accompanying prospectus, and any free writing prospectus
that we have authorized for use in connection with this offering
are accurate only as of their respective dates, regardless of the
time of delivery of this prospectus supplement or of any sale of
our common stock.
In this
prospectus supplement, unless the context otherwise indicates, the
terms “TOMI,” “TOMI Environmental,” the
“Company,” “we,” “our” and
“us” or similar terms refer to Tomi Environmental
Solutions, Inc., together with any consolidated
subsidiaries.
We use
our registered trademarks, TOMI and TOMI Environmental Solutions,
Inc. logo in this prospectus. All other trademarks, trade names and
service marks appearing in this prospectus or the documents
incorporated by reference herein are the property of their
respective owners. Use or display by us of other parties’
trademarks, trade dress or products is not intended to and does not
imply a relationship with, or endorsements or sponsorship of, us by
the trademark or trade dress owner. Solely for convenience,
trademarks and tradenames referred to in this prospectus appear
without the ® and TM symbols, but those references are not
intended to indicate, in any way, that we will not assert, to the
fullest extent under applicable law, our rights or that the
applicable owner will not assert its rights, to these trademarks
and tradenames.
Cautionary Note Regarding Forward-Looking Statements
This
prospectus supplement and the accompanying prospectus, including
the documents incorporated by reference herein and therein, and any
free writing prospectus that we have authorized for use in
connection with this offering contain forward-looking statements
that involve risks and uncertainties. Forward-looking statements
give our current expectations of forecasts of future events. All
statements other than statements of historical facts contained in
this prospectus supplement, the accompanying prospectus and the
documents incorporated by reference herein are forward-looking
statements, including, without limitation, statements regarding our
future financial position, business strategy, new products,
budgets, liquidity, cash flows, projected costs, regulatory
approvals or the impact of any laws or regulations applicable to
us, and plans and objectives of management for future operations,
are forward-looking statements within the meaning of Section 27A of
the Securities Act and 21E of the Securities Exchange Act of 1934,
as amended. The words “anticipate,”
“believe,” “continue,”
“should,” “estimate,” “expect,”
“intend,” “may,” “plan,”
“project,” “will,” and similar expressions,
as they relate to us, are intended to identify forward-looking
statements.
We have
based these forward-looking statements on our current expectations
about future events. While we believe these expectations are
reasonable, such forward-looking statements are inherently subject
to risks and uncertainties, many of which are beyond our control.
Our actual future results may differ materially from those
discussed here for various reasons. Factors that could contribute
to such differences include, but are not limited to:
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our
need for additional financing to meet our business
objectives;
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the
effect of COVID-19 pandemic on our business
operations;
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the
ability to execute our sales and marketing strategies;
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our
plans to research, develop and commercialize our
product;
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our
ability to attract customers;
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our
reliance on third-party manufacturers of our products;
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the
size and growth potential of the markets for our products and our
ability to serve those markets;
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the
rate and degree of market acceptance of our products;
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regulatory
requirements and developments;
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the
performance of our third-party suppliers and
manufacturers;
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the
success of competing products that are or may become
available;
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our
ability to attract and retain key scientific or management
personnel; and
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our
potential inability to remain in compliance with the continued
listing requirements of the NASDAQ Capital Market.
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Given
these risks and uncertainties, you are cautioned not to place undue
reliance on such forward-looking statements. The forward-looking
statements included in this prospectus supplement and the
accompanying prospectus are made only as of the date hereof. We do
not undertake any obligation to update any such statements or to
publicly announce the results of any revisions to any of such
statements to reflect future events or developments.
TOMI Environmental Solutions, Inc.
Overview
TOMI
Environmental Solutions, Inc. is a global company that specializes
in disinfection and decontamination essentials using its premier
Binary Ionization Technology platform through the manufacturing,
licensing, servicing, and selling of its SteraMist brand of
products. SteraMist is a hydrogen peroxide-based mist/fog
registered with the U.S. Environmental Protection Agency, or EPA,
as a hospital-healthcare and effective broad-spectrum surface
disinfectant. Our operating structure consists of five divisions:
Hospital-HealthCare, Life Sciences, TOMI Service Network,
Commercial and Food Safety. We provide environmental solutions for
indoor and outdoor surface and air decontamination.
Company Information
We were incorporated as a Florida corporation on September 18, 1979 under
the name Dauphin, Inc. and began our current operations in 2008
following a series of transactions and name changes. On May 14,
2009, we changed our name to TOMI Environmental Solutions, Inc. Our
corporate headquarters are located at 8430 Spires Way, Suite N,
Frederick, Maryland 21701. Our telephone number is (800) 525-1698.
Our website address is www.tomimist.com. The information contained
on our website is not a part of, and should not be construed as
being incorporated by reference into, this
prospectus.
The Offering
Common
stock offered by us
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2,869,442
shares of common stock.
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Concurrent Private Placement of Warrants
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In the
Private Placement, we are selling to investors in this offering
Warrants to purchase up to an aggregate of 1,434,721 shares of
common stock at an exercise price of $1.68 per share. The Warrants
will be exercisable immediately upon issuance and will have a term
of five years from the date of issuance. The Warrants are being
offered pursuant to the exemptions provided in Section 4(a)(2)
under the Securities Act and Regulation D promulgated thereunder
and, along with the Warrant Shares, have not been registered under
the Act, or applicable state securities laws. Accordingly, the
Warrants and the Warrant Shares may not be offered or sold in the
U.S. except pursuant to an effective registration statement or an
applicable exemption from the registration requirements of the
Securities Act and such applicable state securities laws. See
“Private Placement of Warrants” below.
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Offering
price
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$1.7425
per share
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Common
stock to be outstanding immediately after this
offering
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19,680,955
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Use of
proceeds
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We
intend to use the net proceeds from this offering for general
corporate purposes, including but not limited to sales and
marketing expenses associated with our products, advertising,
general and administrative expenses, purchase of inventory and
working capital. See “Use of
Proceeds.”
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Nasdaq
Capital Market listing
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Our
common stock is listed on the Nasdaq Capital Market under the
symbol “TOMZ.”
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Risk
factors
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You
should read the “Risk
Factors” section of this prospectus supplement and in
the documents incorporated by reference in this prospectus
supplement for a discussion of factors to consider before deciding
to invest in our common stock.
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The
number of shares of common stock to be outstanding after this
offering is based on 16,811,513 shares outstanding as of
September 27, 2021, and excludes as of that date:
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1,606,888
shares of common stock issuable upon exercise of warrants to be
issued in connection with this offering and the concurrent Private
Placement, including warrants to purchase 1,434,721 shares issued
to investors with an exercise price of $1.68 per share, and
warrants to purchase 172,167 shares issued to the placement agent
as described in “Plan of
Distribution”;
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132,500
shares of common stock issuable upon exercise of outstanding
options to purchase common stock; and
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1,849,133
shares of common stock issuable upon exercise of outstanding
warrants to purchase common stock.
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Unless
otherwise indicated, all information contained in this prospectus
supplement assumes no exercise of the placement agent warrants to
be issued to the placement agent as compensation in connection with
this offering.
Risk Factors
You
should consider carefully the risks described below and discussed
under the section captioned “Risk Factors” contained in
our annual report on Form 10-K for the year ended December 31,
2020, as supplemented by our subsequent Quarterly Reports on Form
10-Q as filed under the Securities Exchange Act of 1934, as
amended, or the Exchange Act, which are incorporated by reference
in this prospectus supplement and the accompanying prospectus in
their entirety, together with other information in this prospectus
supplement, the accompanying prospectus and the information and
documents incorporated by reference in this prospectus supplement
and the accompanying prospectus before you make a decision to
invest in our common stock. If any of the following events actually
occur, our business, operating results, prospects or financial
condition could be materially and adversely affected. This could
cause the trading price of our common stock to decline and you may
lose all or part of your investment. The risks described below are
not the only ones that we face. Additional risks not presently
known to us or that we currently deem immaterial may also affect
our business operations.
Risks Related to Our Common Stock and this Offering
You will experience immediate and substantial dilution if you
purchase securities in this offering.
Investors
will incur immediate and substantial dilution as a result of this
offering. After giving effect to the sale by us of 2,869,442 shares
of common stock offered in this offering at offering price of
$1.7425 per share, and after deducting placement agent fees and
estimated offering expenses payable by us, investors in this
offering can expect an immediate dilution of $1.0122 per share. See
“Dilution” for more details.
We also
have an incentive compensation plan for our management, employees
and consultants. We have granted, and expect to grant in the
future, options to purchase shares of our common stock to our
directors, employees and consultants. The sale, or even the
possibility of the sale, of the shares of common stock underlying
these options, RSUs and warrants could have an adverse effect on
the market price for our securities or on our ability to obtain
future financing. For a more detailed discussion of the foregoing,
see the section entitled “Dilution” below.
In
addition, to the extent we need to raise additional capital in the
future and we issue additional equity or convertible debt
securities, our then-existing stockholders may experience dilution
and the new securities may have rights senior to those of our
common stock offered in this offering. Additionally, if we make one
or more significant acquisitions in which the consideration
includes stock or other securities, our stockholders’
holdings may be significantly diluted.
There may be future sales of our securities or other dilution of
our equity, which may adversely affect the market price of our
common stock.
We are
generally not restricted from issuing additional common stock,
including any securities that are convertible into or exchangeable
for, or that represent the right to receive, common stock. The
market price of our common stock could decline as a result of sales
of common stock or securities that are convertible into or
exchangeable for, or that represent the right to receive, common
stock after this offering, such as the warrants that will be issued
in connection with this offering or the perception that such sales
could occur.
Future sales of our common stock may cause the prevailing market
price of our shares to decrease.
As of
September 27, 2021, we had 16,811,513 outstanding shares of common
stock. In addition, as of that date, we had outstanding stock
options to acquire 132,500 shares of common stock. In addition, we
may issue up to an aggregate of 1,849,133 shares of common stock
issuable upon the exercise of warrants outstanding prior to this
offering, and up to 1,606,888 shares of common stock issuable upon
exercise of the warrants issued in this offering and the concurrent
Private Placement and the Placement Agent Warrants. The issuance of
shares of common stock upon the exercise of warrants or options
would dilute the percentage ownership interest of all stockholders,
might dilute the book value per share of our common stock and could
increase the number of our publicly traded shares, which could
depress the market price of our common stock. The perceived risk of
dilution as a result of the significant number of outstanding
warrants and options may cause our common stockholders to be more
inclined to sell their shares, which would contribute to a downward
movement in the price of our common stock. Moreover, the perceived
risk of dilution and the resulting downward pressure on our common
stock price could encourage investors to engage in short sales of
our common stock, which could further contribute to price declines
in our common stock. The fact that our stockholders, warrant
holders and option holders can sell substantial amounts of our
common stock in the public market, whether or not sales have
occurred or are occurring, could make it more difficult for us to
raise additional funds through the sale of equity or equity-related
securities in the future at a time and price that we deem
reasonable or appropriate, or at all.
A more active, liquid trading market for our common stock may not
develop, and the price of our common stock may fluctuate
significantly.
Historically,
the market price of our common stock has fluctuated over a wide
range. There has been relatively limited trading volume in the
market for our common stock, and a more active, liquid public
trading market may not develop or may not be sustained. Limited
liquidity in the trading market for our common stock may adversely
affect a stockholder’s ability to sell its shares of common
stock at the time it wishes to sell them or at a price that it
considers acceptable. If a more active, liquid public trading
market does not develop we may be limited in our ability to raise
capital by selling shares of common stock and our ability to
acquire other companies or assets by using shares of our common
stock as consideration. In addition, if there is a thin trading
market or “float” for our stock, the market price for
our common stock may fluctuate significantly more than the stock
market as a whole. Without a large float, our common stock would be
less liquid than the stock of companies with broader public
ownership and, as a result, the trading prices of our common stock
may be more volatile and it would be harder for a stockholder to
liquidate any investment in our common stock. Furthermore, the
stock market is subject to significant price and volume
fluctuations, and the price of our common stock could fluctuate
widely in response to several factors, including:
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our
quarterly or annual operating results;
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changes
in our earnings estimates;
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additions
or departures of key personnel;
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changes
in the business, earnings estimates or market perceptions of our
competitors;
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changes
in industry, general market or economic conditions;
and
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announcements
of legislative or regulatory changes.
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The
stock market has experienced extreme price and volume fluctuations
in recent years that have significantly affected the quoted prices
of the securities of many companies. The changes often appear to
occur without regard to specific operating performance. The price
of our common stock could fluctuate based upon factors that have
little or nothing to do with us and these fluctuations could
materially reduce our stock price.
Even if this offering is successful, we may need to raise
additional capital in the future to finance our operations, which
may not be available on acceptable terms, or at all. Failure to
obtain this necessary capital when needed may force us to delay,
limit or terminate our product development efforts or other
operations.
We have
had recurring losses from operations, negative operating cash flow
and have an accumulated deficit. We must raise additional funds in
order to continue financing our operations. If additional capital
is not available to us when needed or on acceptable terms, we may
not be able to continue to operate our business pursuant to our
business plan or we may have to discontinue our operations
entirely. Any additional capital raised through the sale of equity
or equity-backed securities may dilute our stockholders’
ownership percentages and could also result in a decrease in the
market value of our equity securities. The terms of any securities
issued by us in future capital transactions may be more favorable
to new investors, and may include preferences, superior voting
rights and the issuance of warrants or other derivative securities,
which may have a further dilutive effect on the holders of any of
our securities then outstanding.
If we
are unable to secure additional funds when needed or on acceptable
terms, we may be required to defer, reduce or eliminate significant
planned expenditures, restructure, curtail or eliminate some or all
of our operations, dispose of technology or assets, pursue an
acquisition of our company by a third party at a price that may
result in a loss on investment for our stockholders, file for
bankruptcy or cease operations altogether. Any of these events
could have a material adverse effect on our business, financial
condition and results of operations. Moreover, if we are unable to
obtain additional funds on a timely basis, there will be
substantial doubt about our ability to continue as a going concern
and increased risk of insolvency and up to a total loss of
investment by our stockholders.
We do not anticipate paying dividends on our common stock and,
accordingly, stockholders must rely on stock appreciation for any
return on their investment.
We do
not expect to pay or declare any further cash dividends on our
common stock for the foreseeable future. We expect to retain our
future earnings, if any, for use in the operation of our business,
including the repayment of our outstanding indebtedness.
Consequently, investors must rely on sales of their common stock
after price appreciation, which may never occur, as the primary way
to realize any gains on their investment.
Use of Proceeds
We
estimate that the net proceeds to us from this offering will be
approximately $4,556,053, after deducting placement agent fees and
estimated offering expenses payable by us.
We
intend to use the net proceeds from this offering for general
corporate purposes, including but not limited to sales and
marketing expenses associated with our products, advertising,
general and administrative expenses, purchase of inventory and
working capital. Pending these uses, we may invest the net proceeds
in short-term, interest-bearing investment grade securities,
certificates of deposit or direct or guaranteed obligations of the
U.S. government. We have not determined the amount of net proceeds
to be used specifically for such purposes. As a result, management
will retain broad discretion over the allocation of net
proceeds.
Dilution
If you
invest in our common stock in this offering, your interest will be
diluted to the extent of the difference between the offering price
per share and the net tangible book value per share of our common
stock after this offering. As June 30, 2021, our net tangible book
value was $9.8172 million, or $0.5840 per share, based on
16,811,513 shares of our common stock outstanding as of September
24, 2021. Our net tangible book value per share represents the
amount of our total tangible assets reduced by the amount of our
total liabilities, divided by the total number of shares of our
common stock outstanding as June 30, 2021. After giving effect to
our sale in this offering of 2,869,442 shares of common stock at an
offering price of $1.7425 per share, after deducting placement
agent fees and estimated offering expenses payable by us, our as
adjusted net tangible book value as of June 30, 2021 would have
been $14.3732 million, or $0.7303 per share. This represents an
immediate increase of net tangible book value of $0.1464 per share
to our existing stockholders and an immediate dilution of $1.0122
per share to new investors purchasing securities in this offering.
The following table illustrates this per share
dilution.
Offering price per
share
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$1.7425
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Net tangible book
value per share at June 30, 2021
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$0.5840
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Increase per share
attributable to investors purchasing shares in this
offering
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$0.1464
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As adjusted net
tangible book value per share after giving effect to this
offering
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$0.7303
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Dilution to
investors purchasing our common stock in this offering
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$1.0122
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The
above discussion and table are based on 16,811,513 shares
outstanding as of June 30, 2021, and excludes as of that
date:
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1,606,888
shares of common stock issuable upon exercise of warrants to be
issued in connection with this offering and the concurrent Private
Placement, including warrants to purchase 1,434,721 shares issued
to investors with an exercise price of $1.68 per share, and
warrants to purchase 172,167 shares issued to the placement agent
as described in “Plan of Distribution”
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132,500
shares of common stock issuable upon exercise of outstanding
options to purchase common stock; and
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1,849,133
shares of common stock issuable upon exercise of outstanding
warrants to purchase common stock.
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To the
extent that outstanding options or warrants are exercised, you may
experience further dilution. In addition, we may choose to raise
additional capital due to market conditions or strategic
considerations even if we believe we have sufficient funds for our
current or future operating plans. To the extent that we raise
additional capital by issuing equity or convertible debt
securities, your ownership will be further diluted.
Private Placement of Warrants
The
Company is also selling to the Purchasers unregistered warrants
(the “Warrants”) to purchase up to an aggregate of
1,434,721 shares of Common Stock, representing 50% of the shares of
Common Stock that may be purchased in the registered direct
offering (the “Warrant Shares”). The Warrants are
exercisable at an exercise price of $1.68 per share, are
exercisable immediately upon issuance and have a term of exercise
equal to five years from the date of issuance.
A
holder of Warrants will have the right to exercise the Warrants on
a “cashless” basis if there is no effective
registration statement registering the resale of the Warrant
Shares. Subject to limited exceptions, a holder of Warrants will
not have the right to exercise any portion of its Warrants if the
holder, together with its affiliates, would beneficially own in
excess of 4.99% (or 9.99% at the election of the holder prior to
the date of issuance) of the number of shares of our common stock
outstanding immediately after giving effect to such exercise,
provided that the holder may increase or decrease the beneficial
ownership limitation up to 9.99%. Any increase in the beneficial
ownership limitation shall not be effective until 61 days following
notice of such change to us.
Except
as otherwise provided in the Warrants or by virtue of such
holder’s ownership of shares of our common stock, the holders
of the Warrants do not have the rights or privileges of holders of
our common stock, including any voting rights, until they exercise
their Warrants.
If a fundamental transaction occurs, then the successor entity will
succeed to, and be substituted for us, and may exercise every right
and power that we may exercise and will assume all of our
obligations under the purchase warrants with the same effect as if
such successor entity had been named in the purchase warrant
itself. If holders of shares of our common stock are given a choice
as to the securities, cash or property to be received in a
fundamental transaction, then the holder shall be given the same
choice as to the consideration it receives upon any exercise of the
purchase warrant following such fundamental transaction. In
addition, in certain circumstances, upon a fundamental transaction,
the holder will have the right to require us to repurchase its
purchase warrant at its fair value using the Black Scholes option
pricing formula; provided, however, that, if the fundamental
transaction is not within our control, including not approved by
our board of directors, then the holder shall only be entitled to
receive the same type or form of consideration (and in the same
proportion), at the Black Scholes value per share of common stock
in the fundamental transaction for each share of common stock
underlying a purchase warrant, that is being offered and paid to
the holders of our common stock in connection with the fundamental
transaction, whether that consideration be in the form of cash,
stock or any combination thereof, or whether the holders of common
stock are given the choice to receive from among alternative forms
of consideration in connection with the fundamental
transaction.
The
Warrants and the Warrant Shares are being offered pursuant to the
exemptions provided in Section 4(a)(2) under the Securities Act and
Regulation D promulgated thereunder, and are not being offered
pursuant to this prospectus supplement and the accompanying
prospectus.
There
is no established public trading market for the Warrants and we do
not expect a market to develop. In addition, we do not intend to
list the Warrants on the Nasdaq Capital Market, any other national
securities exchange or any other nationally recognized trading
system.
Plan of Distribution
We
engaged H.C. Wainwright & Co., LLC, or the placement agent, to
act as our exclusive placement agent to solicit offers to purchase
the shares of our common stock offered by this prospectus
supplement and the accompanying base prospectus. The placement
agent is not purchasing or selling any such shares, nor is it
required to arrange for the purchase and sale of any specific
number or dollar amount of such shares, other than to use its
“reasonable best efforts” to arrange for the sale of
such shares by us. Therefore, we may not sell all of the shares of
our common stock being offered. The terms of this offering were
subject to market conditions and negotiations between us, the
placement agent and prospective investors. The placement agent will
have no authority to bind us by virtue of the engagement letter. We
have entered into a securities purchase agreement directly with
certain institutional and accredited investors who have agreed to
purchase shares of our common stock in this offering. We will only
sell to investors who have entered into securities purchase
agreements. The placement agent may retain sub-agents and selected
dealers in connection with this offering.
Delivery
of the shares of common stock offered hereby is expected to take
place on or about September 29, 2021, subject to satisfaction of
certain closing conditions.
We have
agreed to pay the placement agent an aggregate fee equal to 6.0% of
the gross proceeds received in the offering. In addition, we have
agreed to pay the placement agent up to $50,000 in reimbursement
for fees and legal expenses and out of pocket
expenses.
We
estimate the total expenses of this offering paid or payable by us,
exclusive of the placement agent's cash fee of 6.0% of the gross
proceeds, will be approximately $143,950. After deducting the fees
due to the placement agent and our expenses in connection with this
offering, we expect the net proceeds from this offering will be
approximately $4,556,053.
The
following table shows the per share and total cash fees we will pay
to the placement agent in connection with the sale of the shares of
our common stock pursuant to this prospectus supplement and the
accompanying prospectus.
Common
Stock
|
|
|
Offering
price
|
$1.7425
|
$5,000,002
|
Placement agent
fees
|
$0.1045
|
$300,000
|
Proceeds before
expenses to us
|
$1.6380
|
$4,700,002
|
Placement Agent Warrants
The
Company also agreed to issue to the placement agent warrants to
purchase up to 6.0% of the aggregate number of shares of Common
Stock sold in the transactions (the “Placement Agent
Warrants”). Subject to certain ownership limitations, the
Placement Agent Warrants are immediately exercisable at an exercise
price equal to 125% of the offering price per share of Common Stock
in the offering, or $2.1781 per share, subject to customary
adjustments as provided under the terms of the Placement Agent
Warrants. The Placement Agent Warrants are exercisable for five
years from the commencement of sales of the shares being
offered.
Tail Financing Payments
In the event that any investors that were contacted by the
placement agent or were introduced to us by the placement agent
during the term of our engagement agreement with the placement
agent provide any capital to us in a public or private offering or
capital-raising transaction within 12 months following the
expiration or termination of the engagement of the placement agent,
subject to certain exceptions, we shall pay the placement agent the
cash and warrant compensation provided above on the gross proceeds
from such investors.
Right of First Refusal
In addition, we have granted a right of first refusal to the
placement agent pursuant to which it has the right to act as the
sole book-running manager, sole underwriter or sole placement
agent, as applicable, if we finance any indebtedness using an
agent or raise capital through a public or private offering of
equity or debt securities at any time prior to the 12-month
anniversary of the consummation date of this offering.
Indemnification
We have
agreed to indemnify the placement agent against certain
liabilities, including liabilities under the Securities Act and
liabilities arising from breaches of representations and warranties
contained in our engagement letter with the placement agent. We
have also agreed to contribute to payments the placement agent may
be required to make in respect of such liabilities.
In
addition, we will indemnify the purchasers of shares of our common
stock in this offering against liabilities arising out of or
relating to (i) any breach of any of the representations,
warranties, covenants or agreements made by us in the securities
purchase agreement or related documents or (ii) any action
instituted against a purchaser by a third party (other than a third
party who is affiliated with such purchaser) with respect to the
securities purchase agreement or related documents and the
transactions contemplated thereby, subject to certain
exceptions.
Other Relationships
From
time to time, the placement agent may provide in the future various
advisory, investment and commercial banking and other services to
us in the ordinary course of business, for which they have received
and may continue to receive customary fees and commissions.
However, except as disclosed in this prospectus supplement, we have
no present arrangements with the placement agent for any further
services.
Regulation M Compliance
The
placement agent may be deemed to be an underwriter within the
meaning of Section 2(a)(11) of the Securities Act, and any
commissions received by it and any profit realized on the sale of
our shares of common stock offered hereby by it while acting as
principal might be deemed to be underwriting discounts or
commissions under the Securities Act. The placement agent will be
required to comply with the requirements of the Securities Act and
the Exchange Act, including, without limitation, Rule 10b-5 and
Regulation M under the Exchange Act. These rules and regulations
may limit the timing of purchases and sales of our securities by
the placement agent. Under these rules and regulations, the
placement agent may not (i) engage in any stabilization activity in
connection with our securities; and (ii) bid for or purchase any of
our securities or attempt to induce any person to purchase any of
our securities, other than as permitted under the Exchange Act,
until they have completed their participation in the
distribution.
Trading Market
Our
common stock is listed on the Nasdaq Capital Market under the
symbol “TOMZ.”
Legal Matters
The
validity of the issuance of the securities offered hereby will be
passed upon by our counsel, Morgan, Lewis & Bockius,
LLP.
Experts
The
consolidated financial statements of TOMI Environmental Solutions,
Inc. appearing in TOMI’s Annual Report on Form 10-K for the
year ended December 31, 2020 have been audited by Wolinetz, Lafazan & Company, P.C, an
independent registered public accounting firm, as set forth in its
report thereon, included therein and incorporated herein by
reference. Such financial statements are, and audited financial
statements to be included in subsequently filed documents will be,
incorporated herein in reliance upon the report of Wolinetz, Lafazan & Company, P.C
pertaining to such financial statements as of the date (to the
extent covered by consents filed with the SEC) given on the
authority of such firm as experts in accounting and
auditing.
Where You Can Find More Information; Information Incorporated By
Reference
Available Information
We have
filed with the SEC a registration statement on Form S-3 under the
Securities Act, of which this prospectus supplement forms a part.
The rules and regulations of the SEC allow us to omit from this
prospectus supplement and the accompanying prospectus certain
information included in the registration statement. For further
information about us and the securities we are offering under this
prospectus supplement, you should refer to the registration
statement and the exhibits and schedules filed with the
registration statement. With respect to the statements contained in
this prospectus supplement and the accompanying prospectus
regarding the contents of any agreement or any other document, in
each instance, the statement is qualified in all respects by the
complete text of the agreement or document, a copy of which has
been filed as an exhibit to the registration
statement.
We file
reports, proxy statements and other information with the SEC. The
SEC maintains a website that contains reports, proxy and
information statements and other information about issuers, such as
us, who file electronically with the SEC. The address of that
website is http://www.sec.gov.
Our
website address is www.tomimist.com. The information on, or
accessible through, our website is not part of, and is not
incorporated into, this prospectus supplement or the accompanying
prospectus and should not be considered part of this prospectus
supplement or the accompanying prospectus.
Incorporation By Reference
The
SEC’s rules allow us to “incorporate by
reference” information into this prospectus supplement, which
means that we can disclose important information to you by
referring you to another document filed separately with the SEC.
The information incorporated by reference is deemed to be part of
this prospectus supplement and the accompanying prospectus, and
subsequent information that we file with the SEC will automatically
update and supersede that information. Any statement contained in a
previously filed document incorporated by reference will be deemed
to be modified or superseded for purposes of this prospectus
supplement and accompanying prospectus to the extent that a
statement contained in this prospectus supplement or the
accompanying prospectus modifies or replaces that
statement.
We
incorporate by reference our documents listed below and any future
filings made by us with the SEC under Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, as amended, which we
refer to as the “Exchange Act” in this prospectus
supplement, between the date of this prospectus supplement and the
termination of the offering of the securities described in this
prospectus supplement. We are not, however, incorporating by
reference any documents or portions thereof, whether specifically
listed below or filed in the future, that are not deemed
“filed” with the SEC, including any information
furnished pursuant to Items 2.02 or 7.01 of Form 8-K or related
exhibits furnished pursuant to Item 9.01 of Form 8-K, except as
otherwise provided in such Form 8-K.
This
prospectus supplement and the accompanying prospectus incorporate
by reference the documents set forth below that have previously
been filed with the SEC:
|
●
|
our
Annual Report on Form 10-K for the year ended December 31, 2020,
filed with the SEC on
March 30, 2021;
|
|
●
|
our
Quarterly Reports on Form 10-Q for the quarter ended March 31,
2021, filed with the SEC on
May 17, 2021 and for the
quarter ended June 30, 2021, filed with the SEC on
August 16,
2021;
|
All
reports and other documents we subsequently file pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the
termination of this offering, including, but excluding any
information furnished to, rather than filed with, the SEC, will
also be incorporated by reference into this prospectus supplement
and the accompanying prospectus and deemed to be part of this
prospectus supplement and the accompanying prospectus from the date
of the filing of such reports and documents.
We will
furnish without charge to you a copy of any or all of the documents
incorporated by reference, including exhibits to these documents,
upon written or oral request. Direct your written request to: Vice
President of Finance, TOMI Environmental Solutions, Inc., 8430
Spires Way, Suite N, Frederick, MD 21701, or
800.525.1698.
ABOUT
THIS PROSPECTUS
This prospectus is
part of a registration statement on Form S-3 that we filed with the
Securities and Exchange Commission, or the SEC, utilizing a
“shelf” registration process. Under this shelf registration statement, we may
sell the securities described in this prospectus in one or more
offerings up to a total dollar amount of proceeds of
$50,000,000. This prospectus
describes the general manner in which our securities may be offered
by this prospectus. Each time we offer and sell our
securities, we will provide one or more prospectus supplements that
will contain specific information about the terms of the offering.
We may also authorize one or more free writing prospectuses to be
provided to you that may contain material information relating to
these offerings.
This prospectus
does not contain all of the information included in the
registration statement. For a more complete understanding of the
offering of the securities, you should refer to the registration
statement, including its exhibits. Each prospectus supplement and
any free writing prospectuses prepared by or on behalf of us or to
which we have referred you may also add, update or change
information contained in this prospectus and may include a
discussion of any risk factors or other special considerations that
apply to the offered securities.
Before making an
investment decision, it is important for you to read and consider
the information contained in this prospectus, any accompanying
prospectus supplement, and any free writing prospectuses prepared
by or on behalf of us or to which we have referred you, together
with the additional information described under the heading
“Where You Can Find More Information” and
“Incorporation of Certain Information by Reference”
below.
This prospectus may not be used to offer to
sell, solicit an offer to buy or consummate a sale of securities
unless it is accompanied by a prospectus supplement. If
there is any inconsistency between information in this prospectus
and any accompanying prospectus supplement, you should rely on the
information in the latest supplement and documents incorporated by
reference herein and therein.
This prospectus
includes and incorporates by reference, references to our
trademarks, trade names and service marks, such as Binary
Ionization Technology® and
SteraMist®,
which are protected under applicable intellectual property laws and
are our property. This prospectus may also include trademarks and
trade names that are the property of other organizations. Solely
for convenience, trademarks and trade names referred to in this
prospectus appear without the ® and ™ symbols, but those
references are not intended to indicate that we will not assert, to
the fullest extent under applicable law, our rights, or that the
applicable owner will not assert its rights, to these trademarks
and trade names. We do not intend our use or display of other
companies’ trade names or trademarks to imply a relationship
with, or endorsement or sponsorship of us by, any other
companies.
Unless otherwise indicated herein, references in this prospectus to
“TOMI,” the “company,” “we,”
“us” and “our” refer to TOMI Environmental
Solutions, Inc., a Florida corporation, together with our
consolidated subsidiaries.
ABOUT
THE COMPANY
Overview
TOMI Environmental
Solutions, Inc. is a global company that specializes in
disinfection and decontamination essentials using its premier
Binary Ionization Technology platform through the manufacturing,
licensing, servicing, and selling of its SteraMist brand of
products. SteraMist is a hydrogen peroxide-based mist/fog
registered with the U.S. Environmental Protection Agency, or EPA,
as a hospital-healthcare and effective broad-spectrum surface
disinfectant. Our operating structure consists of five divisions:
Hospital-HealthCare, Life Sciences, TOMI Service Network,
Commercial and Food Safety. We provide environmental solutions for
indoor and outdoor surface and air decontamination.
Company Information
We were incorporated as a Florida corporation on September 18, 1979 under
the name Dauphin, Inc. and began our current operations in 2008
following a series of transactions and name changes. On May 14,
2009, we changed our name to TOMI Environmental Solutions, Inc. Our
corporate headquarters are located at 8430 Spires Way, Suite N,
Frederick, Maryland 21701. Our telephone number is (800) 525-1698.
Our website address is www.tomimist.com. The information contained
on our website is not a part of, and should not be construed as
being incorporated by reference into, this
prospectus.
RISK
FACTORS
Investing in our
securities involves significant risks. Before deciding whether to
invest in our securities, you should consider carefully the risks,
uncertainties and assumptions described in this prospectus and any
accompanying prospectus supplement, including the risk factors set
forth in our filings with the SEC that are incorporated by
reference herein and therein, including the risk factors in our
most recent Annual Report on Form 10-K, as revised or supplemented
by our Quarterly Reports on Form 10-Q, and which may be amended,
supplemented or superseded from time to time by other reports we
file with the SEC in the future. There may be other unknown or
unpredictable economic, business, competitive, regulatory or other
factors that could have material adverse effects on our future
results. If any of these risks actually occurs, our business,
business prospects, financial condition or results of operations
could be seriously harmed. Please also read carefully the section
below entitled “Cautionary Note Regarding Forward-Looking
Statements.”
CAUTIONARY
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus
contains or incorporates forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
or the Securities Act, and Section 21E of the Securities Exchange
Act of 1934, as amended, or the Exchange Act. These forward-looking
statements reflect management’s beliefs and assumptions. In
addition, these forward-looking statements reflect
management’s current views with respect to future events or
our financial performance, and involve certain known and unknown
risks, uncertainties and other factors, including those identified
below, which may cause our or our industry’s actual or future
results, levels of activity, performance or achievements to differ
materially from those expressed or implied by any forward-looking
statements or from historical results. We intend the
forward-looking statements to be covered by the safe harbor
provisions for forward-looking statements contained in Section 27A
of the Securities Act and Section 21E of the Exchange Act.
Forward-looking statements include information concerning our
possible or assumed future results of operations and statements
preceded by, followed by, or that include the words
“may,” “will,” “could,”
“would,” “should,” “believe,”
“expect,” “plan,” “anticipate,”
“intend,” “estimate,”
“predict,” “potential” or similar
expressions.
Forward-looking
statements are inherently subject to risks and uncertainties, many
of which we cannot predict with accuracy and some of which we might
not even anticipate. Although we believe that the expectations
reflected in the forward-looking statements are based upon
reasonable assumptions at the time made, we can give no assurance
that the expectations will be achieved. Future events and actual
results, financial and otherwise, may differ materially from the
results discussed in the forward-looking statements. Readers are
cautioned not to place undue reliance on these forward-looking
statements. We have no duty to update or revise any forward-looking
statements after the date of this prospectus or to conform them to
actual results, new information, future events or
otherwise.
The factors
described under “Risk Factors” in this prospectus or
any accompanying prospectus supplement, and in any documents
incorporated by reference into this prospectus or any accompanying
prospectus supplement, and other factors could cause our or our
industry’s future results to differ materially from
historical results or those anticipated or expressed in any of our
forward-looking statements. We operate in a continually changing
business environment, and new risk factors emerge from time to
time. Other unknown or unpredictable factors also could have
material adverse effects on our future results, performance or
achievements. We cannot assure you that projected results or events
will be achieved or will occur.
USE
OF PROCEEDS
We will retain
broad discretion over the use of the net proceeds from the sale of
the securities offered hereby. Except as described in any
applicable prospectus supplement we have authorized for use in
connection with a specific offering, we currently intend to use the
net proceeds from the sale of the securities offered by us
hereunder, if any, for working capital and general corporate
purposes, including research and development expenses, sales and
marketing expenses, general and administrative expenses and capital
expenditures. We may also use a portion of the net proceeds to
acquire or invest in businesses, products and technologies that are
complementary to our own, although we have no current commitments
or agreements with respect to any acquisitions as of the date of
this prospectus. We will set forth in the applicable prospectus
supplement our intended use for the net proceeds received from the
sale of any securities sold pursuant to the prospectus supplement.
Pending the use of the net proceeds from any such offering, we may
invest the net proceeds in investment grade, short-term
interest-bearing obligations, such as money-market funds,
certificates of deposit, or direct or guaranteed obligations of the
United States government, or hold the net proceeds as
cash.
DESCRIPTION
OF COMMON STOCK
The following
description of our common stock and certain provisions of our
amended and restated articles of incorporation and amended bylaws
are summaries and are qualified by reference to our amended and
restated articles of incorporation and amended bylaws. Copies of
these documents are filed with the SEC as exhibits to the
registration statement of which this prospectus forms a
part.
Authorized
Capital Stock
We are currently authorized to issue 250,000,000
shares of common stock, par value $0.01 per share, 1,000,000 shares
of convertible $0.01 preferred A stock, par value $0.01 per share,
and 4,000 shares of Series B preferred stock, with a stated value
of $1,000 per share. As of October 30, 2020, we had
approximately 16,748,513 shares of common stock outstanding, held
by approximately 241 shareholders of record,
although we believe there to be approximately 6,771 beneficial
owners of our common stock, based on information regarding our
non-objecting beneficial owners and objecting owners we recently
obtained from a third-party financial solutions provider, 63,750
shares of series A preferred stock outstanding held by one
shareholder, and no shares of the series B preferred stock
outstanding.
Common
Stock
The holders of our
common stock are entitled to one vote per share on all matters
submitted to a vote of our shareholders. We have not provided for
cumulative voting for the election of directors in our amended and
restated articles of incorporation or amended bylaws. The holders
of our common stock are entitled to receive ratably the dividends
out of funds legally available if our board of directors, or Board,
in its discretion, determines to issue dividends and then only at
the times and in the amounts that our Board may determine. The
common stock is not entitled to redemption rights, preemptive
rights, conversion rights, and it is not subject to any sinking
fund provisions. The outstanding shares of common stock are fully
paid and non-assessable. The outstanding shares of common stock are
not liable to further call or to assessment by us. If we become
subject to a liquidation event, dissolution or winding-up, the
assets legally available for distribution to our shareholders would
be distributable ratably among the holders of the common stock and
any participating preferred stock outstanding at that time, subject
to prior satisfaction of all outstanding debt and liabilities and
the preferential rights of and the payment of liquidation
preferences, if any, on any outstanding shares of preferred stock.
The rights, powers, preferences and privileges of holders of common
stock are subordinate to, and may be adversely affected by, the
rights of the holders of shares of the preferred stock and any
series of preferred stock which may be designated and issued in the
future. No shareholders hold any registration rights.
Dividend
Policy
Our Board has never
declared or paid any cash dividends, and our Board does not
currently intend to pay any cash dividends for the foreseeable
future. Our Board expects to retain future earnings, if any, to
fund the development and growth of the Company’s business.
Any future determination to pay dividends will be at the discretion
of our Board and will depend upon, among other factors, the
Company’s financial condition, operating results, current and
anticipated cash needs, plans for expansion and other factors that
our Board may deem relevant.
Anti-Takeover Provisions of the Company’s Organizing
Documents
Our amended and restated articles of incorporation
and our amended bylaws include a number of provisions that could
deter takeovers or delay or prevent changes in control, as well as
changes in our Board or
management team, including the following:
Authorized but Unissued
Shares. The authorized but
unissued shares of the common stock and preferred stock will be
available for future issuance without shareholder approval, subject
to applicable law and the rules of The Nasdaq Stock Market
LLC. These additional shares may be
used for a variety of corporate purposes, including future public
offerings to raise additional capital, acquisitions, and employee
benefit plans. The existence of authorized but unissued shares of
common stock or preferred stock may enable our Board to render more
difficult or to discourage an attempt to obtain control of us by
means of a merger, tender offer, proxy contest or
otherwise.
No Cumulative
Voting. Our shareholders do not
have the right to cumulate votes in the election of directors of
our Board, therefore allowing the holders of a majority of the
shares of common stock entitled to vote in any election of
directors of our Board to elect all of the directors standing for
election, if they should so choose.
Shareholder Action; Special
Meeting of Shareholders.
Special meetings of our shareholders may be called only by a
majority of our Board, thus
prohibiting a shareholder from calling a special meeting, except
that, pursuant to the Florida Business Corporation Act, or FBCA,
§ 607.072, shareholders holding 10% or more of the votes
entitled to be cast may call a special meeting. These limitation
might delay the ability of the Company’s shareholders to
force consideration of a proposal.
Each of the foregoing provisions may make it more
difficult for our existing shareholders to replace our Board as
well as for another party to obtain control of us by replacing
our Board. Since our Board has
the power to retain and discharge our officers, these provisions
could also make it more difficult for existing shareholders or
another party to effect a change in management.
Anti-Takeover Provisions under Florida Law
We
are governed by two provisions of the FBCA, which may deter or
frustrate takeovers of Florida corporations.
The
Florida Control Share Act (FBCA § 607.0902) generally provides
that shares acquired in excess of certain specified thresholds,
without first obtaining the approval of our Board, will not possess
any voting rights unless such voting rights are approved by a
majority of our disinterested shareholders.
The
Florida Affiliated Transactions Act (FBCA § 607.0901) requires
that, subject to certain exceptions, any affiliated transaction
with a shareholder that owns more than 15% of the voting shares of
the corporation, referred to as an “interested
shareholder,” receive the approval of either the
corporation’s disinterested directors or a supermajority vote
of disinterested shareholders, or, absent either such approval,
that a statutory “fair price” be paid to the
shareholders in the transaction. The shareholder vote requirement
is in addition to any shareholder vote required under any other
section of the FBCA or our amended and restated articles of
incorporation.
Limitation of Liability and Indemnification
Florida
law also authorizes us to indemnify directors, officers, employees
and agents under certain circumstances and to limit the personal
liability of corporate directors for monetary damages, except that
we may not indemnify a director or officer or advance expenses to a
director or officer if a judgment or other final adjudication
establishes that his or her actions were material to the cause of
action so adjudicated and constitute: (a) willful or intentional
misconduct or a conscious disregard for the best interests of the
corporation in a proceeding by or in right of the corporation to
procure a judgment in its favor or in a proceeding by or in the
right of a shareholder, (b) a transaction in which the director or
officer derived an improper personal benefit, (c) a violation of
the criminal law, unless the director or officer had reasonable
cause to believe his or her conduct was lawful or had no reasonable
cause to believe his or her conduct was unlawful, or (d) in the
case of a director, a circumstance under which the director would
be liable under the FBCA for an unlawful distribution. Our amended
bylaws do not provide for the indemnification of our current and
former directors and officers, thus the only right of
indemnification that our current and former directors and officers
have is a right of indemnification should such director or officer
succeed against a claim brought against them because they were a
director or officer as set out under FBCA § 607.0852. We have
obtained a directors’ and officers’ liability insurance
policy covering its current and former directors and
officers.
Listing
Our common stock is
listed on The Nasdaq Capital Market under the symbol
“TOMZ.”
Transfer
Agent and Registrar
The transfer agent
and registrar for our common stock is Continental Stock Transfer
& Trust Company.
PLAN
OF DISTRIBUTION
We may sell the
securities covered by this prospectus from time to time pursuant to
underwritten public offerings, negotiated transactions, block
trades or a combination of these methods. We may sell the
securities to or through underwriters or dealers, through agents,
or directly to one or more purchasers. We may distribute the
securities from time to time in one or more
transactions:
●
at a fixed price,
or prices, which may be changed from time to time;
●
at market prices
prevailing at the time of sale;
●
at prices related
to such prevailing market prices; or
We may issue
securities to other companies or their security holders to acquire
those companies or equity interests in those companies, or to
acquire assets of those companies, through mergers or
consolidations with us or any of our subsidiaries, or through the
exchange of our securities for securities of the other companies,
or through the exchange of assets of other companies for our
securities, or through similar transactions.
We may also issue
our securities to one or more of our subsidiaries, including
subsidiaries that we presently control and subsidiaries that we may
organize or acquire in the future, and those subsidiaries may
resell our securities to raise capital or to acquire other
companies or equity interests in other companies, or to acquire
assets of other companies.
Our officers and
directors, members of their immediate families, and their
respective affiliates may purchase securities that we offer,
subject to compliance with our related person transaction policy,
policies established by our board of directors with regard to
trading in our securities by officers and directors, and applicable
rules of Nasdaq.
In addition, we may
issue the securities being offered by this prospectus as a dividend
or distribution.
Any applicable
prospectus supplement (and any related free writing prospectus that
we may authorize to be provided to you) will describe the terms of
the offering of the securities, including, to the extent
applicable:
●
the name or names
of the underwriters, if any;
●
the purchase price
of the securities or other consideration therefor, and the
proceeds, if any, we will receive from the sale;
●
any over-allotment
options under which underwriters may purchase additional securities
from us;
●
any agency fees or
underwriting discounts and other items constituting agents’
or underwriters’ compensation;
●
any public offering
price;
●
any discounts or
concessions allowed or reallowed or paid to dealers;
and
●
any securities
exchange or market on which the securities may be
listed.
Sales
Through Underwriters or Dealers
If we use an
underwriter or underwriters in the sale of securities offered by
this prospectus, the underwriters will acquire the securities for
their own account, including through underwriting, purchase,
security lending or repurchase agreements with us, unless the
underwriters are acting only as our agents for the purpose of
selling our securities as described below under “Sales
Through Agents.” The underwriters may resell the securities
from time to time in one or more transactions, including negotiated
transactions. Underwriters may sell the securities in order to
facilitate transactions in any of our other securities (described
in this prospectus or otherwise), including other public or private
transactions and short sales made by the underwriters in connection
with the distribution of our securities by the underwriters.
Underwriters may offer securities to the public either through
underwriting syndicates represented by one or more managing
underwriters or directly by one or more firms acting as
underwriters. Unless otherwise indicated in any applicable
prospectus supplement, the obligations of the underwriters to
purchase the securities will be subject to certain conditions, and
the underwriters will be obligated to purchase all the offered
securities if they purchase any of them. The underwriters may
change from time to time any public offering price and any
discounts or concessions allowed or re-allowed or paid to
dealers.
If we use an
underwriter or underwriters in the sale of securities, we will
execute an underwriting agreement with the underwriter or
underwriters at the time we reach an agreement for sale. We will
set forth in any applicable prospectus supplement the names of the
specific managing underwriter or underwriters, as well as any other
underwriters, and the terms of the transactions, including
compensation of the underwriters and dealers. This compensation may
be in the form of discounts, concessions or commissions. Only
underwriters named in an applicable prospectus supplement will be
underwriters of the securities offered by such prospectus
supplement.
We may grant to the
underwriters options to purchase additional securities to cover
over-allotments, if any, at the public offering price with
additional underwriting discounts or commissions. If we grant any
over-allotment option, the terms of any over-allotment option will
be set forth in any applicable prospectus supplement relating to
those securities.
Sales
Through Dealers
If we use dealers
in the sale of the securities offered by this prospectus, we or an
underwriter will sell the securities to them as principals. The
dealers may then resell those securities to the public at varying
prices to be determined by the dealers at the time of resale. An
applicable prospectus supplement will set forth the names of the
dealers and the terms of the transactions.
Direct
Sales
We may directly
solicit offers to purchase the securities offered by this
prospectus. In this case, no underwriters or agents would be
involved. We may sell the securities directly to institutional
investors or others who may be deemed to be underwriters within the
meaning of the Securities Act with respect to any sale of those
securities. The terms of the sales will be described in any
applicable prospectus supplement.
Sales
Through Agents
Securities also may
be offered and sold through agents designated from time to time. An
applicable prospectus supplement will name any agent involved in
the offer or sale of the securities and will describe any
commissions payable to the agent. Unless otherwise indicated in an
applicable prospectus supplement, any agent will agree to use its
reasonable best efforts to solicit purchases for the period of its
appointment. Any agent may be deemed to be an underwriter within
the meaning of the Securities Act with respect to any sale of those
securities.
Delayed
Delivery Contracts
If any applicable
prospectus supplement indicates, we may authorize agents,
underwriters or dealers to solicit offers from institutions to
purchase securities at the public offering price under delayed
delivery contracts. These contracts would provide for payment and
delivery on a specified date in the future. Institutions with which
contracts of this type may be made include commercial and savings
banks, insurance companies, pension funds, investment companies,
educational and charitable institutions, but in all cases those
institutions must be approved by us. The obligations of any
purchaser under any contract of this type will be subject to the
condition that the purchase of the securities shall not at the time
of delivery be prohibited under the laws of the jurisdiction to
which the purchaser is subject. Any applicable prospectus
supplement will describe the commission payable for solicitation of
those contracts.
Market
Making, Stabilization and Other Transactions
Our common stock is
listed on Nasdaq. Any shares of common stock sold pursuant to an
applicable prospectus supplement will be eligible for listing and
trading on Nasdaq, subject to official notice of issuance. Unless
any applicable prospectus supplement states otherwise, each other
class or series of securities issued will be a new issue and will
have no established trading market. We may elect to list any other
class or series of securities on an exchange, but we are not
currently obligated to do so. Any underwriters that we use in the
sale of offered securities may make a market in the securities, but
may discontinue market making at any time without notice.
Therefore, we cannot assure you that the securities will have a
liquid trading market.
Any underwriter may
also engage in stabilizing transactions, syndicate covering
transactions and penalty bids in accordance with Regulation M under
the Exchange Act. Stabilizing transactions involve bids to purchase
the underlying security in the open market for the purpose of
pegging, fixing or maintaining the price of the securities.
Syndicate covering transactions involve purchases of the securities
in the open market after the distribution has been completed in
order to cover syndicate short positions.
Penalty bids permit
the underwriters to reclaim a selling concession from a syndicate
member when the securities originally sold by the syndicate member
are purchased in a syndicate covering transaction to cover
syndicate short positions. Stabilizing transactions, syndicate
covering transactions and penalty bids may cause the price of the
securities to be higher than it would be in the absence of the
transactions. The underwriters may, if they commence these
transactions, discontinue them at any time.
The effect of these
transactions may be to stabilize or maintain the market price of
the securities at a level above that which might otherwise prevail
in the open market. Any such transactions, if commenced, may be
discontinued at any time. We make no representation or prediction
as to the direction or magnitude of any effect that the
transactions described above, if implemented, may have on the price
of our securities.
Derivative
Transactions and Hedging
We, the
underwriters or other agents may engage in derivative transactions
involving the securities. These derivatives may consist of short
sales for hedging purposes and any other hedging activities. The
underwriters or agents may acquire a long or short position in the
securities, hold or resell securities acquired and purchase options
or futures on the securities and other derivative instruments with
returns linked to or related to changes in the price of the
securities. In order to facilitate these derivative transactions,
we may enter into security lending or repurchase agreements with
the underwriters or agents. The underwriters or agents may effect
the derivative transactions through sales of the securities to the
public, including short sales, or by lending the securities in
order to facilitate short sale transactions by others.
The underwriters or
agents may also use the securities purchased or borrowed from us or
others (or, in the case of derivatives, securities received from us
in settlement of those derivatives) to directly or indirectly
settle sales of the securities or close out any related open
borrowings of the securities arising from the distribution of our
securities by the underwriters.
Electronic
Auctions
We also may make
sales through the Internet or through other electronic means. Since
we may from time to time elect to offer securities directly to the
public, with or without the involvement of agents, underwriters or
dealers, utilizing the Internet or other forms of electronic
bidding or ordering systems for the pricing and allocation of the
securities, you will want to pay particular attention to the
description of that system we will provide in an applicable
prospectus supplement.
The electronic
system may allow bidders to directly participate, through
electronic access to an auction site, by submitting conditional
offers to buy that are subject to acceptance by us, and which may
directly affect the price or other terms and conditions at which
the securities are sold. These bidding or ordering systems may
present to each bidder, on a so-called “real-time”
basis, relevant information to assist in making a bid, such as the
clearing spread at which the offering would be sold, based on the
bids submitted, and whether a bidder’s individual bids would
be accepted, prorated or rejected. Of course, many pricing methods
can and may also be used.
Upon completion of
the electronic auction process, securities will be allocated based
on prices bid, terms of bid or other factors. The final offering
price at which securities would be sold and the allocation of
securities among bidders would be based in whole or in part on the
results of the Internet or other electronic bidding process or
auction.
General
Information
Agents,
underwriters, and dealers may be entitled, under agreements entered
into with us, to indemnification by us against specified
liabilities, including liabilities under the Securities Act, or to
contribution by us to payments they may be required to make in
respect to those liabilities. Any applicable prospectus supplement
will describe the terms and conditions of indemnification or
contribution. Some of our agents, underwriters, and dealers, or
their affiliates, may be customers of, engage in transactions with
or perform services for us, in the ordinary course of business. We
will describe in any applicable prospectus supplement the nature of
any such relationship and the name of the parties involved. Any
lockup arrangements will be set forth in any applicable prospectus
supplement.
LEGAL
MATTERS
The validity of the
securities offered by this prospectus and any applicable prospectus
supplement thereto will be passed upon for us by K&L Gates
LLP, Irvine, California. Additional legal matters may be
passed upon for us or any underwriters, dealers or agents, by
counsel that we name in the applicable prospectus
supplement.
EXPERTS
The consolidated
financial statements incorporated in this prospectus by reference
from TOMI Environmental Solution, Inc.’s Annual Report on
Form 10-K for the year ended December 31, 2019 have been audited by
Wolinetz, Lafazan & Company, P.C., an independent registered
public accounting firm, as stated in their report, which is
incorporated herein by reference. Such financial statements have
been so incorporated in reliance upon the report of such firm given
upon their authority as experts in accounting and
auditing.
WHERE
YOU CAN FIND MORE INFORMATION
This prospectus and
any accompanying prospectus supplement do not contain all of the
information set forth in the registration statement and its
exhibits and schedules in accordance with SEC rules and
regulations. For further information with respect to us and the
securities being offered hereby, you should read the registration
statement, including its exhibits and schedules. Statements
contained in this prospectus and any accompanying prospectus
supplement, including documents that we have incorporated by
reference, as to the contents of any contract or other document
referred to are not necessarily complete, and, with respect to any
contract or other document filed as an exhibit to the registration
statement or any other such document, each such statement is
qualified in all respects by reference to the corresponding
exhibit. You should review the complete document to evaluate these
statements. You may obtain copies of the registration statement and
its exhibits via the SEC’s EDGAR database or our website, or
at the offices of the SEC, where they may be examined without
charge at the Public Reference Room, at the address listed
below.
We file annual,
quarterly and current reports, proxy statements and other documents
with the SEC under the Exchange Act. The SEC maintains a website
that contains reports, proxy and information statements and other
information regarding issuers, including our company, that file
electronically with the SEC. You may obtain documents that we file
with the SEC at http://www.sec.gov and read and copy them at the
SEC’s Public Reference Room at 100 F Street, N.E.,
Washington, D.C. 20549 (information on operation of the Public
Reference Room is available by calling the SEC at
1-800-SEC-0330).
We also make these
documents available on our website at www.tomimist.com. Our website
and the information contained or connected to our website is not
incorporated by reference in this prospectus or any accompanying
prospectus supplement, and you should not consider it part of this
prospectus or any accompanying prospectus supplement.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
The SEC allows us
to “incorporate by reference” in this prospectus
certain of the information we file with the SEC. This means we can
disclose important information to you by referring you to another
document that has been filed separately with the SEC. The
information incorporated by reference is considered to be a part of
this prospectus, and information that we file later with the SEC
will automatically update and supersede information contained in
this prospectus and any accompanying prospectus supplement. We
incorporate by reference the documents listed below that we have
previously filed with the SEC:
●
our Annual Report
on Form 10-K for the fiscal year ended December 31, 2019, filed
with the SEC on March 30, 2020;
●
our Quarterly
Reports on Form 10-Q for the quarter ended March 31, 2020 and June
30, 2020, filed with the SEC on May 14, 2020 and August 14, 2020,
respectively;
●
our Current Reports
on Form 8-K (other than information furnished rather than filed)
filed with the SEC on April 28, 2020, September 14, 2020, and
September 30, 2020; and
●
the description of
our common stock contained in our Registration Statement on Form
8-A (File No. 001-39574) filed with SEC on September 29, 2020,
including any amendment or report filed for the purpose of updating
such description.
We also incorporate
by reference into this prospectus additional documents that we may
file with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Exchange Act prior to the completion or termination of the offering
of the securities described in this prospectus, including all such
documents we may file with the SEC after the date of the initial
registration statement and prior to the effectiveness of the
registration statement, but excluding any information deemed
furnished and not filed with the SEC. Any statements contained in a
previously filed document incorporated by reference into this
prospectus is deemed to be modified or superseded for purposes of
this prospectus to the extent that a statement contained in this
prospectus, or in a subsequently filed document also incorporated
by reference herein, modifies or supersedes that statement. Any
statement so modified or superseded will not be deemed, except as
so modified or superseded, to constitute a part of this
prospectus.
We will furnish
without charge to each person, including any beneficial owner, to
whom a prospectus is delivered, on written or oral request, a copy
of any or all of the documents incorporated by reference in this
prospectus, including exhibits to these documents. You should
direct any requests for documents to TOMI Environmental Solutions,
Inc., 8430 Spires Way, Suite N, Frederick, Maryland 21701;
telephone number: (800) 525-1698. You may also access the documents
incorporated by reference in this prospectus through our website at
www.tomimist.com. Except for the specific incorporated documents
listed above, no information available on or through our website
shall be deemed to be incorporated in this prospectus or the
registration statement of which it forms a part.
2,869,442
Shares of Common
Stock
PROSPECTUS
SUPPLEMENT
H.C. Wainwright
& Co.
September 26, 2021