As
filed with the Securities and Exchange Commission on December 22, 2023.
Registration
No. 333- _______
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
S-1
REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OF 1933
WORKSPORT
LTD.
(Exact
name of registrant as specified in its charter)
Nevada |
|
3714 |
|
65-0782227 |
(State
or Other Jurisdiction of Incorporation
or Organization) |
|
(Primary
Standard
Industrial Classification Code Number) |
|
(I.R.S. Employer
Identification No.) |
2500
N America Dr
West
Seneca, NY 14224
Telephone:
(888) 554-8789
(Address,
including zip code, and telephone number, including area code,
of
registrant’s principal executive offices)
Mr.
Steven Rossi
Chief
Executive Officer and President
2500
N America Dr
West
Seneca, NY 14224
Telephone:
(888) 554-8789
(Name,
address, including zip code, and telephone number, including area code, of agent for service)
With
copies to:
Ross
D. Carmel, Esq.
Philip
Magri, Esq.
Sichenzia
Ross Ference Carmel LLP
1185 Avenue of the Americas, 31st Floor
New York, New York 10036
Telephone: (212) 930-9700
Tel:
(212) 658-0458
Fax:
(212) 930-9725
Approximate
date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933 check the following box. ☒
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, 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 post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting
company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company”
in Rule 12b-2 of the Exchange Act.
Large
accelerated filer ☐ |
Accelerated
filer ☐ |
Non-accelerated
filer ☒ |
Smaller
reporting company ☒ |
|
Emerging
growth company ☐ |
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. ☐
The
Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the
Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective
in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective
on such date as the Securities and Exchange Commission acting pursuant to said Section 8(a), may determine.
The
information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement
filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and is not soliciting
an offer to buy these securities in any state or other jurisdiction where the offer or sale is not permitted.
PRELIMINARY PROSPECTUS | SUBJECT
TO COMPLETION |
DATED DECEMBER 22, 2023 |
7,000,000
Shares of Common Stock
Worksport
Ltd.
This
prospectus relates to the offer and resale of up to an aggregate of 7,000,000 shares of common stock, par value $0.0001 per share (“Warrant
Shares”), of Worksport Ltd. issuable upon exercise of the warrants (the “Warrants”) issued to certain investors (the
“Selling Stockholders”) in a private placement that closed on November 1, 2023 (the “Private Placement”).
The
number of Warrant Shares is determined as if the Warrants were exercised in full as of the trading day immediately preceding the date
this registration statement was initially filed with the Securities and Exchange Commission, each as of the trading day immediately preceding
the applicable date of determination, all of the Warrants of which were acquired by the Selling Stockholders in the Private Placement.
This
prospectus also covers any additional shares of common stock that may become issuable upon any anti-dilution adjustment pursuant to the
terms of the Warrants issued to the Selling Stockholders by reason of stock splits, stock dividends, and other events described therein.
The
Selling Stockholders, or their respective transferees, pledgees, donees or other successors-in-interest, may sell the Warrant Shares
through public or private transactions at prevailing market prices, at prices related to prevailing market prices or at privately negotiated
prices. The Selling Stockholders may sell any, all or none of the Warrant Shares offered by this prospectus, and we do not know when
or in what amount the Selling Stockholders may sell their Warrant Shares hereunder following the effective date of this registration
statement. We provide more information about how a Selling Stockholder may sell its Warrant Shares in the section titled “Plan
of Distribution” on page 21 of this prospectus.
We
are registering the Warrant Shares on behalf of the Selling Stockholders, to be offered and sold by them from time to time. We will not
receive any proceeds from the sale of our common stock by the Selling Stockholders in the offering described in this prospectus. However,
upon the cash exercise of all of the Warrants, we will receive the exercise price of such Warrants, for an aggregate of approximately
$9.4 million. See “Use of Proceeds.”
We
cannot predict when and in what amounts or if the Warrants will be exercised. We have agreed to bear all of the expenses incurred in
connection with the registration of the Warrant Shares. The Selling Stockholders will pay or assume discounts, commissions, fees of underwriters,
selling brokers or dealer managers and similar expenses, if any, incurred for the sale of the Warrant Shares.
We
are an “emerging growth company” and a “smaller reporting company” as such terms are defined under federal securities
laws, and, as such have elected to take advantage of certain reduced public company reporting requirements for this prospectus and may
elect to do so in future filings.
This
prospectus describes the general manner in which the Warrant Shares may be offered and sold. Please see “Plan of Distribution”
on page 21 of this prospectus for more information. For more information regarding the Selling Stockholders, see “Selling Stockholders”
on page 22 of this prospectus.
If
necessary, the specific manner in which the Warrant Shares may be offered and sold will be described in a supplement to this prospectus.
Our
common stock is listed for trading on The Nasdaq Capital Market. At the close of business on December 14, 2023, the closing price of
our common stock was $[*]. The trading price of our common stock has been and may continue to be, subject to wide price fluctuations
in response to various factors, many of which are beyond our control, including those described under the heading “Risk Factors”
beginning on page 14 of this prospectus.
Investing
in our common stock involves a high degree of risk. Please read “Risk Factors” beginning on page 14 of this prospectus.
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. Any representation to the contrary is a criminal offense.
The
date of this prospectus is , 2023
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus describes the general manner in which the Selling Stockholders may offer from time to time up to 7,000,000 Warrant Shares.
You should rely only on the information contained in this prospectus and the related exhibits, any prospectus supplement or amendment
thereto and the documents incorporated by reference, or to which we have referred you, before making your investment decision. Neither
we nor the Selling Stockholders have authorized anyone to provide you with different information. If anyone provides you with different
or inconsistent information, you should not rely on it. This prospectus, any prospectus supplement or amendments thereto do not constitute
an offer to sell, or a solicitation of an offer to purchase, the common stock offered by this prospectus, any prospectus supplement or
amendments thereto in any jurisdiction to or from any person to whom or from whom it is unlawful to make such offer or solicitation of
an offer in such jurisdiction. You should not assume that the information contained in this prospectus, any prospectus supplement or
amendments thereto, as well as information we have previously filed with the U.S. Securities and Exchange Commission (“SEC”),
is accurate as of any date other than the date on the front cover of the applicable document.
If
necessary, the specific manner in which the shares of common stock may be offered and sold will be described in a supplement to this
prospectus, which supplement may also add, update or change any of the information contained in this prospectus. To the extent there
is a conflict between the information contained in this prospectus and any prospectus supplement, you should rely on the information
in such prospectus supplement, provided that if any statement in one of these documents is inconsistent with a statement in another document
having a later date — for example, a document incorporated by reference in this prospectus or any prospectus supplement —
the statement in the document having the later date modifies or supersedes the earlier statement.
Neither
the delivery of this prospectus nor any distribution of common stock pursuant to this prospectus shall, under any circumstances, create
any implication that there has been no change in the information set forth or incorporated by reference into this prospectus or in our
affairs since the date of this prospectus. Our business, financial condition, results of operations and prospects may have changed since
such date.
Unless
the context indicates otherwise, the terms “Worksport,” “Company,” “we,” “us” and “our”
refer to Worksport Ltd., a Nevada corporation, and its subsidiaries.
PROSPECTUS
SUMMARY
This
summary provides a brief overview of the key aspects of our business and our securities. The reader should read the entire prospectus
carefully, especially the risks of investing in our securities discussed under “Risk Factors.” Some of the statements contained
in this prospectus, including statements under “Offering Summary” and “Risk Factors” as well as those noted in
the documents incorporated herein by reference, are forward-looking statements and may involve a number of risks and uncertainties. Our
actual results and future events may differ significantly based upon a number of factors. The reader should not put undue reliance on
the forward-looking statements in this document, which speak only as of the date on the cover of this prospectus.
Overview
Worksport
Ltd., through its subsidiaries, designs, develops, manufactures, and owns the intellectual property (“IP”) on a portfolio
of tonneau cover, solar integration, portable power station, and NP (non-parasitic), hydrogen-based green energy products and solutions
for the automotive aftermarket accessories, power storage, residential heating, and electric vehicle-charging industries. We seek to
provide consumers with next-generation automotive aftermarket accessories while capitalizing on growing consumer interest in clean energy
solutions and power grid independence.
Corporate
History
The
Company was incorporated in the State of Nevada on April 2, 2003 under the name Franchise Holdings International, Inc. (“FNHI”).
On December 16, 2014, FNHI acquired 100% of the outstanding equity of Worksport Ltd., a corporation formed in the Province of Ontario
on December 13, 2011, formerly known as Truxmart Ltd. (“Worksport Ontario”), pursuant to which Worksport Ontario became a
wholly-owned subsidiary of FNHI. In May 2020, FNHI changed its name from “Franchise Holding International Inc.” to “Worksport
Ltd.”
On
May 21, 2021, the Board of Directors (“Board”) authorized the submission of a Certificate of Change/Amendment to the Nevada
Secretary of State in which the Company sought to affect a reverse split of its common stock at the rate of 1-for-20 for the purpose
of increasing the per share price for the Company’s stock in an effort to meet the minimum listing requirements of the Nasdaq.
The Certificate of Change was submitted to the Nevada Secretary of State on May 21, 2021, and the Financial Industry Regulatory Authority
(“FINRA”) corporate action was announced on August 3, 2021. On August 4, 2023, the Company effected a 1-for-20 (1:20) reverse
stock split of its issued and outstanding shares of common stock.
The
Company owns the following subsidiaries: (i) Worksport Ontario, a Canadian corporation; (ii) Terravis Energy, Inc. (“Terravis”),
a Colorado corporation, of which Steven Rossi has 51% voting power; (iii) Worksport USA Operations Corporation, a Colorado corporation;
and (iv) Worksport New York Operations Corporation, a New York corporation.
Public
Offering
On
August 6, 2021, we consummated an underwritten public offering (the “Public Offering”) of an aggregate of 3,272,727 units
pursuant to a registration statement on Form S-1, as amended (File No. 333-256142) and a registration statement on Form S-1 filed pursuant
to Rule 462(b) of the Securities Act of 1933, as amended (File No: 333-258429). The Public Offering
price was $5.50 per unit, and each unit consisted of one share of common stock and one warrant (“Public Warrant”)
to purchase one share of common stock for $6.05 per share (110% of the unit offering price) from the date of issuance until the third
anniversary of the issuance date. We received gross proceeds of approximately $18.0 million from the Public Offering, and after deducting
the underwriting commissions, discounts, and offering expenses payable by us, we received net proceeds of approximately $16.1 million.
We used the net proceeds for working capital, research & development, marketing, and equipment.
Nasdaq
Uplisting
In
connection with the Public Offering, our common stock and Public Warrant commenced trading on The Nasdaq Capital Market under the symbols
“WKSP” and “WKSPW,” respectively, on August 4, 2021. Prior to the uplisting, our common stock was quoted on the
OTCQB Marketplace under the symbol “WKSP.”
Business
Developments
The
following highlights recent material developments in our business:
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● |
In
August 2023, we announced the successful dispatch of our first shipment of hard-folding tonneau covers, which are made in the U.S.
with domestic and imported components. This major development comes on the heels of us initiating manufacturing earlier this month,
and aligns with recent sizable orders, notably a $700,000 order for soft folding covers and a staggering $1,600,000 order for hard-folding
covers, both from a national U.S. customer and reseller of automotive aftermarket accessories. |
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In
September 2023, we announced that we have found a top-tier solar panel provider for our highly anticipated SOLIS Solar Tonneau Cover.
This partner is renowned for their state-of-the-art solar panels and underlying technology. A supply partner will help set a new
standard in renewable energy tech for vehicles and to provide the most durable and highest quality flexible solar panels. With this
supply partner for SOLIS, we are demonstrating its unwavering commitment to pioneering sustainable technological solutions. |
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In
September 2023, we announced significant strides in the development of our groundbreaking COR battery system, designed to complement
the launch of the SOLIS solar cover. This cutting-edge duo is poised to empower remote power supply and extend the driving range of electric
pickup trucks, thereby underscoring our commitment to sustainability and innovation as a cleantech company. |
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In
September 2023, we announced that we have secured a long-term supply agreement with an established, leading automotive aftermarket
reseller in the U.S. Under this agreement, we are on track to earn an estimated $16,000,000 in annual sales of our advanced hard-folding
and soft-folding covers, from this single customer. |
Products
We
have developed a series of soft and hard folding tonneau covers as well as energy products.
Soft
Tonneau Covers
Our
soft tonneau cover offering consists of vinyl wrapped tri- and quad-fold tonneau covers manufactured overseas in Meizhou, China. Enhanced
versions of our vinyl tri-fold soft tonneau covers are now available for purchase and marketed under a “PRO” designation;
our quad-fold soft tonneau covers will soon have an upgraded “PRO” version available as well. These upgraded versions include
our patented quick latch system, which allows the operator to open the cover by simply pulling a release cable – enabling single-sided
operation. Each soft cover is fitted with a powder-coated, lightweight aluminum frame and rear cam latches as well as ultra-violet (UV)
protected, vinyl tri-layer material that seals around the truck bed with a rubber gasket designed to protect cargo from moisture and
debris.
Tri-fold
soft covers are a lower cost option when compared to quad-fold tonneau covers. Compared with Worksport tri-fold soft tonneau covers,
Worksport quad-fold covers have the additional benefit of enabling full truck bed access by being foldable upwards toward the rear window
of the truck. As the market’s first quad-folding vinyl-wrapped cover that will provide full truck bed access utilizing Worksport’s
Intellectual Property, Worksport’s soft quad-fold covers are compact when folded parallel to the back window of the truck while
avoiding obstruction of the rear brake light on most truck models.
Our
soft tonneau cover line includes:
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○ |
The
Worksport SC3 – soft tri-fold introduced in 2011, first Worksport Ltd. product; |
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○ |
The
Worksport SC3 PRO –soft tri-fold with Smart Latch system introduced in 2012; |
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The
Worksport SC4 – soft quad-fold introduced in 2022; and |
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The
Worksport SC4 PRO –soft quad-fold with Smart Latch system introduced in 2023. |
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○ |
The
Worksport SCX – soft tri-fold with extendable frame. |
Hard
Tonneau Covers
Our
hard line of tonneau covers includes tri- and quad-fold, aluminum flush-mounted and top-mounted folding tonneau covers. Our entire line
of hard folding tonneau covers will be manufactured in the USA. Our hard cover panels are designed with formed aluminum, ultra-strong
high temper formed alloy panels with a durable black surface. These panels will have significant dent resistance over many other tonneau
covers as they use thicker aluminum on the exterior surface as opposed to the sandwich style of most covers today. Designed to auto index
(center) in the truck bed and be only 7.5mm above the truck bed, it is a low profile, sleek look that is easy to install. Our hard covers
will be offered with the XCX rail upgrade, allowing future accessories such as expandable cargo division and storage solutions. Similar
to the soft cover line, our hard cover line products will each be available in upgraded versions utilizing our quick latch system, enabling
single-sided operation.
Our
hard tonneau cover line, all of which is in development, includes:
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● |
The
Worksport TC3 – top-mounted hard tri-fold;
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The
Worksport TC3 PRO – top-mounted hard tri-fold with Smart Latch system; |
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The
Worksport FC3 – flush-mounted hard tri-fold;
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The
Worksport FC4 – flush-mounted hard quad-fold; and
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The
Worksport FC4 PRO – flush-mounted hard quad-fold with Smart Latch system. |
Energy
Products
We
are researching and developing various energy-based products, two of which can be sold together as a kit: the Worksport SOLIS tonneau
cover (“SOLIS”) and the Worksport COR energy storage system (“COR”). This kit will be available for both end-consumers
and Original Vehicle Manufactures alike. This kit integrates tonneau cover, solar energy capture, and portable energy storage technologies
to convert pickup trucks to mobile microgrid power stations – allowing Worksport to compete within niche markets in each the automotive
aftermarket accessory, solar energy, and portable power station markets.
Worksport
SOLIS
The
SOLIS, a tonneau cover with integrated solar panels, is a unique, folding tonneau cover design founded on our top-mounted tough cover
design but with the addition of cutting edge, monocrystalline, semi-flexible solar panels and wiring system. These solar panels are secured
to aluminum alloy panels both mechanically and using specialized adhesives, which ensure the covers are extremely strong, durable, and
secure. The SOLIS cover is intended to be sold as an Original Equipment Manufacturer product, as it can be integrated into the design
of leading electric pickup trucks; consequently, we have and will continue forging relationships with electric pickup truck manufacturers,
including but not limited to Workhorse, Atlis, Bollinger, and Hercules as well as Toyota, Stellantis, General Motors, Ford, Nissan, and
Rivian.
The
solar panels that we plan to integrate into the SOLIS cover are capable of generating 170-180 watts per square meter. For example, as
tested outdoors, the SOLIS cover is capable of generating approximately 460 watts of power on a RAM 6’5” truck bed. When
integrated into the design of an electric pickup truck, this power generation can be converted to additional vehicle mileage. The specific
added mileage is dependent on many factors including but not limited to region of the world in which the vehicle is driven, weather conditions,
season, temperature, hours of sun light per day, and average irradiance. For example, assuming a solar power density of 170 W/m2,
battery capacity of 98 kWh, mileage range of 300 miles, average hours of sun per day of 6 hours, average irradiance per day of 700 W/m2,
and surface area of 2.7 m2, the SOLIS cover is estimated to provide 5.6 additional miles of range to an electric pickup truck
per day.
Worksport
COR
The
COR or COR ESS (energy storage system) is a modular, portable power station uniquely designed to mount to the inside of a pickup truck
bed and enable battery swapping without an immediate drop in power output. The COR built-in inverter with an output voltage of 120V AC
(frequency of 60Hz) is capable of powering loads up to 3000W. Combined with its modular 48V batteries, it can store up to 6kWh of energy
on the go. Each additional modular battery adds 1.5kWh of energy storage. The COR main battery, a Lithium battery, boasts a capacity
of 1534Wh while its Hot Swap Lithium Iron Phosphate (Li-LFP) battery has a capacity of around 200Wh. The system allows Bluetooth connection
for monitoring and controlling the COR system and its external batteries.
Not
only does the COR system allow users to swap a depleted battery for a fully charged one, but it does so without a drop in power output
for up to 15 seconds with a load of 3000W. This unique feature allows the COR system to be used in a variety of applications, including
but not limited to sporting and outdoor activities, disaster relief and general emergencies, and vocational activities ranging from contractor
to drone operator. While the COR system is designed to nicely complement the SOLIS tonneau cover, it will be purchasable as a standalone
product – allowing consumers to utilize stored energy, whether captured via grid or grid-independent energy sources, anywhere.
As Worksport’s first step into the energy storage market, the COR system is Worksport’s pioneer product within its future
COR platform.
Manufacturing
As
of June 30, 2023, all Worksport soft-folding tonneau covers were manufactured in a facility located in Meizhou, China according to Worksport’s
specifications, schematics and blueprints. We believe production at the factory can be increased within 30 days to facilitate volumes
up to ten times the current output without any adverse effects on quality or craftsmanship.
We
have purchased many production tools including injection molds, die cast molds, extrusion dies, and stamping dies – many of which
are residing among foreign suppliers who are currently utilizing said tooling to produce needed components for manufacturing or assembly
within the USA. We are concurrently diversifying this list raw material suppliers who can use our production tools to continue producing
our tonneau cover components, should trade with any particular or preferred raw material supplier become more expensive or difficult.
In
May 2022, we purchased a 152,847 square foot production facility for domestic production, storage, and distribution, located in West
Seneca, New York. We have received the majority of all manufacturing equipment deemed necessary to begin production, and we are in the
process of installing and testing those machines, as well as training personnel to use those machines. Management believes that having
manufacturing capability in North America will increase quality control and production efficiency, as well as lower landed costs and
geopolitical risks.
Our
Plant-Readiness Team began initial, basic manufacturing and assembly at our USA-based production facility, improving our process on an
on-going basis.
Intellectual
Property
We
currently hold a broad collection of intellectual property rights relating to certain aspects of our parts and accessories and services.
This includes patents, trademarks, copyrights and trade secrets. Although we believe the ownership of such intellectual property rights
is an important factor in our business and that our success does depend in part on such ownership, we rely primarily on the innovative
skills, technical competence and marketing abilities of our personnel.
Patents
As
of October 31, 2023, our patent portfolio consists of ten (10) issued U.S. utility patents, three (3) issued Canadian utility patent,
and thirty-four (34) pending utility patent applications in various jurisdictions worldwide. Our portfolio further includes seven (7)
design registrations in Europe and China, along with forty-five (45) pending design applications in various jurisdictions worldwide.
We are also in the process of preparing and filing several other utility and design patent applications across relevant countries and
jurisdictions.
Granted
U.S. utility patents will expire between 2032 and 2036, excluding any patent term adjustment that might be available following the grant
of the patent. If issued, pending utility patent applications would expire 20 years from the filing date of each application, excluding
the filing date of any provisional applications and excluding any patent term adjustment that might be available following the grant
of the patent.
Trademarks
As
of October 31, 2023, we have thirty-one (31) trademark registrations and twenty-three (23) pending trademark applications in various
jurisdictions worldwide.
The
Market
We
primarily compete in the Automotive Aftermarket Accessories and New Energy industries with a focus on the Tonneau Cover and the Portable
Power Station Markets.
Tonneau
Cover Market
There
are various forms of tonneau covers, each with their advantages and disadvantages, available for consumption through direct-to-consumer
and retailer and dealer sales channels. Some forms of tonneau covers include but are not limited to:
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Solid
One Piece Caps and Lids; |
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Retractable
Covers; |
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Soft
Folding & Roll-Up Covers; and |
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Hard
Folding & Standing Covers. |
Solid
one piece covers and retractable covers tend to have limited functionality and tend to be priced higher when compared to other types
of tonneau covers. Soft and hard folding/rolling tonneau covers, in contrast, tend to be priced more competitively and, as such, are
a popular choice among tonneau cover consumers. Given these factors and our belief that we can develop less cumbersome, high functioning,
and low cost soft and hard folding covers, we focus primarily on developing soft and hard folding covers.
Our
tonneau cover revenue stream is largely proportional to sales of pickup trucks. Currently, there are 284.9 million vehicles in operation
in the U.S.1, 21%, or 59.5 million, of which are pickup trucks.2 However, as a result of supply chain shortages,
rising interest rates, high prices, and slowing sales, it may take until 2025 for new-vehicle sales to return to pre-pandemic levels.1
While new vehicle sales have decreased, we are well-positioned to capitalize on new vehicle sales; we offer tonneau covers for
each of the 10 most popular makes/models by projected 2022-2029 sales (including, for example, the Ford F-Series, RAM Pickups, and Chevrolet
Silverado), as well as the top 10 most accessorized pickup truck makes/models projected in 2022-2029.2 Within the USA market,
pickup truck market revenue is expected to show a compound annual growth rate of 1.7% in 2023-2027.3 Within this market, pickup
trucks are most popular within the southern region of the United States2, and the two largest state markets for pickup trucks
are by far Texas and California.2 Globally, pickup truck market revenue is expected to show a compound annual growth rate
of 1.58% in 2024-2028.4
Electric
pickup trucks are projected to gain a larger portion of the pickup truck market share each year through 20351, as this submarket
is estimated to have a compound annual growth rate of 31.3% between 2023 and 2032.5 However, a large headwind acting against
this trend is that pickup trucks tend to be more popular in areas with less-developed charging infrastructure2 – a headwind
that the SOLIS cover directly addresses and positions us favorably for possible partnerships and deals with electric pickup truck manufacturers.
The
Specialty Equipment Aftermarket provides more specific insight into how often and for what reasons vehicle owners or renters are purchasing
accessories for their vehicles. Despite crossover utility vehicles being the most common vehicle type on the road in the U.S.1,
pickup trucks are the largest market by sales within the USA for specialty equipment – constituting 31% of this market2,
which translated to $16 billion in sales during 2021.2 This market is expected to grow from $50.9 billion in 2021 to $58.66
billion by 2025.6 Within this pickup truck accessory market, 34% of accessories are truck bed & utility modifications2,
which is the submarket in which we operate. Truck bed covers are among the top product categories for aftermarket accessory purchases
in 20212, and the size of the tonneau cover market within the USA was valued at $3 billion as of 2021.7
As
discretionary consumer goods, the specialty automotive part market is subject to consumer spending trends. Per capita disposable income
fell 7.8% during 2022 as government stimulus ended; however, it is expected to increase slowly during 2023.8 Further, while
the Federal Reserve has projected unemployment rates to increase in 2023 and subsequent years9, recent unemployment rates
are the lowest they have been in recent decades.10 Together, these factors suggest consumer disposable income and unemployment
will need to be carefully monitored in order to accurately forecast the automotive aftermarket accessories’ market potential year-to-year.
Consumers
purchase automotive aftermarket accessories, as well as tonneau covers, specifically, for various reasons. According to recent reports,
97%, 92%, 80%, and 62% of pickup truck owners use their trucks for utility/work, travel/vacation, outdoor recreation, and off-road uses,
respectively.2 Of those pickup truck owners who have purchased accessories for their trucks, 93%, 86%, 68%, and 43% of them
use their pickup trucks for day trips, carrying tools/gear, light off-roading, and car camping, respectively.2 Pickup truck
owners who use their vehicles for outdoor recreation, work, or off-roading are much more likely to purchase accessories when compared
to those who use their vehicles for other purposes.2 Worksport’s tonneau covers largely benefit truck owners using their
vehicles for any of these aforementioned purposes, and the SOLIS cover provides additional utility for those utilizing their trucks for
utility/work, outdoor recreation, and car camping, in particular.
Sales
of truck bed covers occur across several channels, among those including but not limited to part manufacturers, specialty retailers and
online retailers. For physical location sales, the most popular sales channels for truck bed covers include Specialty Retailers/Installers
and New Vehicle Dealerships, which constitute 17% and 11% of in-store sales, respectively.6 For online sales, the most popular
sales channels for truck bed covers include Online Only General Retailer, Specialty Retailers/Installers, and Parts Manufacturers, which
constitute 23%, 19%, and 8% of online sales, respectively.6 In the Fall of 2022, it was reported that roughly 59% of retailer
specialty equipment sales were sold through in-store/physical channels while the other 41% were sold through online channels.11
It was further reported that roughly 50% of manufacturer specialty equipment sales were sold through in-store/physical channels
while the other 50% were sold through online channels.11 Worksport aims to list its products on each of these highly-popular
in-person and online sales channels in order to maximize sales volumes.
|
1. |
SEMA.
2023 Future Trends Report. Retrieved from www.sema.org |
|
2. |
SEMA.
Pickup Accessorization Report. Retrieved from www.sema.org |
|
3. |
https://www.statista.com/outlook/mmo/passenger-cars/pickup-trucks/united-states |
|
4. |
https://www.statista.com/outlook/mmo/passenger-cars/pickup-trucks/worldwide |
|
5. |
https://www.globenewswire.com/en/news-release/2023/03/09/2623657/0/en/Electric-Truck-Market-Worth-Over-USD-11-08-Billion-by-2032-At-CAGR-31-3.html |
|
6. |
SEMA.
2022 Market Report. Retrieved from www.sema.org |
|
7. |
Arizton.
U.S. Tonneau Covers Market - Industry Outlook & Forecast 2022-2027. Retrieved from
https://www.arizton.com/market-reports/us-tonneau-covers-market |
|
8. |
IBIS
World. Per Capita Disposable Income. Retrieved from
https://www.ibisworld.com/us/bed/per-capita-disposable-income/33/#:
:text=Following%20the%20ending%20of%20government,when%20it%20may%20potentially%20hit. |
|
9. |
Federal
Reserve Board. Summary of Economic Projections. Retrieved from
https://www.federalreserve.gov/monetarypolicy/files/fomcprojtabl20221214.pdf. |
|
10. |
Bureau
of Labor Statistics. The Employment Situation – January 2023. Retrieved from
https://www.bls.gov/news.release/pdf/empsit.pdf |
|
11. |
SEMA.
State of the Industry Report 2022 Fall. Retrieved from www.sema.org |
Portable
Power Station Market
Compared
to the Tonneau Cover Market, the Portable Power Station Market is much younger and globalized. Gas and diesel generators have long been
used by consumers to generate electricity when they could not rely on the grid, whether it be for grid damages or the lack of grid in
remote areas. Unlike such generators, portable power stations do not generate electricity, themselves, but can also be used to provide
electricity during times of grid unreliability. These portable power stations are often charged by the grid via home outlets or independent
of the grid via consumers’ vehicles or solar panels.
The
Portable Power Station Market is large and growing. At a compound annual growth rate of 3.9% between 2022 and 20311, the global
Portable Power Station market size was valued at $4.0 billion in 2021.1 Within this global market, the largest regional market
is the North American market.2 The highest compound annual growth rates in this regional market is expected to be those power
stations utilizing lithium-ion batteries for off-grid power applications2, which matches the COR system’s battery type
as well as intended usage.
When
paired with the SOLIS cover, the COR energy storage system will be a market outlier in that it can be charged safely while mobile whereas
competing portable power stations are intended to be stationary during charging.
|
1. |
Allied
Market Research. Portable Power Station Market. Retrieved from
https://www.alliedmarketresearch.com/portable-power-station-market-A11700 |
|
2. |
Markets
And Markets. Portable Power Station Market. Retrieved from
https://www.marketsandmarkets.com/Market-Reports/portable-power-station-market-23592113.html |
Distribution
We
distribute our tonneau covers in Canada and the United States through an expanding network of wholesalers, private labels, distributors,
and online retail channels, including eBay, Amazon, Walmart, and our own e-commerce platform hosted on Shopify. Distribution via each
aforementioned channel is expected to increase during the remainder of 2023 and into 2024. We have pursued and will continue to pursue
relationships with Original Equipment Manufacturers with the intention of distributing through them as well.
The
specialty equipment aftermarket consists of three major types of customers, which include master warehouse distributors and big box stores,
dealers and wholesalers, and retail end consumers. Master warehouse distributors and big box stores stock and distribute products to
their customers, which are usually local dealers and wholesalers. Dealers and wholesalers are local stores which sell products to some
businesses and retail consumers in their area and online. Dealers purchase most of their products from their local distributor who deliver
to them regularly. Retail end consumers are the end users of the products.
Competition
Tonneau
Cover Competitors
The
Tonneau Cover market is relatively consolidated with one industry leader, Real Truck (formerly Truck Hero), having the largest market
share. Real Truck has acquired upwards of 16 independent tonneau cover brands in North America, allowing it to concurrently target many
different niche markets but also potentially cannibalizing its own sales. We compete directly with Real Truck. Other competitors in this
space include Truck Accessories Group (Primarily Leer), Agri-Cover (primarily Access), Truck Covers USA, and Paragon.
We
believe that being independent, innovative, operationally lean, and competitively priced will enable us to acquire a larger portion of
the existing market share. In order to execute on this, we intend to have a small and effective sales team to forge strong business-to-business
relationships, while turning inventory regularly through direct-to-consumer sales supported by a strong customer support team. Selling
above MAP (Minimum Advertised Price) and enforcing this policy will allow business customers to sell without competing with us and in
return support the growth of the distribution base. Our innovative covers are designed to serve purposes that no other tonneau cover
is currently capable of, some of which are specifically geared towards improving margins for distributors. Further, the SOLIS cover’s
inclusion of solar panels may be particularly attractive to electric pickup truck original equipment manufacturers, paving the path towards
an original equipment manufacturer relationship that may be lucrative beyond standard tonneau cover partnerships.
Portable
Power Station Competitors
The
Portable Power Station market is global and highly fragmented and includes many competitors from across the world including but not limited
to Alpha ESS Co., Ltd., Anker Technology, Bluetti, Chilwee Group Co., Ltd, Duracell, GES Group Limited Company, Jackery Inc., Lion Energy,
Milwaukee Tool, and Mitsubishi Corporation. Some of these competitors offer a line of Portable Power Stations, each with different power
capacities, sizes, and price points. Others specialize in few or even one Portable Power Station as to target a specific or niche submarket.
We
intend to be competitive by focusing on our portable power station’s biggest strengths – primarily its modularity and Hot
Swap battery. Modularity allows consumers not only to determine themselves the ideal stored energy capacity and price point they are
seeking but also to upgrade their COR system overtime based on their evolving needs.
Supply
of Components
Production
of our soft and hard cover product lines requires components including but not limited to injection molded plastics, rubber hinges, rubber
seals, foam corners, aluminum blanks, aluminum extrusions, and metal brackets. We believe that we can source materials needed for soft
and hard tonneau cover production from other suppliers without major delay should any preferred supplier no longer be suitable.
For
our domestically-assembled products, we have developed an extensive network of suppliers based in a diverse range of countries, including
but not limited to the USA, China, Romania, Spain, Turkey, and Canada. We are further diversifying our supply chain of tonneau cover
components by developing relationships with suppliers based in countries, including but not limited to Malaysia, Hungary, Czech Republic,
Estonia, Latvia, Slovakia, Bulgaria, Vietnam, Thailand, Poland, Finland, Italy, and Lithuania. For our COR and SOLIS components, we are
establishing relationships with suppliers based in countries, including but not limited to China, Germany, Romania, Turkey, Philippines,
and India. We actively seek to lower reliance on any country deemed a potential geo-political supply chain risk.
Research
and Development
We
invest in research and development activities on an ongoing basis. We are actively acquiring new engineering and design assets, both
in-house and third-party. Our industrial engineers are based in both Canada and the United States, and they have developed and are further
developing unique tonneau cover designs with enhanced user experience, cost-effective and sustainable materials, and automatable manufacturing
potential. Our electrical engineers are based in Canada and work heavily on sourcing solar panels with features suitable for the Company’s
SOLIS cover, as determined through deep product research and testing. Concurrently, the electrical engineering department is researching
and developing more size- and cost-effective methods of portable energy storage in order to offer the market a competitive portable energy
storage system with distinguishable and unique product features.
Our
subsidiary, Terravis Energy, researches green energy solutions for home and community power as well as Electric Vehicle DC charging and
heat-pump technology.
Governmental
Programs, Incentives and Regulations
Globally,
both the operation of our business and the ownership of our products by our customers are impacted by various government programs, incentives,
and other arrangements. Our business and products are also subject to numerous governmental regulations that vary among jurisdictions.
Programs
and Incentives
We
have applied for and been granted tax, mortgage, wage, and energy cost relief in New York in addition to wage cost relief in Ontario.
These programs are provided by several agencies including the Erie County Industrial Development Agency, Empire State Development, NY
Power Authority, and The Canada Revenue Agency. Each of these incentive programs includes its own set of guidelines and requirements,
including but not limited to timely eligibility reporting, environmental regulation compliance, and headcount projection realization
– each of which we have agreed to and must abide by in order to continue realizing said incentives.
We
continue to seek additional incentives and grants in order to lower our operational costs as well as commit less capital to new product
initiatives.
Regulations
Our
COR portable power station is subject to various U.S. and international regulations that govern transport of “dangerous goods,”
defined to include lithium-ion batteries, which may present a risk in transportation. We plan to conduct testing to demonstrate our compliance
with such regulations.
We
use lithium-ion cells in our energy storage products. The use, storage, and disposal of our battery packs are regulated under existing
laws and are the subject of ongoing regulatory changes that may add additional requirements in the future.
Environmental
Compliance
We
are committed to high environmental standards and carry out our activities and operations in compliance with all relevant and applicable
environmental regulations and best industry practices. Costs of environmental regulatory compliance are not expected to be significant.
Human
Capital
As
of October 31, 2023, we had a total of 25 employees, of which included 16 full-time employees in Canada and five full-time and four temporary
employees in the USA. We intend to hire additional employees as operations grow – particularly within our West Seneca, NY manufacturing
facility. We rely on few independent contractors for additional labor and are very selective in our use of consultants.
Practices
and Policies
We
are an equal opportunity employer committed to inclusion and diversity and to providing a workplace free of harassment or discrimination.
Compensation
and Benefits
We
believe that compensation should be competitive and equitable, and should enable employees to share in our success. We recognize our
people are most likely to thrive when they have the resources to meet their needs and the time and support to succeed in their professional
and personal lives. In support of this, we offer a variety of benefits for employees and invest in tools and resources that are designed
to support employees’ growth and development.
Inclusion
and Diversity
We
remain committed to our vision to build and sustain a more inclusive workforce that is representative of the communities we serve. We
continue to work to increase diverse representation, foster an inclusive culture, and support equitable pay and access to opportunity
for all employees.
Engagement
We
believe that open and honest communication among team members, managers, and leaders helps create an open, collaborative work environment,
where everyone can contribute, grow and succeed. Team members are encouraged to come to their managers with questions, feedback or concerns.
Health
and Safety
We
are committed to protecting our team members everywhere we operate and, as such, support employees with general safety trainings. We
have also taken additional health and safety measures during the COVID-19 pandemic.
Available
Information
Our
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to reports filed pursuant to
Sections 13(a) and 15(d) of the Exchange Act, are filed with the SEC. Such reports and other information filed by us with the SEC are
available free of charge at investors.worksport.com/stock-information when such reports are available on the SEC’s website.
We periodically provide certain information for investors on our corporate website, worksport.com, and our investor relations
website, investors.worksport.com. This includes press releases and other information about financial performance, information
on environmental, social and governance matters, and details related to our annual meeting of shareholders. The information contained
on the websites referenced in this prospectus supplement is not incorporated by reference into this filing. Further, our references to
website URLs are intended to be inactive textual references only.
Controlled
Company
Steven
Rossi, our founder and Chief Executive Officer, has voting control over approximately 58.04% of our outstanding voting stock and therefore
we currently meet the definition of a “controlled company” under the corporate governance standards for Nasdaq listed companies
and for so long as we remain a controlled company under this definition, we are eligible to utilize certain exemptions from the corporate
governance requirements of Nasdaq. Upon the closing of this offering, Mr. Rossi, will own approximately 56.27% of the voting power of
our outstanding voting stock.
As
long as Mr. Rossi owns at least 50% of the voting power of our Company, we will be a “controlled company” as defined under
the Nasdaq rules.
For
so long as we are a controlled company under that definition, we are permitted to rely on certain exemptions from corporate governance
rules, including:
|
● |
an
exemption from the rule that a majority of our Board must be independent directors;
|
|
● |
an
exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent
directors; and |
|
|
|
|
● |
an
exemption from the rule that our director nominees must be selected or recommended solely by independent directors. |
Although
we do not intend to rely on the “controlled company” exemption under Nasdaq listing rules, we could elect to rely on this
exemption in the future. If we elect to rely on the “controlled company” exemption, a majority of the members of our Board
might not be independent directors and our nominating and corporate governance and compensation committees might not consist entirely
of independent directors.
As
a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance
requirements.
Executive
Offices
Our
principal corporate office is located at 2500 N America Dr. West Seneca, NY 14224.
Our
main telephone number is (888) 554-8789. Our main website is www.worksport.com. The contents of our website are not incorporated
by reference into this prospectus supplement.
OFFERING
SUMMARY
|
Common
stock outstanding before this offering(1): |
|
20,320,715
shares |
|
|
|
|
|
Common
stock outstanding after completion of this offering(1)(2): |
|
27,320,715
shares (assuming full exercise of the Warrants that are exercisable for the Warrant Shares offered hereby). |
|
|
|
|
|
Use
of Proceeds: |
|
We
will not receive any proceeds from the sale of the common stock by the Selling Stockholders. However, we will receive gross proceeds
of approximately $9.4 million if all of the Warrants held by the Selling Stockholders are exercised for cash, excluding fees payable
to Maxim Group LLC and other expenses. We intend to use any of the net proceeds from Warrant exercises for working capital purposes. |
|
|
|
|
|
Transfer
Agent: |
|
Vstock
Transfer, LLC |
|
|
|
|
|
Nasdaq
Capital Market Symbol: |
|
Our
shares of common stock are listed on The Nasdaq Capital Market under the symbol “WKSP.” |
|
|
|
|
|
Dividend
Policy: |
|
We
have never declared or paid any cash dividends on our shares of common stock. We do not anticipate paying any cash dividends in the
foreseeable future. |
|
|
|
|
|
Risk
Factors: |
|
An
investment in our common stock involves a high degree of risk. You should read this prospectus carefully, including the section titled
“Risk Factors” and the condensed consolidated financial statements and the related notes to those statements included
in this prospectus, before investing in our common stock |
(1) |
The
number of shares of common stock to be outstanding after this offering is based on 20,320,715 shares of common stock outstanding
as of December 22, 2023, and excludes: |
|
● |
455,000
shares of our common stock issuable pursuant to options granted pursuant to the Worksport Ltd. 2015 Equity Incentive Plan (the “2015
Plan”) with a weighted exercise of $2.54 per share, of which a total of 395,000 option shares have vested; |
|
|
|
|
● |
190,000
shares of our common stock issuable pursuant to options granted pursuant to the Worksport Ltd. 2021 Equity Incentive Plan (the “2021
Plan”) with a weighted exercise of $4.56 per share, of which a total of 145,000 have vested; |
|
|
|
|
●
|
932,156
shares
of our common stock issuable pursuant to options granted pursuant to the Worksport Ltd. 2022
Equity Incentive Plan (the “2022 Plan”) with a weighted exercise of $2.26
per share, of which a total of 132,500 option shares have vested; |
|
|
|
|
● |
300,000
shares of common stock underlying PSUs, of which 75,000 PSUs have vested; |
|
|
|
|
● |
170,212
shares of common stock underlying RSUs; |
|
|
|
|
●
|
2,000,000
shares of our common stock issuable pursuant to options granted with a weighted exercise
of $1.74 per share, of which a total of 400,000 option shares have vested; |
|
|
|
|
● |
1,500,000 shares of our common stock issuable pursuant to options granted
with a weighted exercise of $1.44, of which a total of 0 option shares have vested; |
|
|
|
|
● |
Warrants
exercisable for an aggregate of 4,239,924 shares of common stock with a weighted exercise
price of $5.71 per share; and |
|
|
|
|
● |
Pre-funded warrants exercisable for an aggregate of 688,000 shares of common
stock with a weighted exercise price of $0.0001 per share. |
(2) |
Unless
otherwise indicated, this prospectus reflects and assumes no exercise of the options and warrants described above. |
SUMMARY
FINANCIAL DATA
The
following tables summarize our financial data. We derived the summary financial statement data for the nine months ended September 30,
2023 and 2022 from our unaudited financial statements and related notes contained in this prospectus and for the fiscal years ended December
31, 2022 and 2021 set forth below from our audited financial statements and related notes contained in this prospectus. Our historical
results are not necessarily indicative of the results that may be expected in the future. You should read the information presented below
together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” our financial
statements, the notes to those statements and the other financial information contained in this prospectus.
Summary
of Operations in U.S. Dollars
| |
Nine Months Ended September
31, | | |
Fiscal Year Ended December
31, | |
| |
2023 (unaudited) | | |
2022 (unaudited) | | |
2022 (audited) | | |
2021 (audited) | |
Net Revenue | |
$ | 458,483 | | |
$ | 18,350 | | |
$ | 116,502 | | |
$ | 303,750 | |
Cost of Goods Sold | |
| 368,796 | | |
| 12,602 | | |
| 56,967 | | |
| 350,702 | |
| |
| | | |
| | | |
| | | |
| | |
OPERATING EXPENSES | |
| | | |
| | | |
| | | |
| | |
Selling, general and administrative | |
| 4,009,196 | | |
| 2,948,576 | | |
| 12,833,250 | | |
| 7,514,779 | |
Operating loss | |
| (3,919,509 | ) | |
| (2,942,828 | ) | |
| (12,773,715 | ) | |
| (7,561,731 | ) |
| |
| | | |
| | | |
| | | |
| | |
OTHER INCOME (EXPENSE) | |
| (29,789 | ) | |
| 65,168 | | |
| 239,301 | | |
| (335,354 | ) |
| |
| | | |
| | | |
| | | |
| | |
NET LOSS | |
| 3,949,298 | | |
| (2,877,660 | ) | |
| (12,534,414 | ) | |
| (7,897,085 | ) |
Loss per common share (basic and diluted) | |
$ | (0.23 | ) | |
$ | (0.17 | ) | |
$ | (0.73 | ) | |
$ | (0.69 | ) |
Balance
Sheet in U.S. Dollars
| |
As of September 30, | | |
As of December 31, | |
| |
2023 | | |
2022 | | |
2022 | | |
2021 | |
| |
Actual (unaudited) | | |
Actual (unaudited) | | |
Actual (audited) | | |
Actual (audited) | |
Cash | |
$ | 2,965,578 | | |
$ | 16,724,267 | | |
$ | 14,620,757 | | |
$ | 28,567,333 | |
Total Current Assets | |
| 7,894,134 | | |
| 22,096,328 | | |
| 18,322,107 | | |
| 34,032,005 | |
Total Assets | |
| 24,621,491 | | |
| 35,719,303 | | |
| 32,764,130 | | |
| 36,294,099 | |
| |
| | | |
| | | |
| | | |
| | |
Total Current Liabilities | |
| 7,563,771 | | |
| 2,504,881 | | |
| 2,461,730 | | |
| 1,796,789 | |
| |
| | | |
| | | |
| | | |
| | |
Total Liabilities | |
| 8,207,186 | | |
| 8,790,307 | | |
| 8,645,876 | | |
| 2,113,777 | |
| |
| | | |
| | | |
| | | |
| | |
Additional paid-in capital | |
| 59,462,708 | | |
| 56,565,033 | | |
| 56,919,625 | | |
| 54,608,472 | |
| |
| | | |
| | | |
| | | |
| | |
Total Stockholders Equity | |
$ | 16,414,305 | | |
$ | 26,928,996 | | |
$ | 24,118,254 | | |
$ | 34,180,322 | |
SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS
This
prospectus contains “forward-looking statements.” Forward-looking statements reflect the current view about future events.
When used in this prospectus, the words “anticipate,” “believe,” “estimate,” “expect,”
“future,” “intend,” “plan” or the negative of these terms and similar expressions, as they relate
to us or our management, identify forward-looking statements. Such statements, include, but are not limited to, statements contained
in this prospectus relating to our business strategy, our future operating results and liquidity and capital resources outlook. Forward-looking
statements are based on our current expectations and assumptions regarding our business, the economy and other future conditions. Because
forward–looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances
that are difficult to predict. Our actual results may differ materially from those contemplated by the forward-looking statements. They
are neither statements of historical fact nor guarantees of assurance of future performance. We caution you therefore against relying
on any of these forward-looking statements. Important factors that could cause actual results to differ materially from those in the
forward-looking statements include, without limitation:
|
● |
Our
ability to effectively operate our business segments; |
|
● |
Our
ability to manage our research, development, expansion, growth and operating expenses; |
|
● |
Our
ability to evaluate and measure our business, prospects and performance metrics; |
|
● |
Our
ability to compete, directly and indirectly, and succeed in a highly competitive and evolving industry; |
|
● |
Our
ability to respond and adapt to changes in technology and customer behavior; |
|
● |
Our
ability to protect our intellectual property and to develop, maintain and enhance a strong brand; and |
|
● |
other
factors (including the risks contained in the section of this prospectus entitled “Risk Factors”) relating to
our industry, our operations and results of operations. |
Should
one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual results may differ
significantly from those anticipated, believed, estimated, expected, intended or planned.
Factors
or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of
them. We cannot guarantee future results, levels of activity, performance or achievements. Except as required by applicable law, including
the securities laws of the United States, we do not intend to update any of the forward-looking statements to conform these statements
to actual results.
MARKET
DATA
Market
data and certain industry data and forecasts used throughout this prospectus were obtained from internal company surveys, market research,
consultant surveys, publicly available information, reports of governmental agencies and industry publications and surveys. Industry
surveys, publications, consultant surveys and forecasts generally state that the information contained therein has been obtained from
sources believed to be reliable, but the accuracy and completeness of such information are not guaranteed. To our knowledge, certain
third-party industry data that includes projections for future periods does not take into account the effects of the worldwide coronavirus
pandemic. Accordingly, those third-party projections may be overstated and should not be given undue weight. Forecasts are particularly
likely to be inaccurate, especially over long periods of time. In addition, we do not necessarily know what assumptions regarding general
economic growth were used in preparing the forecasts we cite. Statements as to our market position are based on the most currently available
data. While we are not aware of any misstatements regarding the industry data presented in this prospectus, our estimates involve risks
and uncertainties and are subject to change based on various factors, including those discussed under the heading “Risk Factors”
in this prospectus.
TRADEMARKS
Solely
for convenience, our trademarks and tradenames referred to in this prospectus may appear without the ® or ™ symbols, but such
references are not intended to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights to
these trademarks and tradenames. All other trademarks, service marks, and trade names included or incorporated by reference into this
prospectus or the accompanying prospectus are the property of their respective owners.
RISK
FACTORS
Investing
in our securities involves a high degree of risk. You should carefully consider the risks listed below and other information included
and incorporated by reference in this prospectus supplement and accompanying prospectus. There may also be risks of which we are currently
unaware, or that we currently regard as immaterial based on the information available to us that later prove to be material. If any of
these risks occur, our business, operating results and financial condition could be seriously harmed, the trading price of our common
stock could decline, and you could lose some or all of your investment.
Risks
Related to Our Business
Geopolitical
tensions and conflicts in the Middle East, specifically the Israel-Palestinian war, may lead to global economic instability and adversely
affect supply chains, which may adversely impact our operations, financial conditions and business prospects.
While
we do not have any direct operations or significant sales in the Middle East, geopolitical tensions and ongoing conflicts in the region,
particularly between Israel and Palestine, may lead to global economic instability and fluctuating energy prices that could materially
affect our business. It is not possible to predict the broader consequences of the Israel-Palestinian war, including related geopolitical
tensions, and the measures and actions taken by other countries in respect thereof, which could materially adversely affect global trade,
currency exchange rates, regional economies and the global economy. While it is difficult to predict the impact of any of the foregoing,
the Israel-Palestinian war may increase our costs, disrupt our supply chain, reduce our sales and earnings, impair our ability to raise
additional capital when needed on acceptable terms, if at all, or otherwise adversely affect our business, financial condition and results
of operations.
Risks
Related to this Offering and Ownership of our Securities
The
price of our common stock may be adversely affected by the future issuance and sale of shares of our common stock or other equity securities.
We
cannot predict the size of future issuances or sales of our common stock or other equity securities, future acquisitions or capital raising
activities, or the effect, if any, that such issuances or sales may have on the market price of our common stock. The issuance and sale
of substantial amounts of common stock or other equity securities or announcement that such issuances and sales may occur, could adversely
affect the market price of our common stock.
Future
sales by stockholders, or the perception that such sales may occur, may depress the price of our common stock.
The
sale or availability for sale of substantial amounts of our shares in the public market or exercise of common stock warrants and options
or settlement of restricted stock units, or the perception that such sales could occur, could adversely affect the market price of our
common stock and also could impair our ability to raise capital through future offerings of our shares. As of December 22, 2023,
we had 20,320,715 outstanding shares of common stock. Any decline in the price of our common stock may encourage short sales, which could
place further downward pressure on the price of our common stock and may impair our ability to raise additional capital through the sale
of equity securities.
The
issuance of shares upon exercise of derivative securities may cause immediate and substantial dilution to our existing stockholders.
The
issuance of shares upon exercise of options and settlement of outstanding restricted stock units may result in substantial dilution to
the interests of other stockholders since these selling stockholders may ultimately convert or exercise and sell all or a portion of
the full amount issuable upon exercise. If all derivative securities outstanding as of December 22, 2023, including the Warrants,
were converted or exercised into shares of common stock, there would be approximately an additional 17,005,080 million shares
of common stock outstanding as a result. The issuance of these shares will have the effect of further diluting the proportionate equity
interest and voting power of holders of our common stock.
We
currently do not intend to declare dividends on our common stock in the foreseeable future and, as a result, your returns on your investment
may depend solely on the appreciation of our common stock.
We
currently do not expect to declare any dividends on our common stock in the foreseeable future. Instead, we anticipate that all of our
earnings in the foreseeable future will be used to provide working capital, to support our operations and to finance the growth and development
of our business. Any determination to declare or pay dividends in the future will be at the discretion of our Board subject to applicable
laws and dependent upon a number of factors, including our earnings, capital requirements and overall financial conditions. In addition,
terms of any future debt or preferred securities may further restrict our ability to pay dividends on our common stock. Accordingly,
your only opportunity to achieve a return on your investment in our common stock may be if the market price of our common stock appreciates
and you sell your shares at a profit. The market price for our common stock may never exceed, and may fall below, the price that you
pay for such common stock. See “Dividend Policy.”
Our
Chief Executive Officer and Chairman, Steven Rossi, has significant control over stockholder matters and the minority stockholder will
have little or no control over our affairs.
Steven
Rossi currently owns 100% of our outstanding Series A Preferred Stock which entitles him to 51% of the voting power of our outstanding
voting equity. Subject to any fiduciary duties owed to our other stockholders under Nevada law, Mr. Rossi is able to exercise significant
influence over matters requiring stockholder approval, including the election of directors and approval of significant corporate transactions,
and will have some control over our management and policies. Mr. Rossi may have interests that are different from yours. For example,
Mr. Rossi may support proposals and actions with which you may disagree. The concentration of ownership could delay or prevent a change
in control of our Company or otherwise discourage a potential acquirer from attempting to obtain control of our Company, which in turn
could reduce the price of our stock. In addition, Mr. Rossi could use his voting influence to maintain our existing management and directors
in office, delay or prevent changes in control of our Company, or support or reject other management and Board proposals that are subject
to stockholder approval, such as amendments to our employee stock plans and approvals of significant financing transactions.
As
a “controlled company” under the rules of Nasdaq, we may choose to exempt our Company from certain corporate governance requirements
that could have an adverse effect on our public shareholders.
Steven
Rossi, our founder and Chief Executive Officer, has voting control over approximately 58.04% of our outstanding voting stock. Upon the
closing of this Offering, Mr. Rossi, will own approximately 56.27% of the voting power of our outstanding voting stock. We currently
meet the definition of a “controlled company” under the corporate governance standards for Nasdaq listed companies and for
so long as we remain a controlled company under this definition, we are eligible to utilize certain exemptions from the corporate governance
requirements of Nasdaq.
As
long as our officers and directors, either individually or in the aggregate, own at least 50% of the voting power of our Company, we
are a “controlled company” as defined under the listing rules of Nasdaq. For so long as we are a controlled company under
this definition, we are permitted to elect to rely, and may rely, on certain exemptions from corporate governance rules, including:
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an
exemption from the rule that a majority of our Board must be independent directors;
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an
exemption from the rule that the compensation of our chief executive officer must be determined or recommended solely by independent
directors; and |
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an
exemption from the rule that our director nominees must be selected or recommended solely by independent directors. |
Although
we do not intend to rely on the “controlled company” exemption under the Nasdaq listing rules, we could elect to rely on
this exemption in the future. If we elect to rely on the “controlled company” exemption, a majority of the members of our
Board might not be independent directors and our nominating and corporate governance and compensation committees might not consist entirely
of independent directors.
As
a result, you will not have the same protection afforded to shareholders of companies that are subject to these corporate governance
requirements. Our status as a controlled company could cause our Common Stock to look less attractive to certain investors or otherwise
harm our trading price.
USE
OF PROCEEDS
All
of the shares of common stock offered by the Selling Stockholders pursuant to this prospectus will be sold by the Selling Stockholders
for their respective accounts. We will not receive any of the proceeds from these sales. However, we will receive gross proceeds of approximately
$9.4 million if all of the Warrants held by the Selling Stockholders are exercised for cash, excluding fees payable to Maxim Group LLC
and other expenses. We intend to use any of the net proceeds from Warrant exercises for working capital purposes.
DIVIDEND
POLICY
We
have not declared any cash dividends since inception, and we do not anticipate paying any dividends in the foreseeable future. Instead,
we anticipate that all of our earnings will be used to provide working capital, support our operations, and finance the growth and development
of our business. The payment of dividends is within the discretion of the Board and will depend on our earnings, capital requirements,
financial condition, prospects, applicable Nevada law, which provides that dividends are only payable out of surplus or current net profits,
and other factors our Board might deem relevant. There are no restrictions that currently limit our ability to pay dividends on our common
stock other than those generally imposed by applicable state law.
DESCRIPTION
OF SECURITIES
Description
of the Common Stock
As
of December 22, 2023, there were 20,320,715 shares of our common stock outstanding and held of record by 192 stockholders.
Holders
of common stock are entitled to one vote for each share held on all matters submitted to a vote of the stockholders and do not have cumulative
voting rights. Accordingly, holders of a majority of the shares of common stock entitled to vote in any election of directors may elect
all of the directors standing for election. Holders of common stock are entitled to receive ratably any dividends, as may be declared
by the Board out of funds legally available therefor, subject to the rights of the holders of preferred stock. Upon the liquidation,
dissolution or winding up of our Company, the holders of common stock are entitled to receive ratably our net assets available after
the payment of our debts and other liabilities. Holders of common stock have no preemptive, subscription, redemption or conversion rights.
The outstanding shares of common stock are fully paid and nonassessable.
In
the event of our liquidation, dissolution or winding up, the holders of common stock will be entitled to share ratably in the assets
legally available for distribution to stockholders after the payment of or provision for all of our debts and other liabilities, subject
to the prior rights of any preferred stock then outstanding.
We
have never declared or paid any cash dividends on our common stock. We have no present plan to declare and pay any dividends on our common
stock in the near future. We currently intend to retain most, if not all, of our available funds and any future earnings to operate and
expand our business. Any future determination to pay dividends will be at the discretion of our Board, subject to applicable laws, and
will depend on our financial condition, results of operations, capital requirements, general business conditions and other factors that
our Board considers relevant.
Our
Articles of Incorporation authorizes the issuance of 1,000,000 shares of “blank check” preferred stock, par value $0.0001
per share, of which there are 100 shares of Series A Preferred Stock outstanding.
The
Board may provide for the issue of any or all of the unissued and undesignated shares of the preferred stock in one or more series, and
to fix the number of shares and to determine or alter for each such series, such voting powers, full or limited, or no voting powers,
and such designation, preferences, and relative, participating, optional, or other rights and such qualifications, limitations, or restrictions
thereof, as shall be stated and expressed in the resolution or resolutions adopted by the Board providing for the issuance of such shares
and as may be permitted by law, without stockholder approval.
Our
Board has the right to establish one or more series of preferred stock without stockholder approval. Unless required by law or by any
stock exchange on which our common stock is listed, the authorized shares of preferred stock will be available for issuance at the discretion
of our Board without further action by our stockholders. Our Board is able to determine, with respect to any series of preferred stock,
the terms and rights of that series, including:
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the
designation of the series; |
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the
number of shares of the series; |
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whether
dividends, if any, will be cumulative or non-cumulative and the dividend rate, if any, of the series; |
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the
dates at which dividends, if any, will be payable; |
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the
redemption rights and price or prices, if any, for shares of the series; |
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the
terms and amounts of any sinking fund provided for the purchase or redemption of shares of the series; |
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the
amounts payable on shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding-up of the
affairs of our Company; |
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whether
the shares of the series will be convertible into shares of any other class or series, or any other security, of our Company or any
other entity, and, if so, the specification of the other class or series or other security, the conversion price or prices or rate
or rates and provisions for any adjustments to such prices or rates, the date or dates as of which the shares will be convertible,
and all other terms and conditions upon which the conversion may be made; |
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the
ranking of such series with respect to dividends and amounts payable on our liquidation, dissolution or winding-up, which may include
provisions that such series will rank senior to our common stock with respect to dividends and those distributions; |
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restrictions
on the issuance of shares of the same series or any other class or series; or |
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voting
rights, if any, of the holders of the series. |
The
issuance of preferred stock could adversely affect, among other things, the voting power of holders of common stock and the likelihood
that stockholders will receive dividend payments and payments upon our liquidation, dissolution or winding up. The issuance of preferred
stock could also have the effect of delaying, deferring or preventing a change in control of us.
Series
A Preferred Stock
We
are authorized to issue 100 shares of Series A Preferred Stock, par value $0.0001 per share. All of 100 outstanding shares of common
stock are held by Steven Rossi, the Company’s Chief Executive Officer. The Series A Preferred Stock is entitled to 51% of the total
power of the Company regardless of the number of shares of Series A Preferred Stock that are outstanding. The Series A are not (i) convertible
into any other securities of the Company, (ii) entitled to dividends or (iii) to receive any distributions in an event of a liquidation
or winding up of the Company.
Series
B Preferred Stock
We
are authorized to issue up to 100,000 shares of our Series B Preferred Stock, $0.0001 par value.
The
holders of the Series B Preferred Stock are entitled to receive dividends upon payment of any dividend on the Common Stock of the Company
as if the Series B Preferred Stock had been converted into Common Stock.
In
the event of liquidation, dissolution or winding up of the Company, either voluntary or involuntary, the holders of the Series B Preferred
Stock are entitled to receive prior and in preference to any distribution of the assets of the Company to the holders of the common stock
an amount per share equal to the price per share actually paid to the Company upon the initial issuance of Series B Preferred Stock plus
any declared but unpaid dividends.
The
Series B Preferred Stock is not convertible nor non-redeemable. Each outstanding share of Series B Preferred Stock is entitled to vote
on any matter put forth to the holders of the common stock equal to the number of shares of common stock divided by the original issue
price of each share of Series B Preferred Stock divided by $0.000000001.
As
of the date of this prospectus there were no shares of Series B Preferred Stock nor any securities convertible into shares of Series
B Preferred Stock outstanding.
Anti-Takeover
Provisions of Nevada Law and Charter Documents
Anti-Takeover
Effects of Certain Provisions of Nevada Law and Nevada Anti-takeover Statutes
Certain
provisions of the Nevada Revised Statutes, or NRS, as described below, may delay or discourage transactions involving an actual or potential
change in our control or change in our management, including transactions in which stockholders might otherwise receive a premium for
their shares or transactions that our stockholders might otherwise deem to be in their best interests.
Combinations
with Interested Stockholders Statutes
Nevada’s
“combinations with interested stockholders” statutes, NRS 78.411 through 78.444, inclusive, prohibit specified types of business
“combinations” between certain Nevada corporations and any person deemed to be an “interested stockholder” for
two years after such person first becomes an “interested stockholder” unless (1) the corporation’s board of directors
approves, in advance, either the combination itself, or the transaction by which such person becomes an interested stockholder, or (2)
the combination is approved by the board of directors and 60% of the then-outstanding voting power of the corporation’s stockholders
not beneficially owned by the interested stockholder, its affiliates and associates. Further, in the absence of the prior approval described
above, certain restrictions may apply even after such two-year period. However, these statutes do not apply to any combination of a corporation
and an interested stockholder after the expiration of four years after the person first became an interested stockholder.
For
purposes of these statutes, an “interested stockholder” is any person who is (1) the beneficial owner, directly or indirectly,
of 10% or more of the voting power of the outstanding voting shares of the corporation, or (2) an affiliate or associate of the corporation
and at any time within the two previous years was the beneficial owner, directly or indirectly, of 10% or more of the voting power of
the then outstanding shares of the corporation. The definition of the term “combination” is sufficiently broad to cover most
significant transactions between a corporation and an interested stockholder. These statutes generally apply to “resident domestic
corporations,” namely Nevada corporations with 200 or more stockholders of record. However, a Nevada corporation may elect in its
articles of incorporation not to be governed by these particular laws, but if such election is not made in the corporation’s original
articles of incorporation, the amendment (1) must be approved by the affirmative vote of the holders of stock representing a majority
of the outstanding voting power of the corporation not beneficially owned by interested stockholders or their affiliates and associates,
and (2) is not effective until 18 months after the vote approving the amendment and does not apply to any combination with a person who
first became an interested stockholder on or before the effective date of the amendment.
Our
original articles of incorporation include a provision providing that at such time, if any, that we become a “resident domestic
corporation” as defined in the NRS, we will not be subject to, or governed by, any of the provisions of NRS 78.411 to 78.444, inclusive,
as amended from time to time, or any successor statute. As a result, pursuant to NRS 78.434, the “combinations with interested
stockholders” statutes will not apply to us, unless our Articles of Incorporation are subsequently amended to provide that we are
subject to those provisions.
Acquisition
of Controlling Interest Statutes
Nevada’s
“acquisition of controlling interest” statutes, NRS 78.378 through 78.3793, inclusive, contain provisions governing the acquisition
of stockholder voting power above specified thresholds in certain Nevada corporations. These “control share” laws provide
generally that any person that acquires a “controlling interest” in certain Nevada corporations may be denied voting rights,
unless a majority of the disinterested stockholders of the corporation elects to restore such voting rights. These laws provide that
a person acquires a “controlling interest” whenever a person acquires shares of a subject corporation that, but for the application
of these provisions of the NRS, would enable that person to exercise (1) one-fifth or more, but less than one-third, (2) one-third or
more, but less than a majority or (3) a majority or more, of all of the voting power of the corporation in the election of directors.
Once an acquirer crosses one of these thresholds, shares which it acquired in the transaction taking it over the threshold and within
the 90 days immediately preceding the date when the acquiring person acquired or offered to acquire a controlling interest become “control
shares” to which the voting restrictions described above apply.
In
our Bylaws, we have elected not to be governed by, and to otherwise opt out of, the provisions of NRS 78.378 to 78.3793, inclusive. Absent
such provision in our Bylaws, these statutes would apply to us as of a particular date if we were to have 200 or more stockholders of
record (at least 100 of whom have addresses in Nevada appearing on our stock ledger at all times during the 90 days immediately preceding
that date) and do business in the State of Nevada directly or through an affiliated corporation, unless our Articles of Incorporation
or Bylaws in effect on the tenth day after the acquisition of a controlling interest provide otherwise.
NRS
78.139(4) also provides that directors of a Nevada corporation may resist a change or potential change in control of the corporation
if the board of directors determines that the change or potential change is opposed to, or not in, the best interest of the corporation
upon consideration of any relevant facts, circumstances, contingencies or constituencies that the directors are entitled, but not required,
to consider when exercising their directorial powers pursuant to NRS 78.138(4).
The
existence of the foregoing provisions and other potential anti-takeover measures could limit the price that investors might be willing
to pay in the future for shares of our common stock. They could also deter potential acquirers of our Company, thereby reducing the likelihood
that you could receive a premium for your common stock in an acquisition.
Articles
of Incorporation and Bylaw Provisions
Our
Articles of Incorporation and Bylaws contain provisions that might have an anti-takeover effect. These provisions, which are summarized
below, may have the effect of delaying, deterring or preventing a change in control of our Company. They could also impede a transaction
in which our stockholders might receive a premium over the then-current market price of our common stock and our stockholders’
ability to approve transactions that they consider to be in their best interests.
Articles
of Incorporation. Our authorized but unissued shares of common stock and preferred stock are available for our Board to issue without
stockholder approval. We may use these additional shares for a variety of corporate purposes, including future public or private offerings
to raise additional capital, corporate acquisitions and employee benefit plans. The existence of our authorized but unissued shares of
common stock and preferred stock could render more difficult or discourage an attempt to obtain control of our Company by means of a
proxy contest, tender offer, merger or other transaction. Our authorized but unissued shares may be used to delay, defer or prevent a
tender offer or takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in
a premium over the market price for the shares held by our stockholders.
Bylaws.
Certain provisions of our Bylaws may be considered to have anti-takeover effects, including advance notice requirements for director
nominations and other stockholder proposals. Our Bylaws establish advance notice procedures for stockholder proposals to be brought before
an annual meeting of stockholders, and for proposed nominations of candidates for election to our Board at an annual or special meeting
of stockholders. Generally, such notices must be received by our corporate secretary at our principal executive offices, in the case
of an annual meeting, between 90 days and 120 days prior to the first anniversary of the preceding year’s annual meeting and, in
the case of a special meeting called for the purpose of electing directors, between 90 and 120 days prior to the date of the special
meeting or within 10 days after the day on which public announcement of the date of the special meeting is first made by us. In addition,
our Board has the authority to amend or repeal our Bylaws, or to adopt new bylaws, which could have the effect of delaying, deterring
or preventing a change of control.
Listing
Our
common stock is listed on The Nasdaq Capital Market under the symbol “WKSP.”
Transfer
Agent and Registrar
Our
transfer agent and registrar is Vstock Transfer, LLC, 18 Lafayette Place, Woodmere, NY 11598. Their telephone number is (212) 828-8436.
November
2023 Public Offering of Common Stock, Pre-Funded Warrants and Warrants
On
November 2, 2023, we completed a public offering of (i) 1,925,000 shares of common stock and (ii) 1,575,000 pre-funded warrants, each
to purchase one share of common stock at an exercise price per share of $1.3399, and a private offering of 7,000,000 Warrants, each to
purchase one share of common stock at an exercise price per share of $1.34. Subject to certain ownership limitations described in the
pre-funded warrants, the pre-funded warrants are immediately exercisable and may be exercised at a nominal consideration of $0.0001 per
share of common stock any time until all of the pre-funded warrants are exercised in full. The Warrants are exercisable upon issuance
and will expire five years from the date of issuance. The exercise prices of the pre-funded warrants and Warrants are subject to adjustment
for stock splits, reverse splits, and similar capital transactions as described in the warrants.
A
holder will not have the right to exercise any portion of the Warrants or the pre-funded warrants if the holder (together with its affiliates)
would beneficially own in excess of 4.99% (or, at the election of the holder, 9.99%) of the number of shares of common stock outstanding
immediately after giving effect to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrants
or the pre-funded warrants, respectively. However, upon notice from the holder to the Company, the holder may increase the beneficial
ownership limitation, which may not exceed 9.99% of the number of shares of common stock outstanding immediately after giving effect
to the exercise, as such percentage ownership is determined in accordance with the terms of the Warrants or the pre-funded warrants,
respectively, provided that any increase in the beneficial ownership limitation will not take effect until 61 days following notice to
the Company.
As
compensation to Maxim Group LLC, as the exclusive placement agent in connection with the offering, the Company paid the Placement Agent
a cash fee of 7% of the aggregate gross proceeds raised in the offering.
In
connection with the offering, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with certain
institutional investors on October 31, 2023. The Purchase Agreement contained customary representations and warranties and agreements
of the Company and the purchasers and customary indemnification rights and obligations of the parties.
The
shares of common stock, the pre-funded warrants and the underlying shares of common stock were offered pursuant to the prospectus supplement
dated as of October 31, 2023 to the Registration Statement on Form S-1 (File No. 333-267696), as amended, which was declared effective
by the Securities and Exchange Commission on October 31, 2023.
The
Company received net proceeds of approximately $4,200,000 from the offering, after deducting the estimated offering expenses payable
by the Company, including the placement agent fees. The Company intends to use the net proceeds from the offering for general
corporate purposes, including working capital.
PLAN
OF DISTRIBUTION
Each
Selling Stockholder of the securities and any of their pledgees, assignees and successors-in-interest may, from time to time, sell any
or all of their securities covered hereby on The Nasdaq Capital Market or any other stock exchange, market or trading facility on which
the securities are traded or in private transactions. These sales may be at fixed or negotiated prices. A Selling Stockholder may use
any one or more of the following methods when selling securities:
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ordinary
brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
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block
trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block
as principal to facilitate the transaction; |
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purchases
by a broker-dealer as principal and resale by the broker-dealer for its account; |
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an
exchange distribution in accordance with the rules of the applicable exchange; |
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privately
negotiated transactions; |
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settlement
of short sales; |
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in
transactions through broker-dealers that agree with the Selling Stockholders to sell a specified number of such securities at a stipulated
price per security; |
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through
the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
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a
combination of any such methods of sale; or |
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any
other method permitted pursuant to applicable law. |
The
Selling Stockholders may also sell securities under Rule 144 or any other exemption from registration under the Securities Act of 1933,
as amended (the “Securities Act”), if available, rather than under this prospectus.
Broker-dealers
engaged by the Selling Stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser)
in amounts to be negotiated, but, except as set forth in a supplement to this Prospectus, in the case of an agency transaction not in
excess of a customary brokerage commission in compliance with FINRA Rule 2121; and in the case of a principal transaction a markup or
markdown in compliance with FINRA Rule 2121.
In
connection with the sale of the securities or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers
or other financial institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they
assume. The Selling Stockholders may also sell securities short and deliver these securities to close out their short positions, or loan
or pledge the securities to broker-dealers that in turn may sell these securities. The Selling Stockholders may also enter into option
or other transactions with broker-dealers or other financial institutions or create one or more derivative securities which require the
delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer
or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The
Selling Stockholders and any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters”
within the meaning of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers
or agents and any profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts
under the Securities Act. Each Selling Stockholder has informed the Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the securities.
The
Company is required to pay certain fees and expenses incurred by the Company incident to the registration of the securities. The Company
has agreed to indemnify the Selling Stockholders against certain losses, claims, damages and liabilities, including liabilities under
the Securities Act.
We
agreed to keep this prospectus effective until the earlier of (i) the date on which the securities may be resold by the Selling Stockholders
without registration and without regard to any volume or manner-of-sale limitations by reason of Rule 144, without the requirement for
the Company to be in compliance with the current public information under Rule 144 under the Securities Act or any other rule of similar
effect or (ii) all of the securities have been sold pursuant to this prospectus or Rule 144 under the Securities Act or any other rule
of similar effect. The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable
state securities laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered
or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is
complied with.
Under
applicable rules and regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously
engage in market making activities with respect to the common stock for the applicable restricted period, as defined in Regulation M,
prior to the commencement of the distribution. In addition, the Selling Stockholders will be subject to applicable provisions of the
Exchange Act and the rules and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of the
common stock by the Selling Stockholders or any other person. We will make copies of this prospectus available to the Selling Stockholders
and have informed them of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including
by compliance with Rule 172 under the Securities Act).
SELLING
STOCKHOLDERS
The
common stock being offered by the Selling Stockholders are those issuable to the Selling Stockholders upon exercise of the Warrants.
We are registering the shares of common stock in order to permit the Selling Stockholders to offer the shares for resale from time to
time. Except for the ownership of shares of common stock and the Warrants, the Selling Stockholders have not had any material relationship
with us within the past three years.
The
table below lists the Selling Stockholders and other information regarding the beneficial ownership of the shares of common stock by
each of the Selling Stockholders. The second column lists the number of shares of common stock beneficially owned by each Selling Stockholder,
based on its ownership of the shares of common stock and warrants, as of December 22, 2023, assuming exercise of the warrants
held by the Selling Stockholders on that date, without regard to any limitations on exercises.
The
third column lists the shares of common stock being offered by this prospectus by the Selling Stockholders.
This
prospectus generally covers the resale of the sum of (i) the number of shares of common stock issued to the Selling Stockholders in the
“November 2023 Public Offering of Common Stock, Pre-Funded Warrants and Warrants” described above and (ii) the maximum number
of shares of common stock issuable upon exercise of the related Warrants, determined as if the outstanding Warrants were exercised in
full as of the trading day immediately preceding the date this registration statement was initially filed with the SEC, each as of the
trading day immediately preceding the applicable date of determination and all subject to adjustment as provided in the registration
right agreement, without regard to any limitations on the exercise of the Warrants. The fourth column assumes the sale of all of the
shares offered by the Selling Stockholders pursuant to this prospectus.
Under
the terms of the Warrants held by Selling Stockholders, a Selling Stockholder may not exercise any such warrants to the extent such exercise
would cause such Selling Stockholder, together with its affiliates and attribution parties, to beneficially own a number of shares of
common stock which would exceed 4.99% or 9.99%, as applicable, of our then outstanding common stock following such exercise, excluding
for purposes of such determination shares of common stock issuable upon exercise of such warrants which have not been exercised. The
number of shares in the second and fourth columns do not reflect this limitation. The Selling Stockholders may sell all, some or none
of their shares in this offering. See “Plan of Distribution.”
Name of Selling Stockholder | |
Number of Shares of Common Stock Owned Prior to Offering (1) | | |
Maximum Number of Shares of Common Stock to be Sold Pursuant to this Prospectus (2) | | |
Number of Shares of Common Stock Owned After Offering (3) | | |
Percentage of Beneficial Ownership After Offering (4) | |
| |
| | | |
| | | |
| | | |
| | |
Armistice Capital Master Fund Ltd. (5) | |
| 8,840,000 | | |
| 7,000,000 | | |
| 1,840,000 | | |
| 6.73 | % |
*Less
than 1%.
|
(1) |
Consists
of shares of common stock and shares of common stock issuable pursuant to the full exercise of the Warrants issued in the private
placement. |
|
(2) |
Represents
shares of common stock issued to the Selling Stockholders in the private placement and shares of common stock owned by the Selling
Stockholders upon the full exercise of the Warrants. All of the Warrants that are exercisable for the Warrant Shares offered hereby
contain certain beneficial ownership limitations, which provide that a holder of the Warrants will not have the right to exercise
any portion of its Warrants if such holder, together with its affiliates and attribution parties, would beneficially own in excess
of 4.99% or 9.99%, as applicable, of the number of shares of common stock outstanding immediately after giving effect to such exercise,
provided that upon at least 61 days prior notice to us, a holder may increase or decrease such limitation up to a maximum of 9.99%
of the number of shares of common stock outstanding (each such limitation, a “Beneficial Ownership Limitation”). |
|
(3) |
We
do not know when or in what amounts a Selling Stockholder may offer Warrant Shares for sale. The Selling Stockholders might not sell
any or might sell all of the Warrant Shares offered by this prospectus. Because the Selling Stockholders may offer all or some of
the Warrant Shares pursuant to this offering, and because there are currently no agreements, arrangements or understandings with
respect to the sale of any of the Warrant Shares, we cannot estimate the number of the Warrant Shares that will be held by the Selling
Stockholders after completion of the offering. However, for purposes of this table, we have assumed that, after completion of the
offering, none of the Warrant Shares covered by this prospectus will be held by the Selling Stockholders, including common stock
issuable upon exercise of the Warrants issued in the private placement. |
|
(4) |
Based
on 27,320,715 shares of common stock, assuming the full exercise of the Warrants. |
|
|
|
|
(5) |
The securities are directly held by Armistice Capital
Master Fund Ltd., a Cayman Islands exempted company (the “Master Fund”), and may be deemed to be beneficially owned by:
(i) Armistice Capital, LLC (“Armistice Capital”), as the investment manager of the Master Fund; and (ii) Steven Boyd,
as the Managing Member of Armistice Capital. The address of Armistice Capital Master Fund Ltd. is c/o Armistice Capital, LLC, 510
Madison Avenue, 7th Floor, New York, NY 10022 |
EXPERTS
The
2021 consolidated financial statements of Worksport Ltd. included in Worksport Ltd.’s Annual Report on Form 10-K for the year ended
December 31, 2022, have been audited by Haynie & Company, the former independent registered public accounting firm of the Company,
as set forth in their report thereon which is incorporated herein by reference. The 2022 consolidated financial statements of Worksport
Ltd. included in Worksport Ltd.’s Annual Report on Form 10-K for the year ended December 31, 2022, have been audited by Lumsden
& McCormick, LLP, the independent registered public accounting firm for the Company, as set forth in their report thereon which is
incorporated herein by reference. Such financial statements have been incorporated by reference in reliance upon the report pertaining
to such financial statements of such firm given upon their authority as experts in accounting and auditing.
LEGAL
MATTERS
Sichenzia
Ross Ference Carmel LLP, New York, New York, is acting as counsel in connection with the registration of our securities under the Securities
Act, and as such, will pass upon the validity of the securities offered in this prospectus.
WHERE
YOU CAN FIND MORE INFORMATION
We
have filed with the SEC a registration statement on Form S-1 under the Securities Act with respect to the common stock offered in this
prospectus. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth
in the registration statement and its exhibits and schedules, portions of which have been omitted as permitted by the rules and regulations
of the SEC. For further information about us and our common stock, we refer you to the registration statement and to its exhibits and
schedules. Statements in this prospectus about the contents of any contract, agreement or other document are not necessarily complete
and, in each instance, we refer you to the copy of such contract, agreement or document filed as an exhibit to the registration statement,
with each such statement being qualified in all respects by reference to the document to which it refers. Anyone may inspect and copy
the registration statement and its exhibits and schedules at the Public Reference Room the SEC maintains at 100 F Street, N.E., Washington,
D.C. 20549. You may obtain further information about the operation of the SEC’s Public Reference Room by calling the SEC at 1-800-SEC-0330.
You may also inspect the registration statement and its exhibits and schedules and other information without charge at the website maintained
by the SEC. The address of this site is www.sec.gov.
We
also file periodic reports, proxy statements and other information with the SEC. These reports, proxy statements and other information
will be available for inspection and copying at the public reference room and website of the SEC referred to above. We also maintain
a website at https://worksport.com/, by which you may access these materials free of charge as soon as reasonably practicable
after they are electronically filed with, or furnished to, the SEC. The information that is contained on, or that may be accessed through,
our website is not a part of this prospectus. We have included our website in this prospectus solely as an inactive textual reference.
INCORPORATION
OF CERTAIN INFORMATION BY REFERENCE
This
prospectus omits some information contained in the registration statement in accordance with SEC rules and regulations. You should review
the information and exhibits included in the registration statement of which this prospectus is a part for further information about
us and the securities we are offering. Statements in this prospectus concerning any document we filed as an exhibit to the registration
statement or that we otherwise filed with the SEC are not intended to be comprehensive and are qualified by reference to these filings.
You should review the complete document to evaluate these statements.
The
SEC allows us to “incorporate by reference” information we file with it, which means that we can disclose important information
to you by referring you to other documents. The information incorporated by reference is considered to be a part of this prospectus.
Information contained in this prospectus supersedes information incorporated by reference that we have filed with the SEC prior to the
date of this prospectus.
We
incorporate by reference the following documents listed below (excluding any document or portion thereof to the extent such disclosure
is furnished and not filed):
|
● |
Our
Annual Report on Form 10-K for the fiscal year ended December 31, 2022 filed with the SEC on March 31, 2023; |
|
|
|
|
● |
Our
Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2023 filed with the SEC on May 15, 2023; |
|
|
|
|
● |
Our
Quarterly Report on Form 10-Q for the fiscal quarter ended June 30, 2023 filed with the SEC on August 19, 2022; |
|
|
|
|
● |
Our
Quarterly Report on Form 10-Q for the fiscal quarter ended September 30, 2023 filed with the SEC on November 14, 2023; |
|
|
|
|
● |
Our
Current Reports on Form 8-K filed with the SEC on January 10, 2023, August
22, 2023, September
7, 2023, September
11, 2023, September
14, 2023, September 19, 2023, October
26, 2023, November
3, 2023, November
24, 2023, November
28, 2023, December
7, 2023 , December 12, 2023 and December 15, 2023; and |
|
|
|
|
● |
Our
Definitive Proxy Statement on Schedule 14A filed with the SEC on and October 30, 2023. |
This
prospectus forms part of a registration statement on Form S-1 that we filed with the SEC. This prospectus does not contain all of the
information set forth in the registration statement and the exhibits to the registration statement or the documents incorporated by reference
herein and therein. For further information with respect to us and the securities that we are offering under this prospectus, we refer
you to the registration statement and the exhibits and schedules filed as a part of the registration statement and the documents incorporated
by reference herein and therein. You should rely only on the information incorporated by reference or provided in this prospectus and
registration statement. We have not authorized anyone else to provide you with different information. You should not assume that the
information in this prospectus and the documents incorporated by reference herein and therein is accurate as of any date other than the
respective dates thereof.
All
reports and other documents we subsequently file pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act prior to the termination
of this offering, including all such documents we may file with the SEC after the date of the initial registration statement and prior
to the effectiveness of the registration statement, but excluding any information furnished to, rather than filed with, the SEC, will
also be incorporated by reference into this prospectus and deemed to be part of this prospectus from the date of the filing of such reports
and documents.
Any
information in any of the foregoing documents will automatically be deemed to be modified or superseded to the extent that information
in this prospectus or in a later filed document that is incorporated or deemed to be incorporated herein by reference modifies or replaces
such information.
You
can obtain any of the filings incorporated by reference into this prospectus through us or from the SEC through the SEC’s website
at www.sec.gov. We will provide, at no charge, to each person, including any beneficial owner, to whom a copy of this prospectus
is delivered, upon written or oral request of such person, a copy of any or all of the reports and documents referred to above which
have been or may be incorporated by reference into this prospectus. Written or telephone requests should be directed to: Worksport Ltd.,
2500 N America Dr. West Seneca, NY 14224, telephone number (888) 554-8789, Attention: Chief Financial Officer.
7,000,000
Shares of Common Stock
Worksport
Ltd.
PRELIMINARY
PROSPECTUS
_________________,
2023
Part
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
13. Other Expenses of Issuance and Distribution.
The
following table sets forth the costs and expenses, other than placement agent fees and commissions, payable by us in connection with
the sale and distribution of the securities being registered. All of the amounts shown are estimates, except for the Securities and Exchange
Commission (“SEC”) registration fee and the Financial Industry Regulatory Authority, Inc. (“FINRA”) filing fee:
| |
Amount | |
SEC registration fee | |
$ | 1,384.49 | |
Accounting fees and expenses | |
| 1,200 | |
Legal fees and expenses | |
| 1,200 | |
Miscellaneous | |
| 1,000 | |
Total expenses | |
$ | 4,784.49 | |
Item
14. Indemnification of Directors and Officers.
The
Company’s Articles of Incorporation and Bylaws provide that, to the fullest extent permitted by the laws of the State of Nevada,
any officer or director of the Company, who was or is a party or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or she is or was
or has agreed to serve at the request of the Company as a director, officer, employee or agent of the Company, or while serving as a
director or officer of the Company, is or was serving or has agreed to serve at the request of the Company as a director, officer, employee
or agent (which, for purposes hereof, shall include a trustee, partner or manager or similar capacity) of another corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise, or by reason of any action alleged to have been taken or omitted in
such capacity. For the avoidance of doubt, the foregoing indemnification obligation includes, without limitation, claims for monetary
damages against the Indemnitee to the fullest extent permitted under Section 78.7502 of the Nevada Revised Statutes as in existence on
the date hereof.
The
indemnification provided shall be from and against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred by the indemnitee or on the indemnitee’s behalf in connection with such action, suit or proceeding
and any appeal therefrom, but shall only be provided if the indemnitee acted in good faith and in a manner the indemnitee reasonably
believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action, suit or proceeding,
had no reasonable cause to believe the indemnitee’s conduct was unlawful.
In
the case of any threatened, pending or completed action or suit by or in the right of the Company to procure a judgment in its favor
by reason of the fact that he or she is or was a director, officer, employee or agent of the Company, or while serving as a director
or officer of the Company, is or was serving or has agreed to serve at the request of the Company as a director, officer, employee or
agent of another corporation, partnership, joint venture, trust, employee benefit plan or other enterprise, no indemnification shall
be made in respect of any claim, issue or matter as to which the indemnitee shall have been adjudged to be liable to the Company unless,
and only to the extent that, the Nevada courts or the court in which such action or suit was brought shall determine upon application
that, despite the adjudication of liability but in view of all the circumstances of the case, the indemnitee is fairly and reasonably
entitled to indemnity for such expenses which the Nevada courts or such other court shall deem proper.
The
termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that he or she did not act in good faith and in a manner which Indemnitee reasonably believed
to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had reasonable
cause to believe that the indemnitee’s conduct was unlawful.
To
the extent that indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling
our company pursuant to the foregoing provisions, we have been informed that, in the opinion of the SEC, such indemnification is against
public policy as expressed in the Securities Act and is therefore unenforceable. If a claim for indemnification against such liabilities
(other than the payment by us of expenses incurred or paid by a director, officer or controlling person of our company in the successful
defense of any action, suit or proceeding) is asserted by any of our directors, officers or controlling persons in connection with the
securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit
to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities
Act and will be governed by the final adjudication of that issue.
In
any placement agent agreement we enter into in connection with the sale of the securities being registered hereby, the Placement Agent
will agree to indemnify, under certain conditions, us, our directors, our officers and persons who control us within the meaning of the
Securities Act of 1933, as amended, or the Securities Act, against certain liabilities.
Item
15. Recent Sales of Unregistered Securities.
Set
forth below is information regarding shares of capital stock issued by us within the past three years which were not registered under
the Securities Act.
November
2023 Public Offering of Common Stock, Pre-Funded Warrants and Warrants
On
November 2, 2023, we completed a private offering of 7,000,000 Warrants, each to purchase one share of common stock at an exercise price
per share of $1.34. The Warrants are exercisable upon issuance and will expire five years from the date of issuance. The exercise price
of the Warrants is subject to adjustment for stock splits, reverse splits, and similar capital transactions as described in the warrants.
All
of the Purchasers were “accredited investors” as such term is defined in Rule 501(a) under the Securities Act. The Placement
Shares and Warrants were offered pursuant to the exemptions provided in Section 4(a)(2) under the Securities Act and/or Rule 506(b) of
Regulation D promulgated thereunder. The use of proceeds was for general working capital purposes.
Item
16. Exhibits and Financial Statement Schedules.
(a)
Exhibits: Reference is made to the Exhibit Index following the signature pages hereto, which Exhibit Index is hereby incorporated
into this Item.
(b)
Financial Statement Schedules: All schedules are omitted because the required information is inapplicable, or the information
is presented in the financial statements and the related notes.
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 of 1933;
(ii)
To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than 20% change in the maximum aggregate offering price set forth in the “Calculation of 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.
2.
For the purposes of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and 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.
For the purpose of determining liability under the Securities Act of 1933 to any purchaser:
(i)
If the registrant is relying on Rule 430B:
(a)
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
(b)
Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on
Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required
by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier
of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the
offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date
an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the
registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration
statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is
part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or
modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in
any such document immediately prior to such effective date; or
(ii)
If the registrant is subject to Rule 430C, 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.
5.
For the purposes of determining liability under the Securities Act of 1933 to any purchaser in the initial distributions of the securities,
the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration
statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold
to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will
be considered to offer or sell such securities to such purchaser:
(i)
Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule
424;
(ii)
Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by
the undersigned registrant;
(iii)
The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant
or its securities provided by or on behalf of the undersigned registrant; and
(iv)
Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.
6.
The undersigned registrant hereby undertakes to provide to the underwriter at the closing specified in the underwriting agreements certificates
in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.
7.
The undersigned registrant hereby undertakes that:
(i)
For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed
as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant
to Rule 424(b) (1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time
it was declared effective.
(ii)
For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons
pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the SEC such indemnification is against public
policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such
liabilities, other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the
successful defense of any action, suit or proceeding, is asserted by one of our directors, officers, or controlling persons in connection
with the securities being registered, we will, unless in the opinion of our counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question of whether such indemnification is against public policy as expressed in the
Securities Act, and we will be governed by the final adjudication of such issue.
EXHIBIT
INDEX
Exhibit No.: |
|
Description: |
3.1 |
|
Amended and Restated Articles of Incorporation of Worksport Ltd. filed with the Nevada Secretary of State on May 7, 2021 (8) |
3.1.1 |
|
Amended and Restated Certificate of Designation of the Series A Preferred Stock filed with the Nevada Secretary of State on March 20, 2019 (8) |
3.1.2 |
|
Series B Preferred Stock Certificate of Designation filed with the Nevada Secretary of State on May 18, 2020 (8) |
3.1.3 |
|
Amendment to the Amended and Restated Certificate of Designation of the Series A Preferred Stock filed with the Nevada Secretary of State on May 7, 2020 (8) |
3.1.4 |
|
Amendment to the Amended and Restated Articles of Incorporation filed May 21, 2021 effecting the 1-for-20 Reverse Stock Split (10) |
3.2 |
|
Amended and Restated Bylaws adopted on March 31, 2021 (8) |
3.3 |
|
Articles of Merger of TMAN Global.com, Inc. and Franchise Holdings International, Inc. (1) |
5.1* |
|
Opinion of Counsel of Registrant |
10.1 |
|
Broker-Dealer Agreement, dated September 15, 2020, between Worksport Ltd. and Dalmore Group, LLC (6) |
10.2 |
|
Patent License Agreement, dated November 26, 2014 (3) |
10.3 |
|
Corporate Advisory Services Agreement between Worksport Ltd. and Belair Capital Partners, Inc., dated May 1, 2014 (3) |
10.4 |
|
Shipping Agreement with Federal Express (Fedex) dated September 26, 2014 (3) |
10.5 |
|
Shipping Agreement with United Parcel Service (UPS) dated March 31, 2014 (3) |
10.6 |
|
Warehousing and Shipping with JBF Express dated July 24, 2013 (3) |
10.7 |
|
Continuous Importation Bond with Globe Express Services (3) |
10.8 |
|
Business
Services Agreement, between 1369781 and Worksport Ltd, dated June 1, 2015 (4) |
10.9 |
|
Business
Services Agreement, between 2224342 and Worksport Ltd, dated June 23, 2015 (4) |
10.10 |
|
Services
Agreement, between Marchese and Worksport Ltd., dated June 3, 2015 (4) |
10.11 |
|
Services
Agreement, between JAAM and Worksport Ltd, dated June 8, 2015 (4) |
10.12 |
|
Software as a Service Agreement, dated September 16, 2020, between Worksport Ltd. and Novation Solutions Inc. (o/a DealMaker) (6) |
10.14† |
|
Employment Agreement, dated May 10, 2021, between Worksport Ltd. and Steven Rossi (7) |
10.15† |
|
Worksport Ltd. 2015 Equity Incentive Plan (10) |
10.16 |
|
Lease Agreement, dated April 16, 2021, between Worksport Ltd. and Majorcon Holdings, Inc. re 7299 East Danbro Crescent (10) |
10.17 |
|
Lease Agreement, dated April 30, 2018, between Worksport Ltd. and N.H.D. Developments Limited re 41 Courtland Avenue (10) |
10.18 |
|
Form of Subscription Agreement for 2021 Private Placement (11) |
10.19† |
|
Worksport Ltd. 2015 Equity Incentive Plan (10) |
10.20 (14)† |
|
Worksport Ltd. 2021 Equity Incentive Plan |
10.21 (14)† |
|
Worksport Ltd. 2022 Equity Incentive Plan |
10.22 |
|
At the Market Offering Agreement, dated September 30, 2022, by and between the Company and H.C. Wainwright & Co., LLC. (12) |
10.23† |
|
Performance Stock Unit award, dated November 11, 2022, to Steven Rossi (13) |
10.24† |
|
Performance Stock Unit award, dated November 11, 2022, to Lorenzo Rossi (13) |
10.25† |
|
Restricted Stock award, dated November 11, 2022, to Steven Rossi (13) |
10.26 (14) |
|
Agreement dated as of January 30, 2023, between Worksport Ltd. and Wesley Van de Wiel. |
14.1 |
|
Code of Ethics (9) |
21.1 (14) |
|
List of Subsidiaries |
23.1* |
|
Consent of Haynie & Company |
23.2* |
|
Consent of Lumsden & McCormick, LLP |
23.3* |
|
Consent of Counsel of Registrant (included in Exhibit 5.1) |
24.1 |
|
Power of Attorney (included on the signature page hereto) |
104 |
|
Cover Page Interactive Data File. |
107* |
|
Filing Fee Table |
†Management
compensatory plan.
*Filed
herewith.
|
(1) |
Filed
as an exhibit to the Company’s Form 10-Q filed April 24, 2009. |
|
(2) |
Filed
as an exhibit to the Company’s Form 1-A filed on July 15, 2020. |
|
(3) |
Filed
as an exhibit to the Company’s Form 8-K filed on December 17, 2014. |
|
(4) |
Filed
as an exhibit to the Company’s Form S-1 filed on July 21, 2015. |
|
(5) |
Filed
as an exhibit to the Company’s Form 1-A/A filed on September 10, 2020. |
|
(6) |
Filed
as an exhibit to the Company’s Form 1-A/A filed on September 29, 2020. |
|
(7) |
Filed
as an exhibit to the Company’s Form 8-K filed on May 12, 2021. |
|
(8) |
Filed
as an exhibit to the Company’s Registration Statement on Form S-1 filed on May 14, 2021. |
|
(9) |
Filed
as an exhibit to the Company’s Form 8-K filed July 2, 2021. |
|
(10) |
Filed
as an exhibit to the Company’s Registration Statement on Form S-1/A filed on July 8, 2021. |
|
(11) |
Filed
as an exhibit to the Company’s Registration Statement on Form S-1/A filed on July 16, 2021. |
|
(12) |
Filed
as an exhibit to the Company’s Registration Statement on Form S-3 filed on September 30, 2022. |
|
(13) |
Filed
as an exhibit to the Company’s Form 10-Q filed November 14, 2022. |
|
(14) |
Filed
as an exhibit to the Company’s Form 10-K filed March 31, 2023. |
SIGNATURES
Pursuant
to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-1 and has duly caused this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Mississauga, Province of Ontario, on December 22, 2023.
|
WORKSPORT
LTD. |
|
|
|
By: |
/s/
Steven Rossi |
|
Name: |
Steven
Rossi |
|
Title: |
President,
Chief Executive Officer, and Chairman of the Board of Directors (Principal Executive Officer) |
POWER
OF ATTORNEY
KNOW
ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Steven Rossi and Michael Johnston,
and each of them (with full power to each of them to act alone), his or her true and lawful attorneys-in-fact and agents, 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 or
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 Securities and Exchange Commission, granting unto said attorneys-in-fact and agents,
and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about
the premises, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that
said attorneys-in-fact and agents, or any of them, or their substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant
to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities
and on the dates indicated.
Signature |
|
Title |
|
Date |
|
|
|
|
|
/s/
Steven Rossi |
|
President,
Chief Executive Officer, and Chairman of the Board of Directors |
|
December
22, 2023 |
Steven
Rossi |
|
(Principal
Executive Officer) |
|
|
|
|
|
|
|
/s/
Michael Johnston |
|
Chief
Financial Officer |
|
December
22, 2023 |
Michael
Johnston |
|
(Principal
Financial Officer and Principal Accounting Officer) |
|
|
|
|
|
|
|
/s/
Lorenzo Rossi |
|
Director |
|
December
22, 2023 |
Lorenzo
Rossi |
|
|
|
|
|
|
|
|
|
/s/
Craig Loverock |
|
Director |
|
December
22, 2023 |
Craig
Loverock |
|
|
|
|
|
|
|
|
|
/s/
William Caragol |
|
Director |
|
December
22, 2023 |
William
Caragol |
|
|
|
|
|
|
|
|
|
/s/
Ned L. Siegel |
|
Director |
|
December
22, 2023 |
Ned
L. Siegel |
|
|
|
|
Exhibit
5.1
December
22, 2023
Worksport
Ltd.
2500
N America Dr.
West
Seneca, NY 14224
Ladies
and Gentlemen:
We
have acted as counsel for Worksport Ltd., a Nevada corporation (the “Company”), in connection with the preparation and filing
of a Registration Statement on Form S-1 (the “Registration Statement”), including a related prospectus filed with the Registration
Statement (the “Prospectus”), with the Securities and Exchange Commission (the “Commission”) pursuant to the
Securities Act of 1933, as amended (the “Securities Act”), covering the offer and resale by selling stockholders of up to
a total of 7,000,000 shares of common stock (each, a “Share”), par value $0.0001 per share, of the Company, underlying warrants
issued in a private placement (the “Warrants”). This opinion is being rendered in connection with the filing of the Registration
Statement with the Commission.
In
connection with this opinion, we have examined originals or copies (certified or otherwise identified to our satisfaction) of (i) the
Company’s Amended and Restated Articles of Incorporation, as currently in effect, (ii) the Company’s Amended and Restated
Bylaws as currently in effect, (iii) the Registration Statement and related Prospectus and (vi) such corporate records, agreements, documents
and other instruments, and such certificates or comparable documents of public officials or of officers and representatives of the Company,
as we have deemed relevant and necessary as a basis for the opinion hereinafter set forth.
In
such examination, we have assumed the genuineness of all signatures, the legal capacity of all natural persons, the authenticity of all
documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed
or photostatic copies, and the authenticity of the originals of such latter documents. As to certain questions of fact material to this
opinion, we have relied upon certificates or comparable documents of officers and representatives of the Company and have not sought
to independently verify such facts.
Based
on the foregoing, and in reliance thereon, and subject to the qualifications, limitations, exceptions and assumptions set forth herein,
we are of the opinion that, the Shares issuable upon the exercise of the Warrants have been duly authorized and, upon the exercise of
the Warrants in accordance with the terms thereof, the Shares will be duly and validly issued, fully paid and non-assessable shares of
common stock of the Company.
We
express no opinion herein as to the laws of any state or jurisdiction other than Chapter 78 of the Nevada Revised Statutes (including
the statutory provisions and all applicable judicial decisions interpreting those laws) and the federal laws of the United States of
America.
This
opinion speaks only as of the date hereof and we assume no obligation to update or supplement this opinion if any applicable laws
change after the date of this opinion or if we become aware after the date of this opinion of any facts, whether existing before or arising
after the date hereof, that might change the opinions expressed above.
This
opinion is furnished in connection with the filing of the Registration Statement and may not be relied upon for any other purpose without
our prior written consent in each instance.
We
assume no obligation to update or supplement any of our opinions to reflect any changes of law or fact that may occur. We hereby consent
to the filing of this letter as an exhibit to the Registration Statement and to the reference to our firm under the caption “Legal
Matters” in the Prospectus which is a part of the Registration Statement. In giving such consents, we do not thereby admit that
we are in the category of persons whose consent is required under Section 7 of the Securities Act or the Rules and Regulations of the
Commission promulgated thereunder.
Very
truly yours,
/s/
Sichenzia Ross Ference Carmel LLP
Sichenzia
Ross Ference Carmel LLP
1185
AVENUE OF THE AMERICAS | 31ST FLOOR | NEW YORK, NY | 10036
T (212) 930-9700 | F (212) 930-9725 | WWW.SRFC.LAW
Exhibit
23.1
CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We consent to the incorporation by reference in this Registration Statement on Form S-1 of Worksport Ltd. of our report dated March
31, 2022, relating to our audit of the December 31, 2021 financial statements, which appears in Worksport Ltd.’s Annual Report
on Form 10-K for the year ended December 31, 2022.
We
also consent to the reference to our firm under the caption “Experts” in the prospectus that is part of this Registration
Statement.
/s/
Haynie & Company
Salt
Lake City, Utah
December
22, 2023
Exhibit
23.2
CONSENT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To
The Board of Directors of
Worksport
Ltd.
Gentlemen:
We
consent to the incorporation by reference in this registration statement on Form S-1 of our report dated March 30, 2023 with respect
to our audit of the consolidated financial statements of Worksport Ltd. as of and for the year ended December 31, 2022, which report
is included in the Annual Report on Form 10-K of Worksport Ltd. for the year ended December 31, 2022. We also consent to the reference
to our firm under the heading “Experts” in the Prospectus, which is part of this Registration Statement.
/s/
Lumsden McCormick CPA
Lumsden
McCormick CPA
Buffalo,
New York
December
22, 2023
Exhibit
107
Calculation
of Filing Fee Tables
Form
S-1
Worksport
Ltd.
(Exact
Name of Registrant as Specified in its Charter)
Table
1: Newly Registered Securities
Table
1: Newly Registered and Carry Forward Securities
| |
Security Type | | |
Security Class Title | | |
Fee Calculation Rule or Carry Forward Rule | | |
Amount Registered(1) | | |
Proposed Maximum Offering Price Per Share | | |
Maximum Aggregate Offering Price | | |
Fee Rate | | |
Amount of Registration Fee(5) | |
Fees to be Paid | |
| Equity | | |
| Shares of Common Stock, par value $0.0001 per share(2) | | |
| 457(g) | | |
| 7,000,000 | | |
$ | 1.34 | | |
$ | 9,380,000 | | |
| .00014760 | | |
$ | 1,384.49 | |
Carry Forward Securities | |
| – | | |
| – | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | | |
| — | |
| |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | |
Total Offering Amounts | | |
| | | |
| | | |
| | | |
| | | |
$ | 9,380,000 | | |
| .00014760 | | |
$ | 1,384.49 | |
Total Fee Offsets | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| — | |
Fees Previously Paid | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| — | |
Net Fee Due | | |
| | | |
| | | |
| | | |
| | | |
| | | |
| | | |
$ | 1,384.49 | |
(1) |
Pursuant
to Rule 416 under the Securities Act, this registration statement shall also cover any additional shares of the registrant’s
securities that become issuable by reason of any share splits, share dividends or similar transactions. |
|
|
(2) |
Consists
of 7,000,000 shares of common stock, par value $0.0001 per share, issuable upon the exercise of warrants for $1.34 per share registered
for sale by certain of the selling stockholders named in this registration statement. |
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