CAPITAL STOCK

12 Months Ended

Mar. 31, 2022

Equity [Abstract]

CAPITAL STOCK

NOTE 13 – CAPITAL STOCK

Our authorized capital consists of 200,000,000 shares of common stock with a par value of $0.001 per share.

During the year ended March 31, 2021, we issued 47,895,828 shares of common stock as follows:

● 34,512,143 shares were sold to investors for $138,564,619

● 3,145,481 shares were issued for the conversion of convertible promissory notes for $4,831,206

● 6,521,563 shares were issued to investors for exercised warrants valued for $13,952,336

● 732,974 shares were issued for cashless exercise of 1,300,069 warrants

● 1,000,000 shares were issued pursuant to a debt conversion agreement for $2,100,000

● 943,336 shares were issued for services provided to the Company value at $1,707,500

● 1,016,331 shares valued at $1,450,359 were issued to employees, members of the Board of Directors, and members of the Advisory Committee as compensation

● 24,000 shares were issued to investors for $48,000 in liquidation damage fees

During the year ended March 31, 2022, we issued 23,385,780 shares of common stock as follows:

● 20,000,000 shares were issued in connection with our merger of Gemini Direct Investments, LLC valued at $142,691,282

● 431,080 shares were issued to investors for exercised warrants valued for $943,907

● 374,584 shares were issued for cashless exercise of 443,110 warrants

● 772,450 shares valued at $1,631,701 were issued for services and equipment provided to the Company

● 1,807,666 shares valued at $5,759,000 were issued to employees, members of the Board of Directors, and members of the Advisory Committee as compensation

On November 30, 2020, the Company entered into an underwriting agreement (the “Underwriting Agreement”) with Alexander Capital, L.P. (“Alexander Capital”), as representative of the underwriters listed therein (the “Underwriters”), pursuant to which the Company agreed to sell to the Underwriters in a firm commitment underwritten public offering (the “Offering”) an aggregate of 8,564,285 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), at a public offering price of $2.10 per share. In addition, the Underwriters were granted an over-allotment option (the “Over-allotment Option”) for a period of 45 days to purchase up to an additional 1,284,643 shares of Common Stock. The Offering closed on December 3, 2020.

The Company conducted the Offering pursuant to a Registration Statement on Form S-1, as amended, which was declared effective by the Securities and Exchange Commission (the “Commission”) on November 30, 2020 (the “Registration Statement”).

The net proceeds to the Company from the Offering, after deducting the underwriting discount, the underwriters’ fees and expenses and the Company’s estimated Offering expenses, were $15,850,448.

AMMO, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

On December 11, 2020, the Company completed the closing of the Over-allotment Option. The Underwriters purchases 1,284,643 shares of the Company’s common stock at the public offering price of $2.10 per share. The net proceeds to the Company from the Offering, after deducting the underwriting discount, were $2,467,799.

The Underwriting Agreement contains customary representations, warranties and agreements by the Company, customary conditions to closing, indemnification obligations of the Company and the Underwriters, including for liabilities under the Securities Act of 1933, as amended, other obligations of the parties and termination provisions. In addition, pursuant to the terms of the Underwriting Agreement and related “lock-up” agreements, the Company (for a period of one year after the date of the Underwriting Agreement), and each director and executive officer of the Company (for a period of six months after the date of the final prospectus relating to the Public Offering), have agreed, subject to customary exceptions, not to sell, transfer or otherwise dispose of securities of the Company, without the prior written consent of Alexander Capital.

On December 3, 2020, pursuant to the Underwriting Agreement, the Company entered into an Underwriter’s warrant agreement (the “Underwriters’ Warrant Agreement”) with the Underwriters and certain affiliates of the Underwriters. Pursuant to the Underwriters’ Warrant Agreement, the Company provided the Underwriters and certain affiliates of the Underwriters with a warrant to purchase 428,215 shares of Common Stock in the aggregate. Such warrant may be exercised beginning on May 29, 2021 (the date that is 180 days after the date on which the Registration Statement became effective) until November 30, 2025 (the date that is five years after the date on which the Registration Statement became effective). The initial exercise price of the Underwriters’ Warrant Agreement is $2.63 per share.

Pursuant to subscription agreements with certain investors, the Company agreed to file a registration statement for shares purchased by investors on or before the 75^th day following closing. The Company was unable to meet this obligation and is required to pay a liquidated damage fee to investors on a monthly basis to avoid default until such registration statement is filed. Accordingly, the Company paid $329,800 in the current period ending March 31, 2021, of which $48,000 was paid by the issuance of 24,000 share of common stock at a price per share of $2.00. The Company recorded these fees as issuance costs in Other Expenses.

On January 22, 2021, the Company repurchased 1,000,000 shares of the Company’s common stock issued to JSC at a price of $1.50 per share pursuant to the Amended APA.

On March 12, 2021, the Company entered into an underwriting agreement (the “RA Underwriting Agreement”) with Roth Capital Partners, LLC and Alexander Capital, L.P., as representatives of the several underwriters identified therein (collectively, the “RA Underwriters”), relating to a firm commitment public offering of 20,000,000 newly issued shares of our common stock at a public offering price of $5.00 per share. Under the terms of the RA Underwriting Agreement, we granted the RA Underwriters a 30-day option to purchase up to an additional 3,000,000 shares of common stock from us. The closing of the offering occurred on March 16, 2021 and included the exercise of the RA Underwriters Over-allotment of 3,000,000 additional shares.

The gross proceeds to us from the sale of 23,000,000 shares of common stock, before deducting underwriting discounts and commissions and estimated offering expenses payable by us, was $115,000,000 and included total expenses of $9,569,161 included commissions to the RA Underwriters of $8,625,000.

The RA Underwriting Agreement includes customary representations, warranties and covenants, and customary conditions to closing, expense and reimbursement obligations and termination provisions. Additionally, under the terms of the Underwriting Agreement, we have agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended, or to contribute to payments the Underwriters may be required to make in respect of these liabilities.

The shares of common stock being sold by us have been registered pursuant to a registration statement on Form S-3 (File No. 333-253192), which the Commission declared effective on February 24, 2021. A final prospectus supplement and accompanying base prospectus relating to the offering were filed with the Commission on March 15, 2021.

AMMO, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

At March 31, 2022 and March 31, 2021, outstanding and exercisable stock purchase warrants consisted of the following:

	Number of Shares			Weighted Averaged Exercise Price		Weighted Average Life Remaining (Years)
Outstanding at March 31, 2020		8,504,372		$	2.10		3.60
Granted		2,925,204			2.31		2.47
Exercised		(7,821,631	)		2.08		-
Forfeited or cancelled		-			-		-
Outstanding at March 31, 2021		3,607,945		$	2.31		3.24
Exercisable at March 31, 2021		3,179,730		$	2.27		3.05

	Number of Shares			Weighted Averaged Exercise Price		Weighted Average Life Remaining (Years)
Outstanding at March 31, 2021		3,607,945		$	2.31		3.24
Granted		200,000			0.01		3.92
Exercised		(874,190	)		1.76		-
Forfeited or cancelled		-			-		-
Outstanding at March 31, 2022		2,933,755		$	2.32		2.29
Exercisable at March 31, 2022		2,933,755		$	2.32		2.29

As of March 31, 2022, we had 2,933,755 warrants outstanding. Each warrant provides the holder the right to purchase up to one share of our Common Stock at a predetermined exercise price. The outstanding warrants consist of (1) warrants to purchase 100,000 shares of Common Stock at an exercise price of $0.01 per share until March 2026, (2) warrants to purchase 911 shares of Common Stock at an exercise price of $1.65 per share until April 2025; (3) warrants to purchase 1,821,567 shares of our Common Stock at an exercise price of $2.00 per share consisting of 32% of the warrants until August 2024, and 68% until February 2026; (4) warrants to purchase 474,966 shares of Common Stock at an exercise price of $2.40 until September 2024; (5) warrants to purchase 386,311 shares of Common Stock at an exercise price of $2.63 until November 2025, and (6) warrants to purchase 150,000 shares of Common Stock at an exercise price of $6.72 until February 2024.