Blue Star Foods Corp. 10-K

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our common stock was quoted on the OTC pink sheets under the symbol “BSFC” from February 18, 2020 until November 2, 2021. Our common stock began trading on the NASDAQ Capital Market on November 3, 2021. The last reported sales price of our common stock on the NASDAQ Capital Market on March 30, 2022 was $2.09. Holders As of March 31, 2022, the Company had 92 stockholders of record. Lock-up Agreements In connection with the Merger, holders of 15,750,000 shares of common stock were prohibited, subject to certain exceptions, from disposing of or hedging any shares of common stock or securities convertible or exercisable for shares of common stock during an 18-month period for Restricted Holders and 12-month period for Pre-Merger Holders, after the Merger in excess of 50% of all of the common stock held by (or issuable to) them and at a price below $2.20 per share. Thereafter, such Holders may not sell, dispose or otherwise transfer more than one-third of the common stock held by such Holder in any two-month period. In connection with our underwritten common stock public offering in November 2021, 3,120,000 shares of common stock subject to a 10-year option at an exercise price of $2.00 per share granted to Christopher Constable, our former chief financial officer and director, are subject to a lock-up and may not be sold, disposed of or otherwise transferred until May 3, 2022. 31 Dividends We have never paid any cash dividends on our capital stock and do not anticipate paying any cash dividends on our Common Stock in the foreseeable future. We intend to retain future earnings to fund ongoing operations and future capital requirements. Our Loan and Security Agreement with Lighthouse contains terms prohibiting or limiting the amount of dividends that may be declared or paid on our common stock. Any future determination to pay cash dividends will be at the discretion of our board of directors and will be dependent upon financial condition, results of operations, capital requirements and such other factors as the board of directors deems relevant. Securities Authorized for Issuance under Equity Compensation Plans The following table provides information regarding our equity compensation plans as of December 31, 2021: Equity Compensation Plan Information Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted- average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans Equity compensation plans approved by security holders 4,408,430 (1) 2.00 3,660,000 Equity compensation plans not approved by security holders 0 0 0 (1) Represents (i) a 10-year option to purchase 3,120,000 shares of common stock at an exercise price of $2.00 per share granted to Christopher Constable, our former chief financial officer and director, which shares are subject to a lock-up until May 3, 2022 (ii) 10-year options to purchase an aggregate of 580,000 shares of common stock at an exercise price of $2.00 per share to certain employees, (iii) 10-year options to purchase an aggregate of 25,000 shares of common stock at an exercise price of $2.00 per share to certain contractors under the 2018 Plan; (iv) 3-year options to purchase an aggregate of 500,000 shares of common stock at an exercise price of $2.00 per share to the Company’s directors; (v) 4-year options to purchase an aggregate of 176,417 shares of common stock at an exercise price of $2.30 per share an employee; and (vi) 3-year options to purchase an aggregate of 7,013 shares of common stock at an exercise price of $6.00 per share to Silvia Alana, the Company’s Chief Financial Officer. Recent Sales of Unregistered Securities Except as set forth below, there were no sales of equity securities during the period covered by this Report that were not registered under the Securities Act and were not previously reported in a Quarterly Report on Form 10-Q or a Current Report on Form 8-K filed by the Company. On October 7, 2021, we issued 10,000 shares of common stock to an investor upon exercise of a warrant purchased in the Merger in 2018. On October 17, 2021, we issued 5,000 shares of common stock to an investor upon exercise of a warrant purchased in a private offering. On October 27, 2021, we issued an aggregate of 44,000 shares of common stock to two investors upon exercise of warrants purchased in the Merger in 2018. On October 28, 2021, we issued 10,000 shares of common stock to an investor upon exercise of a warrant purchased in the Merger in 2018. On October 29, 2021, we issued an aggregate 50,000 shares of common stock to two investors upon exercise of warrants purchased in the Merger in 2018. 32 On November 2, 2021, we issued an aggregate of 52,000 shares of common stock to six investors upon exercise of warrants purchased in Merger in 2018. On November 3, 2021, we issued 2,000 shares of common stock to an investor upon exercise of a warrant purchased in the merger in 2018. On November 4, 2021, we issued an aggregate 35,250 shares of common stock to two investors upon exercise of warrants purchased in the Merger in 2018. On November 5, 2021, we issued 150,000 shares of common stock to an investor upon exercise of a warrant purchased in the Merger in 2018. On November 5, 2021, we issued 800,000 shares of common stock to Newbridge Securities Corporation (“Newbridge”), as underwriters’ representative, in connection with our underwritten public offering. On November 5, 2021, we issued a warrant to purchase an aggregate of 56,000 shares of common stock at an exercise price of $5.00 per share to Newbridge. Such warrant is exercisable on a date which is 180 days from the closing of the underwritten offering and expires on November 11, 2024. On November 8, 2021, we issued 12,500 shares of common stock to an investor upon exercise of a warrant purchased in a private offering. On November 10, 2021 and December 31, 2021, the Company issued 52,326 and 18,405 shares of common stock, respectively, to Intelligent Investments I LLC for legal services provided to the Company. On December 31, 2021, the Company issued 5,000 shares of common stock to TraDigital Marketing Group for consulting services provided to the Company. On December 31, 2021, we issued 10,992 shares of common stock to each of Nubar Herian and John Keeler, 15,107 shares of common stock to each of Timothy McLellan and Trond Ringstad and 19,909 shares of common stock to Jeffrey Guzy for serving as directors of the Company. The above issuances did not involve any underwriters, underwriting discounts or commissions, or any public offering and we believe is exempt from the registration requirements of the Securities Act of 1933 by virtue of Section 4(2) thereof. Purchases of Equity Securities by the Issuer and Affiliated Purchasers None. ITEM 6. SELECTED FINANCIAL DATA We are a smaller reporting company as defined by Rule 12b-2 of the Securities Exchange Act of 1934 and are not required to provide the information under this Item.