As
filed with the Securities and Exchange Commission on November 30, 2020
Registration
No. 333-
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE SECURITIES ACT OF 1933
ZEDGE,
INC.
(Exact
name of registrant as specified in its charter)
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Delaware
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26-3199071
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(State or other jurisdiction
of
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(I.R.S. Employer
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Incorporation or
organization)
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Identification Number)
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1178
Broadway
3rd
Floor #1450
New
York, NY 10001
(330)
577-3424
(Address,
including zip code; telephone number, including area code of registrant’s principal executive offices)
Jonathan
Reich
Chief
Executive Officer
Zedge,
Inc.
1178
Broadway
3rd
Floor #1450
New
York, NY 10001
(330)
577-3424
(Name,
address, including zip code; telephone number, including area code of agent for service)
Copies
to:
Dov
T. Schwell, Esq.
Schwell
Wimpfheimer & Associates LLP
37
W. 39th Street, Suite 505
New
York, NY 10018
(646)
328-0795
Approximate
date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement
as determined by the registrant.
If
the only securities to be offered on this Form are being offered pursuant to dividend or reinvestment plans, please check the
following box. ☐
If
any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under
the Securities Act of 1933, other than securities offered only in connection with dividend or reinvestment plans, check the following
box. ☒
If
this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please
check the following box and list the Securities Act registration statement number of the earlier effective registration statement
for the same offering. ☐
If
this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list
the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If
this Form is a registration statement pursuant to General Instruction I.D. or a post-effective amendment thereto that shall become
effective upon filing with the Commission pursuant to Rule 462(e) under the Securities Act, check the following box. ☐
If
this Form is a post-effective amendment to a registration statement filed pursuant to General Instruction I.D. filed to register
additional securities or additional classes of securities pursuant to Rule 413(b) under the Securities Act, check the following
box. ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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. (check one):
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Large
accelerated filer ☐
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Accelerated
Filer ☐
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Non-accelerated
filer ☐
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Smaller
reporting company ☒
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Emerging
growth company ☒
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If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act. ☐
CALCULATION
OF REGISTRATION FEE
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Title of Securities to be Registered (1)
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Proposed
Maximum
Aggregate
Offering Price(2)
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Amount of
Registration Fee(3)
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Class B Common Stock, par value $.01 per share
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Warrants
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Total
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$
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20,000,000
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$
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2,182
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(1)
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Includes
an indeterminate number of securities that may be issued in primary offerings or upon
exercise, conversion or exchange of any securities registered hereunder that provide
for exercise, conversion or exchange.
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(2)
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Not
specified as to each class of securities to be registered hereunder pursuant to General
Instruction II(D) to Form S-3 under the Securities Act of 1933, as amended (the “Securities
Act”). The proposed maximum aggregate offering price per class of securities will
be determined from time to time by the registrant in connection with the issuance of
the securities registered hereunder. The aggregate public offering price of the securities
registered hereby will not exceed $20,000,000.
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(3)
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Calculated
pursuant to Rule 457(o) under the Securities Act.
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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. We may not sell these securities until the registration statement
filed with the Securities and Exchange Commission is declared effective. This prospectus is not an offer to sell these securities
and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted.
SUBJECT
TO COMPLETION, DATED November 30, 2020
PROSPECTUS
Zedge,
Inc.
$20,000,000
Class
B Common Stock
Warrants
We
may from time to time offer to sell any combination of the securities described in this prospectus in one or more offerings. The
aggregate initial offering price of all securities sold under this prospectus will not exceed $20,000,000.
This
prospectus provides a general description of the securities we may offer. Each time we sell securities, we will provide specific
terms of the securities offered in a supplement to this prospectus. We may also authorize one or more free writing prospectuses
to be provided to you in connection with these offerings. The prospectus supplement and any related free writing prospectus may
also add, update or change information contained in this prospectus. You should carefully read this prospectus, the applicable
prospectus supplement and any related free writing prospectus, as well as any documents incorporated by reference herein or therein
before you invest in any securities. This prospectus may not be used to consummate a sale of securities unless accompanied by
the applicable prospectus supplement.
Our
Class B common stock is listed on the NYSE American stock exchange under the symbol “ZDGE”. On November 27, 2020,
the last reported sale price for our Class B common stock was $3.78 per share. The applicable prospectus supplement will contain
information, where applicable, as to any other listing on any securities market or other exchange of the securities, if any, covered
by the prospectus supplement.
Investing
in our securities involves risks. See “Risk Factors” beginning on page 5.
We
may sell these securities directly to investors, through agents designated from time to time or to or through underwriters or
dealers. For additional information on the methods of sale, you should refer to the section entitled “Plan of Distribution”
in this prospectus. If any underwriters are involved in the sale of any securities with respect to which this prospectus is being
delivered, the names of such underwriters and any applicable commissions or discounts will be set forth in a prospectus supplement.
The price to the public of such securities and the net proceeds we expect to receive from such sale will also be set forth in
a prospectus supplement.
Neither
the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or
determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
The
date of this prospectus is November 30, 2020.
TABLE
OF CONTENTS
ABOUT
THIS PROSPECTUS
This
prospectus is a part of a registration statement that we filed with the Securities and Exchange Commission, or SEC, utilizing
a “shelf” registration process. Under this shelf registration process, we may sell any combination of the securities
described in this prospectus in one or more offerings up to a total dollar amount of $20,000,000. This prospectus provides you
with a general description of the securities we may offer. Each time we sell securities under this shelf registration, we will
provide a prospectus supplement that will contain specific information about the terms of that offering. We may also authorize
one or more free writing prospectuses to be provided to you that may contain material information relating to these offerings.
The prospectus supplement and any related free writing prospectus that we may authorize to be provided to you may also add, update
or change information contained in this prospectus or in any documents that we have incorporated by reference into this prospectus.
You should read this prospectus, any applicable prospectus supplement and any related free writing prospectus, together with the
information incorporated herein by reference as described under the heading “Where You Can Find Additional Information.”
You
should rely only on the information that we have provided or incorporated by reference in this prospectus, any applicable prospectus
supplement and any related free writing prospectus that we may authorize to be provided to you. No person is authorized to give
any information or represent anything not contained in this prospectus, any accompanying prospectus supplement and any applicable
pricing supplement. We have not authorized any dealer, salesman or other person to give any information or to make any representation
other than those contained or incorporated by reference in this prospectus, any applicable prospectus supplement or any related
free writing prospectus that we may authorize to be provided to you. You must not rely upon any information or representation
not contained or incorporated by reference in this prospectus, the accompanying prospectus supplement or related free writing
prospectus. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others
may give you. We are only offering the securities in places where sales of those securities are permitted.
This
prospectus, the accompanying supplement to this prospectus and any related free writing prospectus, if any, do not constitute
an offer to sell or the solicitation of an offer to buy any securities other than the registered securities to which they relate,
nor do this prospectus, the accompanying supplement to this prospectus or any related free writing prospectus, if any, constitute
an offer to sell or the solicitation of an offer to buy securities in any jurisdiction to any person to whom it is unlawful to
make such offer or solicitation in such jurisdiction. You should not assume that the information contained in this prospectus,
any applicable prospectus supplement or any related free writing prospectus is accurate on any date subsequent to the date set
forth on the front of the document or that any information we have incorporated by reference therein is correct on any date subsequent
to the date of the document incorporated by reference, even though this prospectus, any applicable prospectus supplement or any
related free writing prospectus is delivered or the applicable securities are sold on a later date.
As
used in this prospectus, “Zedge, Inc.,” “Zedge,” “the Company,” “we,” “our,”
“ours,” and “us” refer to Zedge, Inc. and its consolidated subsidiaries.
SUMMARY
This
summary highlights selected information from this prospectus and the documents incorporated herein by reference and does not contain
all of the information that you need to consider in making your investment decision. You should carefully read the entire prospectus,
including the risks of investing in our securities discussed under “Risk Factors” beginning on page 5 of this
prospectus, the information incorporated herein by reference, including our financial statements, and the exhibits to the registration
statement of which this prospectus is a part. All references in this prospectus to “we,” “us,” “our,”
“Zedge,” “Zedge, Inc.”, the “Company” and similar designations refer to Zedge, Inc. and its
consolidated subsidiaries, unless otherwise indicated or as the context otherwise requires.
Our
Business
Zedge
is a leading app developer focusing on the mobile phone personalization and entertainment verticals. With approximately 450 million
organic installs and 32 million monthly active users as of the end of our most recent fiscal year, “Zedge Wallpapers and
Ringtones” is all about identity. We are the hub for self-expression used by millions for mobile phone personalization,
social content and fandom art including wallpapers, video wallpapers, ringtones, notification sounds on Android and wallpapers
video wallpapers, ringtones and app icons on iOS. Our app enables consumers to showcase who they are, what they like, and amplify
their persona. Zedge Premium, our marketplace, enables content creators, ranging the gamut from world class celebrities to emerging
artists, to display their talent and sell their content to our users. We secure our content from amateur and professional artists,
and also from emerging and major brands. We provide artists with the capability to easily launch a virtual storefront in our Zedge
app where they can market and sell their content to our user base. In fiscal 2020, we expanded to the entertainment vertical and
introduced a new entertainment app called “Shortz – Chat Stories by Zedge” that offers serialized, short-form
fiction stories as a beta. Our apps run on our flexible and proven state-of-the-art digital publishing platform.
Our
Zedge app has been installed approximately 450 million times, and at July 31, 2020, boasted approximately 32 million monthly active
users, or MAU. MAU is a key performance indicator that captures the number of unique users that used our Zedge app during the
previous 30-day of the relevant period. Our Zedge app has consistently ranked as one of the most popular free apps in the Google
Play store in the United States. Historically, we have not made a material investment in paid user acquisition for our Zedge app.
Our
Zedge app’s success stems from its ability to meet consumer demand for a rich and diverse catalogue of both long-tail and
popular content in a fun, intuitive and user-friendly fashion that aligns with their interest in expressing their essence in a
bespoke manner, to offer reliable search and discovery capabilities and to make relevant content recommendations to our users.
To this end, we invest heavily in both product design and development and the underlying technology required to satisfy both our
Zedge app’s users’ and content contributors’ expectations. Our Zedge app utilizes both user-generated and licensed,
third-party content to achieve these goals.
In
March 2018, we launched Zedge Premium, a marketplace within our Zedge app where professional creators and brands market, distribute
and sell their digital content to our consumers. Since launching Zedge Premium, we have made and continue making material investments
in optimizing our Zedge app’s homepage design in order to maximize exposure to premium content with the goal of driving
sales. Over time, we expect that Zedge Premium will contribute to a virtuous cycle whereby it drives new consumers into our Zedge
app resulting in more artist payouts, which in turn makes the platform more attractive for artists and brands looking to expand
their reach and increase their income.
In
January 2019, we started offering freemium Zedge app users the ability to convert into paying subscribers for amongst other things
the ability to remove unsolicited advertisements from our Zedge app. As of July 31, 2020, we had more than 504,000 active paid
subscribers. In fiscal 2021, we hope to further optimize the offer based on user type, geography and price point as well as introduce
new subscription enhancements like content bundles and rewards.
In
December 2019, we completed the beta launch of ‘Shortz’ our new entertainment app offering serialized, short-form
fiction delivered in a text-message format across both Android and iOS, focusing on users in the United States, the United Kingdom
and Canada and it is now available globally.
Over
the past several years, our Zedge app has experienced a continuing decline in its MAU as well as a shift in the regional customer
make-up with MAU in emerging markets representing an increasing portion of our user base. As of July 31, 2020, users in emerging
markets represented 70% of our MAU compared to 65% a year prior. This shift has negatively impacted revenue because advertising
rates in emerging markets are materially lower than in well-developed markets. In the fourth quarter of fiscal 2020, users in
emerging markets grew by 1.4% while users in well-developed economies declined 18.6% when compared to the same period in fiscal
2019. As of July 31, 2020, approximately 50% of our Zedge app’s user base was located in North America and Europe (including
Eastern Europe) with a split of 26% and 24%, respectively, compared with 54% as of July 31, 2019 with 27% in each of North America
and Europe (including Eastern Europe).
MAU
growth is tightly coupled with securing new users. Historically, our relatively high ranking in the Google Play store has been
one of the primary drivers for securing new users. Although still an important factor, we now also dedicate resources to growth
initiatives, both organic and paid. With time, we believe that we can change our growth dynamic in well-developed markets. Aside
from targeted growth initiatives, we need to continually improve the core user experience, test different mechanisms and content
verticals that may spur growth and capitalize on the role that Zedge Premium artists can have on driving new users into the Zedge
platform.
The
COVID-19 pandemic has negatively impacted our Zedge app’s new user growth. We believe that new smartphone sales have suffered
as a result of retail business closures, negatively impacting new user growth, especially in well-developed markets. Assuming
the retail business rebounds from the COVID-19 pandemic, we expect that our Zedge app’s new user growth will also recover
and we will benefit accordingly.
During
the quarter and fiscal year ended July 31, 2020, we generated approximately 73% and 78%, respectively, of our revenues from selling
our Zedge app’s advertising inventory to advertising networks, advertising exchanges, and direct arrangements with advertisers.
Advertising networks and advertising exchanges are third-party technology platforms that facilitate the buying and selling of
media advertising inventory from multiple ad networks. The price of advertising inventory is fixed on an advertising network whereas
the price for inventory is determined through real-time bidding on an advertising exchange. Advertisers are attracted to our Zedge
app because of its sizable user base.
In
our Zedge Premium marketplace, the content owner sets the price and the user can purchase the content by paying for it with Zedge
Credits, our closed virtual currency. A user can earn Zedge Credits when taking specific actions such as watching a rewarded video.
Alternatively, users can buy Zedge Credits via an in-app purchase. If a user purchases Zedge Credits, Google Play or App Store
keeps 30% of the purchase price with the remaining 70% being paid to us. When a user purchases Zedge Premium content, the artist
or brand receives 70% of the actual value of the Zedge Credits used to buy the content item as a royalty and we retain the remaining
30% as our fee, which we recognize as revenue. As Zedge Premium matures and expands, we expect to also diversify our revenue source
mix.
In
January 2019, we started offering a subscription-based product to Android users of our Zedge app in which the payment of a monthly
or annual fee would remove unsolicited ads when using our Zedge app. During the first 12 months after a customer’s sign
up for the subscription-based product, Google retains up to 30% as a fee, which decreases to 15% from month 13 and beyond. As
of July 31, 2020, we had more than 504,000 active paid subscribers, 89% of which had subscribed on an annual basis. During fiscal
2020, subscriptions have generated approximately $2.4 million in gross revenue.
Prior
to May 31, 2019, we generated service revenue from managing and optimizing the advertising inventory of a third-party mobile application
publisher, as well as overseeing the billing, collections and reporting related to advertising for this publisher. The agreement
with this mobile application publisher was terminated effective May 31, 2019, and we are no longer providing these services.
During
fiscal 2020, we generated revenues of $9.5 million and a loss from operations of $0.4 million, compared to revenues of $8.8 million
and a loss from operations of $2.9 million in fiscal 2019.
During
fiscal 2020, advertisements from MoPub (owned by Twitter) represented 28.8% of our revenue, advertisements from Google represented
26.1% of our revenues and advertisements from Facebook represented 7.4% of our revenues, as compared with 28.1%, 27.9% and 5.8%,
respectively, during fiscal 2019. In addition, advertisements from Ogury contributed 6.5% of our revenues during fiscal 2020,
as compared with 9.8% during fiscal 2019.
Our
Technology
Our
Zedge app is powered by a scalable distributed platform that is comprised of both open source and proprietary technologies centered
on content management and discovery, web and app development, data mining and analytics, deep learning, mobile content/device
compatibility, advertising and reporting. We have built a robust platform that allows us to ideate, test, and launch where warranted
by the outcome and we have embraced machine learning throughout our technology stack in order to improve content recommendations
and relevancy. From an end user’s perspective, our Zedge app’s platform minimizes response latency while maximizing
content relevancy and discoverability. We optimize our platform by utilizing systems, algorithms and heuristics that organize
our Zedge app’s content based upon real user data and that renders the content in a relevant fashion. Our infrastructure
provides a fully redundant production environment in a cloud-hosted, virtual-server environment.
Our
History
In
2003, Tom Arnoy, Kenneth Sundnes and Paul Shaw launched a consumer website at www.zedge.net that people used to upload and download
ringtones.
In
December 2006, IDT Corporation acquired 90% of Zedge. Zedge Holdings, Inc. was incorporated in Delaware in 2008, and our name
was changed to Zedge, Inc. in 2016.
In
2009, we introduced the Android version of our Zedge app. The Zedge app provided ease-of-use by negating the need for customers
to first download a ringtone or wallpaper to their computer and then upload that content to their mobile phone.
We
launched the iOS version of our Zedge app in 2013, followed by launch of the Windows Mobile Zedge app in 2014.
During
2014 and 2015, our Zedge app introduced app icons, social sharing features and marketing automation capabilities, and expanded
the number of languages supported.
In
2016, IDT Corporation spun off our stock to its stockholders, and our Class B Common Stock was listed on the NYSE American with
the ticker symbol “ZDGE”.
In
March 2018, we completed the launch of Zedge Premium, our marketplace that is part of the Zedge app where artists and brands can
market, distribute and sell to our users their digital content, including wallpapers, ringtones, video wallpapers and stickers.
In
January 2019, we started testing a subscription-based product on the Android version of our Zedge app, whereby users could prepay
a monthly or yearly fee to remove unsolicited ads when using our Zedge app. As of July 31, 2020, we had more than 504,000 active
paid subscribers.
In
December 2019, we completed the beta launch of ‘Shortz’, our new entertainment app offering serialized, short-form
fiction delivered in a text-message format across both Android and iOS, focusing on users in the United States, the United Kingdom
and Canada and it is now available globally.
In
August 2020, Jonathan Reich was promoted to Chief Executive Officer and Yi Tsai was promoted to Chief Financial Officer.
Securities
We May Offer
We
may offer shares of our Class B common stock and warrants to purchase Class B common stock from time to time under this prospectus,
together with any applicable prospectus supplement and related free writing prospectus, at prices and on terms to be determined
by market conditions at the time of offering. This prospectus provides you with a general description of the securities we may
offer. Each time we offer a type or series of securities, we will provide a prospectus supplement that will describe the specific
amounts, prices and other important terms of the securities, including, to the extent applicable:
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designation or classification;
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aggregate principal amount or aggregate offering
price;
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maturity, if applicable;
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conversion
or exchange prices or rates, if any, and, if applicable, any provisions for changes to or adjustments in the conversion or exchange
prices or rates and in the securities or other property receivable upon conversion or exchange;
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restrictive covenants, if any;
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voting or other rights, if any; and
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important United States federal income tax considerations.
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A
prospectus supplement and any related free writing prospectus that we may authorize to be provided to you may also add, update
or change information contained in this prospectus or in documents we have incorporated by reference. However, no prospectus supplement
or free writing prospectus will offer a security that is not registered and described in this prospectus at the time of the effectiveness
of the registration statement of which this prospectus is a part.
We
may sell the securities directly to or through underwriters, dealers or agents. We, and our underwriters or agents, reserve the
right to accept or reject all or part of any proposed purchase of securities. If we do offer securities through underwriters or
agents, we will include in the applicable prospectus supplement:
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the names of those underwriters or agents;
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applicable fees, discounts and commissions to
be paid to them;
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details regarding over-allotment options, if
any; and
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the net proceeds to us.
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Class
B Common Stock
We
may offer shares of our Class B common stock, par value $0.01 per share, either alone or underlying other registered securities
convertible into or exercisable for our Class B common stock. Holders of our Class B common stock are entitled to receive dividends
as our board of directors may declare from time to time out of legally available funds, subject to the preferential rights of
the holders of any shares of our preferred stock that are outstanding or that we may issue in the future. Currently, we do not
have any issued and outstanding preferred stock. Each holder of our Class B common stock is entitled to one tenth of one vote
per share. In this prospectus, we provide a general description of, among other things, our dividend policy and the rights and
restrictions that apply to holders of our Class B common stock. Our Class B common stock is described in greater detail in this
prospectus under “Description of Capital Stock — Class B Common Stock.”
Warrants
We
may from time to time offer warrants for the purchase of our Class B common stock in one or more series. We may issue warrants
independently or together with Class B common stock, and the warrants may be attached to or separate from those securities.
The
warrants may be evidenced by warrant certificates issued under one or more warrant agreements, which are contracts between us
and an agent for the holders of the warrants. In this prospectus, we have summarized certain general features of the warrants
under “Description of Warrants.” We urge you, however, to read the prospectus supplements and any free writing prospectus
that we may authorize to be provided to you related to the series of warrants being offered, as well as the complete warrant agreements
and warrant certificates that contain the terms of the warrants. Specific warrant agreements will contain additional important
terms and provisions and will be incorporated by reference as an exhibit to the registration statement which includes this prospectus.
RISK FACTORS
Investment in our securities involves risks. Prior to making
a decision about investing in our securities, you should consider carefully all of the information included and incorporated by
reference or deemed to be incorporated by reference in this prospectus or the applicable prospectus supplement, including the risk
factors incorporated by reference herein from our Form 10-K for the fiscal year ended July 31, 2020, as updated by annual, quarterly
and other reports and documents we file with the Securities and Exchange Commission (the “SEC”) since July 31, 2020,
including after the date of this prospectus and that are incorporated by reference herein or in the applicable prospectus supplement.
Each of these risk factors could have a material adverse effect on our business, results of operations, financial position or cash
flows, which may result in the loss of all or part of your investment.
FORWARD-LOOKING STATEMENTS
This prospectus and the documents incorporated herein by reference
contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements
are based on our management’s current beliefs, expectations and assumptions about future events, conditions and results and
on information currently available to us. Discussions containing these forward-looking statements may be found, among other places,
in the Sections entitled “Business,” “Risk Factors” and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” incorporated by reference from our most recent Annual Report on Form 10-K
and in our Quarterly Reports on Form 10-Q, as well as any amendments thereto, filed with the SEC.
All statements, other than statements of historical fact, included
or incorporated herein regarding our strategy, future operations, financial position, future revenues, projected costs, plans,
prospects and objectives are forward-looking statements. Words such as “expect,” “anticipate,” “intend,”
“plan,” “believe,” “seek,” “estimate,” “think,” “may,”
“could,” “will,” “would,” “should,” “continue,” “potential,”
“likely,” “opportunity” and similar expressions or variations of such words are intended to identify forward-looking
statements, but are not the exclusive means of identifying forward-looking statements. Additionally, statements concerning future
matters such as our expectations of business and market conditions, development and commercialization of new products, enhancements
of existing products or technologies, and other statements regarding matters that are not historical are forward-looking statements.
Such statements are based on currently available operating, financial and competitive information and are subject to various risks,
uncertainties and assumptions that could cause actual results to differ materially from those anticipated or implied in our forward-looking
statements due to a number of factors including, but not limited to, those set forth above under the section entitled “Risk
Factors” in this prospectus and any accompanying prospectus supplement. Given these risks, uncertainties and other factors,
many of which are beyond our control, you should not place undue reliance on these forward-looking statements.
Except as required by law, we assume no obligation to update
these forward-looking statements publicly, or to revise any forward-looking statements to reflect events or developments occurring
after the date of this prospectus, even if new information becomes available in the future.
USE OF PROCEEDS
Except as described in any applicable prospectus supplement
and in any free writing prospectuses in connection with a specific offering, we currently intend to use the net proceeds from the
sale of the securities offered hereby for general corporate purposes, which may include, among other things, working capital, capital
expenditures, other corporate expenses and acquisitions of complementary products, technologies or businesses.
We have not determined the amount of net proceeds to be used
specifically for the foregoing purposes. As a result, our management will have broad discretion in the allocation of the net proceeds
and investors will be relying on the judgment of our management regarding the application of the proceeds of any sale of the securities.
Pending these uses, we intend to invest the net proceeds in investment-grade, short-term, interest-bearing securities.
DESCRIPTION OF SECURITIES WE MAY OFFER
We may offer shares of our Class B common stock and warrants
to purchase Class B common stock from time to time under this prospectus, together with any applicable prospectus supplement and
related free writing prospectus, at prices and on terms to be determined by market conditions at the time of offering. This prospectus
provides you with a general description of the securities we may offer. Each time we offer a type or series of securities, we will
provide a prospectus supplement that will describe the specific amounts, prices and other important terms of the securities. We
may offer up to $20,000,000 of securities under this prospectus.
DESCRIPTION OF OUR CAPITAL STOCK
Our authorized capital stock consists of (i) 2.6 million shares
of Class A common stock, (ii) 40 million shares of Class B common stock, and (iii) 2.4 million shares of Preferred Stock.
The following statements set forth the material terms of our
classes of authorized stock; however, reference is made to the more detailed provisions of, and such statements are qualified in
their entirety by reference to, our Third Amended Certificate of Incorporation.
Class A Common Stock
Holders of shares of our Class A common stock are entitled to
three votes for each share on all matters to be voted on by the stockholders. Holders of our Class A common stock are entitled
to share ratably in dividends, if any, as may be declared from time to time by the Board of Directors in its discretion from funds
legally available therefor. Each share of our Class A common stock may be converted, at any time and at the option of the holder,
and automatically converts upon transfers to unaffiliated parties, into one fully paid and non-assessable share of our Class B
common stock.
As of November 24, 2020, there were 524,775 shares of our Class
A common stock outstanding.
Class B Common Stock
Holders
of shares of our Class B common stock are entitled to one tenth of one vote for each share on all matters to be voted on by the
stockholders. Holders of our Class B common stock are entitled to share ratably in dividends, if any, as may be declared from time
to time by the Board of Directors in its discretion from funds legally available therefor. Our Class B common stock is listed
on the NYSE American stock exchange
As of November
24, 2020, there were 11,945,861 shares of our Class B common stock outstanding.
Preferred Stock
The Board of Directors has the authority to fix the price, rights,
preferences, privileges and restrictions, including voting rights, of those shares without any further vote or action by the stockholders.
There are currently no shares of our preferred stock outstanding.
Anti-Takeover Effects of Our Charter and By-Laws
Some provisions of Delaware law and our Certificate of Incorporation
and By-Laws could make the following more difficult:
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acquisition of us by means of a tender offer;
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acquisition of us by means of a proxy contest or otherwise;
or
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removal of our incumbent officers and directors.
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These provisions, summarized below, are expected to discourage
coercive takeover practices and inadequate takeover bids. These provisions also are designed to encourage persons seeking to acquire
control of us to first negotiate with our Board of Directors. We believe that the benefits of increased protection give us the
potential ability to negotiate with the proponent of an unfriendly or unsolicited proposal to acquire or restructure us and outweigh
the disadvantages of discouraging those proposals because negotiation of them could result in an improvement of their terms.
Certificate of Incorporation; By-Laws
Our Certificate of Incorporation and By-Laws contain provisions
that could make more difficult the acquisition of us by means of a tender offer, a proxy contest or otherwise. These provisions
are summarized below.
Undesignated Preferred Stock.
The authorization of our undesignated preferred stock makes it possible for our Board of Directors to issue our
preferred stock with voting or other rights or preferences that could impede the success of any attempt to change control of
us. These and other provisions may have the effect of deferring hostile takeovers or delaying changes of control of our
management.
Size of Board and Vacancies. Our
Certificate of Incorporation provides that the number of directors on our Board of Directors will be fixed exclusively by our
Board of Directors. Newly created directorships resulting from any increase in our authorized number of directors or
any vacancies in our Board of Directors resulting from death, resignation, retirement, disqualification, removal from office
or other cause will be filled solely by the vote of our remaining directors in office.
Stockholder Meetings. Under
our By-Laws, only our (i) Chief Executive Officer, (ii) President or (iii) Corporate Secretary may call special meetings of
our stockholders.
Transfer Agent and Registrar
The transfer agent and registrar for our capital stock is American
Stock Transfer & Trust, LLC.
DESCRIPTION OF WARRANTS
The following description, together with the additional information
we may include in any applicable prospectus supplements and free writing prospectuses, summarizes the material terms and provisions
of the warrants that we may offer under this prospectus, which may consist of warrants to purchase Class B common stock and may
be issued in one or more series. Warrants may be offered independently or together with Class B common stock offered by any prospectus
supplement, and may be attached to or separate from those securities. While the terms we have summarized below will apply generally
to any warrants that we may offer under this prospectus, we will describe the particular terms of any series of warrants that we
may offer in more detail in the applicable prospectus supplement and any applicable free writing prospectus. The terms of any warrants
offered under a prospectus supplement may differ from the terms described below. However, no prospectus supplement will fundamentally
change the terms that are set forth in this prospectus or offer a security that is not registered and described in this prospectus
at the time of its effectiveness.
We will issue the warrants under a warrant agreement that we
will enter into with a warrant agent to be selected by us. The warrant agent will act solely as an agent of ours in connection
with the warrants and will not act as an agent for the holders or beneficial owners of the warrants. We will file as exhibits to
the registration statement of which this prospectus is a part, or will incorporate by reference from a current report on Form 8-K
that we file with the SEC, the form of warrant agreement, including a form of warrant certificate, that describes the terms of
the particular series of warrants we are offering before the issuance of the related series of warrants. The following summaries
of material provisions of the warrants and the warrant agreements are subject to, and qualified in their entirety by reference
to, all the provisions of the warrant agreement and warrant certificate applicable to a particular series of warrants. We urge
you to read the applicable prospectus supplement and any applicable free writing prospectus related to the particular series of
warrants that we sell under this prospectus, as well as the complete warrant agreements and warrant certificates that contain the
terms of the warrants.
General
We will describe in the applicable prospectus supplement the
terms relating to a series of warrants, including:
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the offering price and aggregate number of warrants offered;
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the currency for which the warrants may be purchased;
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if applicable, the designation and
terms of the securities with which the warrants are issued and the number of warrants issued with each such security or each principal
amount of such security;
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if applicable, the date on and after
which the warrants and the related securities will be separately transferable;
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the number of shares of Class B common
stock purchasable upon the exercise of one warrant and the price at which these shares may be purchased upon such exercise;
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the effect of any merger, consolidation,
sale or other disposition of our business on the warrant agreements and the warrants;
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the terms of any rights to redeem or call the warrants;
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any provisions for changes to or
adjustments in the exercise price or number of securities issuable upon exercise of the warrants;
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the dates on which the right to exercise the warrants will commence and expire;
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the manner in which the warrant agreements and warrants may be modified;
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United States federal income tax consequences of holding or exercising the warrants; and
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any other specific terms, preferences, rights or limitations of or restrictions on the warrants.
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Before exercising their warrants, holders of warrants will not
have any of the rights of holders of the Class B common stock purchasable upon such exercise, including the right to receive dividends,
if any, or payments upon our liquidation, dissolution or winding up or to exercise voting rights, if any.
Exercise of Warrants
Each warrant will entitle the holder to purchase the securities
that we specify in the applicable prospectus supplement at the exercise price that we describe in the applicable prospectus supplement.
Unless we otherwise specify in the applicable prospectus supplement, holders of the warrants may exercise the warrants at any time
up to the specified time on the expiration date that we set forth in the applicable prospectus supplement. After the close of business
on the expiration date, unexercised warrants will become void.
Holders of the warrants may exercise the warrants by delivering
the warrant certificate representing the warrants to be exercised together with specified information, and paying the required
amount to the warrant agent in immediately available funds, as provided in the applicable prospectus supplement. We will set forth
on the reverse side of the warrant certificate and in the applicable prospectus supplement the information that the holder of the
warrant will be required to deliver to the warrant agent.
Upon receipt of the required payment and the warrant certificate
properly completed and duly executed at the corporate trust office of the warrant agent or any other office indicated in the applicable
prospectus supplement, we will issue and deliver the securities purchasable upon such exercise. If fewer than all of the warrants
represented by the warrant certificate are exercised, then we will issue a new warrant certificate for the remaining amount of
warrants. If we so indicate in the applicable prospectus supplement, holders of the warrants may surrender securities as all or
part of the exercise price for warrants.
Enforceability of Rights by Holders of Warrants
Each warrant agent will act solely as our agent under the applicable
warrant agreement and will not assume any obligation or relationship of agency or trust with any holder of any warrant. A single
bank or trust company may act as warrant agent for more than one issue of warrants. A warrant agent will have no duty or responsibility
in case of any default by us under the applicable warrant agreement or warrant, including any duty or responsibility to initiate
any proceedings at law or otherwise, or to make any demand upon us. Any holder of a warrant may, without the consent of the related
warrant agent or the holder of any other warrant, enforce by appropriate legal action its right to exercise, and receive the securities
purchasable upon exercise of, its warrants.
LEGAL OWNERSHIP OF SECURITIES
We can issue securities in registered form or in the form of
one or more global securities. We describe global securities in greater detail below. We refer to those persons who have securities
registered in their own names on the books that we or any applicable trustee or depositary or warrant agent maintain for this purpose
as the “holders” of those securities. These persons are the legal holders of the securities. We refer to those persons
who, indirectly through others, own beneficial interests in securities that are not registered in their own names, as “indirect
holders” of those securities. As we discuss below, indirect holders are not legal holders, and investors in securities issued
in book-entry form or in street name will be indirect holders.
Book-Entry Holders
We may issue securities in book-entry form only, as we will
specify in the applicable prospectus supplement. This means securities may be represented by one or more global securities registered
in the name of a financial institution that holds them as depositary on behalf of other financial institutions that participate
in the depositary’s book-entry system. These participating institutions, which are referred to as participants, in turn,
hold beneficial interests in the securities on behalf of themselves or their customers.
Only the person in whose name a security is registered is recognized
as the holder of that security. Global securities will be registered in the name of the depositary or its participants. Consequently,
for global securities, we will recognize only the depositary as the holder of the securities, and we will make all payments on
the securities to the depositary. The depositary passes along the payments it receives to its participants, which in turn pass
the payments along to their customers who are the beneficial owners. The depositary and its participants do so under agreements
they have made with one another or with their customers; they are not obligated to do so under the terms of the securities.
As a result, investors in a global security will not own securities
directly. Instead, they will own beneficial interests in a global security, through a bank, broker or other financial institution
that participates in the depositary’s book-entry system or holds an interest through a participant. As long as the securities
are issued in global form, investors will be indirect holders, and not legal holders, of the securities.
Street Name Holders
We may terminate a global security or issue securities that
are not issued in global form. In these cases, investors may choose to hold their securities in their own names or in “street
name.” Securities held by an investor in street name would be registered in the name of a bank, broker or other financial
institution that the investor chooses, and the investor would hold only a beneficial interest in those securities through an account
he or she maintains at that institution.
For securities held in street name, we or any applicable trustee
or depositary will recognize only the intermediary banks, brokers and other financial institutions in whose names the securities
are registered as the holders of those securities, and we or any such trustee or depositary will make all payments on those securities
to them. These institutions pass along the payments they receive to their customers who are the beneficial owners, but only because
they agree to do so in their customer agreements or because they are legally required to do so. Investors who hold securities in
street name will be indirect holders, not legal holders, of those securities.
Legal Holders
Our obligations, as well as the obligations of any applicable
trustee or third party employed by us or a trustee, run only to the legal holders of the securities. We do not have obligations
to investors who hold beneficial interests in global securities, in street name or by any other indirect means. This will be the
case whether an investor chooses to be an indirect holder of a security or has no choice because we are issuing the securities
only in global form.
For example, once we make a payment or give a notice to the
holder, we have no further responsibility for the payment or notice even if that holder is required, under agreements with its
participants or customers or by law, to pass it along to the indirect holders but does not do so. Similarly, we may want to obtain
the approval of the holders to amend an indenture, to relieve us of the consequences of a default or of our obligation to comply
with a particular provision of an indenture, or for other purposes. In such an event, we would seek approval only from the legal
holders, and not the indirect holders, of the securities. Whether and how the legal holders contact the indirect holders is up
to the legal holders.
Special Considerations for Indirect Holders
If you hold securities through a bank, broker or other financial
institution, either in book-entry form because the securities are represented by one or more global securities or in street name,
you should check with your own institution to find out:
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how it handles securities payments and notices;
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whether it imposes fees or charges;
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how it would handle a request for the holders’ consent, if ever required;
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whether and how you can instruct
it to send you securities registered in your own name so you can be a legal holder, if that is permitted in the future;
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how it would exercise rights under
the securities if there were a default or other event triggering the need for holders to act to protect their interests; and
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if the securities are in book-entry
form, how the depositary’s rules and procedures will affect these matters.
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Global Securities
A global security is a security that represents one or any other
number of individual securities held by a depositary. Generally, all securities represented by the same global securities will
have the same terms.
Each security issued in book-entry form will be represented
by a global security that we issue to, deposit with and register in the name of a financial institution or its nominee that we
select. The financial institution that we select for this purpose is called the depositary. Unless we specify otherwise in the
applicable prospectus supplement, The Depository Trust Company, New York, New York, known as DTC, will be the depositary for all
securities issued in book-entry form.
A global security may not be transferred to or registered in
the name of anyone other than the depositary, its nominee or a successor depositary, unless special termination situations arise.
We describe those situations below under “—Special Situations When A Global Security Will Be Terminated.” As
a result of these arrangements, the depositary, or its nominee, will be the sole registered owner and legal holder of all securities
represented by a global security, and investors will be permitted to own only beneficial interests in a global security. Beneficial
interests must be held by means of an account with a broker, bank or other financial institution that in turn has an account with
the depositary or with another institution that does. Thus, an investor whose security is represented by a global security will
not be a legal holder of the security, but only an indirect holder of a beneficial interest in the global security.
If the prospectus supplement for a particular security indicates
that the security will be issued as a global security, then the security will be represented by a global security at all times
unless and until the global security is terminated. If termination occurs, we may issue the securities through another book-entry
clearing system or decide that the securities may no longer be held through any book-entry clearing system.
Special Considerations For Global Securities
As an indirect holder, an investor’s rights relating to
a global security will be governed by the account rules of the investor’s financial institution and of the depositary, as
well as general laws relating to securities transfers. We do not recognize an indirect holder as a holder of securities and instead
deal only with the depositary that holds the global security.
If securities are issued only as global securities, an investor
should be aware of the following:
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an investor cannot cause the securities
to be registered in his or her name, and cannot obtain non-global certificates for his or her interest in the securities, except
in the special situations we describe below;
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an investor will be an indirect
holder and must look to his or her own bank or broker for payments on the securities and protection of his or her legal rights
relating to the securities, as we describe above;
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an investor may not be able to
sell interests in the securities to some insurance companies and to other institutions that are required by law to own their securities
in non-book-entry form;
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an investor may not be able to
pledge his or her interest in the global security in circumstances where certificates representing the securities must be delivered
to the lender or other beneficiary of the pledge in order for the pledge to be effective;
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the depositary’s policies,
which may change from time to time, will govern payments, transfers, exchanges and other matters relating to an investor’s
interest in the global security. We and any applicable trustee have no responsibility for any aspect of the depositary’s
actions or for its records of ownership interests in the global security. We and the trustee also do not supervise the depositary
in any way;
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the depositary may, and we understand
that DTC will, require that those who purchase and sell interests in the global security within its book-entry system use immediately
available funds, and your broker or bank may require you to do so as well; and
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financial institutions that participate
in the depositary’s book-entry system, and through which an investor holds its interest in the global security, may also
have their own policies affecting payments, notices and other matters relating to the securities. There may be more than one financial
intermediary in the chain of ownership for an investor. We do not monitor and are not responsible for the actions of any of those
intermediaries.
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Special Situations When A Global Security Will Be Terminated
In a few special situations described below, a global security
will terminate and interests in it will be exchanged for physical certificates representing those interests. After that exchange,
the choice of whether to hold securities directly or in street name will be up to the investor. Investors must consult their own
banks or brokers to find out how to have their interests in securities transferred to their own names, so that they will be direct
holders. We have described the rights of holders and street name investors above.
A global security will terminate when the following special
situations occur:
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if the depositary notifies us
that it is unwilling, unable or no longer qualified to continue as depositary for that global security and we do not appoint another
institution to act as depositary within 90 days;
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if we notify any applicable trustee that we wish to terminate that global security; or
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if an event of default has occurred
with regard to securities represented by that global security and has not been cured or waived.
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The applicable prospectus supplement may also list additional
situations for terminating a global security that would apply only to the particular series of securities covered by the prospectus
supplement. When a global security terminates, the depositary, and neither we nor any applicable trustee, is responsible for deciding
the names of the institutions that will be the initial direct holders.
PLAN OF DISTRIBUTION
We may sell the securities being offered hereby in one or more
of the following ways from time to time:
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through agents to the public or to investors;
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to underwriters for resale to the public or to investors;
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in “at the market”
offerings, within the meaning of Rule 415(a)(4) of the Securities Act, to or through a market maker or into an existing trading
market on an exchange or otherwise;
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directly to investors; or
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through a combination of any of these methods of sale.
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We will set forth in a prospectus supplement the terms of the
particular offering of securities, including:
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the name or names of any agents or underwriters;
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the purchase price of the securities being offered and the proceeds we will receive from the sale;
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any over-allotment options under which underwriters may purchase additional securities from us;
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any agency fees or underwriting
discounts and other items constituting agents’ or underwriters’ compensation;
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any initial public offering price;
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any discounts or concessions allowed or re-allowed or paid to dealers; and
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any securities exchanges or markets on which such securities may be listed.
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Agents
We may designate agents who agree to use their reasonable efforts
to solicit purchases of our securities for the period of their appointment or to sell our securities on a continuing basis.
Underwriters
If we use underwriters for a sale of securities, the underwriters
will acquire the securities for their own account. The underwriters may resell the securities in one or more transactions, including
negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. The obligations
of the underwriters to purchase the securities will be subject to the conditions set forth in the applicable underwriting agreement.
The underwriters will be obligated to purchase all the securities of the series offered if they purchase any of the securities
of that series. We may change from time to time any initial public offering price and any discounts or concessions the underwriters
allow or reallow or pay to dealers. We may use underwriters with whom we have a material relationship. We will describe the nature
of any such relationship in any prospectus supplement naming any such underwriter. Only underwriters we name in the prospectus
supplement are underwriters of the securities offered by the prospectus supplement.
Direct Sales
We may also sell securities directly to one or more purchasers
without using underwriters or agents. Underwriters, dealers and agents that participate in the distribution of the securities may
be underwriters as defined in the Securities Act, and any discounts or commissions they receive from us and any profit on their
resale of the securities may be treated as underwriting discounts and commissions under the Securities Act. We will identify in
the applicable prospectus supplement any underwriters, dealers or agents and will describe their compensation. We may have agreements
with the underwriters, dealers and agents to indemnify them against specified civil liabilities, including liabilities under the
Securities Act. Underwriters, dealers and agents may engage in transactions with or perform services for us in the ordinary course
of their businesses.
Trading Markets and Listing of Securities
Unless otherwise specified in the applicable prospectus supplement,
each class or series of securities will be a new issue with no established trading market, other than our Class B common stock,
which is listed on the NYSE American stock market. We may elect to list any other securities or class or series of securities on
any exchange or market, but we are not obligated to do so. Any listing may be cancelled at any time. It is possible that one or
more underwriters may make a market in a class or series of securities, but the underwriters will not be obligated to do so and
may discontinue any market making at any time without notice. We cannot give any assurance as to the liquidity of the trading market
for any of the securities.
Stabilization Activities
Any underwriter may engage in overallotment, stabilizing transactions,
short covering transactions and penalty bids in accordance with Regulation M under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”). Overallotment involves sales in excess of the offering size, which create a short position. Stabilizing
transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum.
Short covering transactions involve purchases of the securities in the open market after the distribution is completed to cover
short positions. Penalty bids permit the underwriters to reclaim a selling concession from a dealer when the securities originally
sold by the dealer are purchased in a covering transaction to cover short positions. Those activities may cause the price of the
securities to be higher than it would otherwise be. If commenced, the underwriters may discontinue any of these activities at any
time.
Passive Market Making
Any underwriters who are qualified may engage in passive market
making transactions in in accordance with Rule 103 of Regulation M, during the business day prior to the pricing of the offering,
before the commencement of offers or sales of the securities. Passive market makers must comply with applicable volume and price
limitations and must be identified as passive market makers. In general, a passive market maker must display its bid at a price
not in excess of the highest independent bid for such security. If all independent bids are lowered below the passive market maker’s
bid, however, the passive market maker’s bid must then be lowered when certain purchase limits are exceeded.
LEGAL MATTERS
Schwell Wimpfheimer & Associates, LLP, New York, New York,
will pass for us upon the validity of the securities being offered by this prospectus and applicable prospectus supplement, and
counsel named in the applicable prospectus supplement will pass upon legal matters for any underwriters, dealers or agents.
EXPERTS
The consolidated financial statements of Zedge, Inc. appearing
in Zedge, Inc.’s Annual Report on Form 10-K for the year ended July 31, 2020, have been audited by Mayer Hoffman McCann CPAs,
the New York Practice of Mayer Hoffman McCann P.C., independent registered public accounting firm, as set forth in their report
thereon, included therein, and incorporated herein by reference. Such consolidated financial statements are incorporated herein
by reference in reliance upon such report given on the authority of such firm as experts in accounting and auditing.
WHERE YOU CAN FIND ADDITIONAL INFORMATION
We are a reporting company and file annual, quarterly and current
reports, proxy statements and other information with the SEC. We have filed with the SEC a registration statement on Form S-3 under
the Securities Act with respect to the securities we are offering under this prospectus. This prospectus does not contain all of
the information set forth in the registration statement and the exhibits to the registration statement. For further information
with respect to us and the securities 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. You may read and copy the registration statement, as well
as our reports, proxy statements and other information, at the SEC’s Public Reference Room at 100 F Street, N.E., Washington,
D.C. 20549. You can request copies of these documents by writing to the SEC and paying a fee for the copying cost. Please call
the SEC at 1-800-SEC-0330 for more information about the operation of the Public Reference Room. The SEC maintains an internet
site that contains reports, proxy and information statements, and other information regarding issuers that file electronically
with the SEC, where our SEC filings are also available. The address of the SEC’s web site is http://www.sec.gov. We maintain
a website at http://www.zedge.net. Information contained in or accessible through our website does not constitute a part of this
prospectus.
INCORPORATION OF CERTAIN INFORMATION
BY REFERENCE
The SEC allows us to “incorporate by reference”
information that we file with it into this prospectus, which means that we can disclose important information to you by referring
you to those documents. The information incorporated by reference is an important part of this prospectus. Information in this
prospectus supersedes information incorporated by reference that we filed with the SEC prior to the date of this prospectus, while
information that we file later with the SEC will automatically update and supersede the information in this prospectus. We incorporate
by reference into this registration statement and prospectus the following documents, and any future filings we will make with
the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of the initial registration statement but prior
to effectiveness of the registration statement and after the date of this prospectus but prior to the termination of the offering
of the securities covered by this prospectus (other than current reports or portions thereof furnished under Item 2.02 or
Item 7.01 of Form 8-K):
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Our Annual Report on Form 10-K for the year ended July 31, 2020, filed with the SEC on October 28, 2020;
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Our definitive proxy statement on Schedule 14A filed with the SEC on November 20, 2020; and
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The description of our Class B common stock set forth under Item 11 in the Post-Effective Amendment No. 2 to the Registrant’s Registration Statement on Form 10, filed with the SEC on June 1, 2016, including any amendment or report filed for the purpose of updating such information.
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We will provide each person, including any beneficial owner,
to whom a prospectus is delivered, a copy of any or all of the information that has been incorporated by reference into this prospectus
but not delivered with this prospectus upon written or oral request at no cost to the requester. Requests should be directed to:
Zedge, Inc., 1178 Broadway, 3rd Floor #1450, New York, New York 10001, Attn: Investor Relations, or you
may call us at (330) 577-3424.
ZEDGE,
INC.
$20,000,000
Class B Common
Stock
Warrants
PROSPECTUS
November 30, 2020
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
14. Other Expenses of Issuance and Distribution
The following statement sets forth the
estimated expenses in connection with the offering described in the registration statement (all of which will be borne by Zedge,
Inc.).
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Securities and Exchange Commission Fee
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$
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2,182
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Accountants’ Fees and Expenses
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$
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(1)
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Legal Fees and Expenses
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$
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(1)
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Printing Fees
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$
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(1)
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Miscellaneous
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$
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(1)
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TOTAL
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$
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(1)
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(1)
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These fees are calculated based on the securities offered
and the number of issuances and accordingly cannot be estimated at this time.
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15. Indemnification of Officers and Directors
Delaware law authorizes corporations to eliminate the personal
liability of directors to corporations and their stockholders for monetary damages for breach or alleged breach of the directors’
“duty of care”. While the relevant statute does not change directors’ duty of care, it enables corporations to
limit available relief to equitable remedies such as injunction or rescission. The statute has no effect on directors’ duty
of loyalty, acts or omissions not in good faith or involving intentional misconduct or knowing violations of law, illegal payment
of dividends and approval of any transaction from which a director derives an improper personal benefit.
The Company has adopted provisions in its Amended and Restated
Certificate of Incorporation, as amended, which eliminate the personal liability of its directors to the Company and its stockholders
for monetary damages for breach or alleged breach of their duty of care. The bylaws of the Company provide for indemnification
of its directors, officers, employees and agents to the fullest extent permitted by the General Corporation Law of the State of
Delaware, the Company’s state of incorporation, including those circumstances in which indemnification would otherwise be
discretionary under Delaware Law. Section 145 of the General Corporation Law of the State of Delaware permits a corporation to
indemnify any director or officer of the corporation against expenses (including attorneys’ fees), judgments, fines, and
amounts paid in settlement actually and reasonably incurred in connection with any action, suit, or proceeding brought by reason
of the fact that such person is or was a director or officer of the corporation, if such person acted in good faith and in a manner
that he or she reasonably believed to be in, or not opposed to, the best interests of the corporation, and, with respect to any
criminal action or proceeding, if he or she had no reason to believe his or her conduct was unlawful. In a derivative action, or
an action brought by or on behalf of the corporation, indemnification may be provided only for expenses actually and reasonably
incurred by any director or officer in connection with the defense or settlement of such an action or suit if such person acted
in good faith and in a manner that he or she reasonably believed to be in, or not opposed to, the best interests of the corporation,
except that no indemnification shall be provided if such person shall have been adjudged to be liable to the corporation, unless
and only to the extent that the court in which the action or suit was brought shall determine that the defendant is fairly and
reasonably entitled to indemnity for such expenses despite such adjudication of liability.
The Company may enter into indemnification agreements with certain
of its executive officers and directors, indemnifying them against certain potential liabilities that may arise as a result of
their service to the Company, and providing certain other protections. The Company also maintains insurance policies which insure
the officers and directors against certain liabilities.
16. Exhibits
EXHIBIT LIST
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(1)
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Incorporated by reference to Form 10-12G/A, filed June
1, 2016.
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(2)
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Incorporated by reference to Form 10-K, filed October
28, 2019.
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17. Undertakings
The undersigned registrant hereby undertakes:
1) To file, during any period in which
offers or sales are being made, a post-effective amendment to this registration statement: (i) to include any prospectus required
by Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected
in the form of prospectus filed with the Securities and Exchange Commission (the “Commission”), pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price
set forth in the “Calculation of Registration Fee” table in the effective registration statement; and (iii) to
include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement;
Provided, however, that paragraphs
(a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if the registration statement is on Form S-3 or Form F-3 and the information
required to be included in a post-effective amendment by those paragraphs is contained in reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 (the
“Exchange Act”), that are incorporated by reference in the registration statement, or is contained in a form of prospectus
filed pursuant to Rule 424(b) that is part of the registration statement.
2) That, for the purpose of determining
any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating
to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
3) To remove from registration by means
of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.
4) That, for the purpose of determining
liability under the Securities Act to any purchaser:
i. 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
ii. Each prospectus required
to be filed pursuant to Rule 424(b)(2), (b)(5) or (b)(7) as part of a registration statement in reliance on Rule 430B
relating to an offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of providing the information
required by Section 10(a) of the Securities Act shall be deemed to be part of and included in the registration statement
as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale
of securities in the offering described in 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 the 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.
5) That, for the purpose of determining
liability of the registrant under the Securities Act to any purchaser in the initial distribution 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 an undersigned registrant; and
iv. Any other communication that
is an offer in the offering made by the undersigned registrant to the purchaser.
6) That, for purposes of determining any
liability under the Securities Act, each filing of the registrant’s annual report pursuant to section 13(a) or section 15(d)
of the Exchange Act (and, where applicable, each filing of an employee benefit plan’s annual report pursuant to section 15(d)
of the Exchange Act) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
7) To file an application for the purpose
of determining the eligibility of the trustee to act under subsection (a) of Section 310 of the Trust Indenture Act in
accordance with the rules and regulations prescribed by the Commission under Section 305(b)(2) of the Trust Indenture
Act.
Insofar as indemnification for liabilities
arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to
the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
SIGNATURES
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-3 and has duly caused this registration statement to be signed on its behalf by the undersigned thereunto
duly authorized in the City of New York, State of New York, on November
30, 2020.
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ZEDGE, INC.
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By:
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/s/ Jonathan Reich
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Jonathan Reich
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Chief Executive Officer
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POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that
each person whose signature appears below constitutes and appoints Jonathan Reich as his true and lawful attorneys-in-fact and
agents, with full powers of substitution and resubstitution, for him and in his name, place and stead, in any and all capacities,
to sign any and all amendments to this registration statement (including post-effective amendments and any related registration
statements filed pursuant to Rule 462 and otherwise), 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 full power and authority
to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents
and purposes as he might or could do in person, hereby ratifying and confirming that said attorney-in-fact and agent, or any substitute
or resubstitute, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements
of the Securities Act of 1933, as amended, this registration statement has been signed by the following persons in the capacities
indicated and as of November 30, 2020.
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Signature
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Titles
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/s/ Michael Jonas
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Chairman of the Board
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Michael Jonas
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/s/ Howard S. Jonas
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Vice Chairman of the Board
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Howard S. Jonas
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/s/ Jonathan Reich
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Chief Executive Officer
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Jonathan Reich
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(Principal Executive Officer)
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/s/ Yi Tsai
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Chief Financial Officer
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Yi Tsai
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(Principal Financial Officer and Principal Accounting Officer)
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/s/ Mark Ghermezian
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Director
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Mark Ghermezian
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/s/ Elliot Gibber
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Director
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Elliot Gibber
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/s/ Paul Packer
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Director
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Paul Packer
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/s/ Gregory Suess
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Director
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Gregory Suess
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EXHIBIT INDEX
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(1)
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Incorporated by reference to Form 10-12G/A, filed June
1, 2016.
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(2)
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Incorporated by reference to Form 10-K, filed October
28, 2019.
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Grafico Azioni Zedge (AMEX:ZDGE)
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