PROSPECTUS |
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Filed Pursuant to Rule 424(b)(3)
Registration No. 333-282739 |
Up to 2,607,723 Shares of Common Stock
Gaxos.ai Inc.
Pursuant to this prospectus,
the selling stockholders identified herein (the “Selling Stockholders”) are offering on a resale basis up to an aggregate
of 2,607,723 shares (the “Shares”) of common stock, par value $0.0001 per share (the “Common Stock”) of Gaxos.ai
Inc. (the “Company,” “we,” “us” or “our”) comprised of (i) up to 1,256,734 shares of Common
Stock issuable upon the exercise of outstanding series A warrants at an exercise price of $2.33 per share for a term of five and one-half
years from the date of issuance (the “Series A Warrants”); (ii) up to 1,256,734 shares of Common Stock issuable upon the exercise
of outstanding series B warrants at an exercise price of $2.33 per share for a term of and twenty-four months from the date of issuance
(the “Series B Warrants”) and (iii) up to 94,255 shares of Common Stock issuable upon the exercise of outstanding placement
agent warrants at an exercise price of $3.225 per share for a term of five and one-half years (the “Placement Agent Warrants”
and together with the Series A Warrants and Series B Warrants, the “Warrants”). The Series A Warrants and Series B Warrants
were purchased pursuant to a letter agreement by and between us and the Selling Stockholder, dated September 20, 2024 (the “Letter
Agreement”). The Placement Agent Warrants were issued pursuant to an engagement agreement, dated September 20, 2024, by and between
us and H.C. Wainwright & Co., LLC (the “Placement Agent”).
We will not receive any of
the proceeds from the sale by the Selling Stockholders of the Common Stock. Upon any exercise of the Warrants by payment of cash, however,
we will receive the exercise price of the Warrants, which, if exercised in cash with respect to the Shares offered hereby, would
result in gross proceeds to us of approximately $6.1 million. However, we cannot predict when and in what amounts or if the Warrants will
be exercised by payments of cash and it is possible that the Warrants may expire and never be exercised, in which case we would not receive
any cash proceeds.
The Selling Stockholders,
or their respective transferees, pledgees, donees or other successors-in-interest identified in this prospectus may offer the Shares from
time to time through public or private transactions at fixed prices, at prevailing market prices at the time of sale, at prices related
to the prevailing market price, at varying prices determined at the time of sale, or at negotiated prices. The registration of the Shares
on behalf of the Selling Stockholders; however, does not necessarily mean that the Selling Stockholders will offer or sell their Shares
under this registration statement or at any time in the near future. We provide more information about how the Selling Stockholders may
sell their Shares in the section entitled “Plan of Distribution” on page 11. The Selling Stockholders will bear
all commissions and discounts, if any, attributable to the sale or disposition of the Shares, or interests therein. We will not be paying
any underwriting discounts or commissions in this offering. We will pay the expenses of registering the Shares pursuant to this prospectus.
Our Common Stock is listed
on The Nasdaq Capital Market under the symbol “GXAI”. On October 16, 2024, the closing price per share of our Common Stock
as reported on The Nasdaq Capital Market was $1.61 per share. We may amend or supplement this prospectus from time to time by filing
amendments or supplements as required. You should read the entire prospectus and any amendments or supplements carefully before you make
your investment decision.
Investing in our securities
involves a high degree of risk. You should review carefully the risks and uncertainties described under the heading “Risk Factors”
beginning on page 5 of this prospectus.
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 October 29, 2024.
TABLE OF CONTENTS
You should rely only on the
information provided in this prospectus, as well as the information incorporated by reference into this prospectus and any applicable
prospectus supplement. Neither we nor the Selling Stockholders have authorized anyone to provide you with different information. We take
no responsibility for, and can provide no assurance as to the reliability of, any information other than the information in this prospectus,
any amendment or supplement to this prospectus, and any free writing prospectus prepared by us or on our behalf. Neither we nor the
Selling Stockholders are making an offer of these securities in any jurisdiction where the offer is not permitted. You should not assume
that the information in this prospectus, any applicable prospectus supplement or any documents incorporated by reference is accurate as
of any date other than the date of the applicable document. Since the respective dates of this prospectus and the documents incorporated
by reference into this prospectus, our business, financial condition, results of operations and prospects may have changed.
ABOUT THIS PROSPECTUS
This prospectus is part of
a registration statement that we filed with the SEC using a “shelf” registration process. Under this shelf registration process,
we and the Selling Stockholders may, from time to time, issue, offer and sell, as applicable, any combination of the securities described
in this prospectus in one or more offerings. The Selling Stockholders may use the shelf registration statement to sell up to an aggregate
of 2,607,723 shares of Common Stock issuable upon exercise of the Warrants, from time to time through any means described in the section
entitled “Plan of Distribution.” More specific terms of any securities that the Selling Stockholders offer and sell
may be provided in a prospectus supplement that describes, among other things, the specific amounts and prices of the Common Stock being
offered and the terms of the offering.
A prospectus supplement may
also add, update or change information included in this prospectus. Any statement contained in this prospectus will be deemed to be modified
or superseded for purposes of this prospectus to the extent that a statement contained in such prospectus supplement modifies or supersedes
such statement. Any statement so modified will be deemed to constitute a part of this prospectus only as so modified, and any statement
so superseded will be deemed not to constitute a part of this prospectus. You should rely only on the information contained in this prospectus,
any applicable prospectus supplement or any related free writing prospectus. See “Where You Can Find More Information.”
PROSPECTUS SUMMARY
The following summary highlights
information contained elsewhere in this prospectus. This summary is not complete 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 the heading “Risk Factors” contained in this prospectus and under similar headings
in the other documents that are incorporated by reference into this prospectus. You should also carefully read the information incorporated
by reference into this prospectus, including our financial statements, and the exhibits to the registration statement of which this prospectus
is a part.
Unless the context indicates
otherwise, references in this prospectus to “Gaxos,” “the Company,” “we,” “us,” “our”
and similar references refer to Gaxos.ai Inc.
Our Company
We are a technology-based
company that is developing applications aimed at redefining the way we utilize artificial intelligence (“AI”) to optimize
the user experience. We are committed to addressing the need for AI solutions in both health and entertainment.
Gaxos Gaming
Our flagship product is our
gaming platform called “Gaxos” (the “Platform” or “Gaxos Gaming”), created with a vision to develop,
design, acquire, and manage conventional games and to combine these games with unconventional game mechanisms, such as the ability for
gamers and developers to utilize artificial intelligence to create and design in-game features, as well as to mint unique in-game features,
such as skins, characters, weapons, gear, levels, and virtual lands, in the form of non-fungible tokens, or “NFTs,” that will
allow users to have unique experiences and more control over in-game assets.
In 2023, we launched our own
proprietary games that are simple and fun to play, and that offer gamers the ability to utilize AI to personalize their gaming experience
as well as to mint their own affordable NFTs, with unique and exclusive features, that can be utilized across the network of games and
platform that we intend to build. As of October 2024, we have launched four games, Space Striker AI, Brawl Bots, BattleFleet AI, and Jigsaw
Puzzle AI. Space Striker AI allows players to engage in a captivating storyline and exciting retro shooting space action in the players
AI-generated spaceship. Players can fuse crystals to upgrade their ship parts to craft, clash and conquer the galaxy all within a dynamic
free-to-play economy. Brawl Bots immerses users in high-octane battles in real time against other players, in solo play or teams. Each
player gets to control their own exclusive Bot character, ensuring a personalized gaming experience. BattleFleet AI is a take on the classic
Battleship game with AI elements that allow gamers to design their ships. Jigsaw Puzzle AI lets gamers solve preloaded jigsaw puzzles
as well as design and solve new jigsaw puzzles using AI.
We expect to launch more games
in 2025. We have a pipeline of games in various stages of development. We plan to methodically launch games based on research and market
data.
In addition to launching our
own proprietary games, Gaxos Gaming is developing an artificial intelligence solution for game developers and studios. The solution is
intended to offer a transformative generative AI service that empowers the gaming industry to create without limits through dynamic content
generation, seamless integration, and personalized solutions. Key features of the product will be:
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AI-Powered Creativity: Reduces creative asset development time from hours to minutes, transforming artistic visions into reality with ease. |
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Seamless Integration: With plug-and-play functionality for Unity and upcoming support for Unreal Engine, integration is effortless into existing workflows. |
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Dynamic Content Generation: User-Generated-Ai-Content (“UGAiC”) feature offers new experiences with each playthrough by letting gamers use AI in real time, fostering a dynamic gaming environment. |
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Customized Solutions: From personalized AI models and templates to expert consulting services, offering to include custom solutions to meet unique needs of each developer. |
We launched the artificial
intelligence solution in September 2024.
Gaxos Health
Recently, we began to develop
a new initiative, Gaxos Health, which is dedicated to revolutionizing personal health and wellness by developing a suite of innovative
AI-powered health optimization solutions. Gaxos Health will integrate AI-driven insights with individual biometric data and health goals
to create web and application based personalized wellness strategies for users. We believe that this cutting-edge approach will redefine
preventative medicine, offering unparalleled personalization in health and wellness. Gaxos Health solutions will analyze a wide range
of health data to provide tailored wellness plans and address the growing demand for personalized health solutions. We believe that this
technology is not just a step but a leap forward in empowering individuals to take control of their health and longevity with AI’s
precision and intelligence.
We expect to launch the AI-powered health optimization
product in the first half of 2025.
Recent Developments
September 2024 Warrant Inducement Transaction
As reported in the Current
Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on September 23, 2024, on September 20, 2024,
we entered into the Letter Agreement with the holder (the “Holder”) of (i) series A warrants to purchase up to 628,367 shares
of Common Stock (the “March 2024 Series A Warrants”) and (ii) series B warrants to purchase up to 628,367 shares of Common
Stock (the “March 2024 Series B Warrants” and together with the March 2024 Series A Warrants, the “March 2024 Warrants”)
pursuant to which the Holder agreed to exercise in cash the March 2024 Warrants at a reduced exercise price of $2.58 per share (reduced
from $5.75 per share for the March 2024 Warrants), for gross proceeds to us of approximately $3.24 million. As an inducement to such exercise,
we agreed to issue to the Holder unregistered warrants to purchase (i) up to 1,256,734 shares of Common Stock issuable upon the exercise
of outstanding series A warrants at an exercise price of $2.33 per share for a term of five and one-half years from the date of issuance
(the “Series A Warrants”) and (ii) up to 1,256,734 shares of Common Stock issuable upon the exercise of outstanding series
B warrants at an exercise price of $2.33 per share for a term of and twenty-four months from the date of issuance (the “Series B
Warrants” and together with the Series A Warrants, the “New Warrants”).
The shares of Common Stock
issuable upon exercise of the March 2024 Warrants are registered pursuant to the Company’s Registration Statement on Form S-3 (File
No. 333-278513), which was filed with the SEC on April 4, 2024 and declared effective by the SEC on April 16, 2024, and prospectus supplement
related thereto.
Notwithstanding the foregoing,
in the event that a warrant exercise would cause the Holder to exceed the beneficial ownership limitation set forth in the New Warrants,
we will only issue such number of shares that would not cause the Holder to exceed the maximum amount permitted thereunder, with the balance
to be held in abeyance until notice from the Holder that the balance (or portion thereof) may be issued in compliance with such limitations.
In the event that the shares underlying the New Warrants are not subject to an effective registration statement at the time of exercise,
the New Warrants may be exercised on a cashless basis at any time.
In connection with the transactions
contemplated in the Letter Agreement, we entered into an engagement letter (the “Engagement Letter”) with H.C. Wainwright
& Co., LLC (the “Placement Agent”) to act as exclusive placement agent in connection with the transactions contemplated
by the Letter Agreement (the “Warrant Inducement Transaction”). Pursuant to the terms of the Engagement Letter, the Placement
Agent received $85,000 for non-accountable expenses and clearing fees in the amount of $15,950. Additionally, we issued to the Placement
Agent, or it’s designees, Placement Agent Warrants to purchase up to 94,255 shares of Common Stock at an exercise price of $3.225
for a term of five and one-half years from the date of issuance (the “Placement Agent Warrants”).
We intend to use these net
proceeds received from the Warrant Inducement Transaction for general working capital and general corporate purposes.
The Letter Agreement also
contains customary representations and agreements, including a provision for liquidated damages owed by us in the event that the shares
underlying the New Warrants are not timely delivered upon future exercises of the New Warrants.
The New Warrants contain (i)
customary stock-based anti-dilution protection, (ii) a cashless exercise provision in the event the shares underlying the New Warrants
are not registered for resale at the time of exercise, (iii) beneficial ownership limitations that may be waived at the option of the
Holder upon 61 days’ notice to us, (iv) a put right granting the Holder the right to require us or our successor to redeem the New
Warrants in cash for their Black-Scholes value in the event of a Fundamental Transaction (as defined in the New Warrants) and (v) other
customary provisions for warrants of this type.
Corporate History
We were originally incorporated
in the State of Wyoming on October 27, 2021. On March 30, 2022, we reincorporated to Delaware by filing the Delaware Certificate with
the Delaware Secretary of State. On January 5, 2024, we filed an amendment to our Certificate of Incorporation with the Delaware Secretary
of State to change our name to “Gaxos.ai Inc.”
Corporate Information
Our principal executive offices
are located at 101 Eisenhower Parkway, Suite 300, Roseland, NJ 07068 and our telephone number is (973) 275-7428. Our website address is https://gaxos.ai.
The information contained on our website is not incorporated by reference into this prospectus.
Implications of Being a Smaller Reporting Company
We are a “smaller reporting
company,” meaning that the market value of our shares held by non-affiliates is less than $700 million and our annual revenue was
less than $100 million during the most recently completed fiscal year. We have elected to rely on exemptions from certain disclosure requirements
that are available to smaller reporting companies. Specifically, as a smaller reporting company, we may choose to present only the two
most recent fiscal years of audited financial statements in our Annual Report on Form 10-K and have reduced disclosure obligations regarding
executive compensation.
ABOUT THIS OFFERING
This prospectus relates to
the offer and resale by the Selling Stockholders of up to 2,607,723 shares of Common Stock issuable upon the exercise of the New Warrants.
All of the Shares, if and when sold, will be sold by the Selling Stockholders. The Selling Stockholders may sell the Shares from time
to time at prevailing market prices or at privately negotiated prices.
Shares offered by the Selling Stockholders: |
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up to an aggregate of 2,607,723 shares (the “Shares”) of common stock, par value $0.0001 per share (the “Common Stock”) comprised of (i) up to 1,256,734 shares of Common Stock issuable upon the exercise of outstanding series A warrants at an exercise price of $2.33 per share for a term of five and one-half years from the date of issuance (the “Series A Warrants”); (ii) up to 1,256,734 shares of Common Stock issuable upon the exercise of outstanding series B warrants at an exercise price of $2.33 per share for a term of and twenty-four months from the date of issuance (the “Series B Warrants”); and (iii) up to 94,255 shares of Common Stock issuable upon the exercise of outstanding placement agent warrants at an exercise price of $3.225 per share for a term of five and one-half years (the “Placement Agent Warrants” and together with the Series A Warrants and Series B Warrants, the “Warrants”). The Series A Warrants and Series B Warrants were purchased pursuant to a letter agreement by and between us and the Selling Stockholder, dated September 20, 2024 (the “Letter Agreement”). The Placement Agent Warrants were issued pursuant to an engagement agreement, dated September 20, 2024, by and between us and H.C. Wainwright& Co., LLC (the “Placement Agent”) |
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Shares of Common Stock outstanding as of October 1, 2024. |
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1,892,773 shares(1) |
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Use of proceeds: |
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We will not receive any proceeds from any sale of the Shares by the Selling Stockholders. We will receive proceeds in the event that any of the Warrants are exercised at the exercise prices per share for cash which would result in gross proceeds of approximately $6.1 million if all such Warrants are exercised for cash. We can give no assurances that any such Warrant will be exercised, nor can we give any assurances that we will receive any from the Selling Stockholders sale pursuant to this prospectus. Any proceeds that we receive from the exercise of the Warrants will be used for working capital and other general corporate purposes. See “Use of Proceeds.” |
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Risk factors: |
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An investment in the shares of Common Stock offered
under this prospectus is highly speculative and involves substantial risk. Please carefully consider the “Risk Factors”
section on page 5, other information in this prospectus and in the documents incorporated by reference herein for a discussion of risks.
Additional risks and uncertainties not presently known to us or that we currently deem to be immaterial may also impair our business and
operations.
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NASDAQ symbol: |
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GXAI |
(1) |
The number of shares of Common Stock to be outstanding is based on 1,892,773 shares of our Common Stock outstanding as of October 1, 2024, and excludes: |
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58,373 shares of Common Stock issuable upon the exercise of warrants outstanding at a weighted average exercise price of $16.17 per share; |
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64,084 shares of Common Stock issuable upon the exercise of stock options outstanding at a weighted average exercise price of $31.35 per share; and |
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239,553 shares of Common Stock reserved for future issuance under our 2022 Equity Incentive Plan. |
Unless otherwise indicated, all information in
this prospectus supplement assumes no exercise of the outstanding options or warrants, described above.
RISK FACTORS
Investing in our securities
involves substantial risks. Please carefully consider the risk factors described below together with the risk factors described in our
most recent Annual Report on Form 10-K, any subsequent updates in our Quarterly Reports on Form 10-Q and in any other filings we make
with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
incorporated by reference herein, and the matters discussed under “Disclosure Regarding Forward-Looking Statements” below,
before making an investment decision. Additional risk factors may be included in any prospectus supplements relating to securities described
in this prospectus. The occurrence of any of those risks could materially and adversely affect our business, prospects, financial condition,
results of operations or cash flow. Other risks and uncertainties that we do not now consider to be material or of which we are not now
aware may become important factors that affect us in the future and could result in a complete loss of your investment.
We will not receive any proceeds from the
sale of the shares of Common Stock by the Selling Stockholders covered by this prospectus other than upon any exercise
of the New Warrants or Placement Agent Warrants for cash.
We are registering the shares
of Common Stock that were, or may be, issued by us to the Selling Stockholders to permit the resale of these shares of Common Stock from
time to time after the date of this prospectus. We will not receive any of the proceeds from the sale by the Selling Stockholders of the
shares of Common Stock. Upon any exercise of any of the New Warrants or Placement Agent Warrants for cash, the Selling Stockholders would
pay us the exercise price set forth in such New Warrants or Placement Agent Warrants.
We are currently listed on The Nasdaq Capital
Market. If we are unable to maintain listing of our securities on the Nasdaq Capital Market or any stock exchange, our stock price could
be adversely affected and the liquidity of our stock and our ability to obtain financing could be impaired and it may be more difficult
for our shareholders to sell their securities.
Although our common stock
is currently listed on The Nasdaq Capital Market (“Nasdaq”), we may not be able to continue to meet the exchange’s minimum
listing requirements or those of any other national exchange. If we are unable to maintain listing on Nasdaq or if a liquid market for
our common stock does not develop or is sustained, our common stock may remain thinly traded.
The Listing Rules of Nasdaq
require listing issuers to comply with certain standards in order to remain listed on its exchange. If, for any reason, we should fail
to maintain compliance with these listing standards and Nasdaq should delist our securities from trading on its exchange and we are unable
to obtain listing on another national securities exchange, a reduction in some or all of the following may occur, each of which could
have a material adverse effect on our shareholders:
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the liquidity of our Common Stock; |
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the market price of our Common Stock; |
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our ability to obtain financing for the continuation of our operations; |
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the number of investors that will consider investing in our Common Stock; |
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the number of market makers in our Common Stock; |
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the availability of information concerning the trading prices and volume of our Common Stock; and |
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the number of broker-dealers willing to execute trades in shares of our Common Stock. |
DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This prospectus and the documents
incorporated by reference herein contain forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933,
as amended, (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended, (the “Exchange
Act”), about us and our industry that involve substantial risks and uncertainties.
These statements involve a
number of risks and uncertainties. Words such as “may,” “expects,” “intends,” “anticipates,”
“believes,” “estimates,” “plans,” “seeks,” “could,” “should,”
“continue,” “will,” “potential,” “projects” and similar expressions are intended to identify
such forward-looking statements. Readers are cautioned that these forward-looking statements speak only as of the date on which this prospectus
is filed with the Securities and Exchange Commission (the “SEC”), and, except as required by law, we do not assume any obligation
to update, amend or clarify them to reflect events, new information or circumstances occurring after such date. Forward-looking statements
in this prospectus and any documents incorporated by reference herein include, but are not limited to, statements about:
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our business strategies; |
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the timing of regulatory submissions; |
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our ability to obtain and maintain regulatory approval of our existing product candidates and any other product candidates we may develop, and the labeling under any approval we may obtain; |
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risks related to market acceptance of products; |
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intellectual property risks; |
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risks associated with our reliance on third-party organizations; |
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our competitive position; |
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our industry environment; |
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our anticipated financial and operating results, including anticipated sources of revenues; |
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assumptions regarding the size of the available market, benefits of our products, product pricing and timing of product launches; |
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management’s expectation with respect to future acquisitions; |
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statements regarding our goals, intentions, plans and expectations, including the introduction of new products and markets; and |
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our cash needs and financing plans. |
We caution our shareholders
and other readers not to place undue reliance on such statements.
Other sections of this prospectus
may include additional factors that could harm our business and financial performance. Moreover, we operate in a very competitive and
rapidly changing environment. New risk factors emerge from time to time, and it is not possible for our management to predict all risk
factors, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may
cause actual results to differ from those contained in, or implied by, any forward-looking statements.
These and other risks and
assumptions are outlined under “Risk Factors” contained in this prospectus and any related free writing prospectus,
and in our most recent Annual Report on Form 10-K and our most recent filed Quarterly Reports on Form 10-Q, incorporated by reference
into this prospectus, as well as any amendments thereto reflected in subsequent filings with the SEC. The discussion of risks and uncertainties
set forth in this prospectus or referenced in those filings is not necessarily a complete or exhaustive list of all risks facing us at
any particular point in time. We operate in a highly competitive, highly regulated and rapidly changing environment, and our business
is in a state of evolution. Therefore, it is likely that new risks will emerge and the nature and elements of existing risks will change.
It is not possible for management to predict all such risk factors or changes therein or to assess either the impact of all such risk
factors on our business or the extent to which any individual risk factor, combination of factors or new or altered factors may cause
results to differ materially from those contained in any forward-looking statement. Forward-looking statements represent our estimates
and assumptions only as of the date such forward-looking statements are made. You should carefully read this prospectus and any related
free writing prospectus, together with the information incorporated herein or therein by reference as described under the section titled
“Incorporation of Certain Information By Reference,” and with the understanding that our actual future results may
materially differ from what we expect.
Except as required by law,
forward-looking statements speak only as of the date they are made, and we assume no obligation to update any forward-looking statements
publicly, or to update the reasons why actual results could differ materially from those anticipated in any forward-looking statements,
even if new information becomes available.
USE OF PROCEEDS
We will not receive any of
the proceeds from the sale by the Selling Stockholders of the Common Stock. Upon any exercise of the New Warrants or Placement Agent Warrants
by payment of cash, however, we will receive the exercise price of the New Warrants and Placement Agent Warrants, which, if exercised
in cash with respect to all of the Shares offered hereby, would result in gross proceeds to us of approximately $6.1 million. However,
we cannot predict when and in what amounts or if the New Warrants or Placement Agent Warrants will be exercised by payments of cash and
it is possible that the New Warrants or Placement Agent Warrants may expire and never be exercised, in which case we would not receive
any cash proceeds. We intend to use any proceeds from the Selling Stockholders’ exercise of
the Warrants for working capital and other general corporate purposes.
SELLING STOCKHOLDERS
The Common Stock being offered
by the Selling Stockholders are those previously issued to the Selling Stockholders, and those issuable to the Selling Stockholders, upon
exercise of the New Warrants and Placement Agent Warrants. For additional information regarding the issuances of those securities, see
“Recent Developments – September 2024 Warrant Inducement Transaction” above. We are registering the Shares in
order to permit the Selling Stockholders to offer the Shares for resale from time to time. Except for the ownership of the shares of Common
Stock, or as otherwise set forth herein the Selling Stockholders have not had any material relationship with us within the past three
years.
The table below lists the
Selling Stockholders and other information regarding the beneficial ownership of the shares of Common Stock by the Selling Stockholders.
The second column lists the number of shares of Common Stock beneficially owned by the Selling Stockholders, based on their ownership
of the shares of our securities, as of October 1, 2024, assuming exercise of the New Warrants and Placement Agent Warrants held by the
Selling Stockholders on that date, without regard to any limitations on conversion.
The third column lists the
shares of Common Stock being offered by this prospectus by the Selling Stockholders.
This prospectus generally
covers the resale of the maximum number of shares of Common Stock issuable upon exercise of the Warrants, determined as if the outstanding
New Warrants and Placement Agent Warrants were exercised in full as of the trading day immediately preceding the date this registration
statement was initially filed with the SEC, each as of the trading day immediately preceding the applicable date of determination
and without regard to any limitations on the exercise of the New Warrants and Placement Agent Warrants. Under the terms of the New Warrants,
the Selling Stockholders may not exercise the New Warrants to the extent such exercise would cause such Selling Stockholder, together
with their affiliates and attribution parties, to beneficially own a number of shares of Common Stock which would exceed 4.99% of the
number of shares of our Common Stock outstanding following such exercise (for purposes of the denominator, immediately after giving effect
to the issuance of shares of Common Stock to be issued upon the applicable exercise of such Warrant). The fourth column assumes the sale
of all of the Shares offered by the Selling Stockholders pursuant to this prospectus without regard to such limitations. The Selling Stockholders
may sell all, some or none of their Shares in this offering. See “Plan of Distribution.”
Name and Address | |
Number of shares of Common Stock Beneficially Owned Prior to Offering(1) | | |
Maximum Number of shares of Common Stock to be Sold Pursuant to this Prospectus | | |
Number of shares of Common Stock Beneficially Owned After Offering | | |
Percent of Common Stock Beneficially Owned After Offering | |
Armistice Capital, LLC(2) | |
| 3,508,068 | (3) | |
| 2,513,468 | | |
| 994,600 | | |
| 4.99 | % |
Michael Vasinkevich(4) | |
| 60,441 | | |
| 60,441 | | |
| - | | |
| - | |
Noam Rubinstein(4) | |
| 29,690 | | |
| 29,690 | | |
| - | | |
| - | |
Craig Schwabe(4) | |
| 3,181 | | |
| 3,181 | | |
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Charles Worthman(4) | |
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(1) |
The ability to exercise the Warrants held by the Selling Stockholder is subject to a beneficial ownership limitation that, at the time of initial issuance of the Warrants was capped at 4.99% beneficial ownership of the Company’s issued and outstanding Common Stock (post-exercise). This beneficial ownership limitation may be adjusted up or down, subject to providing advanced notice to the Company. Beneficial ownership as reflected in the selling stockholders table reflects the total number of shares potentially issuable underlying the Warrants and does not give effect to this beneficial ownership limitation. Accordingly, actual beneficial ownership, as calculated in accordance with Section 13(d) and Rule 13d-3 thereunder may be lower than as reflected in the table. |
(2) |
The securities are directly held by Armistice Capital Master Fund Ltd., a Cayman Islands exempted company (the “Master Fund”), and may be deemed to be beneficially owned by: (i) Armistice Capital, LLC (“Armistice Capital”), as the investment manager of the Master Fund; and (ii) Steven Boyd, as the Managing Member of Armistice Capital. The warrants are subject to a beneficial ownership limitation of 4.99%, which such limitation restricts the Selling Stockholder from exercising that portion of the warrants that would result in the Selling Stockholder and its affiliates owning, after exercise, a number of shares of common stock in excess of the beneficial ownership limitation. The address of Armistice Capital Master Fund Ltd. is c/o Armistice Capital, LLC, 510 Madison Avenue, 7th Floor, New York, NY 10022. |
(3) |
Includes (i) 16,600 shares of Common Stock, (ii) 978,000 shares of Common Stock issuable upon the exercise of pre-funded warrants and (iii) 2,513,468 shares of Common Stock issuable upon the exercise of New Warrants offered hereby. |
(4) |
Each of the selling stockholders is affiliated with H.C. Wainwright & Co., LLC, a registered broker dealer and has a registered address of c/o H.C. Wainwright & Co., 430 Park Ave, 3rd Floor, New York, NY 10022, and has sole voting and dispositive power over the securities held. The number of shares to be sold in this offering consists of shares of common stock issuable upon exercise of Placement Agent Warrants, which were received as compensation for our private placement. The selling stockholder acquired the Placement Agent Warrants in the ordinary course of business and, at the time the Placement Agent Warrants were acquired, the selling stockholder had no agreement or understanding, directly or indirectly, with any person to distribute such securities. |
DESCRIPTION OF CAPITAL STOCK
General
The following description
of our capital stock summarizes the material terms and provisions of our common stock and preferred stock. While the terms we have summarized
below will apply generally to any future common stock or preferred stock that we may offer, we will describe the particular terms of any
class or series of these securities in more detail in the applicable prospectus supplement. For the complete terms of our common stock
and preferred stock, please refer to our Certificate of Incorporation, as amended (as amended, “Certificate of Incorporation”),
and our Amended and Restated Bylaws, as amended (as amended, “Bylaws”) that are incorporated by reference into the registration
statement of which this prospectus is a part or may be incorporated by reference in this prospectus or any applicable prospectus supplement.
The terms of these securities may also be affected by the Delaware General Corporation Law (the “DGCL”). The summary
below and that contained in any applicable prospectus supplement or any related free writing prospectus are qualified in their entirety
by reference to our Certificate of Incorporation and our Bylaws.
As of the date of this prospectus,
our authorized capital stock consisted of 50,000,000 shares of Common Stock, $0.0001 par value per share, and 5,000,000 shares of Preferred
Stock, $0.0001 par value per share. Our Board may establish the rights and preferences of the preferred stock from time to time. As of
October 1, 2024, there were 1,892,773 shares of our common stock and no shares of our preferred stock issued and outstanding.
Voting Rights
Holders of our Common Stock
are entitled to one vote for each share held on all matters submitted to a vote of the Company’s stockholders. Holders of our Common
Stock have no cumulative voting rights.
Dividend Rights
Subject to preferences that
may be applicable to any outstanding shares of our Preferred Stock, holders of our Common Stock are entitled to receive dividends, if
any, as may be declared from time to time by our board of directors out of the Company’s assets which are legally available.
Liquidation Rights
Upon the liquidation, dissolution
or winding-up, holders of our Common Stock are entitled to share in all assets remaining after payment of all liabilities and the liquidation
preferences of any outstanding shares of Preferred Stock.
Other Rights
Holders of the Company’s
Common Stock have no preemptive or conversion rights or other subscription rights.
Warrants
As of October 1, 2024, there
were outstanding warrants to purchase an aggregate of 2,666,096 shares of our Common Stock at an exercise price of $2.67 per share.
Warrants Registered Pursuant to this Registration
Statement
Common Stock Warrants
The Series A Warrants are
exercisable for a period of five and one-half years from the issuance date at an exercise price of $2.33 per share of Common Stock, subject
to adjustment (the “Series A Warrants”). The Series B Warrants are exercisable for a period of twenty-four months from the
issuance date at an exercise price of $2.33 per share of Common Stock, subject to adjustment (the “Series B Warrants” and
together with the Series A Warrants, the “Common Stock Warrants”). If, at any time after the issuance date of the Common Stock
Warrant, a registration statement covering the resale of the Common Stock Warrant Shares is not effective, the holders may exercise the
Common Stock Warrants by means of a cashless exercise. We are prohibited from effecting an exercise of the Common Stock Warrants to the
extent that, as a result of such exercise, the holder together with the holder’s affiliates, would beneficially own more than 4.99%
(or, at the election of the holder, 9.99%) of the number of shares of common stock outstanding immediately after giving effect to the
issuance of the Common Stock Warrant Shares upon exercise of the Common Stock Warrant, which beneficial ownership limitation may be increased
by the holder up to, but not exceeding, 9.99%.
Placement Agent Warrants
The Placement Agent Warrants
are exercisable for a period of five and one-half years from the issuance date at an exercise price of $3.225 per share of Common Stock,
subject to adjustment. If, at any time after the issuance date of the Placement Agent Warrants, a registration statement covering the
resale of the Placement Agent Warrant Shares is not effective, the holders may exercise the Placement Agent Warrants by means of a cashless
exercise. We are prohibited from effecting an exercise of the Placement Agent Warrants to the extent that, as a result of such exercise,
the holder together with the holder’s affiliates, would beneficially own more than 4.99% of the number of shares of common stock
outstanding immediately after giving effect to the issuance of the Placement Agent Warrant Share upon exercise of the Placement Agent
Warrants, which beneficial ownership limitation may be increased by the holder up to, but not exceeding, 9.99%.
Applicable Anti-Takeover Law
Set forth below is a summary
of the provisions of our Certificate of Incorporation and Bylaws and the Delaware General Corporation Law that could have the effect of
delaying or preventing a change in control of the Company. The following description is only a summary, and it is qualified by reference
to the Certificate of Incorporation, Bylaws and relevant provisions of the DGCL.
Delaware Law
We are governed by the provisions
of Section 203 of the DGCL. In general, Section 203 prohibits a publicly traded Delaware corporation from engaging in a business combination
with an interested stockholder for a period of three years after the date of the transaction in which the person became an interested
stockholder, unless the business combination is approved in a prescribed manner. A business combination includes mergers, asset sales
or other transactions resulting in a financial benefit to the stockholder. An interested stockholder is a person who, together with affiliates
and associates, owns (or within three years, did own) 15% or more of the corporation’s voting stock, subject to certain exceptions.
The statute could have the effect of delaying, deferring or preventing a change in control of the Company.
Board of Directors Vacancies
Our Bylaws authorize our board
of directors to fill vacant directorships. In addition, the number of directors constituting our board of directors may be set by resolution
of the incumbent directors.
Special Meeting of Stockholders
Our Bylaws provide that special
meetings of our shareholders may be called by the chief executive officer of the Corporation, the board of directors or a committee of
the board of directors that has been duly designated by the board of directors and whose powers and authority include the power to call
such meetings.
Advance Notice Requirements for Stockholder
Proposals and Director Nominations
Our Bylaws provide that shareholders
seeking to bring business before our annual meeting of shareholders, or to nominate candidates for election as directors at our annual
meeting of shareholders, must provide timely notice of their intent in writing. To be timely, a shareholder’s notice must be delivered
to the secretary at our principal executive offices not later than the close of business on the 90th day nor earlier than the close of
business on the 120th day prior to the first anniversary of the preceding year’s annual meeting; provided, however, that in the
event the date of the annual meeting is not within 30 days before or after such anniversary date, notice by the shareholder to be timely
must be so delivered not later than the close of business on the 10th day following the day on which such notice of the date of annual
meeting was mailed or public disclosure of the date of the annual meeting was made, whichever occurs first. These provisions may preclude
our shareholders from bringing matters before our annual meeting of shareholders or from making nominations for directors at our annual
meeting of shareholders.
Authorized but Unissued Shares
Our authorized but unissued
shares of Common Stock and Preferred Stock are available for future issuance without stockholder approval and may be utilized for a variety
of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans.
The existence of authorized but unissued and unreserved Common Stock and Preferred Stock could render more difficult or discourage an
attempt to obtain control of the Company by means of a proxy contest, tender offer, merger or otherwise.
Exclusive Forum
Our Certificate of Incorporation
provides that unless we consent in writing to the selection of an alternative forum, the State of Delaware is the sole and exclusive forum
for: (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of a fiduciary duty
owed by any director, officer or other employee of our Company to us or our stockholders, (iii) any action asserting a claim against us,
our directors, officers or employees arising pursuant to any provision of the DGCL or our Certificate of Incorporation or our Bylaws,
or (iv) any action asserting a claim against us, our directors, officers, employees or agents governed by the internal affairs doctrine,
except for, as to each of (i) through (iv) above, any claim as to which the Court of Chancery determines that there is an indispensable
party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction
of the Court of Chancery within ten days following such determination), which is vested in the exclusive jurisdiction of a court or forum
other than the Court of Chancery, or for which the Court of Chancery does not have subject matter jurisdiction.
Additionally, our Certificate
of Incorporation provides that unless we consent in writing to the selection of an alternative forum, the federal district courts of the
United States of America will be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the
Securities Act. Any person or entity purchasing or otherwise acquiring any interest in shares of our capital stock are deemed to have
notice of and consented to this provision.
Transfer Agent and Registrar
The transfer agent and registrar
is West Coast Stock Transfer, Inc., whose address is 721 N. Vulcan Ave. Suite 106, Encinitas, CA 92024.
Exchange Listing
Our common stock is listed
on the Nasdaq Capital Market under the symbol “GXAI.” Prior to the change of our symbol to GXAI on January 19, 2024, our common
stock was listed on the Nasdaq Capital Market under the symbol “NFTG.”
PLAN OF DISTRIBUTION
The Selling Stockholders and
any of their pledgees, assignees and successors-in-interest may, from time to time, sell any or all of their securities covered hereby
on the principal Trading Market or any other stock exchange, market or trading facility on which the securities are traded or in private
transactions. “Trading Market” means any of the following markets or exchanges on which our Common Stock is listed or quoted
for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select
Market, the New York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing). These sales may be at fixed or negotiated
prices. The Selling Stockholders may use any one or more of the following methods when selling securities:
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ordinary brokerage transactions and transactions in which the broker-dealer solicits purchasers; |
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block trades in which the broker-dealer will attempt to sell the securities as agent but may position and resell a portion of the block as principal to facilitate the transaction; |
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purchases by a broker-dealer as principal and resale by the broker-dealer for its account; |
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an exchange distribution in accordance with the rules of the applicable exchange; |
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privately negotiated transactions; |
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settlement of short sales; |
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in transactions through broker-dealers that agree with the Selling Stockholders to sell a specified number of such securities at a stipulated price per security; |
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through the writing or settlement of options or other hedging transactions, whether through an options exchange or otherwise; |
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a combination of any such methods of sale; or |
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any other method permitted pursuant to applicable law. |
The Selling Stockholders may
also sell securities under Rule 144 or any other exemption from registration under the Securities Act, if available, rather than under
this prospectus.
Broker-dealers engaged by
the Selling Stockholders may arrange for other brokers-dealers to participate in sales. Broker-dealers may receive commissions or discounts
from the Selling Stockholders (or, if any broker-dealer acts as agent for the purchaser of securities, from the purchaser) in amounts
to be negotiated, but, except as set forth in a supplement to this prospectus, in the case of an agency transaction not in excess of a
customary brokerage commission in compliance with FINRA Rule 2121; and in the case of a principal transaction a markup or markdown in
compliance with FINRA Rule 2121.
In connection with the sale
of the securities or interests therein, the Selling Stockholders may enter into hedging transactions with broker-dealers or other financial
institutions, which may in turn engage in short sales of the securities in the course of hedging the positions they assume. The Selling
Stockholders may also sell securities short and deliver these securities to close out their short positions, or loan or pledge the securities
to broker-dealers that in turn may sell these securities. The Selling Stockholders may also enter into option or other transactions with
broker-dealers or other financial institutions or create one or more derivative securities which require the delivery to such broker-dealer
or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution
may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction).
The Selling Stockholders and
any broker-dealers or agents that are involved in selling the securities may be deemed to be “underwriters” within the meaning
of the Securities Act in connection with such sales. In such event, any commissions received by such broker-dealers or agents and any
profit on the resale of the securities purchased by them may be deemed to be underwriting commissions or discounts under the Securities
Act. The Selling Stockholders has informed us that it does not have any written or oral agreement or understanding, directly or indirectly,
with any person to distribute the securities.
We are required to pay certain
fees and expenses that we incur incident to the registration of the securities. We have agreed to indemnify the Selling Stockholders against
certain losses, claims, damages and liabilities, including liabilities under the Securities Act.
We have agreed to keep this
prospectus effective until no holder of the New Warrants owns any New Warrants or New Warrant Shares (as defined in the Letter Agreement).
The resale securities will be sold only through registered or licensed brokers or dealers if required under applicable state securities
laws. In addition, in certain states, the resale securities covered hereby may not be sold unless they have been registered or qualified
for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.
Under applicable rules and
regulations under the Exchange Act, any person engaged in the distribution of the resale securities may not simultaneously engage in market
making activities with respect to the Common Stock for the applicable restricted period, as defined in Regulation M, prior to the commencement
of the distribution. In addition, the Selling Stockholders will be subject to applicable provisions of the Exchange Act and the rules
and regulations thereunder, including Regulation M, which may limit the timing of purchases and sales of the Common Stock by the Selling
Stockholders or any other person. We will make copies of this prospectus available to the Selling Stockholders and have informed them
of the need to deliver a copy of this prospectus to each purchaser at or prior to the time of the sale (including by compliance with Rule
172 under the Securities Act).
LEGAL MATTERS
The validity of the issuance
of the securities offered hereby will be passed upon for us by Sheppard, Mullin, Richter & Hampton LLP, New York, New York. Additional
legal matters may be passed upon for us or any underwriters, dealers, or agents by counsel that we will name in the applicable prospectus
supplement.
EXPERTS
Our consolidated financial
statements as of and for the years ended December 31, 2023 and 2022, incorporated by reference in this prospectus and the registration
statement, of which it forms a part, have been audited by Salberg & Company, P.A. and D. Brooks & Associates CPAs, respectively,
independent registered public accounting firms, as set forth in each of their reports thereon incorporated by reference herein, and are
included in reliance on such reports given on the authority of such firms as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the SEC
a registration statement under the Securities Act with respect to the shares of Common Stock offered hereby. We file annual, quarterly
and current reports, proxy statements and other information with the SEC. This prospectus is part of the registration statement on Form
S-3 under the Securities Act. 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 that may be offered under this prospectus,
we refer you to the registration statement and the exhibits filed as a part of the registration statement. You may read any document we
file with the SEC, including reports, proxy statements and information statements, on the SEC’s website at www.sec.gov. Our
SEC filings are also available to the public at our website at https://gaxos.ai.
Information on our website,
any subsection, page, or other subdivision of our website, or any website linked to by content on our website, is not part of this prospectus
and you should not rely on that information unless that information is also in this prospectus or incorporated by reference herein.
IMPORTANT INFORMATION INCORPORATED BY REFERENCE
The SEC allows us to “incorporate
by reference” information from other documents that we file with it, which means that we can disclose important information to you
by referring you to those documents. The information incorporated by reference is considered to be 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 prospectus and the registration statement of which this prospectus is a part the information or documents listed
below that we have filed with the SEC (Commission File No. 001-34810):
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our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on March 27, 2024; |
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our Quarterly Report on Form
10-Q for the period ended March 31, 2024, filed with the SEC on May 14, 2024; |
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our Quarterly Report on
Form 10-Q for the period ended June 30, 2024, filed with the SEC on August 13, 2024; |
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our Current Reports on
Form 8-K or 8-K/A filed with the SEC on January 10, 2024, January 10, 2024, February 28, 2024, March 11, 2024, March 13, 2024, March 13, 2024, March 20, 2024 and September 23, 2024. |
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the description of our
Common Stock set forth in the Registration Statement on Form 8-A filed with the SEC on February 10, 2023 (File No. 001-41620), and
any amendment or report filed with the SEC for the purpose of updating such description, including Exhibit 4.1 of our Annual Report
on Form 10-K for the year ended December 31, 2023. |
We also incorporate by reference
any future filings (other than current reports furnished under Item 2.02 or Item 7.01 of Form 8-K and exhibits filed on such form that
are related to such items unless such Form 8-K expressly provides to the contrary) made with the SEC pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act, until we file a post-effective amendment that indicates the termination of the offering of the securities
made by this prospectus and will become a part of this prospectus from the date that such documents are filed with the SEC. Information
in such future filings updates and supplements the information provided in this prospectus. Any statements in any such future filings
will automatically be deemed to modify and supersede any information in any document we previously filed with the SEC that is incorporated
or deemed to be incorporated herein by reference to the extent that statements in the later filed document modify or replace such earlier
statements.
You can request a copy of
these filings, at no cost, by writing or telephoning us at the following address or telephone number:
Gaxos.ai Inc.
101 Eisenhower Parkway, Suite 300
Roseland, NJ 07068
(973) 275-7428
Attn: Corporate Secretary
GAXOS.AI INC.
2,607,723 Shares of Common Stock
Preliminary
Prospectus
October 29, 2024
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