Exhibit 10.1

 

ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (the “Agreement”), dated as of December 9, 2016
(the “Effective Date”), is entered into by and among OHIO FITNESS AND MARTIAL
ARTS, LLC, d/b/a IT Fight Series, a Ohio limited liability company (“Seller”),
Scott Sheeley, an individual and resident of the State of Ohio (the “Selling
Member”), and ALLIANCE MMA, INC., a Delaware corporation (“Buyer”).

 

WHEREAS, Seller is engaged in promoting and conducting mixed martial arts events
at various venues under the “IT Fight Series” brand (the “Business”); and

 

WHEREAS, the Selling Member owns all of the issued and outstanding equity
interests of Seller; and

 

WHEREAS, the Selling Member and the Seller wish to provide for the sale of
substantially all of the assets and property rights now owned and held by the
Seller that are used or usable in the Business to the Buyer on the terms and
conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the premises and mutual covenants,
agreements and provisions herein contained, the parties hereto, intending to be
legally bound, hereby agree as follows:

 

ARTICLE 1

DEFINITIONS

 

1.1       Definitions. The following terms have the following meanings when used
herein:

 

“Accounts Receivable” has the meaning set forth in Section 2.1(b).

 

“Action” means any claim, action, suit, arbitration, inquiry, proceeding or
investigation that is pending by or before any Governmental Authority.

 

“Affiliate” shall mean a Person that directly, or indirectly through one or more
intermediaries, controls or is controlled by, or is under common control with,
the Person specified. For purposes of this definition, the terms “control,”
“controlled by” and “under common control with” shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of such Person and, in the case of an entity, shall
require (i) in the case of a corporate entity, direct or indirect ownership of
at least a majority of the securities having the right to vote for the election
of directors, and (ii) in the case of a non-corporate entity, direct or indirect
ownership of at least a majority of the equity interests with the power to
direct the management and policies of such non-corporate entity.

 

“Agreement” means this Asset Purchase Agreement, including all Schedules and
Exhibits hereto, as it may be amended from time to time in accordance with its
terms.

 

 

 

 

“Assignment and Assumption Agreement” means the Assignment and Assumption
Agreement in substantially the form attached hereto as Exhibit A.

 

“Assumed Contracts” has the meaning set forth in Section 2.1(d).

 

“Assumed Liabilities” has the meaning set forth in Section 2.3.

 

“Bill of Sale, Conveyance and Assignment” means the Bill of Sale, Conveyance and
Assignment in substantially the form attached hereto as Exhibit B.

 

“Business” means the business of promoting, sponsoring and otherwise
commercializing mixed martial arts events including live, televised and
pay-per-view events and the commercial exploitation of related products and
services at such events.

 

“Business Day” means any day of the year on which national banking institutions
in New York are open to the public for conducting business and are not required
or authorized to close.

 

“Business Employees” has the meaning set forth in Section 5.17.

 

“Buyer” has the meaning set forth in the preamble hereto.

 

“Claim” has the meaning set forth in Section 10.4.

 

“Claim Notice” has the meaning set forth in Section 10.4.

 

“Claimed Amount” has the meaning set forth in Section 10.4.

 

“Closing” means the closing of the purchase and sale of the Purchased Assets
contemplated by this Agreement.

 

“Closing Date” means the date set forth in Section 4.1.

 

“Code” has the meaning set forth in Section 3.4.

 

“Collateral Sources” has the meaning set forth in Section 10.5(c).

 

“Commission” means the U.S. Securities and Exchange Commission.

 

“Common Stock” means the common stock of Buyer $0.001 par value per share.

 

“Confidential Information” has the meaning set forth in Section 12.3.

 

“Employee Plan” has the meaning set forth in Section 5.16.

 

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“Encumbrance” shall mean any interest, consensual or otherwise, in property,
whether real, personal or mixed property or assets, tangible or intangible,
securing an obligation owed to, or a claim by a third Person, or otherwise
evidencing an interest of a Person other than the owner of the property, whether
such interest is based on common law, statute or contract, and including, but
not limited to, any security interest, security title or lien arising from a
mortgage, recordation of abstract of judgment, deed of trust, deed to secure
debt, encumbrance, restriction, charge, covenant, claim, exception,
encroachment, easement, right of way, license, permit, pledge, conditional sale,
option trust (constructive or otherwise) or trust receipt or a lease,
consignment or bailment for security purposes and other title exceptions and
encumbrances affecting the property.

 

“Equipment” has the meaning set forth in Section 2.1(c).

 

“Escrow Agent” means Mazzeo Song P.C.

 

“Escrowed Shares” has the meaning set forth in Section 3.3(b).

 

“Excluded Assets” has the meaning set forth in Section 2.2.

 

“Fighter Contract” has the meaning set forth in Section 5.21.

 

“Final Purchase Price Allocation” has the meaning set forth in Section 3.4.

 

“Gross Profit” has the meaning set forth in Section 3.2.

 

“Governmental Authority” means any government or governmental or regulatory,
judicial or administrative, body thereof, or political subdivision thereof,
whether foreign, federal, state, national, supranational or local, or any
agency, instrumentality or authority thereof, or any court or arbitrator (public
or private).

 

“Indemnified Person” has the meaning set forth in Section 10.3(a).

 

“Indemnifying Person” has the meaning set forth in Section 10.3(a).

 

“Intellectual Property Rights” means all intellectual property and other
proprietary rights, protected or protectable, under the laws of the United
States or any political subdivision thereof, including, without limitation
(i) copyrights (including but not limited to all copyrights in Seller’s MMA
event video library and fighter photographs and other copyrighted works);
(ii) all computer software, trade secrets and market and other data, inventions,
discoveries, devices, processes, designs, techniques, ideas, know-how and other
proprietary information, whether or not reduced to practice, and rights to limit
the use or disclosure of any of the foregoing by any Person; (iii) all domestic
and foreign patents and the registrations, applications, renewals, extensions,
divisional applications and continuations (in whole or in part) thereof; and
(iv) and all rights and causes of action for infringement, misappropriation,
misuse, dilution or unfair trade practices associated with (i) through
(iii) above. For purposes of clarification, Intellectual Property Rights shall
not include any trade names, trade dress, trademarks, service marks, logos,
brand names and other identifiers together with all goodwill associated
therewith which are licensed by Seller to Buyer pursuant to the Trademark
License Agreement.

 

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“Intellectual Property Transfer Agreement” means the Intellectual Property
Transfer Agreement in substantially the form attached hereto as Exhibit D.

 

“Inventory” has the meaning set forth in Section 2.1(h).

 

“Law” means any federal, state, local or foreign law, statute, code, ordinance,
rule or regulation (including rules of any self-regulatory organization).

 

“Liability” has the meaning set forth in Section 2.3.

 

“Losses” has the meaning set forth in Section 10.4.

 

“Make Good Escrow Agreement” means the Make Good Escrow Agreement in
substantially the form attached hereto as Exhibit E.

 

“Make Good” has the meaning set forth in Section 3.2.

 

“Most Recent Financial Statements” has the meaning set forth in Section 5.14.

 

“Non-Competition and Non-Solicitation Agreement” means that certain
Non-Competition and Non-Solicitation Agreement in substantially the form
attached hereto as Exhibit F.

 

“Order” shall mean any: (a) order, judgment, injunction, edict, decree, ruling,
pronouncement, determination, decision, opinion, verdict, sentence, subpoena,
writ or award issued, made, entered, rendered or otherwise put into effect by or
under the authority of any court or other Governmental Authority; or (b)
agreement with any Governmental Authority entered into in connection with any
Proceeding.

 

“Other Agreements” means, collectively, the Assignment and Assumption Agreement,
the Bill of Sale, Conveyance and Assignment, the Intellectual Property Transfer
Agreement, the Non-Competition and Non-Solicitation Agreement, the Make Good
Escrow Agreement, and the Trademark License Agreement.

 

“Permits” means all material permits, licenses, franchises and other
authorizations of any Governmental Authority possessed by or granted to Seller
in connection with the Business.

 

“Permitted Encumbrances” means (i) Encumbrances set forth on Schedule 2.1, (ii)
the Assumed Liabilities and any Encumbrances securing the same, (iii) any
Encumbrance in favor of a Person claiming by or through Buyer, (iv) any
Encumbrance which will be released at Closing, and (v) the lien for ad valorem
taxes not yet due or payable.

 

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“Person” means any individual, corporation, partnership, limited partnership,
joint venture, limited liability company, trust or unincorporated organization,
governmental entity, government or any agency or political subdivision thereof.

 

“Proceeding” shall mean any action, suit, litigation, arbitration, proceeding
(including any civil, criminal, administrative, investigative or appellate
proceeding and any informal proceeding), prosecution, contest, hearing, inquiry,
inquest, audit, examination or investigation commenced, brought, conducted or
heard by or before, or otherwise involving, any Governmental Authority.

 

“Purchase Price” has the meaning set forth in Section 3.1.

 

“Purchased Assets” has the meaning set forth in Section 2.1.

 

“Seller” has the meaning set forth in the preamble hereto.

 

“Share Price” means $4.50 per share of Common Stock.

 

“Target Gross Profit Notice” has the meaning set forth in Section 3.2(b).

 

“Trademark License Agreement” means that certain Trademark License Agreement in
substantially the form attached hereto as Exhibit G.

 

“Taxes” shall mean all taxes, charges, fees, duties, levies or other
assessments, including, without limitation, income, gross receipts, net
proceeds, ad valorem, turnover, real and personal property (tangible and
intangible), sales, use, franchise, excise, value added, goods and services,
license, payroll, unemployment, environmental, customs duties, capital stock,
disability, stamp, leasing, lease, user, transfer, fuel, excess profits,
occupational and interest equalization, windfall profits, severance and
employees’ income withholding, social security and similar employment taxes or
any other taxes imposed by the United States or any other foreign country or by
any state, municipality, subdivision or instrumentality of the Unites States or
of any other foreign country or by any other tax authority, including all
applicable penalties and interest, and such term shall include any interest,
penalties or additions to tax attributable to such taxes.

 

“Third Party Claim” has the meaning set forth in Section 10.3(a).

 

“Third-Party Claim Notice” has the meaning set forth in Section 10.3(a).

 

“Transferred Intellectual Property” has the meaning set forth in Section 2.1(k).

 

“Unaudited Financial Statements” has the meaning set forth in Section 5.14.

 

“U.S. GAAP” means U.S. Generally Accepted Accounting Principles.

 

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“1060 Forms” has the meaning set forth in Section 3.4.

 

ARTICLE 2

PURCHASE AND SALE

 

2.1       Agreements to Purchase and Sell. Subject to the terms and conditions
contained herein, at the Closing, Seller shall sell, transfer, convey, assign
and deliver to Buyer, and Buyer shall purchase and accept from Seller, free and
clear from all Encumbrances (except the Permitted Encumbrances), all of Seller’s
right, title and interest in and to all of the properties, assets, and other
rights of every kind and nature, whether tangible or intangible, real or
personal, owned, leased, licensed or otherwise held by Seller as of the Closing,
in each case to the extent primarily relating to or used in the Business
regardless of where such assets are located (collectively, the “Purchased
Assets”), including but not limited to the following:

 

(a)       all cash;

 

(b)       all accounts receivable, notes and notes receivable and other
receivables (whether or not billed) relating to the Business (collectively, the
“Accounts Receivable”);

 

(c)       all lighting, trusses, machinery, tools, spare parts, vehicles,
furniture, fixtures, fighter cages and other equipment and other tangible
personal property (excluding Inventory) of the Business (collectively, the
“Equipment”), including such Equipment identified on Schedule 2.1(c), and all
transferrable warranties and guarantees, if any, express or implied, existing
for the benefit of Seller in connection with the Equipment;

 

(d)       all contracts and agreements of Seller including, without limitation,
leases, licenses, sponsorship agreements, agreements with fighters and managers,
employment agreements, non-competition and non-solicitation agreements,
agreements with event venues, open quotations and bids from or to Seller’s
suppliers, customers or potential customers, and other agreements, whether oral
or written, relating to or used in the Business, including those identified on
Schedule 2.1(d) (collectively, the “Assumed Contracts”);

 

(e)       all rights under the all leases and subleases of real property
relating to or used in the Business and listed on Schedule 2.1(e) (“Real Estate
Leases”);

 

(f)       all deposits, prepayments and prepaid expenses or other similar
current assets used in the Business;

 

(g)       all transferable approvals, authorizations, certifications, consents,
variances, permissions, licenses and Permits to or from, or filings, notices or
recordings to or with, any Governmental Authority used in the Business;

 

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(h)       all inventory, including all raw materials, work-in-process, finished
goods, packaging materials, office supplies, maintenance supplies, spare parts
and similar items used or intended for use in connection with the Business
(“Inventory”);

 

(i)       all leasehold improvements constructed by Seller or provided by
landlords for Seller, subject to the rights and obligations under the Real
Estate Leases;

 

(j)       all sales and marketing information, including all customer records
and sales history with respect to customers (including invoices), sales and
marketing records, price lists, documents, correspondence, studies, reports, and
all other books, ledgers, files, and records of every kind, tangible data,
customer lists (including appropriate contact information), vendor and supplier
lists, service provider lists, promotional literature and advertising materials,
catalogs, data books and records, of the Seller, relating to the Business;

 

(k)       all Intellectual Property Rights related to the Business, including
the goodwill of the business related thereto (collectively, the “Transferred
Intellectual Property”);

 

(l)       all records, reports and information files of Seller relating to the
Business (including business development and development history files);

 

(m)       all claims, warranties, guarantees, refunds, causes of action,
defenses, counterclaims, rights of recovery, rights of set-off and rights of
recoupment of every kind and nature (including rights to insurance proceeds)
related to the Business, received after the Closing Date with respect to damage,
non-conformance of or loss to the Purchased Assets, except for any of the
foregoing to the extent they arise under the Excluded Assets;

 

(n)       to the extent transferable, all telephone and facsimile numbers and
Internet domain addresses, in each case related to the Purchased Assets,
including, without limitation, those described on Schedule 2.1 (n);

 

(o)       all other assets used in connection with the Business and not retained
by Seller pursuant to Section 2.2.

 

2.2       Excluded Assets. Notwithstanding anything to the contrary in this
Agreement, Seller shall not sell, transfer or assign, and Buyer shall not
purchase or otherwise acquire, the following assets of Seller (such assets being
collectively referred to hereinafter as the “Excluded Assets”):

 

(a)       all rights of Seller arising under this Agreement, the Other
Agreements or from the consummation of the transactions contemplated hereby or
thereby;

 

(b)       all corporate minute books, stock records and Tax returns (including
all work papers relating to such Tax returns) of Seller and such other similar
corporate books and records of Seller as may exist on the Closing Date;

 

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(c)       all claims and rights to refunds of Taxes paid by or on behalf of
Seller;

 

(d)       all assets of any employee benefit plan, arrangement, or program
maintained or contributed to by Seller;

 

(e)        all licenses and approvals of any Governmental Authority related to
the Business that are personal to Seller and non-transferrable;

 

(f)       all employee, personnel and other records that Seller is required by
Law to retain in its possession;

 

(g)       all capital stock held in treasury;

 

(h)       notes receivable from employees or shareholders of Seller; and

 

(i)       the items set forth on Schedule 2.2.

 

2.3       Liabilities of Seller; Assumed Liabilities. Buyer is not assuming and
shall not be held responsible for nor shall be required to assume or be
obligated to pay, discharge or perform, any debts, taxes, adverse claims,
obligations or liabilities of Seller of any kind or nature or at any time
existing or asserted, whether fixed, contingent or otherwise, whether in
connection with the Purchased Assets, the Business or otherwise and whether
arising before or after the consummation of the transactions contemplated by
this Agreement, or bear any cost or charge with respect thereto, including
without limitation, any accounts or notes payable, Taxes, warranty or personal
injury claims accrued prior to the Closing, commissions, union contracts,
unemployment contracts, profit sharing, retirement, pension, bonus,
hospitalization, vacation or other employee benefits or any employment or
old-age benefits relating to the employees of Seller. Notwithstanding the
foregoing, on the Closing Date, Buyer shall assume and agrees to timely pay,
perform and discharge the following Liabilities of Seller (collectively referred
to as the “Assumed Liabilities”):

 

(a)       all Liabilities and all obligations arising after the Closing Date
under the Assumed Contracts, other than any Liability arising out of or relating
to a breach of any Assigned Contract that occurred prior to the Closing Date;
and

 

(b)       all Liabilities or other claims related to the Business, that arise
from acts performed by Buyer after the Closing Date or that arise from ownership
and operation of the Purchased Assets and Business after the Closing Date.

 

For purposes of this Agreement, “Liability” means any debt, obligation, duty or
liability of any nature (including unknown, undisclosed, unmatured, unaccrued,
unasserted, contingent, indirect, conditional, implied, vicarious, derivative,
joint, several or secondary liability), regardless of whether such debt,
obligation, duty or liability would be required to be disclosed on a balance
sheet prepared in accordance with U.S. GAAP and regardless of whether such debt,
obligation, duty or liability is immediately due and payable.

 

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2.4       Procedures for Purchased Assets not Transferable. If any property or
other rights included in the Purchased Assets are not assignable or transferable
either by virtue of the provisions thereof or under applicable law without the
consent of some third party or parties, Seller shall use its commercially
reasonable efforts to obtain such consents after the execution of this
Agreement, but prior to the Closing, and Buyer shall use its commercially
reasonable efforts to assist in that endeavor. If any such consent cannot be
obtained prior to the Closing and the Closing occurs, this Agreement, the Other
Agreements and the related instruments of transfer shall not constitute an
assignment or transfer of the Purchased Asset regarding which such consent was
not obtained and Buyer shall not assume Seller’s obligations with respect to
such Purchased Asset, but Seller shall use its commercially reasonable efforts
to obtain such consent as soon as reasonably possible after the Closing or
otherwise obtain for Buyer the practical benefit of such property or rights and
Buyer shall use its commercially reasonable efforts to assist in that endeavor.
For purposes of this Section 2.4 only and not for the purposes of the rest of
this Agreement, commercially reasonable efforts shall not include any
requirement of either party to expend money, commence any litigation or offer or
grant any accommodation (financial or otherwise) to any third party.

 

ARTICLE 3

PURCHASE PRICE

 

3.1       Purchase Price. The purchase price (“Purchase Price”) for the
Purchased Assets shall be $750,000, subject to the Make Good adjustment pursuant
to Section 3.2.

 

3.2        Make Good Adjustments and Increases to Purchase Price.

 

(a)       The Selling Member agrees that in the event that the Gross Profit
attributable to the Business and the Purchased Assets and included in earnings
before income taxes in Buyer’s Annual Report on Form 10-K for the fiscal year
ending December 31, 2017, as filed with the Commission, is less than $107,143
(the “2017 Guaranteed Gross Profit”), shares of Common Stock representing 30% of
the Purchase Price set forth in Section 3.1 above and placed in escrow in
accordance with the Make Good Escrow Agreement will be cancelled and returned to
treasury. As used in this Agreement and the Other Agreements, “Gross Profit”
means total revenue minus the cost of revenue as determined by US GAAP,
consistently applied. For purposes of clarification all employee salaries and
related expenses incident to the Business shall be included in the cost of
revenue for purposes of determining Gross Profit.

 

(b)       2017 Guaranteed Gross Profit will be determined by Buyer and confirmed
by Buyer’s independent auditors 45 days prior to the date Buyer’s Annual Report
on Form 10-K for the fiscal year ending December 31, 2017 is filed with the
Commission. The methodology (including allocations of corporate revenue and
expenses to the Purchased Assets and the Business) for determining 2017
Guaranteed Gross Profit will be consistently applied by Buyer to each of the
regional MMA promotions acquired by Buyer. Seller will have 10 days after
receipt of Buyer’s determination of 2017 Guaranteed Gross Profit (which will
include the methodology applied by buyer for computing 2017 Guaranteed Gross
Profit) (the “Target Gross Profit Notice”) to provide written detailed
objections to Buyer and Buyer’s independent auditors to Buyer’s determination of
2017 Guaranteed Gross Profit. Absent manifest error on behalf of Buyer, Buyer’s
determination of 2017 Guaranteed Gross Profit shall be binding upon Seller.

 

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(c)       Cancellation of any Common Stock pursuant to this Section 3.2 shall be
deemed adjustments to the Purchase Price.

 

3.3       Payment of Purchase Price. The Purchase Price shall be paid at the
Closing by delivery:

 

(a)       to Seller of $150,000 in cash.

 

(b)       subject to Section 3.3(c) below, to Seller of the number of shares of
Common Stock (rounded to the nearest whole number) equal to $600,000 divided by
the Share Price.

 

(c)       to the Escrow Agent, pursuant to the terms of the Make Good Escrow
Agreement, from the Common Stock deliverable under Section 3.3(b) above, a
number of shares of Common Stock equal to 30% of the number of shares of Common
Stock (rounded to the nearest whole number) equal to the Purchase Price divided
by the Share Price (such shares the “Escrowed Shares”).

 

3.4 Allocation of Purchase Price. The Purchase Price shall be allocated among
the Purchased Assets and the Assumed Liabilities in accordance with Schedule 3.4
(the “Final Purchase Price Allocation”), which has been prepared in accordance
with the rules under Section 1060 of the Internal Revenue Code of 1986, as
amended (the “Code”). To the extent the Purchase Price is adjusted under Section
3.2, the parties shall adjust the Final Purchase Price Allocation consistent
with Schedule 3.4 and the rules under Section 1060 of the Code to reflect such
adjustment to the Purchase Price. The parties recognize that the Purchase Price
does not include Buyer’s acquisition expenses and that Buyer will allocate such
expenses appropriately. The parties agree to act in accordance with the
computations and allocations contained in the Final Purchase Price Allocation in
any relevant Tax returns or filings (including any forms or reports required to
be filed pursuant to Section 1060 of the Code or any provisions of local, state
and foreign law (“1060 Forms”)), and to cooperate in the preparation of any 1060
Forms and to file such 1060 Forms in the manner required by applicable law.
Neither Buyer nor Seller shall take any position (whether in audits, Tax
returns, or otherwise) that is inconsistent with the Final Purchase Price
Allocation unless required to do so by applicable law.

 

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ARTICLE 4

CLOSING

 

4.1       Closing Date. The Closing shall take place at a place and location to
be agreed upon between Buyer and Seller, subject to the satisfaction or waiver
of each of the conditions set forth in Article 8 (such date, the “Closing
Date”).

 

4.2       Transactions at Closing. At the Closing, subject to the terms and
conditions hereof:

 

(a)       Transfer of Purchased Assets and Seller’s Closing Deliveries. Seller
shall transfer and convey or cause to be transferred and conveyed to Buyer all
of the Purchased Assets and Seller and Buyer shall execute and Seller shall
deliver to Buyer each of the Other Agreements and such other good and sufficient
instruments of transfer and conveyance as shall be necessary to vest in Buyer
title to all of the Purchased Assets or as shall be reasonably requested by the
Buyer. The Seller shall also deliver to Buyer the Seller Officer’s Certificate
required by Section 8.2(b) and all other documents required to be delivered by
Seller at Closing pursuant hereto.

 

(b)       Payment of Purchase Price, Assumption of Assumed Liabilities and
Buyer’s Closing Deliveries. In consideration for the transfer of the Purchased
Assets and other transactions contemplated hereby Buyer shall deliver the
Purchase Price to the Seller and shall execute and deliver to Seller the Bill of
Sale, Conveyance and Assignment and the Assignment and Assumption Agreement,
whereby Buyer assumes the Assumed Liabilities, and each of the Other Agreements,
as well as the Buyer Officer’s Certificate required by Section 8.1(b) and all
other documents required to be delivered by Buyer at Closing pursuant hereto or
as shall be reasonably requested by Seller.

 

(c)       Notification of transfer of Purchased Assets. At or before the
Closing, Seller will notify all parties to the contracts specified on
Schedule 5.7 hereto of the transfer of the Purchased Assets to Buyer and provide
copies of such notices to Buyer.

 

ARTICLE 5

REPRESENTATIONS AND WARRANTIES OF SELLER AND THE SELLING MEMBER

 

Seller and the Selling Member, jointly and severally, represent and warrant to
Buyer as follows:

 

5.1       Organization. Seller is a corporation duly organized and validly
existing in good standing under the laws of the State of Ohio, duly qualified to
transact business as a foreign entity in such jurisdictions where the nature of
its Business makes such qualification necessary, except as to jurisdictions
where the failure to qualify would not reasonably be expected to have a material
adverse effect on the Business of the Seller or the Purchased Assets, and has
all requisite corporate power and authority to own, lease and operate the
Purchased Assets and to carry on its Business, as now being conducted.

 

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5.2       Due Authorization.

 

(a)       Seller has full corporate power and authority to execute, deliver and
perform its obligations under this Agreement and the Other Agreements, and the
execution and delivery of this Agreement and the Other Agreements and the
performance of all of its obligations hereunder and thereunder has been duly and
validly authorized and approved by all necessary corporate action of the Seller,
including approval of this Agreement and the Other Agreements by the board of
directors of the Seller.

 

(b)       Subject to obtaining any consents of Persons listed on Schedule 5.7,
the signing, delivery and performance of this Agreement and the Other Agreements
by Seller is not prohibited or limited by, and will not result in the breach of
or a default under, or conflict with any obligation of Seller with respect to
the Purchased Assets under (i) any provision of its certificate of
incorporation, by-laws or other organizational documentation of Seller, (ii) any
material agreement or instrument to which Seller is a party or by which it or
its properties are bound, (iii) any authorization, judgment, order, award, writ,
injunction or decree of any Governmental Authority which breach, default or
conflict would have a material adverse effect on the Business or Purchased
Assets or Seller’s ability to consummate the transactions contemplated hereby,
or (iv) any applicable law, statute, ordinance, regulation or rule which breach,
default or conflict would have a material adverse effect on the Business or
Purchased Assets or Seller’s ability to consummate the transactions contemplated
hereby, and, will not result in the creation or imposition of any Encumbrance on
any of the Purchased Assets. This Agreement has been, and on the Closing Date
the Other Agreements will have been, duly executed and delivered by Seller and
constitutes, or, in the case of the Other Agreements, will constitute, the
legal, valid and binding obligation of Seller, enforceable against Seller in
accordance with their respective terms, except as enforceability may be limited
or affected by applicable bankruptcy, insolvency, moratorium, reorganization or
other laws of general application relating to or affecting creditors’ rights
generally.

 

5.3       Equipment and other Purchased Assets. Other than as set forth on
Schedule 5.3, the Equipment and other Purchased Assets owned by, in the
possession of, or used by Seller, in connection with the Business is in good
condition and repair, ordinary wear and tear excepted, and is usable in the
ordinary course of business.

 

5.4       Title. Other than as set forth on Schedule 5.4, the Purchased Assets
are owned legally and beneficially by Seller with good and transferable title
thereto, free and clear of all Encumbrances other than Permitted Encumbrances.
At the Closing, Buyer will receive legal and beneficial title to all of the
Purchased Assets, free and clear of all Encumbrances, except for the Permitted
Encumbrances and Assumed Liabilities, and subject to obtaining any consents of
Persons listed on Schedule 5.7.

 

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5.5       Intellectual Property. Identified on Schedule 5.5 is a complete and
accurate list of all Intellectual Property Rights used by Seller in the
Business. Except as set forth on Schedule 5.5, the Transferred Intellectual
Property is owned free and clear of all Encumbrances or has been duly licensed
for use by Seller and all pertinent licenses and their respective material terms
are set forth on Schedule 5.5. Except as set forth on Schedule 5.5, the
Transferred Intellectual Property is not the subject of any pending adverse
claim or, to Seller’s knowledge, the subject of any threatened litigation or
claim of infringement or misappropriation. Except as set forth on Schedule 5.5,
the Seller has not violated the terms of any license pursuant to which any part
of the Transferred Intellectual Property has been licensed by the Seller. To
Seller’s knowledge, except as set forth on Schedule 5.5, the Transferred
Intellectual Property does not infringe on any Intellectual Property Rights of
any third party. To the Seller’s knowledge the Transferred Intellectual Property
together with the rights granted under the Trademark License Agreement
constitutes all of the Intellectual Property Rights necessary to conduct the
Business as presently conducted. Except as set forth on Schedule 5.5, the
Transferred Intellectual Property will continue to be available for use by Buyer
from and after the Closing at no additional cost to Buyer.

 

5.6       Litigation. Except as set forth on Schedule 5.6, there is no suit (at
law or in equity), claim, action, judicial or administrative proceeding,
arbitration or governmental investigation now pending or, to the best knowledge
of Seller threatened, (i) arising out of or relating to any aspect of the
Business, or any part of the Purchased Assets, (ii) concerning the transactions
contemplated by this Agreement, or (iii) involving Seller, its shareholders, or
the officers, directors or employees of Seller in reference to actions taken by
them in the conduct of any aspect of the Business.

 

5.7       Consents. Except as set forth on Schedule 5.7, no notice to, filing
with, authorization of, exemption by, or consent of any Person is required for
Seller to consummate the transactions contemplated hereby.

 

5.8       Brokers, Etc. No broker or investment banker acting on behalf of
Seller or under the authority of Seller is or will be entitled to any broker’s
or finder’s fee or any other commission or similar fee directly or indirectly
from Seller or Buyer in connection with any of the transactions contemplated
herein, other than any fee that is the sole responsibility of Seller.

 

5.9       Absence of Undisclosed Liabilities. To Seller’s knowledge, Seller has
not incurred any material liabilities or obligations with respect to the
Purchased Assets (whether accrued, absolute, contingent or otherwise), which
continue to be outstanding, except as otherwise expressly disclosed in this
Agreement.

 

5.10       Assumed Contracts. All current and complete copies of all Assumed
Contracts (which shall be deemed to include all Fighter Contracts) have been
delivered to or made available to the Buyer. Except as set forth on Schedule
5.10, the Assumed Contracts are all in full force and effect and, to Seller’s
knowledge, there are no outstanding material defaults or violations under such
Assumed Contracts on the part of the Seller or, to the knowledge of the Seller,
on the part of any other party to such Assumed Contracts, except for such
defaults as will not have a material adverse effect on the Business or Purchased
Assets, taken as a whole. Except as set forth on Schedule 5.10, there are no
current or pending negotiations with respect to the renewal, repudiation or
amendment of any Assumed Contract, other than in connection with negotiations
for renewals and amendments in the ordinary course of business.

 

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5.11       Tax Matters. In each case except as would not reasonably be expected
to have a material adverse effect on the Purchased Assets:

 

(a)       No failure, if any, of the Seller to duly and timely pay all Taxes,
including all installments on account of Taxes for the current year, that are
due and payable by it will result in an Encumbrance on the Purchased Assets;

 

(b)       There are no proceedings, investigations, audits or claims now pending
or threatened against the Seller in respect of any Taxes, and there are no
matters under discussion, audit or appeal with any governmental authority
relating to Taxes, which will result in an Encumbrance on the Purchased Assets;

 

(c)       The Seller has duly and timely withheld all Taxes and other amounts
required by law to be withheld by it relating to the Purchased Assets (including
Taxes and other amounts relating to the Purchased Assets required to be withheld
by it in respect of any amount paid or credited or deemed to be paid or credited
by it to or for the account or benefit of any Person, including any employees,
officers or directors and any non-resident Person), and has duly and timely
remitted to the appropriate Governmental Authority such Taxes and other amounts
required by law to be remitted by it; and

 

(d)       The Seller has duly and timely collected all amounts on account of any
sales or transfer Taxes, including goods and services, harmonized sales and
provincial or territorial sales Taxes with respect to the Purchased Assets,
required by law to be collected by it and has duly and timely remitted to the
appropriate Governmental Authority any such amounts required by law to be
remitted by it.

 

5.12       Scope of Rights in Purchased Assets. Except as set forth on
Schedule 5.12, the rights, properties, and assets included in the Purchased
Assets include substantially all of the rights, properties, and assets, of every
kind, nature and description, wherever located, that Seller believes are
necessary to own, use or operate the Business.

 

5.13       Compliance with Laws. Seller is in compliance with all laws
applicable to the Business, except where the failure to be in compliance would
not have a material adverse effect on the Purchased Assets or the Business.
Seller has not received any unresolved written notice of or been charged with
the violation of any laws applicable to the Business except where such charge
has been resolved. Except as set forth on Schedule 5.13, there are no pending
or, to the knowledge of the Seller, threatened actions or proceedings by any
Governmental Authority, which would prohibit or materially impede the Business.

 

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5.14 Financial Statements. Seller has provided to Buyer copies of the unaudited
balance sheet of the Seller at December 31, 2014 and December 31, 2015 and the
related statements of income and cash flows for the years then ended together
with the unaudited balance sheet of the Seller at September 30, 2016 and the
related statements of income and cash flows for the nine months then ended
(referred to as the “Most Recent Financial Statements”. Except as set forth on
Schedule 5.14, the Most Recent Financial Statements fairly present, in all
material respects, the net assets of the Business at December 31, 2015 and for
the nine months ended September 30, 2016 and the operating profit or loss of the
Business.

 

5.15       Absence of Certain Changes. Except as contemplated by this Agreement,
reflected in the Most Recent Financial Statements or set forth on Schedule 5.15,
since December 31, 2015, (i) the Business has been conducted in all material
respects in the ordinary course of business and (ii) neither Seller nor the
Selling Member have taken any of the following actions:

 

(a)       sold, assigned or transferred any material portion of the Purchased
Assets other than (i) in the ordinary course of business or (ii) sales or other
dispositions of obsolete or excess equipment or other assets not used in the
Business;

 

(b)       cancelled any indebtedness other than in the ordinary course of
business, or waived or provided a release of any rights of material value to the
Business or the Purchased Assets;

 

(c)       except as required by Law, granted any rights to severance benefits,
“stay pay”, termination pay or transaction bonus to any Business Employee or
increased benefits payable or potentially payable to any such Business Employee
under any previously existing severance benefits, “stay-pay”, termination pay or
transaction bonus arrangements (in each case, other than grants or increases for
which Buyer will not be obligated following the Closing);

 

(d)       except in the ordinary course of business, made any capital
expenditures or commitments therefor with respect to the Business in an amount
in excess of $50,000 in the aggregate;

 

(e)       acquired any entity or business (whether by the acquisition of stock,
the acquisition of assets, merger or otherwise), other than acquisitions that
have not or will not become integrated into the Business;

 

(f)       amended the terms of any existing Employee Plan, except for amendments
required by Law;

 

(g)       changed the Tax or accounting principles, methods or practices of the
Business, except in each case to conform to changes required by Tax Law, in U.S.
GAAP or applicable local generally accepted accounting principles;

 

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(h)       amended, cancelled (or received notice of future cancellation of) or
terminated any Assumed Contract which amendment, cancellation or termination is
not in the ordinary course of business;

 

(i)       materially increased the salary or other compensation payable by
Seller to any Business Employee, or declared or paid, or committed to declare or
pay, any bonus or other additional payment to and Business Employees, other than
(A) payments for which Buyer shall not be liable after Closing, (B) customary
compensation increases and (C) bonus awards or payments under existing bonus
plans and arrangements awarded to Business Employees which have been awarded or
paid in the ordinary course of business;

 

(j)       failed to make any material payments under any Assumed Contracts or
Permits as and when due (except where contested in good faith or cured by
Seller) under the terms of such Assumed Contracts or Permits;

 

(k)       suffered any material damage, destruction or loss relating to the
Business or the Purchased Assets, not covered by insurance;

 

(l)       incurred any material claims relating to the Business or the Purchased
Assets not covered by applicable policies of liability insurance within the
maximum insurable limits of such policies;

 

(m)       mortgaged, sold, assigned, transferred, pledged or otherwise placed an
Encumbrance on any Purchased Asset, except in the ordinary course of business,
as otherwise set forth herein or that will be released at Closing;

 

(n)       transferred, granted, licensed, assigned, terminated or otherwise
disposed of, modified, changed or cancelled any material rights or obligations
with respect to any of the Transferred Intellectual Property, except in the
ordinary course of business; or

 

(o)       entered into any agreement or commitment to take any of the actions
set forth in paragraphs (a) through (n) of this Section 5.15.

 

5.16       Employee Benefit Plans. Attached on Schedule 5.16 is a list of all
qualified and non-qualified pension and welfare benefit plans of Seller (the
“Employee Plans”). Each of the Employee Plans has been operated in accordance
with its terms, does not discriminate (as that term is defined in the Code) and
will, along with all other bonus plans, incentive or compensation arrangements
provided by Seller to or for its employees, be terminated by Seller immediately
following Closing. All payments due from Seller pursuant thereto have been paid.

 

5.17       Business Employees. Attached on Schedule 5.17 is a list of all
employees of Seller (collectively, the “Business Employees”), their current
salaries or compensation, a listing of commission arrangements, a list of
commitments for future salary or compensation increases, and the last salary
raise with dates and amounts. Schedule 5.17 lists all individuals with whom
Seller has employment, consulting, representative, labor, non-compete or any
other restrictive agreements. Except as set forth on Schedule 5.17, Seller has
not entered into any severance or similar arrangement with respect of any
Business Employee (or any former employee or consultant) that will result in any
obligation (absolute or contingent) of Buyer or Seller to make any payment to
any Business Employee (or any former employee or consultant) following
termination of employment.

 

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5.18       Labor Relations. Except as set forth on Schedule 5.18, Seller has
complied in all material respects with all federal, state and local laws, rules
and regulations relating to the employment of labor including those related to
wages, hours and the payment of withholding and unemployment Taxes. Seller has
withheld all amounts required by law or agreement to be withheld from the wages
or salaries of its employees and is not liable for any arrearage of wages or any
Taxes or penalties for failure to comply with any of the foregoing.

 

5.19       Sponsors, Vendors and Suppliers. Attached on Schedule 5.19 is a
complete and accurate list of (i) the five (5) largest sponsors of Seller in
terms of revenue during the period from January 1, 2014 through June 30, 2015,
showing the approximate total amount of sponsorship revenue by Seller from each
such sponsor during such period; and (ii) the five (5) largest vendors and
suppliers (whether of production services, event venues, equipment, fighter
managers, etc.) to Seller in terms of purchases or payments made by Seller to
such vendor or supplier during the period from January 1, 2014 through June 30,
2015, showing the approximate total purchases or payments by Seller from each
such supplier during such period. Except as set forth on Schedule 5.19 and to
Seller’s knowledge, as of the date of this Agreement there has been no adverse
change in the business relationship of Seller with any sponsor or supplier named
on Schedule 5.19 that is material to the Business or the financial condition of
Seller.

 

5.20       Conflict of Interest. Except as set forth on Schedule 5.20, neither
Seller nor the Selling Member have any direct or indirect interest (except
through ownership of less than five percent (5%) of the outstanding securities
of corporations listed on a national securities exchange or registered under the
Securities Exchange Act of 1934, as amended) in (i) any entity which does
business with Seller or is competitive with the Business, or (ii) any property,
asset or right which is used by Seller in the conduct of its Business.

 

5.21       Fighters Under Contract. Schedule 5.21 sets forth each agreement to
which the Seller or Selling Member is a party with any professional mixed
martial arts fighter and the economic terms of each such agreement (each a
“Fighter Contract”). Each Fighter Contract is in full force and effect and, to
Seller’s knowledge, there are no outstanding material defaults or violations
under any such Fighter Contract on the part of the Seller or, to the knowledge
of the Seller, on the part of any other party to such Fighter Contract, except
for such defaults as will not have a material adverse effect on the Business or
Purchased Assets, taken as a whole. Except as set forth on Schedule 5.21, there
are no current or pending negotiations with respect to the renewal, repudiation
or amendment of any Fighter Contract, other than in connection with negotiations
for renewals and amendments in the ordinary course of business.

 

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5.22       Inventories. All Inventory, except for obsolete items or items of
below-standard quality which have been written off or written down on Seller’s
balance sheet, has been purchased in the ordinary course of business, is free
from material defects, consists of goods of the kind, quantity and quality
regularly used and sold in the Business. The Inventory, except for obsolete
items or items of below-standard quality which have been written off or written
down on Seller’s balance sheet, is merchantable and fit for its intended purpose
and Seller has not, is not contemplating, nor has any reason to believe that a
recall of such items or any items previously sold by Seller is necessary or
warranted.

 

5.23       Accounts Receivable. All of the Accounts Receivable are (and as of
the Closing Date will be) bona fide receivables subject to no counterclaims or
offsets and arose in the ordinary course of business. At the Closing and except
for Permitted Encumbrances, no person or entity will have any lien on such
Accounts Receivable or any part thereof, and no agreement for deduction, free
goods, discount or other deferred price or quantity adjustment will have been
made with respect to any such Accounts Receivable.

 

5.24       Insurance. Seller maintains (i) insurance on all the Purchased Assets
covering property damage by fire or other casualty which it is customary for
Seller to insure, (ii) insurance protection against all liabilities, claims, and
risks against which it is customary for Seller to insure, and (iii) insurance
for worker’s compensation and unemployment, products liability, and general
public liability. All of such policies are consistent with past practices of
Seller. Seller is not in default under any of such policies or binders. Such
policies and binders are in full force and effect on the date hereof and shall
be kept in full force and effect through the Closing Date.

 

5.25       Payment of Debts. Except for those liabilities assumed by Buyer
pursuant to Section 2.3, Seller has made adequate provisions for payments of the
amount due to its creditors and shall pay the same at Closing or pursuant to
their existing terms on or before the Closing.

 

5.26       Accuracy of Statements. No representation or warranty by Seller or
Selling Member in this Agreement contains, or will contain, an untrue statement
of a material fact or omits, or will omit, to state a material fact necessary to
make the statements contained herein or therein, in light of the circumstances
in which they are made, not misleading. There is no fact known to Seller or
Selling Member that materially adversely affects the business, financial
condition or affairs of the Business, Seller or Selling Member.

 

5.27       Representations and Warranties of Buyer. Neither Seller nor Selling
Member are aware of, or have discovered through due diligence, any breaches by
Buyer of its representations and warranties made in Article 6 of this Agreement,
which they have not disclosed to Buyer.

 

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5.28       Sufficiency of Assets. Other than as set forth on Schedule 5.28, the
Purchased Assets constitute all of the assets necessary to conduct the Business
as it is conducted as of the date of this Agreement. Other than as set forth on
Schedule 5.28, all Permits and Assumed Contracts, including those identified on
Schedule 2.1(d) will be available for use by the Buyer on materially identical
terms (i) as of the Closing and (ii) for one year following the Closing.

 

5.29       The Selling Member.

 

(a)       The Selling Member has ever (i) made a general assignment for the
benefit of creditors, (ii) filed, or had filed against such Selling Member, any
bankruptcy petition or similar filing, (iii) suffered the attachment or other
judicial seizure of all or a substantial portion of such Selling Member’s
assets, (iv) admitted in writing such Selling Member’s inability to pay his or
her debts as they become due, or (v) taken or been the subject of any action
that may have an adverse effect on his ability to comply with or perform any of
his covenants or obligations under any of the Other Agreements.

 

(b)       Selling Member is not subject to any Order or is bound by any
agreement that may have an adverse effect on his ability to comply with or
perform any of his or her covenants or obligations under any of the Other
Agreements. There is no Proceeding pending, and no Person has threatened to
commence any Proceeding, that may have an adverse effect on the ability of
Selling Member to comply with or perform any of his covenants or obligations
under any of the Other Agreements. No event has occurred, and no claim, dispute
or other condition or circumstance exists, that might directly or indirectly
give rise to or serve as a basis for the commencement of any such Proceeding.

 

5.30       Investment Purposes.

 

(a)       Seller and Selling Member (i) understand that the shares of Common
Stock to be issued to Seller pursuant to this Agreement have not been registered
for sale under any federal or state securities Laws and that such shares are
being offered and sold to Seller pursuant to an exemption from registration
provided under Section 4(2) of the Securities Act, (ii) agree that Seller is
acquiring such shares for its own account for investment purposes only and
without a view to any distribution thereof other than to the Selling Member as
permitted by the Securities Act and subject to the Lock-Up Agreement, (iii)
acknowledge that the representations and warranties set forth in this Section
5.30 are given with the intention that the Buyer rely on them for purposes of
claiming such exemption from registration, and (iv) understand that they must
bear the economic risk of the investment in such shares for an indefinite period
of time as such shares cannot be sold unless subsequently registered under
applicable federal and state securities Laws or unless an exemption from
registration is available therefrom.

 

(b)       Seller and Selling Member agree (i) that the shares of Common Stock to
be issued to Seller pursuant to this Agreement will not be sold or otherwise
transferred for value unless (x) a registration statement covering such shares
has become effective under applicable state and federal securities laws,
including, without limitation, the Securities Act, or (y) there is presented to
the Buyer an opinion of counsel satisfactory to the Buyer that such registration
is not required, (ii) that any transfer agent for the Common Stock may be
instructed not to transfer any such shares unless it receives satisfactory
evidence of compliance with the foregoing provisions, and (iii) that there will
be endorsed upon any certificate evidencing such shares an appropriate legend
calling attention to the foregoing restrictions on transferability of such
shares.

 

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(c)       Seller and Selling Member is an “accredited investor” within the
meaning of Rule 501 of Regulation D under the Securities Act.

 

(d)       Seller and Selling Member (i) are aware of the business, affairs and
financial condition of the Buyer and the other, and have acquired sufficient
information about the Buyer to reach an informed and knowledgeable decision to
acquire the shares of Common Stock to be issued to Seller pursuant to this
Agreement, (ii) have discussed the Buyer’s plans, operations and financial
condition with the Buyer’s officers, (iii) have received all such information as
they have deemed necessary and appropriate to enable them to evaluate the
financial risk inherent in making an investment in the shares of Common Stock to
be issued pursuant to this Agreement, (iv) have sufficient knowledge and
experience in financial and business matters and in the business of conducting
mixed martial arts promotions so as to be capable of evaluating the merits and
risks of their investment in Common Stock, and (v) are capable of bearing the
economic risks of such investment.

 

ARTICLE 6

REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer represents and warrants to Seller and the Selling Member as follows:

 

6.1       Organization. Buyer is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all
requisite corporate power and authority to own its property and to carry on its
business as it is now being conducted.

 

6.2       Due Authorization. Buyer has full corporate power and authority to
execute, deliver and perform its obligations under this Agreement and the Other
Agreements and the execution and delivery of this Agreement and the Other
Agreements and the performance of all of its obligations hereunder and
thereunder has been duly and validly authorized and approved by all necessary
corporate action of the Buyer. This Agreement has been, and on the Closing Date
the Other Agreements will have been, duly executed and delivered by Buyer and
constitutes, or, in the case of the Other Agreements will constitute, the legal,
valid and binding obligations of Buyer, enforceable against Buyer in accordance
with their respective terms, except as enforceability may be limited or affected
by applicable bankruptcy, insolvency, moratorium, reorganization or other laws
of general application relating to or affecting creditors’ rights generally.

 

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6.3       Consents. Except as set forth on Schedule 6.3, no notice to, filing
with, authorization of, exemption by, or consent of, any Person is required for
Buyer to consummate the transactions contemplated hereby.

 

6.4       No Conflict or Violation. Neither the execution and delivery of this
Agreement nor the consummation of the transactions contemplated hereby will
result in (i) a violation of or a conflict with any provision of the certificate
of incorporation, by-laws or other organizational document of Buyer; (ii) a
breach of, or a default under, any term of provision of any contract, agreement,
indebtedness, lease, commitment, license, franchise, permit, authorization or
concession to which Buyer is a party which breach or default would have a
material adverse effect on the business or financial condition of Buyer or their
ability to consummate the transactions contemplated hereby; or (iii) a violation
by Buyer of any statute, rule, regulation, ordinance, code, order, judgment,
writ, injunction, decree or award, which violation would have a material adverse
effect on the business or financial condition of Buyer or its ability to
consummate the transactions contemplated hereby.

 

6.5       Brokers, Etc. No broker or investment banker acting on behalf of Buyer
or under the authority of Buyer is or will be entitled to any broker’s or
finder’s fee or any other commission or similar fee directly or indirectly from
Seller or Buyer in connection with any of the transactions contemplated herein,
other than any fee that is the sole responsibility of Buyer.

 

6.6       Accuracy of Statements. No representation or warranty by Buyer in this
Agreement contains, or will contain, an untrue statement of a material fact or
omits, or will omit, to state a material fact necessary to make the statements
contained herein or therein, in light of the circumstances in which they are
made, not misleading. There is no fact known to Buyer that materially adversely
affects the business, financial condition or affairs of the Buyer.

 

6.7       Representations and Warranties of Seller and the Selling Member. Buyer
is not aware of, nor has discovered through due diligence, any breaches by
Seller or Selling Member of their respective representations and warranties made
in Article 5 of this Agreement, which it has not disclosed to Seller and the
Selling Member.

 

6.8       Capitalization. The authorized capital stock of the Buyer consists of
(i) 45,000,000 shares of Common Stock, of which on the date hereof 8,888,975
shares are issued and outstanding, and (ii) 5,000,000 shares of preferred stock,
$0.001 par value per share, of which on the date hereof and on the Closing Date
no shares are issued and outstanding. Other that shares underlying employee
options and restricted shares issued under the Buyer’s 2016 Equity Incentive
Plan and a warrant to purchase 222,230 shares of Common Stock at an exercise
price of $7.42 per share issued to the Buyer’s underwriter in connection with
its initial public offering, no subscription, warrant, option, convertible
security or other right (contingent or otherwise) to purchase, acquire
(including rights of first refusal, anti-dilution or pre-emptive rights) or
register under the Securities Act any shares of capital stock of the Company is
authorized or outstanding. The Company does not have any obligation to issue any
subscription, warrant, option, convertible security or other such right or to
issue or distribute to holders of any shares of its capital stock any evidence
of indebtedness or assets of the Company. The Company does not have any
obligation to purchase, redeem or otherwise acquire any shares of its capital
stock or any interest therein or to pay any dividend or make any other
distribution in respect thereof. There are no outstanding or authorized stock
appreciation, phantom stock, profit participation or similar rights with respect
to the Company. At the Closing, the shares of Common Stock to be issued to
Seller as consideration for the Purchase Price will be duly authorized, validly
issued, fully paid and non-assessable.

 

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ARTICLE 7

COVENANTS AND CONDUCT OF SELLER

FROM THE DATE OF EXECUTION OF THIS AGREEMENT TO THE CLOSING DATE

 

Seller and the Selling Member, jointly and severally, covenant that from the
date of the execution of this Agreement to the Closing Date, Seller shall:

 

7.1       Compensation. Except in the ordinary course of business or as set
forth on Schedule 7.1, not increase or commit to increase, the amount of
compensation payable, or to become payable by Seller, or make, any bonus,
profit-sharing or incentive payment to any of its officers, directors or
relatives of any of the foregoing;

 

7.2       Encumbrance of Assets. Not cause any Encumbrance of any kind other
than Permitted Encumbrances to be placed upon any of the Purchased Assets or
other assets of Seller, exclusive of liens arising as a matter of law in the
ordinary course of business as to which there is no known default;

 

7.3       Incur Liabilities. Not take any action which would cause Seller to
incur any obligation or liability (absolute or contingent) except liabilities
and obligations incurred in the ordinary course of business or which will be
paid at Closing;

 

7.4       Disposition of Assets. Not sell or transfer any of the Purchased
Assets or any other tangible or intangible assets of Seller or cancel any debts
or claims, except in each case in the ordinary course of business;

 

7.5       Executory Agreements. Except for modifications in connection with
extensions of existing agreements in the ordinary course of business, not
modify, amend, alter, or terminate (by written or oral agreement, or any manner
of action or inaction), any of the executory agreements of Seller including,
without limitation, any Fighter Contracts, agreements with vendors, televisions
or media partners, event sponsors or event venue providers except as otherwise
approved by Buyer in writing, which consent will not be unreasonably withheld or
delayed;

 

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7.6       Material Transactions. Not enter into any transaction material in
nature or amount without the prior written consent of Buyer, except for
transactions in the ordinary course of business;

 

7.7       Purchase or Sale Commitments. Not undertake any purchase or sale
commitment that will result in purchases outside of customary requirements;

 

7.8       Preservation of Business. Use its best efforts to preserve the
Purchased Assets, keep in faithful service the present officers and key
employees of Seller (other than increasing compensation to do so) and preserve
the goodwill of its suppliers, customers and others having business relations
with Seller;

 

7.9       Investigation. Allow, during normal business hours, Buyer’s personnel,
attorneys, accountants and other authorized representatives free and full access
to the plans, properties, books, records, documents and correspondence, and all
of the work papers and other documents relating to Seller in the possession of
Seller, its officers, directors, employees, auditors or counsel, in order that
Buyer may have full opportunity to make such investigation as it may desire of
the properties and Business of Seller;

 

7.10       Compliance with Laws. Comply in all material respects with all Laws
applicable to Seller or to the conduct of its Business;

 

7.11       Notification of Material Changes. Provide Buyer’s representatives
with prompt written notice of any material and adverse change in the condition
(financial or other) of Seller’s assets, liabilities, earnings, prospects or
business which has not been disclosed to Buyer in this Agreement; and

 

7.12       Cooperation. Cooperate fully, completely and promptly with Buyer in
connection with (i) securing any approval, consent, authorization or clearance
required hereunder, or (ii) satisfying any condition precedent to the Closing
without additional cost and expense to Seller unless such action is otherwise
the obligation of Seller.

 

7.13       Financial Statements. Cooperate fully, completely and promptly with
Buyer, its counsel, and all auditors in connection with providing Buyer at
Seller’s expense all Seller audited and reviewed financial statements required
by the Commission and Regulation S-X promulgated under the Securities Act for
inclusion in the Buyer’s Form 8-K.

 

Nothing in this Agreement shall prohibit Seller from paying dividends and other
distributions to the Selling Member.

 

ARTICLE 8

CONDITIONS TO CLOSING

 

8.1       Conditions to Obligations of Seller. The obligations of Seller to
consummate the transactions contemplated by this Agreement shall be subject to
fulfillment at or prior to the Closing of the following conditions (any one or
more of which may be waived in whole or in part by Seller):

 

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(a)       Performance of Agreements and Conditions. All agreements and covenants
to be performed and satisfied by Buyer hereunder on or prior to the Closing Date
shall have been duly performed and satisfied by Buyer in all material respects.

 

(b)       Representations and Warranties True. The representations and
warranties of Buyer contained in this Agreement that are qualified as to
materiality shall be true and correct, and all other representations and
warranties of Buyer contained in this Agreement shall be true and correct except
for breaches of, or inaccuracies in, such representations and warranties that,
in the aggregate, would not have a material adverse effect on the expected
benefits to Seller of the transactions contemplated by this Agreement taken as a
whole, in each such case on and as of the Closing Date, with the same effect as
though made on and as of the Closing Date, and there shall be delivered to
Seller on the Closing Date a certificate, in form of Exhibit H attached hereto,
executed by the Managing Memberof Buyer to that effect (the “Buyer Officer’s
Certificate”).

 

(c)       Payment of Purchase Price. Buyer shall have paid the Purchase Price
and assumed the Assumed Liabilities as provided in Section 4.2(b).

 

(d)       No Action or Proceeding. No legal or regulatory action or proceeding
shall be pending or threatened by any Person to enjoin, restrict or prohibit the
purchase and sale of the Purchased Assets contemplated hereby. No order,
judgment or decree by any court or regulatory body shall have been entered in
any action or proceeding instituted by any party that enjoins, restricts, or
prohibits this Agreement or the complete consummation of the transactions as
contemplated by this Agreement.

 

(e)       Other Agreements. Buyer shall have delivered to Seller a duly executed
copy of each of the Other Agreements.

 

(f)       Required Consents. Seller shall have obtained all consents of or
notification to any third parties required by the terms of any Assumed Contract
or applicable law for Seller to assign it rights and obligations to Buyer as
contemplated by this Agreement.

 

8.2       Conditions to Obligations of Buyer. The obligations of Buyer to
consummate the transactions contemplated by this Agreement shall be subject to
fulfillment at or prior to the Closing of the following conditions (any one or
more of which may be waived in whole or in part by Buyer):

 

(a)       Performance of Agreements and Covenants. All agreements and covenants
to be performed and satisfied by Seller and the Selling Member hereunder on or
prior to the Closing Date shall have been duly performed and satisfied by Seller
in all material respects.

 

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(b)       Representations and Warranties True. The representations and
warranties of Seller and the Selling Member contained in this Agreement that are
qualified as to materiality shall be true and correct, and all other
representations and warranties of Seller and the Selling Member contained in
this Agreement shall be true and correct except for breaches of, or inaccuracies
in, such representations and warranties that, in the aggregate, would not have a
material adverse effect on the Purchased Assets or the Business taken as a
whole, in each such case on and as of the Closing Date with the same effect as
though made on and as of the Closing Date (except for those representations and
warranties that specifically refer to some other date), and there shall be
delivered by Seller on the Closing Date a certificate, in form of Exhibit I
attached hereto, executed by the Managing Memberof Seller to that effect (the
“Seller Officer’s Certificate”).

 

(c)       No Action or Proceeding. No legal or regulatory action or proceeding
shall be pending or threatened by any Person to enjoin, restrict or prohibit the
purchase and sale of the Purchased Assets contemplated hereby. No order,
judgment or decree by any court or regulatory body shall have been entered in
any action or proceeding instituted by any party that enjoins, restricts, or
prohibits this Agreement or the complete consummation of the transactions as
contemplated by this Agreement.

 

(d)       Other Agreements. Seller and the Selling Member shall have delivered
to Buyer a duly executed copy of each of the Other Agreements to which it is a
party.

 

(e)       Material Adverse Change. There shall not have been a material adverse
change in the Seller’s business, financial condition, prospects, assets or
operations relating to the Purchased Assets or the Business, taken as a whole,
except to the extent such material adverse change arises from or relates to: (i)
any change in economic, business or financial market conditions in the United
States or regions in which the Business operates, (ii) changes in any Laws or in
accounting rules or standards; (iii) any natural disaster, act of terrorism or
war, or the outbreak of hostilities, or any other international or domestic
calamity or crisis; (iv) any action taken or not taken with the prior written
consent of the Purchaser or required or expressly permitted by the terms of this
Agreement; (v) the pendency of this Agreement and the transactions contemplated
hereby or (vi) any existing event, circumstance, change or effect with respect
to which the Buyer has knowledge as of the date of this Agreement.

 

(f)        Non-Competition and Non-Solicitation Agreements. The Selling Member
shall have entered into a Non-Competition and Non-Solicitation Agreement with
the Buyer in substantially the form attached hereto as Exhibit F.

 

(g)       Required Consents. Seller shall have obtained all consents of or
notification to any third parties required by the terms of any Assumed Contract
or applicable law for Seller to assign it rights and obligations to Buyer as
contemplated by this Agreement.

 

(h)       Intentionally Omitted.

 

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(i)       Available Cash at Closing. The amount of cash acquired at Closing
pursuant to Section 2.1(a) shall be at a minimum sufficient to conduct the
Seller’s next scheduled event consistent with past practice and utilizing solely
the Purchased Assets.

 

(j)       Satisfaction of Encumbrances. Seller shall deliver a payoff letter or
similar documentation, in form reasonably acceptable to Buyer, terminating any
Encumbrance on any of the Purchased Assets, together with executed UCC-2 or
UCC-3 termination statements (or any other applicable termination statement)
executed by each Person holding Encumbrances on any Purchased Asset.

 

ARTICLE 9

POST-CLOSING COVENANTS, OTHER AGREEMENTS

 

9.1       Availability of Records. After the Closing, Buyer, shall make
available to Seller as reasonably requested by Seller, its agents and
representatives, or as requested by any Governmental Authority, all information,
records and documents relating to the Purchased Assets for all periods prior to
Closing and shall preserve all such information, records and documents until the
later of: (a) six (6) years after the Closing; (b) the expiration of all
statutes of limitations for Taxes for periods prior to the Closing, or
extensions thereof applicable to Seller and its shareholders for Tax
information, records or documents; or (c) the required retention period for all
government contract information, records or documents. Prior to destroying any
records related to Seller for the period prior to the Closing, Buyer shall
notify Seller ninety (90) days in advance of any such proposed destruction of
its intent to destroy such records, and Buyer will permit Seller to retain any
such records.

 

9.2       Tax Matters.

 

(a)       Bifurcation of Taxes. Seller and its Affiliates shall be solely liable
for all Taxes imposed upon Seller attributable to the Purchased Assets for all
taxable periods ending on or before the Closing Date. Buyer and its Affiliates
shall be solely liable for any Taxes imposed upon Buyer attributable to the
Purchased Assets for any taxable year or taxable period commencing after the
Closing Date.

 

(b)       Transfer Taxes. Buyer and Seller shall each pay one-half of any and
all sales, use, transfer and documentary Taxes and recording and filing fees
applicable to the transfer of the Purchased Assets.

 

(c)       Cooperation and Records. After the Closing Date, Buyer and Seller
shall cooperate in the filing of any Tax returns or other Tax-related forms or
reports, to the extent any such filing requires providing each other with
necessary relevant records and documents relating to the Purchased Assets.
Seller and Buyer shall cooperate in the same manner in defending or resolving
any Tax audit, examination or Tax-related litigation. Buyer and Seller shall
cooperate in the same manner to minimize any transfer, sales and use Taxes.
Nothing in this Section shall give Buyer or Seller any right to review the
other’s Tax returns or Tax related forms or reports.

 

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(d)       Bulk Sales Laws. Seller and Buyer waive compliance with bulk sales
laws for Tax purposes.

 

9.3       Post-Closing Delivery. Subject to the provisions of Section 4.2,
Seller agrees to arrange for physical delivery to Buyer of the tangible
Purchased Assets in Seller’s possession. Buyer and Seller acknowledge that title
and risk of loss with respect to all Purchased Assets shall pass to Buyer at
Closing. Seller agrees to use commercially reasonable efforts to preserve and
maintain the tangible Purchased Assets in good working condition and to protect
such Purchased Assets against damage, deterioration and other wasting. All
Intellectual Property (in particular all MMA video content) comprising the
Purchased Assets will be delivered to Buyer in electronic form consistent with
common industry practice.

 

ARTICLE 10

INDEMNIFICATION

 

10.1       Indemnification by Seller and the Selling Member. Seller and Selling
Member hereby jointly and severally agree to indemnify, defend and hold Buyer
harmless from and against any Losses (defined below) in respect of the
following:

 

(a)       Losses resulting in bodily injury, wrongful death, and/or property
damages, including without limitation, actual, punitive, direct, indirect, or
consequential damages and all attorney’s fees and court costs recoverable by the
injured party or parties arising out of litigation that is currently pending
against Seller or arising from facts which occurred prior to Closing which, in
the case of litigation, the defense of which is not being defended by Seller’s
insurance carrier or, if the same results in or has resulted in a verdict or
damages to be paid, the same is not being paid by Seller’s insurance company.

 

(b)       Losses resulting from the breach of any representations, warranties,
covenants or agreements made by Seller or Selling Member in this Agreement or
the Other Agreements.

 

10.2       Indemnification by Buyer. Buyer hereby agrees to indemnify, defend
and hold Seller and the Selling Member harmless from and against any Losses in
respect of the following:

 

(a)       Losses resulting from any breach of any representations, warranties,
covenants or agreements made by Buyer in this Agreement or the Other Agreements.

 

(b)       Buyer’s operation of the Business and ownership of the Purchased
Assets after the Closing, including, without limitation, all sales and use
Taxes, ad valorem Taxes, and products liability claims with respect to such
post-Closing operations.

 

(c)       The Assumed Liabilities, including all claims arising from the
obligations assumed under the Assumed Contracts as set forth in Section 2.1(d).

 

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10.3       Indemnification Procedure for Third-Party Claims.

 

(a)       In the event that any party (the “Indemnified Person”) desires to make
a claim against any other party (the “Indemnifying Person”) in connection with
any Losses for which the Indemnified Person may seek indemnification hereunder
in respect of a claim or demand made by any Person not a party to this Agreement
against the Indemnified Person (a “Third-Party Claim”), such Indemnified Person
must notify the Indemnifying Person in writing, of the Third-Party Claim (a
“Third-Party Claim Notice”) as promptly as reasonably possible after receipt,
but in no event later than fifteen (15) calendar days after receipt, by such
Indemnified Person of notice of the Third-Party Claim; provided, that failure to
give a Third-Party Claim Notice on a timely basis shall not affect the
indemnification provided hereunder except to the extent the Indemnifying Person
shall have been actually and materially prejudiced as a result of such failure.
Upon receipt of the Third-Party Claim Notice from the Indemnified Person, the
Indemnifying Person shall be entitled, at the Indemnifying Person’s election, to
assume or participate in the defense of any Third-Party Claim at the cost of
Indemnifying Person. In any case in which the Indemnifying Person assumes the
defense of the Third-Party Claim, the Indemnifying Person shall give the
Indemnified Person ten (10) calendar days’ notice prior to executing any
settlement agreement and the Indemnified Person shall have the right to approve
or reject the settlement and related expenses; provided, however, that upon
rejection of any settlement and related expenses, the Indemnified Person shall
assume control of the defense of such Third-Party Claim and the liability of the
Indemnifying Person with respect to such Third-Party Claim shall be limited to
the amount or the monetary equivalent of the rejected settlement and related
expenses.

 

(b)       The Indemnified Person shall retain the right to employ its own
counsel and to discuss matters with the Indemnifying Person related to the
defense of any Third-Party Claim, the defense of which has been assumed by the
Indemnifying Person pursuant to Section 10.3(a) of this Agreement, but the
Indemnified Person shall bear and shall be solely responsible for its own costs
and expenses in connection with such participation; provided, however, that,
subject to Section 10.3(a) above, all decisions of the Indemnifying Person shall
be final and the Indemnified Person shall cooperate with the Indemnifying Person
in all respects in the defense of the Third-Party Claim, including refraining
from taking any position adverse to the Indemnifying Person.

 

(c)       If the Indemnifying Person fails to give notice of the assumption of
the defense of any Third-Party Claim within a reasonable time period not to
exceed forty-five (45) days after receipt of the Third-Party Claim Notice from
the Indemnified Person, the Indemnifying Person shall no longer be entitled to
assume (but shall continue to be entitled to participate in) such defense. The
Indemnified Person may, at its option, continue to defend such Third-Party Claim
and, in such event, the Indemnifying Person shall indemnify the Indemnified
Person for all reasonable fees and expenses in connection therewith (provided it
is a Third-Party Claim for which the Indemnifying Person is otherwise obligated
to provide indemnification hereunder). The Indemnifying Person shall be entitled
to participate at its own expense and with its own counsel in the defense of any
Third-Party Claim the defense of which it does not assume. Prior to effectuating
any settlement of such Third-Party Claim, the Indemnified Person shall furnish
the Indemnifying Person with written notice of any proposed settlement in
sufficient time to allow the Indemnifying Person to act thereon. Within fifteen
(15) days after the giving of such notice, the Indemnified Person shall be
permitted to effect such settlement unless the Indemnifying Person (a)
reimburses the Indemnified Person in accordance with the terms of this Article
10 for all reasonable fees and expenses incurred by the Indemnified Person in
connection with such Claim; (b) assumes the defense of such Third-Party Claim;
and (c) takes such other actions as the Indemnified Person may reasonably
request as assurance of the Indemnifying Person’s ability to fulfill its
obligations under this Article 10 in connection with such Third-Party Claim.

 

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10.4       Indemnification Procedure for Other Claims. An Indemnified Party
wishing to assert a claim for indemnification which is not a Third Party Claim
subject to Section 10.3 (a “Claim”) shall deliver to the Indemnifying Party a
written notice (a “Claim Notice”) which contains (i) a description and, if then
known, the amount (the “Claimed Amount”) of any Losses incurred by the
Indemnified Party or the method of computation of the amount of such claim of
any Losses, (ii) a statement that the Indemnified Party is entitled to
indemnification under this Article 10 and a reasonable explanation of the basis
therefor, and (iii) a demand for payment in the amount of such Losses. Within
thirty (30) days after delivery of a Claim Notice, the Indemnifying Party shall
deliver to the Indemnified Party a written response in which the Indemnifying
Party shall: (A) agree that the Indemnified Party is entitled to receive all of
the Claimed Amount (in which case such response shall be accompanied by delivery
to the Escrow Agent of the Claim Notice), (B) agree in a “Counter Notice” that
the Indemnified Party is entitled to receive part, but not all, of the Claimed
Amount (the “Agreed Amount”), or (C) contest that the Indemnified Party is
entitled to receive any of the Claimed Amount including the reasons therefor. If
the Indemnifying Party in the Counter Notice or otherwise contests the payment
of all or part of the Claimed Amount, the Indemnifying Party and the Indemnified
Party shall use good faith efforts to resolve such dispute. If such dispute is
not resolved within sixty (60) days following the delivery by the Indemnifying
Party of such response, the Indemnifying Party and the Indemnified Party shall
each have the right to submit such dispute to a court of competent jurisdiction
in accordance with the provisions of Section 12.17.

 

10.5       Losses.

 

(a)       For purposes of this Agreement, “Losses” shall mean all actual
liabilities, losses, costs, damages, penalties, assessments, demands, claims,
causes of action, including, without limitation, reasonable attorneys’,
accountants’ and consultants’ fees and expenses and court costs, including
punitive, indirect, consequential or other similar damages. Losses shall include
punitive, indirect, consequential or similar damages only for claims brought by
third parties.

 

29 

 

 

(b) Any liability for indemnification under this Agreement shall be determined
without duplication of recovery due to the facts giving rise to such liability
constituting a breach of more than one representation, warranty, covenant or
agreement.

 

 

(c)       The Indemnified Person agrees to use all reasonable efforts to obtain
recovery from any and all third parties who are obligated respecting a Loss
(e.g. parties to indemnification agreements, insurance companies, etc.)
(“Collateral Sources”) respecting any Claim pursuant to which the Indemnified
Person is entitled to indemnification hereunder. If the amount to be netted
hereunder from any payment from a Collateral Source is determined after payment
of any amount otherwise required to be paid to an Indemnified Person under this
Article 10, the Indemnified Person shall repay to the Indemnifying Person,
promptly after such receipt from Collateral Source, any amount that the
Indemnifying Person would not have had to pay pursuant to this Article 10 had
such receipt from the Collateral Source occurred at the time of such payment.

 

(d)       Each Indemnified Person shall (and shall cause its Affiliates to) use
commercially reasonable efforts to mitigate any claim for Losses that an
Indemnified Person asserts under this Article 10.

 

(e)       The amount of any and all Losses (and other indemnification payments)
under this Agreement shall be decreased by (A) any Tax benefits in excess of Tax
detriments actually realized by the applicable Indemnified Person related to the
Loss, including deductibility of any such Losses (or other items giving rise to
such indemnification payment), and (B) the amount of any insurance proceeds or
other amounts recoverable from Collateral Sources (netted against deductibles
and other costs associated with making or pursuing any such claims, as
applicable), received or to be received by the applicable Indemnified Person
with respect to such Losses under any insurance policy maintained by the
Indemnified Person or any other Person or from any other Collateral Source. The
Indemnified Person will assign to the Indemnifying Person any rights or
contribution or subrogation the Indemnified Person may have against or
respecting any Collateral Source or other Persons related to such Loss which is
indemnified by the Indemnifying Person hereunder.

 

10.6       Certain Limitations. Notwithstanding anything to the contrary
contained in this Agreement: (i) Neither Seller and the Selling Member nor Buyer
shall be required to indemnify any party hereunder for their breach of any
representation or warranty unless and until the aggregate amount of Losses
arising from such types of breaches shall exceed $25,000.00 and at such time as
the aggregate amount of Losses exceeds such amount the obligation to indemnify
shall include all Losses including the first $25,000.00; and (ii) Seller and the
Selling Member shall not be liable to provide indemnification hereunder in an
aggregate amount in excess of the value of the Escrowed Shares.

 

10.7       Exclusive Remedies. Each of Buyer, Seller and the Selling Member
acknowledges and agrees that, from and after the Closing, its sole and exclusive
remedy with respect to any and all Losses based upon, arising out of or
otherwise in respect of the matters set forth in this Agreement and the Other
Agreements shall be pursuant to the indemnification set forth in this Article
10, and such party shall have no other remedy or recourse with respect to any of
the foregoing other than pursuant to, and subject to the terms and conditions
of, this Article 10; provided, that the foregoing limitation shall not apply to
claims seeking specific performance or other available equitable relief.

 

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ARTICLE 11

TERMINATION AND SURVIVAL

 

11.1       Termination of Agreement. This Agreement may be terminated at any
time prior to the Closing Date as follows:

 

(a)       with the mutual consent of Buyer and Seller;

 

(b)       by Buyer, if it is not then in material breach of its obligations
under this Agreement and if (A) any of Seller’s or the Selling Member’s
representations and warranties contained in this Agreement shall be inaccurate
such that the condition set forth in Section 8.2(b) would not be satisfied, or
(B) any of Seller’s or the Selling Member’s covenants contained in this
Agreement shall have been breached such that the condition set forth in
Section 8.2(a) would not be satisfied; provided, however, that Buyer shall not
terminate this Agreement under this Section on account of any breach or
inaccuracy that is curable by Seller unless Seller fails to cure such inaccuracy
or breach within ten (10) Business Days after receiving written notice from
Buyer of such inaccuracy or breach; or

 

(c)       by Seller, if it is not then in material breach of its obligations
under this Agreement and if (A) any of Buyer’s representations and warranties
contained in this Agreement shall be inaccurate such that the condition set
forth in Section 8.1(b) would not be satisfied, or (B) any of Buyer’s covenants
contained in this Agreement shall have been breached such that the condition set
forth in Section 8.1(a) would not be satisfied; provided, however, that Seller
shall not terminate this Agreement under this Section on account of any breach
or inaccuracy that is curable by Buyer unless Buyer fails to cure such
inaccuracy or breach within ten (10) Business Days after receiving written
notice from Seller of such inaccuracy or breach.

 

(d)       by Buyer or Seller if the Closing has not occurred on or prior to June
30, 2016, as such date may be extended by mutual agreement of Buyer and Seller,
upon written notice by Buyer to Seller or Seller to Buyer; provided that the
Person providing notice of termination is not then in material breach of any
representation, warranty, covenant or agreement contained in this Agreement.

 

11.2       Procedure Upon Termination. In the event of termination and
abandonment by Buyer or Seller, or both, pursuant to Section 11.1 hereof,
written notice thereof shall forthwith be given to the other party or parties,
and this Agreement shall terminate, and the purchase of the Purchased Assets
hereunder shall be abandoned, without further action by Buyer or Seller. If this
Agreement is terminated as provided herein each party shall redeliver all
documents, work papers and other material of any other party relating to the
transactions contemplated hereby, whether so obtained before or after the
execution hereof, to the party furnishing the same.

 

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11.3       Effect of Termination.

 

(a)       In the event that this Agreement is validly terminated as provided
herein, then each of the parties shall be relieved of its duties and obligations
arising under this Agreement after the date of such termination and such
termination shall be without liability to Buyer or Seller; provided, however,
that the obligations of the parties set forth in Article 10, this Section 11.3
and Sections 12.2, 12.3, 12.4, 12.7, 12.9, 12.13, and 12.15 hereof shall survive
any such termination and shall be enforceable hereunder.

 

(b)       Nothing in this Section 11.3 shall relieve Buyer or Seller of any
liability for a material breach of this Agreement prior to the date of
termination, the damages recoverable by the non-breaching party shall include
all attorneys’ fees reasonably incurred by such party in connection with the
transactions contemplated hereby.

 

11.4       Survival of Representations and Warranties. Except with respect to
(a) the covenants of Buyer, Seller and the Selling Member which are intended to
survive the Closing, (b) Seller’s and the Selling Member’s representations
provided for in Section 5.2(a), 5.4 and 5.8 which survive indefinitely, (c)
Seller’s and Selling Member’s representations provided for in Sections 5.6,
5.11, 5.14, 5.16 and 5.22 which survive until the applicable statute of
limitations expires with respect to claims arising under such Sections, and (d)
Buyer’s representation provided for in Section 6.2 which survives indefinitely,
the representations and warranties of each of the parties hereto shall survive
the Closing for a period of twenty-four (24) months.

 

ARTICLE 12

MISCELLANEOUS

 

12.1       Assignment. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns;
provided, however, that no assignment shall be made by either party without the
prior express written consent of the other party.

 

12.2       Risk of Loss. All risk of loss with respect to the Purchased Assets
to be transferred hereunder shall remain with Seller until the transfer of the
Purchased Assets and the Business on the Closing Date. Anything to the contrary
in this Agreement notwithstanding, in the event there has been any material
damage to or destruction of any of the Purchased Assets prior to the Closing
Date and Buyer elects to consummate the transactions contemplated herein, at
Closing, Seller shall assign to Buyer all of Seller’s right to receive insurance
proceeds toward the repair or replacement of such Purchased Assets, if any, and
if no such insurance is in effect or the amount payable thereunder is
insufficient to repair or replace any such Purchased Assets, the parties shall
equitably adjust the Purchase Price; provided, however, if any such adjustment
would result in a reduction in the Purchase Price of more than five percent
(5%), Seller and the Selling Member’s shall have the option to terminate this
Agreement.

 

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12.3       Confidentiality. All information gained by either party concerning
the other as a result of the transactions contemplated hereby (“Confidential
Information”), including the execution and consummation of the transactions
contemplated hereby and the terms thereof and information obtained by Buyer and
its representatives in conducting due diligence respecting Seller and the
Purchased Assets, will be kept in strict confidence. All Confidential
Information will be used only for the purpose of consummating the transactions
contemplated hereby. Following the Closing, all Confidential Information
relating to the Business disclosed by Seller to Buyer shall become the
Confidential Information of Buyer, subject to the restrictions on use and
disclosure by Seller imposed under this Section 12.3. Neither Seller, the
Selling Member, nor Buyer shall, without having previously informed the other
party about the form, content and timing of any such announcement, make any
public disclosure with respect to the Confidential Information or transactions
contemplated hereby, except:

 

(a)       As may be required by the Securities Act or the Exchange Act for
inclusion in any report required to be disclosed pursuant thereto; or

 

(b)       As may be required by applicable Law provided that, in any such event,
the party required to make the disclosure will (I) provide the other party with
prompt written notice of any such requirement so that such other party may seek
a protective order or other appropriate remedy, (II) consult with and exercise
in good faith all reasonable efforts to mutually agree with the other party
regarding the nature, extent and form of such disclosure, (III) limit disclosure
of Confidential Information to what is legally required to be disclosed, and
(IV) exercise its best efforts to preserve the confidentiality of any such
Confidential Information; or

 

(c)       Buyer may disclose the terms of this Agreement and the transactions
contemplated hereby to an actual or prospective underwriter, lender, investor,
partner or agent, subject to a non-disclosure agreement pursuant to which such
lender, investor, partner or agent agrees to be bound by the terms of this
Section 12.3; or

 

(d)       Disclosure to a party’s representatives and advisors in connection
with advising such party and preparing its Tax returns.

 

12.4       Expenses. Each party shall bear its own expenses with respect to the
transactions contemplated by this Agreement.

 

12.5       Severability. Each of the provisions contained in this Agreement
shall be severable, and the unenforceability of one shall not affect the
enforceability of any others or of the remainder of this Agreement.

 

12.6       Entire Agreement. This Agreement may not be amended, supplemented or
otherwise modified except by an instrument in writing signed by all of the
parties hereto. This Agreement and the Other Agreements contain the entire
agreement of the parties hereto with respect to the transactions covered hereby,
superseding all negotiations, prior discussions and preliminary agreements made
prior to the date hereof.

 

33 

 

 

12.7       No Third Party Beneficiaries. This Agreement is for the sole benefit
of the parties hereto and their permitted assigns and nothing herein, express or
implied (including Article 10), shall give or be construed to give to any
Person, other than the parties hereto and such permitted assigns, any legal or
equitable rights hereunder.

 

12.8       Waiver. The failure of any party to enforce any condition or part of
this Agreement at any time shall not be construed as a waiver of that condition
or part, nor shall it forfeit any rights to future enforcement thereof. Any
waiver hereunder shall be effective only if delivered to the other party hereto
in writing by the party making such waiver.

 

12.9       Governing Law. This Agreement shall be construed and enforced in
accordance with and governed by the laws of the State of Delaware without regard
to the conflicts of laws provisions thereof.

 

12.10       Headings. The headings of the sections and subsections of this
Agreement are inserted for convenience only and shall not be deemed to
constitute a part hereof.

 

12.11       Counterparts. The parties may execute this Agreement in one or more
counterparts, and each fully executed counterpart shall be deemed an original.

 

12.12       Further Documents. Each of Buyer, Seller and the Selling Member
shall, and shall cause its respective Affiliates to, at the request of another
party, execute and deliver to such other party all such further instruments,
assignments, assurances and other documents as such other party may reasonably
request in connection with the carrying out of this Agreement and the
transactions contemplated hereby.

 

12.13       Notices. All communications, notices and consents provided for
herein shall be in writing and be given in person or by means of facsimile (with
request for assurance of receipt in a manner typical with respect to
communications of that type and confirmation by mail), by overnight courier or
by registered or certified mail, and shall become effective: (a) on delivery if
given in person; (b) on the date of transmission if sent by facsimile; (c) one
(1) Business Day after delivery to the overnight service; or (d) four
(4) Business Days after being mailed, with proper postage and documentation, for
first-class registered or certified mail, prepaid.

 

34 

 

 

Notices shall be addressed as follows:

 

If to Buyer, to:

 

Alliance MMA, Inc.

590 Madison Avenue, 21st Floor

New York, New York 10022

Attention: Paul K. Danner, III

Phone: (212) 739-7825
Fax: (212) 658-9291

Email: pdanner@alliancemma.com

 

with copies to:

 

Mazzeo Song P.C.

444 Madison Avenue, 4th Floor

New York, NY 10022

Attention: Robert L. Mazzeo, Esq.

Phone: (212) 599-0310

Fax: (212) 599-8400

Email: rmazzeo@mazzeosong.com

 

If to Seller or the Selling Member, to:

 

Ohio Fitness and Martial Arts, LLC

d/b/a IT Fight Series

304 E. Lake Ave.

Bellefontaine, OH 43311

Attention: Mr. Scott Sheeley

Phone: (937) 935-3236

Email: scottsheeley@yahoo.com

 

with copies to:

 

Josh M. Stolly, Esq.

Thompson, Dunlap & Heydinger Ltd.

1111 Rush Ave.

P.O. Box 68

Bellefontaine, OH 43311

Phone: (937) 593-6065

Fax: (410) 547-2432

Email: jstolly@tdhlaw.com

 

provided, however, at the time of mailing or within three (3) Business Days
thereafter there is or occurs a labor dispute or other event that might
reasonably be expected to disrupt the delivery of documents by mail, any
communication, notice or consent provided for herein shall be given in person or
by means of facsimile or by overnight courier, and further provide that if any
party shall have designated a different address by notice to the others, then to
the last address so designated.

 

35 

 

 

12.14       Schedules. Buyer and Seller agree that any disclosure in any
Schedule attached hereto shall (a) constitute a disclosure only under such
specific Schedule and shall not constitute a disclosure under any other Schedule
referred to herein unless a specific cross-reference to another Schedule is
provided or such disclosure is otherwise clear from the context of the
disclosure in such Schedule and (b) not establish any threshold of materiality.
Seller or Buyer may, from time to time prior to or at the Closing, by notice in
accordance with the terms of this Agreement, supplement or amend any Schedule,
including one or more supplements or amendments to correct any matter which
would constitute a breach of any representation, warranty, covenant or
obligation contained herein. No such supplemental or amended Schedule shall be
deemed to cure any breach for purposes of Section 8.2(b). If, however, the
Closing occurs, any such supplement and amendment will be effective to cure and
correct for all other purposes any breach of any representation, warranty,
covenant or obligation which would have existed if Seller or Buyer had not made
such supplement or amendment, and all references to any Schedule hereto which is
supplemented or amended as provided in this Section 12.14 shall for all purposes
at and after the Closing be deemed to be a reference to such Schedule as so
supplemented or amended.

 

12.15       Construction. The language in all parts of this Agreement shall be
construed, in all cases, according to its fair meaning. The parties acknowledge
that each party and its counsel have reviewed and revised this Agreement and
that any rule of construction to the effect that any ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation
of this Agreement. Words in the singular shall be deemed to include the plural
and vice versa and words of one gender shall be deemed to include the other
gender as the context requires.

 

12.16       Knowledge. As used herein, Seller will be deemed to have knowledge
of a particular fact or matter only if Scott Sheeley is actually aware of the
fact or matter, or with the exercise of reasonable diligence should have been
aware of the fact or mater.

 

12.17       Submission to Jurisdiction. Each of Buyer, Seller and Selling Member
(a) submits to the exclusive jurisdiction of the Court of Chancery of the State
of Delaware (or any other federal or state court in the State of Delaware if it
is determined that the Court of Chancery does not have jurisdiction over such
action) in any action or proceeding arising out of or relating to this
Agreement, (b) agrees that all claims in respect of such action or proceeding
may be heard and determined only in any such court, and (c) agrees not to bring
any action or proceeding arising out of or relating to this Agreement in any
other court. Each party waives any defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any bond, surety
or other security that might be required of the other party with respect
thereto. Either party may make service on the other party by sending or
delivering a copy of the process to the Party to be served at the address and in
the manner provided for the giving of notices in Section 12.13. Nothing in this
Section 12.17, however, shall affect the right of any Party to serve legal
process in any other manner permitted by law.

 

12.18       Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY AND ANY ACTION, PROCEEDING OR COUNTERCLAIM
(WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE) ARISING OUT OF, RELATING TO OR
IN CONNECTION WITH ANY MATTER WHICH IS THE SUBJECT OF THIS AGREEMENT, THE OTHER
AGREEMENTS OR THE ACTIONS OF ANY PARTY HERETO IN THE NEGOTIATION,
ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.

 

[Signature Page to Asset Purchase Agreement Follows]

 

36 

 

 

[Signature Page to Asset Purchase Agreement]

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective duly authorized officers as of the date first above written.

 

 

 

SELLER:

 

OHIO FITNESS AND MARTIAL ARTS, LLC

 

By:  /s/ Scott Sheeley                  

Name: Scott Sheeley

Title: Managing Member

 

SELLING MEMBER:

 

  /s/ Scott Sheeley                   

Scott Sheeley

 

BUYER:

 

ALLIANCE MMA, INC.

 

 

By:   /s/Paul K. Danner                       

Name: Paul K. Danner, III

Title: Chief Executive Officer

 

37 

 

 

EXHIBITS AND SCHEDULES

 

Exhibits

 

  Exhibit A: Form of Assignment and Assumption Agreement   Exhibit B: Form of
Bill of Sale, Conveyance and Assignment   Exhibit C: [Intentionally Omitted]  
Exhibit D: Form of Intellectual Property Transfer Agreement   Exhibit E: Form of
Make Good Escrow Agreement   Exhibit F Form of Non-Competition and
Non-Solicitation Agreement   Exhibit G Form of Trademark License Agreement  
Exhibit H Form of Buyer Officer’s Certificate   Exhibit I Form of Seller
Officer’s Certificate

Schedules

 

  Schedule 2.1 Permitted Encumbrances   Schedule 2.1(c) Equipment   Schedule
2.1(d) Assumed Contracts   Schedule 2.1(e) Real Estate Leases   Schedule 2.1(n)
Additional Assets   Schedule 2.2 Excluded Assets   Schedule 3.4 Allocation of
Purchase Price   Schedule 5.3 Equipment and other Purchased Assets   Schedule
5.4 Title   Schedule 5.5 Intellectual Property   Schedule 5.6 Litigation  
Schedule 5.7 Required Consents   Schedule 5.10 Contract Exceptions   Schedule
5.12 Scope of Rights in Purchased Assets   Schedule 5.13 Compliance with Laws  
Schedule 5.14 Financial Statements   Schedule 5.15 Certain Changes   Schedule
5.16 Employee Plans   Schedule 5.17 Business Employees   Schedule 5.18 Labor
Relations   Schedule 5.19 Customers and Suppliers   Schedule 5.20 Conflicts  
Schedule 5.21 Fighters Under Contract   Schedule 6.3 Buyer Consents   Schedule
7.1 Compensation Covenant

 

38 

 

 

Schedule 2.1

Permitted Encumbrances

 

None

 

 

 

 

Schedule 2.1(c)

Equipment

 

Fighter training cage and related equipment

Gloves and show accessories

 

 

 

 

Schedule 2.1(d)

Assumed Contracts

 

See Schedule 5.21

 

 

 

 

Schedule 2.1(e)

Real Estate Leases

 

None, however Seller will continue to store Equipment related to the Business at
its facilities at no cost to Buyer.

 

 

 

 

Schedule 2.1(n)

Additional Assets

 

None

 

 

 

 

Schedule 2.2

Excluded Assets

 

None

 

 

 

 

 

Schedule 3.4

Allocation of Purchase Price

 

To be agreed to and attached at Closing

 

 

 

 

Schedule 5.3

Equipment and other Purchased Assets

 

None

 

 

 

 

Schedule 5.4

Title

 

None

 

 

 

 

Schedule 5.5

Intellectual Property

 

Seller uses certain copyrights in the IT Fight Series logo and branding
materials as well as rights in certain social media platforms such as Facebook
and Instagram which will be conveyed to Buyer at closing.

 

 

 

 

Schedule 5.6

Litigation

 

None

 

 

 

 

Schedule 5.7

Required Consents

 

The Ohio Athletic Commission will require the Buyer to obtain a MMA Promotion
license in Ohio or may require the Selling Member to amend his license to
reflect that the Business was acquired by the Buyer.

 

 

 

 

Schedule 5.10

Contract Exceptions

 

None

 

 

 

 

Schedule 5.12

Scope of Rights in Purchased Assets

 

None

 

 

 

 

Schedule 5.13

Compliance with Laws

 

None

 

 

 

 

Schedule 5.14

Financial Statements

 

None

  

 

 

 

Schedule 5.15

Certain Changes

 

None

 

 

 

 

Schedule 5.16

Employee Plans

 

None

 

 

 

 

Schedule 5.17

Business Employees

 

None. All Business event staff are 1099 Independent contractors hired on a per
event basis.

 

 

 

 

Schedule 5.18

Labor Relations

 

None

 

 

 

 

Schedule 5.19

Customers and Suppliers

 

None

 

 

 

 

Schedule 5.20

Conflicts

 

None

 

 

 

 

Schedule 5.21

Fighters Under Multi-Fight Contracts

 

Tim McCavit

Brandon Suber

Rob Walker

Albert Cheng

Tiago Tavares

Tony Castillo

Damonte Robinson

Tray Taylor

Jan Finney

Lloyd Thorton

Devoniere Jackson

Jameson Sharp

Carlo Prater

Chico Bayes

Alex Rozman

Gary Keyfauver

Clint Anderson

 

 

 

 

Schedule 6.3

Buyer Consents

 

None

 

 

 

 

Schedule 7.1

Compensation Covenant

 

Not Applicable

 

 

 

 

Exhibit A

 

ASSIGNMENT AND ASSUMPTION AGREEMENT

 

This ASSIGNMENT AND ASSUMPTION AGREEMENT dated as of December 9, 2016 is entered
into by and among OHIO FITNESS AND MARTIAL ARTS, LLC, a Ohio limited liability
company (“Seller”) and ALLIANCE MMA, INC., a Delaware corporation (“Buyer”) and
is delivered pursuant to, and subject to the terms of, that certain Asset
Purchase Agreement, dated as of December 9, 2016 (the “Asset Purchase
Agreement”), by and among Seller, Buyer, and Scott Sheeley, an individual and
resident of the State of Ohio (the “Selling Member”). All capitalized terms not
otherwise defined herein shall have the meanings ascribed to such terms in the
Asset Purchase Agreement.

 

WHEREAS, pursuant to the Asset Purchase Agreement the parties hereto together
with the Selling Member have agreed that at the Closing (which Closing is taking
place as of the date hereof), Seller will transfer to Buyer and Buyer will
accept and assume, only those liabilities and obligations of Seller arising from
and after the Closing Date under the Assumed Contracts set forth on Schedule
2.1(d) to the Asset Purchase Agreement.

 

NOW, THEREFORE, subject to the terms and conditions of the Asset Purchase
Agreement and for the consideration set forth therein, Buyer and Seller each
hereby agrees as follows:

 

As of the date hereof, Seller hereby transfers and assigns to Buyer, and Buyer
hereby accepts and assumes those liabilities and obligations of Seller arising
from and after the Closing Date under the Assumed Contracts set forth on
Schedule A attached hereto. With the exception of the liabilities and
obligations to be assumed by Buyer pursuant to the preceding sentence, Buyer
shall not assume and shall in no event be liable for any other debts,
liabilities or obligations of Seller, whether fixed or contingent, known or
unknown, liquidated or unliquidated, secured or unsecured, or otherwise and
regardless of when they arose or arise. In the event of any inconsistency
between the terms hereof and the terms of the Asset Purchase Agreement, the
terms of the Asset Purchase Agreement shall control.

 

 

[Signature Page for Assignment and Assumption Agreement to follow]

 

 

 

 

[Signature Page for Assignment and Assumption Agreement]

 

 

IN WITNESS WHEREOF, the Assignor and Assignee have caused this Assignment and
Assumption Agreement to be duly executed and authorized as of the date hereof.

 

ASSIGNOR:

 

OHIO FITNESS AND MARTIAL ARTS, LLC

 

By /s/ Scott Sheeley                             

Name: Scott Sheeley

Title: Managing Member

 

ASSIGNEE:

 

ALLIANCE MMA, INC.

 

 

By: /s/ Paul K. Danner                        

Name: Paul K. Danner, III

Title: Chief Executive Officer

 

 

 

 

Schedule A

 

Multi-Fight Fighter Agreements with each of the following professional fighters:

 

Tim McCavit 

Brandon Suber 

Rob Walker 

Albert Cheng 

Tiago Tavares 

Tony Castillo 

Damonte Robinson 

Tray Taylor 

Jan Finney 

Lloyd Thorton 

Devoniere Jackson 

Jameson Sharp 

Carlo Prater 

Chico Bayes 

Alex Rozman 

Gary Keyfauver 

Clint Anderson 

 

 

 

 

Exhibit B

 

BILL OF SALE, CONVEYANCE AND ASSIGNMENT

 

THIS BILL OF SALE, CONVEYANCE AND ASSIGNMENT (this “Instrument”) dated as of
December 9, 2016 is entered into by and among OHIO FITNESS AND MARTIAL ARTS,
LLC, a Ohio limited liability company (“Seller”) and ALLIANCE MMA, INC., a
Delaware corporation (“Buyer”) and is delivered pursuant to, and subject to the
terms of, that certain Asset Purchase Agreement, dated as of December 9, 2016
(the “Asset Purchase Agreement”), by and among Seller, Buyer, and Scott Sheeley,
an individual and resident of the State of Ohio (the “Selling Member”).

 

NOW, THEREFORE, subject to the terms and conditions of the Asset Purchase
Agreement and for the consideration set forth therein, Buyer and Seller each
hereby agrees as follows:

 

1.   Seller does hereby sell, convey, transfer, assign and deliver to Buyer, all
of its right, title and interest in and to the Purchased Assets.       2.  
Notwithstanding anything to the contrary in this Instrument, the Asset Purchase
Agreement or in any other document delivered in connection herewith or
therewith, the Purchased Assets subject to this Instrument shall expressly
exclude the Excluded Assets.       3.   From time to time, as and when
reasonably requested by Buyer, Seller shall execute and deliver all such
documents and instruments and shall take, or cause to be taken, all such further
or other actions as Buyer may reasonably deem necessary or desirable to more
effectively sell, transfer, convey and assign to Buyer all of Seller’s right,
title and interest in the Purchased Assets subject to this Instrument.       4.
  This Instrument shall be governed by and construed in accordance with the
internal laws of the State of Delaware applicable to agreements made and to be
performed entirely within such State, without regard to the conflicts of laws
principles of such State.       5.   To the extent that any provision of this
Instrument is inconsistent or conflicts with the Asset Purchase Agreement, the
provisions of the Asset Purchase Agreement shall control. Nothing in this
Instrument, express or implied, is intended or shall be construed to expand or
defeat, impair or limit in any way the rights, obligations, claims or remedies
of the parties as set forth in the Asset Purchase Agreement.       6.   This
Instrument may be executed in any number of counterparts, each of which when
executed and delivered shall be deemed to be an original and all of which when
taken together shall constitute but one and the same instrument.

 

[Signature Page to Bill of Sale, Conveyance and Assignment to Follow]

 

 

 

 

[Signature Page to Bill of Sale, Conveyance and Assignment]

 

IN WITNESS WHEREOF, the parties hereto have caused this Instrument to be
executed by their respective duly authorized officers as of the date first above
written.

 

SELLER:

 

OHIO FITNESS AND MARTIAL ARTS, LLC

 

By: /s/ Scott Sheeley                           

Name: Scott Sheeley

Title: Managing Member

 

BUYER:

 

ALLIANCE MMA, INC.

 

 

By: /s/ Paul K. Danner                         

Name: Paul K. Danner, III

Title: Chief Executive Officer

 

2 

 

 

Exhibit D

 

INTELLECTUAL PROPERTY TRANSFER AGREEMENT

 

This INTELLECTUAL PROPERTY TRANSFER AGREEMENT dated as of December 9, 2016 is
entered into by and among OHIO FITNESS AND MARTIAL ARTS, LLC, a Ohio limited
liability company (“Assignor”) and ALLIANCE MMA, INC., a Delaware corporation
(“Assignee”) and is delivered pursuant to, and subject to the terms of, that
certain Asset Purchase Agreement, dated as of December 9, 2016 (the “Asset
Purchase Agreement”), by and among Assignor, Assignee, and Scott Sheeley, an
individual and resident of the State of Ohio (the “Selling Member”).

 

WHEREAS, Assignor has good and marketable rights and title in and to the patent
applications, issued patents, trademarks, trademark applications, copyrights and
copyright applications listed on Schedule 1 attached hereto (the “Intellectual
Property”); and

 

WHEREAS, Assignee desires to acquire Assignor’s rights and title in and to the
Intellectual Property and Assignor desires to assign to the Assignee its rights
and title in and to the Intellectual Property.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

1.       Assignor hereby transfers, assigns and otherwise conveys to Assignee,
all of Assignor’s rights, title, and interest in, to, and under the following:

 

A. the patents included in the Intellectual Property, including, without
limitation, any continuations, divisions, continuations-in-part, reissues,
reexaminations, extensions or foreign equivalents thereof, and including,
without limitation, the subject matter of all claims that may be obtained
therefrom, and all other corresponding rights that are or may be secured under
the laws of the United States or any other jurisdiction, now or hereafter in
effect;

 

B. the copyrights and applications for registration of copyrights included in
the Intellectual Property, and all corresponding rights, including, without
limitation, moral rights, that are or may be secured under the laws of the
United States or any other jurisdiction, now or hereafter in effect; and

 

C. all proceeds of the assets transferred pursuant to subsections 1(A) and 1(B)
above, including, without limitation, the right to sue for, and collect on, (i)
any claim by Assignor against third parties for past, present, or future
infringement of the such transferred assets, and (ii) any income, royalties, or
payments due or payable and related exclusively to such transferred assets as of
the date of this assignment or thereafter.

 

 

 

 

2.       Assignor authorizes the pertinent officials of the United States Patent
and Trademark Office and the United States Copyright Office and the pertinent
official of similar offices or governmental agencies in any applicable
jurisdictions outside the United States to record the transfer of the patents,
copyrights and related registrations and applications for registration set forth
on Schedule A to Assignee as assignee of Assignor’s entire rights, title and
interest therein. Assignor agrees to further execute any documents reasonably
necessary to effect the assignment specified herein or to confirm Assignee’s
ownership of the Intellectual Property.

 

3.       The terms of the Asset Purchase Agreement are incorporated herein by
reference. Except as set forth herein, the rights and obligations of the
Assignor and Assignee set forth in the Asset Purchase Agreement remain
unmodified. Capitalized terms used herein or in the Schedule A hereto but not
otherwise defined herein or in the Schedule 1 hereto shall have the respective
meanings given to them in the Asset Purchase Agreement.

 

4.       This Intellectual Property Transfer Agreement shall be construed and
enforced in accordance with and governed by the laws of the State of Delaware
without regard to the conflicts of laws provisions thereof.

 

5.       This Intellectual Property Transfer Agreement may be executed in any
number of counterparts, each of which when executed and delivered shall be
deemed to be an original and all of which when taken together shall constitute
but one and the same instrument.

 

[Signature Page for Intellectual Property Transfer Agreement to follow]

 

2 

 

 

[Signature Page for Intellectual Property Transfer Agreement]

 

 

IN WITNESS WHEREOF, the Assignor and Assignee have caused this Intellectual
Property Transfer Agreement to be duly executed and authorized as of the date
hereof.

 

ASSIGNOR:

 

OHIO FITNESS AND MARTIAL ARTS, LLC

 

By: /s/ Scott Sheeley                            

Name: Scott Sheeley

Title: Managing Member

 

ASSIGNEE:

 

ALLIANCE MMA, INC.

 

 

By: /s/ Paul K. Danner                         

Name: Paul K. Danner, III

Title: Chief Executive Officer

 

3 

 

 

SCHEDULE A

 

PATENTS

 

None

 

COPYRIGHTS

 

Copyrights in all Fighter Promotional Materials, videos and other audiovisual
and multi-media materials together with all other copyrights in and to all the
copyrightable materials included in the Purchased Assets.

 

4 

 

 

Exhibit E

 

MAKE GOOD ESCROW AGREEMENT

 

This Make Good Escrow Agreement (the “Agreement”), dated as of December 9, 2016
(the “Effective Date”) is entered into by and among ALLIANCE MMA, INC., a
Delaware corporation (“Company”), Scott Sheeley, an individual and resident of
the State of Ohio (the “Selling Member”), and Mazzeo Song P.C., a New York
professional corporation (“Escrow Agent”) and is delivered pursuant to, and
subject to the terms of, that certain Asset Purchase Agreement, dated as of
December 9, 2016 (the “Asset Purchase Agreement”), by and among Company, OHIO
FITNESS AND MARTIAL ARTS, LLC, a Ohio limited liability company (“Seller”), and
the Selling Member. All capitalized terms not otherwise defined herein shall
have the meanings ascribed to such terms in the Asset Purchase Agreement.

 

WHEREAS, as an inducement for the Company to enter into the Asset Purchase
Agreement, the Selling Member has agreed to place the “Escrow Shares” (as
defined in Section 2 hereto) into escrow for the benefit of the Company in the
event the Selling Member fails to satisfy certain financial thresholds relative
to the Business and the Purchased Assets and to satisfy any claims for
indemnification pursuant to Article 10 of the Asset Purchase Agreement.

 

WHEREAS, pursuant to the requirements of the Asset Purchase Agreement, the
Company and the Selling Member have agreed to establish an escrow on the terms
and conditions set forth in this Agreement;

 

WHEREAS, the Escrow Agent has agreed to act as escrow agent pursuant to the
terms and conditions of this Agreement; and

 

NOW, THEREFORE, in consideration of the mutual promises of the parties and the
terms and conditions hereof, the parties hereby agree as follows:

 

1.       Appointment of Escrow Agent. The Selling Member and the Company hereby
appoint Mazzeo Song P.C. as Escrow Agent to act in accordance with the terms and
conditions set forth in this Agreement, and Escrow Agent hereby accepts such
appointment and agrees to act in accordance with such terms and conditions.

 

2.       Establishment of Escrow. Upon the Closing Date, the Selling Member
shall deliver, or cause to be delivered, to the Escrow Agent certificates
evidencing 50,000 shares (the “Escrow Shares”) of the Company’s common stock,
par value $0.001 per share (“Common Stock”) in proportion to their respective
ownership interests in Seller as set forth on Exhibit A attached hereto, along
with bank signature stamped stock powers executed in blank or such other signed
instrument of transfer acceptable to the Company’s transfer agent to enable the
transfer agent to cancel such Escrow Shares upon instruction from the Company in
accordance with Section 4.

 

 

 

 

3.       Representations of Selling Member. The Selling Member hereby represent
and warrant, jointly and severally as follows:

 

(a)       The Escrow Shares of the Selling Member are validly issued, fully paid
and nonassessable shares of the Company, and free and clear of all pledges,
liens and encumbrances.

 

(b)       Performance of this Agreement and compliance with the provisions
hereof will not violate any provision of any applicable law and will not
conflict with or result in any breach of any of the terms, conditions or
provisions of, or constitute a default under, or result in the creation or
imposition of any lien, charge or encumbrance upon, any of the properties or
assets of any of the Selling Member pursuant to the terms of any indenture,
mortgage, deed of trust or other agreement or instrument binding upon any of the
Selling Member, other than such breaches, defaults or liens which would not have
a material adverse effect taken as a whole.

 

4.       Cancellation of Escrow Shares for Failure to Attain 2017 Guaranteed
Gross Profit.

 

2017 Guaranteed Gross Profit. The Selling Member agrees that in the event that
the earnings before interest, taxes, depreciation, and amortization attributable
to the Business and the Purchased Assets and included in earnings before income
taxes in Buyer’s Annual Report on Form 10-K for the fiscal year ending December
31, 2017, as filed with the Commission, is less than $107,143 (the “2017
Guaranteed Gross Profit”), the Escrow Agent will, upon receipt of the Target
Gross Profit Notice from the Company, transfer the Escrow Shares together with
the stock powers and other transfer instruments to the Company’s transfer agent
with instructions that the Escrow Shares will be cancelled and returned to
treasury. In the event that earnings before interest, taxes, depreciation, and
amortization attributable to the Business and the Purchased Assets and included
in earnings before income taxes in Buyer’s Annual Report on Form 10-K for the
fiscal year ending December 31, 2017, as filed with the Commission, is equal to
or greater than the 2017 Guaranteed Gross Profit, no cancellation of the Escrow
Shares shall be required by the Selling Member under this Section 4 and subject
to any claim for indemnification made under Article 10 of the Asset Purchase
Agreement as provided in Section 5, such Escrow Shares shall be returned to the
Selling Member (and if the Escrow Agent has no address to which to deliver them,
then to the Company) in accordance with this Agreement. The Escrow Agent need
only rely on the Target Gross Profit Notice from the Company in this regard and
notwithstanding anything to the contrary contained herein will disregard any
contrary instructions.

 

5.       Cancellation of Escrow Shares to Satisfy Indemnification Claims.

 

(a)       Indemnification. An Claim for Losses to be paid from the Escrow Shares
pursuant to Article 10 of the Asset Purchase Agreement may be made only if the
Company delivers to the Selling Member (with a copy to the Escrow Agent) by the
deadline for submitting such a Claim under the Asset Purchase Agreement (the
“Indemnity Termination Date”) a Claim Notice that sets forth in reasonable
detail the specific facts and circumstances giving rise to such claim and a good
faith estimate of the dollar amount of the Losses for which the Indemnified
Party claims it is entitled to indemnification pursuant to the terms of the
Asset Purchase Agreement (the “Claimed Amount”). Within thirty (30) days after
delivery of a Claim Notice, the Selling Member shall deliver to the Company a
written response in which the Selling Member shall: (A) agree that the Company
is entitled to receive all of the Claimed Amount (in which case such response
shall be accompanied by delivery to the Escrow Agent of the Selling Member’s
acceptance of terms of the Claim Notice), (B) agree in a “Counter Notice” that
the Company is entitled to receive part, but not all, of the Claimed Amount (the
“Agreed Amount”), or (C) contest that the Company is entitled to receive any of
the Claimed Amount including the reasons therefor. If the Indemnifying Party in
the Counter Notice or otherwise contest the payment of all or part of the
Claimed Amount, the Company and the Selling Member shall use good faith efforts
to resolve such dispute. If such dispute is not resolved within sixty (60) days
following the delivery by the Selling Member of such response, the Company and
the Selling Member shall have the right to submit such dispute to a court of
competent jurisdiction in accordance with the provisions of Section 12.17 of the
Assets Purchase Agreement.

 

2 

 

 

(b)       If no Counter Notice is received by the Escrow Agent, or if the
Company accepts the Selling Member’s Agreed Amount in the Counter Notice, in
either case within such thirty (30) day period, then the Claimed Amount or the
Agreed Amount claimed in the applicable Claim Notice or Counter Notice shall be
deemed established for purposes of this Escrow Agreement, and, at the end of
such thirty (30) day period, the Escrow Agent shall promptly deliver to the
Company’s transfer agent (with instructions that the shares so transferred are
to be cancelled and returned to treasury) a number of shares of Common Stock
from the Escrow Shares with a Market Value (as defined below) as of the date of
the Claim Notice or Counter Notice equal to the Claimed Amount or the Agreed
Amount as the case may. The “Market Value” of a share of Common Stock as of any
day shall be equal to average of the Company Stock Prices over the twenty
consecutive NASDAQ trading days (or, if the Company Common Stock is not traded
on the NASDAQ Capital Market, such number of trading days on any other exchange
or market on which the Company Common Stock is then trading) ending on and
including the second full trading day preceding such day.

 

(c)       If a Counter Notice is given by the Selling Member within thirty (30)
days after delivery of a Claim Notice and the Company and the Selling Member are
unable to agree upon the Agreed Amount the parties shall use good faith efforts
to resolve such dispute. If such dispute is not resolved within sixty (60) days
following the delivery by the Selling Member of the Counter Notice the Company
and the Selling Member shall have the right to submit such dispute to a court of
competent jurisdiction in accordance with the provisions of Section 12.17 of the
Assets Purchase Agreement. In such case the Escrow Agent shall deliver to the
Company’s transfer agent (with instructions that the shares so transferred are
to be cancelled and returned to treasury) the appropriate number of shares of
Common Stock with a Market Value as of the date of the Claim Notice or Counter
Notice equal to the Claimed Amount or the Agreed Amount as the case may from the
Escrow Shares in respect of such Claim only in accordance with (A) joint written
instructions of the Company and the Selling Member, or (B) a final judgment with
no further right to appeal, upon an award rendered by a court of competent
jurisdiction.

 

3 

 

 

(d)       If the Selling Member and the Company reach a settlement with respect
to any Claim made by the Company or if the number of shares of Common Stock to
be cancelled in respect of a Claim is determined through a judgment not subject
to appeal as provided in Section 5(c), the Selling Member and the Company shall
jointly deliver written notice of such settlement or judgment to the Escrow
Agent, including (if applicable) instructions to the Escrow Agent to deliver to
the Company’s transfer agent the appropriate number of shares of Common Stock
with the relevant Market Value equal to the amount of such settlement or
judgment (with instructions that the shares so transferred are to be cancelled
and returned to treasury), and the Escrow Agent shall act promptly in accordance
with such instructions.

 

(e)       To the extent the Escrow Agent is otherwise required hereunder to
transfer a fractional share of Common Stock to the Company transfer agent, the
Escrow Agent shall round such fractional share to the nearest whole share, with
one half of such share being rounded downward.

 

(g)       The Company shall cause its stock transfer agent to cooperate with the
Escrow Agent, at the Company’s expense, in connection with this Agreement.

 

6.       Duration. This Agreement shall terminate on the earlier of the 24-month
anniversary of the Effective Date or cancellation of all the Escrow Shares. Upon
termination of this Agreement any remaining Escrow Shares will be returned to
the Selling Member within ten (10) Business Days to the address set forth on
Exhibit A. The Company agrees to provide the Escrow Agent written notice of the
filing with the Commission of any financial statements or reports referenced
herein.

 

7.       Escrow Shares. Until such time as (if at all) the Escrow Shares are
required to be cancelled pursuant to the Asset Purchase Agreement and in
accordance with this Agreement, any dividends payable in respect of the Escrow
Shares and all voting rights applicable to the Escrow Shares shall be retained
by the Selling Member. Should the Escrow Agent receive dividends or voting
materials, such items shall be passed immediately on to the Selling Member and
shall not be invested or held for any time longer than is needed to effectively
re-route such items to the Selling Member.

 

8.       Interpleader. Should any controversy arise among the parties hereto
with respect to this Agreement or with respect to the right to cancel or receive
the Escrow Shares, the Escrow Agent shall have the right to consult counsel
and/or to institute an appropriate interpleader action to determine the rights
of the parties. Escrow Agent is also each hereby authorized to institute an
appropriate interpleader action upon receipt of a written letter of direction
executed by the parties so directing the Escrow Agent. If Escrow Agent is
directed to institute an appropriate interpleader action, it shall institute
such action not prior to thirty (30) days after receipt of such letter of
direction and not later than sixty (60) days after such date. Any interpleader
action instituted in accordance with this Section 7 shall be filed in any court
of competent jurisdiction in the State of New York, and the Escrow Shares in
dispute shall be deposited with the court and in such event Escrow Agent shall
be relieved of and discharged from any and all obligations and liabilities under
and pursuant to this Agreement with respect to the Escrow Shares and any other
obligations hereunder.

 

4 

 

 

9.       Exculpation and Indemnification of Escrow Agent.

 

(a)       Escrow Agent is not a party to, and is not bound by or charged with
notice of any agreement out of which this escrow may arise. Escrow Agent acts
under this Agreement as a depositary only and is not responsible or liable in
any manner whatsoever for the sufficiency, correctness, genuineness or validity
of the subject matter of the escrow, or any part thereof, or for the form or
execution of any notice given by any other party hereunder, or for the identity
or authority of any person executing any such notice. Escrow Agent will have no
duties or responsibilities other than those expressly set forth herein. Escrow
Agent will be under no liability to anyone by reason of any failure on the part
of any party hereto (other than Escrow Agent) or any maker, endorser or other
signatory of any document to perform such Person’s obligations hereunder or
under any such document. Except for this Agreement and instructions to Escrow
Agent pursuant to the terms of this Agreement, Escrow Agent will not be
obligated to recognize any agreement between or among any or all of the Persons
referred to herein, notwithstanding its knowledge thereof. In the event of any
actual or alleged mistake or fraud of the Company, its auditors, the Selling
Member or any other Person (other than Escrow Agent) in connection with any
information provided to the Escrow Agent hereunder, Escrow Agent shall have no
obligation or liability to any party hereunder.

 

(b)       Escrow Agent will not be liable for any action taken or omitted by it,
or any action suffered by it to be taken or omitted, absent gross negligence or
willful misconduct. Escrow Agent may rely conclusively on, and will be protected
in acting upon, any order, notice, demand, certificate, or opinion or advice of
counsel (including counsel chosen by Escrow Agent), statement, instrument,
report or other paper or document (not only as to its due execution and the
validity and effectiveness of its provisions, but also as to the truth and
acceptability of any information therein contained) which is reasonably believed
by Escrow Agent to be genuine and to be signed or presented by the proper Person
or Persons. The duties and responsibilities of the Escrow Agent hereunder shall
be determined solely by the express provisions of this Agreement and no other or
further duties or responsibilities shall be implied, including, but not limited
to, any obligation under or imposed by any laws of the State of New York upon
fiduciaries.

 

(c)       The Company and the Selling Member each hereby, jointly and severally,
indemnify and hold harmless Escrow Agent and its principals, partners, agents,
employees and affiliates from and against any expenses, including reasonable
attorneys’ fees and disbursements, damages or losses suffered by Escrow Agent in
connection with any claim or demand, which, in any way, directly or indirectly,
arises out of or relates to this Agreement or the services of Escrow Agent
hereunder; except, that if Escrow Agent is guilty of willful misconduct, gross
negligence or fraud under this Agreement, then Escrow Agent will bear all
losses, damages and expenses arising as a result of such willful misconduct,
gross negligence or fraud. Promptly after the receipt by Escrow Agent of notice
of any such demand or claim or the commencement of any action, suit or
proceeding relating to such demand or claim, Escrow Agent will notify the other
parties hereto in writing. For the purposes hereof, the terms “expense” and
“loss” will include all amounts paid or payable to satisfy any such claim or
demand, or in settlement of any such claim, demand, action, suit or proceeding
settled with the express written consent of the parties hereto, and all costs
and expenses, including, but not limited to, reasonable attorneys’ fees and
disbursements, paid or incurred in investigating or defending against any such
claim, demand, action, suit or proceeding. The provisions of this Section 8
shall survive the termination of this Agreement.

 

5 

 

 

10.       Compensation of Escrow Agent. Escrow Agent shall be entitled to
$10,000 as compensation for its services as Escrow Agent hereunder, which
compensation shall be paid by the Company. The fee agreed upon for the services
rendered hereunder is intended as full compensation for Escrow Agent’s services
as contemplated by this Agreement; provided, however, that in the event that
Escrow Agent renders any material service not contemplated in this Agreement, or
there is any assignment of interest in the subject matter of this Agreement, or
any material modification hereof, or if any material controversy arises
hereunder, or Escrow Agent is made a party to any litigation pertaining to this
Agreement, or the subject matter hereof, then Escrow Agent shall be reasonably
compensated by the Company for such extraordinary services and reimbursed for
all costs and expenses, including reasonable attorney’s fees, occasioned by any
delay, controversy, litigation or event, and the same shall be recoverable from
the Company. Prior to incurring any costs and/or expenses in connection with the
foregoing sentence, Escrow Agent shall be required to provide written notice to
the Company of such costs and/or expenses and the relevancy thereof and Escrow
Agent shall not be permitted to incur any such costs and/or expenses prior to
receiving written approval from the Company, which approval shall not be
unreasonably withheld.

 

11.       Resignation of Escrow Agent. At any time, upon ten (10) Business Days’
written notice to the Company, Escrow Agent may resign and be discharged from
its duties as Escrow Agent hereunder. As soon as practicable after its
resignation, Escrow Agent will promptly turn over to a successor escrow agent
appointed by the Company the Escrow Shares held hereunder upon presentation of a
document appointing the new escrow agent and evidencing its acceptance thereof.
If, by the end of the 10-day period following the giving of notice of
resignation by Escrow Agent, the Company shall have failed to appoint a
successor escrow agent, Escrow Agent may interplead the Escrow Shares into the
registry of any court having jurisdiction.

 

12.       Records. Escrow Agent shall maintain accurate records of all
transactions hereunder. Promptly after the termination of this Agreement or as
may reasonably be requested by the parties hereto from time to time before such
termination, Escrow Agent shall provide the parties hereto, as the case may be,
with a complete copy of such records, certified by Escrow Agent to be a complete
and accurate account of all such transactions. The authorized representatives of
each of the parties hereto shall have access to such books and records at all
reasonable times during normal business hours upon reasonable notice to Escrow
Agent and at the requesting party’s expense.

 

6 

 

 

13.       Notice. All notices, communications and instructions required or
desired to be given under this Agreement must be in writing and shall be deemed
to be duly given if sent by registered or certified mail, return receipt
requested, or overnight courier, to the addresses set forth in the Asset
Purchase Agreement or provided to the Escrow Agent in writing under separate
cover.

 

14.       Execution in Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

 

15.       Assignment and Modification. This Agreement and the rights and
obligations hereunder of any of the parties hereto may not be assigned without
the prior written consent of the other parties hereto. Subject to the foregoing,
this Agreement will be binding upon and inure to the benefit of each of the
parties hereto and their respective successors and permitted assigns. No other
Person will acquire or have any rights under, or by virtue of, this Agreement.
No portion of the Escrow Shares shall be subject to interference or control by
any creditor of any party hereto, or be subject to being taken or reached by any
legal or equitable process in satisfaction of any debt or other liability of any
such party hereto prior to the cancellation or disbursement thereof to such
party hereto in accordance with the provisions of this Agreement. This Agreement
may be amended or modified only in writing signed by all of the parties hereto.

 

16.       Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without giving effect to the
principles of conflicts of laws thereof.

 

17.       Headings. The headings contained in this Agreement are for convenience
of reference only and shall not affect the construction of this Agreement.

 

18.       Attorneys’ Fees. If any action at law or in equity, including an
action for declaratory relief, is brought to enforce or interpret the provisions
of this Agreement, the prevailing party shall be entitled to recover reasonable
attorneys’ fees from the other party (unless such other party is the Escrow
Agent), which fees may be set by the court in the trial of such action or may be
enforced in a separate action brought for that purpose, and which fees shall be
in addition to any other relief that may be awarded.

 

[Signature Page to Make Good Escrow Agreement Follows]

 

7 

 

 

[Signature Page to Make Good Escrow Agreement]

 

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the date
set forth opposite their respective names.

 

ESCROW AGENT:

 

Mazzeo Song P.C.

 

By:  /s/ Robert L. Mazzeo                    

Name: Robert L. Mazzeo, Esq.

Title: Partner

 

SELLING MEMBER:

 

  /s/ Scott Sheeley                                

Scott Sheeley

 

COMPANY:

 

ALLIANCE MMA, INC.

 

 

By:  /s/ Paul K. Danner                        

Name: Paul K. Danner, III

Title: Chief Executive Officer

 

8 

 

 

Exhibit A

 

The table below represents the number of Escrow Shares deposited with the Escrow
Agent by the Selling Member and subject to cancellation in accordance with the
operation of Sections 4 and Section 5 of the attached Agreement.

 

Selling Member Name and Address Number of Shares Deposited into Escrow        

  

9 

 

 

EXHIBIT F

 

NON-COMPETITION AND NON-SOLICITATION AGREEMENT

 

THIS NON-COMPETITION AND NON-SOLICITATION AGREEMENT (the “Agreement”), dated as
of December 9, 2016 (the “Effective Date”) is entered into by and between
ALLIANCE MMA, INC., a Delaware corporation (“Company”) and Scott Sheeley, an
individual and resident of the State of Ohio (the “Selling Member”).

 

WHEREAS, the Company, OHIO FITNESS AND MARTIAL ARTS, LLC, a Ohio limited
liability company (“Seller”), and the Selling Member are parties to that certain
Asset Purchase Agreement, dated as of December 9, 2016 (the “Asset Purchase
Agreement”) pursuant to which the Company acquired substantially all the assets
of Seller’s business (as more particularly defined in the Asset Purchase
Agreement, the “Business”);

 

WHEREAS, the execution and delivery of this Agreement by Selling Member was a
condition to the purchase by the Company of the Business and consummation of the
other transactions contemplated by the Asset Purchase Agreement;

 

WHEREAS, also in connection with purchase by the Company of the Business and
consummation of the other transactions contemplated by the Asset Purchase
Agreement, the Selling Member has been offered employment by the Company, and
the Selling Member will have access to and be instrumental in developing and
implementing critical aspects of the Company’s strategic business plan; and

 

WHEREAS, the Selling Member is an owner of capital stock or options to acquire
the capital stock of the Company and will otherwise personally benefit from the
transactions contemplated by this Agreement.

 

NOW, THEREFORE, in consideration of (i) the Company entering into the Asset
Purchase Agreement, (ii) the employment or continued employment of the Selling
Member by the Company, and (iii) the continued receipt and access to
confidential, proprietary, and trade secret information associated with the
Selling Member’s position with the Company, the Selling Member and the Company
agree as follows:

 

1.       Confidentiality. Selling Member understands and agrees that in the
course of providing services to the Company, Selling Member may acquire
confidential and/or proprietary information concerning the Company’s operations,
its future plans and its methods of doing business. Selling Member understands
and agrees it would be extremely damaging to the Company if Selling Member
disclosed such information to a competitor or made such information available to
any other person. Selling Member understands and agrees that such information is
divulged to Selling Member in strict confidence and Selling Member understands
and agrees that Selling Member shall not use such information other than in
connection with the Business and will keep such information secret and
confidential unless disclosure is required by court order or otherwise by
compulsion of law. In view of the nature of Selling Member’s employment with the
Company and the information that Selling Member has received during the course
of Selling Member’s employment, Selling Member also agrees that the Company
would be irreparably harmed by any violation, or threatened violation of the
agreements in this paragraph and that, therefor, the Company shall be entitled
to an injunction prohibiting Selling Member from any violation or threatened
violation of such agreements.

 

 

 

 

2.       Non-Competition and Non-Solicitation. The Selling Member acknowledges
and agrees that the nature of the Company’s confidential, proprietary, and trade
secret information to which the Selling Member has, and will continue to have,
access to derives value from the fact that it is not generally known and used by
others in the highly competitive industry in which the Company competes. The
Selling Member further acknowledges and agrees that, even in complete good
faith, it would be impossible for the Selling Member to work in a similar
capacity for a competitor of the Company without drawing upon and utilizing
information gained during employment with the Company. Accordingly, at all times
during the Selling Member’s employment with the Company and for a period of
three (3) years after termination, for any reason, of such employment, the
Selling Member will not, directly or indirectly:

 

(a) Engage in any business or enterprise (whether as owner, partner, officer,
director, employee, consultant, investor, lender or otherwise, except as the
holder of not more than one percent (1%) of the outstanding capital stock of a
company) that directly or indirectly competes with the Company’s business or the
business of any of its subsidiaries anywhere in the United States, including but
not limited to any business or enterprise that develops, manufactures, markets,
or sells any product or service that competes with any product or service
developed, manufactured, marketed or sold, or planned to be developed,
manufactured, marketed or sold, by the Company or any of its subsidiaries while
the Selling Member was employed by the Seller or the Company; or

 

(b) Either alone or in association with others (i) solicit, or facilitate any
organization with which the Selling Member is associated in soliciting, any
employee of the Company or any of its subsidiaries to leave the employ of the
Company or any of its subsidiaries; (ii) solicit for employment, hire or engage
as an independent contractor, or facilitate any organization with which the
Selling Member is associated in soliciting for employment, hire or engagement as
a independent contractor, any person who was employed by the Company or any of
its subsidiaries at any time during the term of the Selling Member’s employment
with the Seller or the Company or any of their respective subsidiaries
(provided, that this clause (ii) shall not apply to any individual whose
employment with the Seller, the Company or any of its subsidiaries has been
terminated for a period of one year or longer); or (iii) solicit business from
or perform services for any customer, supplier, licensee or business relation of
the Seller or the Company or any of their respective subsidiaries, induce or
attempt to induce, any such entity to cease doing business with the Company or
any of its subsidiaries; or in any way interfere with the relationship between
any such entity and the Company or any of its subsidiaries.

 

2 

 

 

(c) Notwithstanding the foregoing, nothing contained in this Agreement shall
preclude the Selling Member from training mixed martial arts fighters.

 

3.       Return of Property. Selling Member understands and agrees that all
business information, files, research, records, memoranda, books, lists and
other documents and tangible materials, including computer disks, and other
hardware and software that he receives during his employment, whether
confidential or not, are the property of the Company, and that, upon the
termination of his services, for whatever reason, he will promptly deliver to
the Company all such materials, including copies thereof, in his possession or
under his control. Any analytical templates, books, presentations, reference
materials, computer disks and other similar materials already rightfully owned
by the Selling Member prior to the Effective Date shall remain the property of
the Selling Member and any copies thereof obtained by or provided to the Company
shall be returned or destroyed in a manner similar acceptable to the Selling
Member.

 

4.       Not Employment Contract. The Selling Member acknowledges that this
Non-Competition and Non-Solicitation Agreement does not constitute a contract of
employment and, except as set forth in a written employment agreement between
the parties, does not guarantee hat the Company or any of its subsidiaries will
continue his employment for any period of time or otherwise change the at-will
nature of his employment.

 

5.       Interpretation. If any restriction set forth in Section 2 is found by
any court of competent jurisdiction to be invalid, illegal, or unenforceable, it
shall be modified to the minimum extent necessary to render the modified
restriction valid, legal and enforceable. The parties intend that the
non-competition and non-solicitation provisions contained in this Agreement
shall be deemed to be a series of separate covenants, one for each and every
county of each and every state of the United States of America where this
provision is intended to be effective.

 

6.       Severability. The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

 

7.       Waiver of Rights. No delay or omission by the Company in exercising any
right under this Agreement will operate as a waiver of that or any other right.
A waiver or consent given by the Company on any one occasion is effective only
in that instance and will not be construed as a bar to or waiver of any right on
any other occasion.

 

8.       Equitable Remedies. The restrictions contained in this Agreement are
necessary for the protection of the business and goodwill of the Company and its
subsidiaries and are considered by the Selling Member to be reasonable for such
purpose. The Selling Member agrees that any breach of this Agreement is likely
to cause the Company substantial and irrevocable damage and therefor, in the
event of any such breach, the Selling Member agrees that the Company, in
addition to such other remedies that may be available, shall be entitled to
specific performance and other injunctive relief.

 

3 

 

 

9.       Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware. Any action, suit, or other
legal proceeding which is commenced to resolve any matter arising under or
relating to any provision of this Agreement shall be commenced only in a court
of the State of Delaware (or, if appropriate, a federal court located within
Delaware), and the Company and the Selling Member each consents to the
jurisdiction of such a court.

 

10.       Term. This Agreement shall be effective on the Effective Date. This
Agreement shall expire on December 9, 2019, provided the obligations of the
Selling Member under Sections 2 shall survive for a period of three (3) years
after expiration or termination. Notwithstanding the foregoing the obligations
of the Selling Member under Sections 1 and 3 shall survive indefinitely.

 

THE SELLING MEMBER ACKNOWLEDGES THAT HE HAS CAREFULLY READ THIS AGREEMENT, HAS
SOUGHT INDEPENDENT COUNSEL TO ADVISE HIM AS TO THE NATURE AND EXTENT OF HIS
OBLIGATIONS HEREUNDER AND UNDERSTANDS AND AGREES TO ALL OF THE PROVISIONS IN
THIS AGREEMENT.

 

[Signature Page to Non-Competition And Non-Solicitation Agreement Follows]

 

4 

 

 

[Signature Page to Non-Competition And Non-Solicitation Agreement]

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective duly authorized officers as of the date first above written.

 

 

COMPANY:

 

ALLIANCE MMA, INC.

 

 

By:  /s/ Paul K. Danner                        

Name: Paul K. Danner, III

Title: Chief Executive Officer

 

SELLING MEMBER:

 

 

By: /s/ Scott Sheeley                           

Scott Sheeley

 

5 

 

 

Exhibit G

 

TRADEMARK LICENSE AGREEMENT

 

This TRADEMARK LICENSE AGREEMENT (“Agreement”) dated as of December 9, 2016 is
entered into by and among OHIO FITNESS AND MARTIAL ARTS, LLC, a Ohio limited
liability company (“Licensor”) and ALLIANCE MMA, INC., a Delaware corporation
(“Licensee”) and is delivered pursuant to, and subject to the terms of, that
certain Asset Purchase Agreement, dated as of December 9, 2016 (the “Asset
Purchase Agreement”), by and among Licensor, Licensee, and Scott Sheeley, an
individual and resident of the State of Ohio (the “Selling Member”). All
capitalized terms not otherwise defined herein shall have the meanings ascribed
to such terms in the Asset Purchase Agreement.

 

WHEREAS, Licensor asserts that it is the sole and exclusive owner of the name
“IT Fight Series” and all logos, trademarks and service marks attendant thereto
(the “Licensed Marks”).

 

WHEREAS, in connection with the Asset Purchase Agreement, Licensor agreed to
grant Licensee an exclusive license for use and exploitation of the Licensed
Marks in connection with the Business as more particularly set forth herein.

 

NOW, THEREFORE, in consideration of the premises and mutual covenants,
agreements and provisions herein contained, the parties hereto, intending to be
legally bound, hereby agree as follows:

 

ARTICLE 1

TERM AND TERMINATION

 

1.1       Term. The term of this Agreement and the rights granted and
obligations assumed hereto, shall commence on the Closing Date and shall endure
and remain in full force in perpetuity.

 

1.2       Termination. Notwithstanding anything contained in Section 1.1 to the
contrary, this Agreement may be terminated at any time as follows:

 

(a)with the mutual consent of Licensor and Licensee;

 

(b)       by Licensor, if it is not then in material breach of its obligations
under the Asset Purchase Agreement and if (A) any of Licensee’s representations
and warranties contained in the Asset Purchase Agreement shall be inaccurate
such that the condition set forth in Section 8.1(b) of the Asset Purchase
Agreement would not be satisfied, or (B) any of Licensee’s covenants contained
in this Agreement shall have been breached such that the condition set forth in
Section 8.1(a) of the Asset Purchase Agreement would not be satisfied; provided,
however, that Licensor shall not terminate this Agreement under this Section on
account of any breach or inaccuracy that is curable by Licensee unless Licensee
fails to cure such inaccuracy or breach within ten (10) Business Days after
receiving written notice from Licensor of such inaccuracy or breach.

 

 

 

 

ARTICLE 2

LICENSE GRANT AND RIGHTS

 

2.1       License.

 

(a)       Licensor hereby grants to Licensee and Licensee hereby accepts from
Licensor, subject to the terms and conditions hereinafter set forth, a
non-transferrable, exclusive, perpetual, royalty free, fully paid up, worldwide
license to use and commercially exploit the Licensed Marks in connection with
the Purchased Assets and the Business.

 

(b)       The license granted in Section 2.1(a) above shall extent to the use of
any of the Licensed Marks in connection with the distribution or other
commercialization of any photograph, video, television broadcast, online
distribution, electronic gamming, or other form of audio visual media format or
transmission now known or in the future conceived, bearing the Licensed Marks.

 

2.2       Bankruptcy; Abandonment. As sole and exclusive owner of the Licensed
Marks, Licensor agrees that in the event of bankruptcy, or appointment of a
receiver or trustee for conserving or distributing its assets for the benefit of
creditors the Licensed Marks shall, without notice, become the sole and
exclusive property of Licensee, as of ninety-one (91) days prior to such event,
and any and all rights of every kind and nature of Licensor in and to the
Licensed Marks shall terminate.

 

ARTICLE 3

ENFORCEMENT OF RIGHTS

 

3.1       Joint Enforcement. Upon discovery of any infringement of the Licensed
Marks at the option of either Licensor or Licensee, appropriate legal action in
connection therewith shall be undertaken either jointly or separately by
Licensor and Licensee. In the event that such action is taken jointly, each
party shall contribute equally to the expenses of any such action. If any
damages for infringement are awarded by a final decree or judgment to Licensor
and Licensee, then after deducting all expenses arising from the litigation and
reimbursing each contributing party for its contributions, the remainder shall
be divided equally among the contributing parties.

 

3.2       Independent Enforcement. If one party shall not wish to join or
continue in any such action, but the other party shall wish to institute or
continue such action, said one party shall render all reasonable assistance to
the other party in connection therewith at said other party’s expense and said
other party shall be entitled to retain all recoveries with respect to such
action.

 

2 

 

 

ARTICLE 4

REPRESENTATIONS AND WARRANTIES OF LICENSOR

 

Licensor hereby represents and warrants to Licensee as follows:

 

4.1       Ownership. Licensor is the sole and exclusive owner of the Licensed
Marks.

 

4.2       Authority. Licensor is authorized to grant the rights conferred
hereby.

 

4.3       No Violation. The execution and delivery of this Agreement, the
granting of the rights contained herein and the use of the Licensed Marks in
accordance with the terms of this Agreement, will not violate any laws or
regulations or violate or invalidate any agreement or documents to which
Licensor is a party and by which Licensor is bound or to which the Licensed
Marks is subject.

 

4.4       No Other Grants. To knowledge of Licensor, no person or entity is
entitled to any claim for compensation from Licensee for the use of the Licensed
Marks in accordance with the terms and conditions of this Agreement, and no
Person or entity has been granted any right in or to the Licensed Marks or any
part hereof, anywhere in the world.

 

4.5       Infringement. The Licensed Marks are not the subject of any pending
adverse claim or, to the knowledge of Licensor, the subject of any threatened
litigation or claim of infringement or misappropriation. To Licensor’s
knowledge, the Licensed Marks do not infringe on any Intellectual Property
Rights of any third party.

 

ARTICLE 5

MISCELLANEOUS

 

5.1       Incorporation by Reference. Sections 12.1, 12.3, 12.5,12.7 through
12.13, 12.15, 12.17 and 12.18 of the Asset Purchase Agreement are hereby
incorporate by reference provided that all references to Seller shall be deemed
to refer to Licensor and all references to Buyer shall be deemed to refer to
Licensee.

 

[Signature Page to Trademark License Agreement Follows]

 

3 

 

 

[Signature Page to Trademark License Agreement]

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective duly authorized officers as of the date first above written.

 

LICENSOR:

 

OHIO FITNESS AND MARTIAL ARTS, LLC

 

By: /s/ Scott Sheeley                            

Name: Scott Sheeley

Title: Managing Member

 

 

LICENSEE:

 

ALLIANCE MMA, INC.

 

 

By:  /s/ Paul K. Danner                        

Name: Paul K. Danner, III

Title: Chief Executive Officer

  

4 

 

 

Exhibit H

OFFICER’S CERTIFICATE

OF

ALLIANCE MMA, INC.

 

Reference is made to that certain ASSET PURCHASE AGREEMENT (the “Agreement”),
dated as of December 9, 2016 (the “Effective Date”) by and among OHIO FITNESS
AND MARTIAL ARTS, LLC, a Ohio limited liability company (“Seller”), ALLIANCE
MMA, INC., a Delaware corporation (“Buyer”), and Scott Sheeley, an individual
and resident of the State of Ohio (the “Selling Member”). Capitalized terms used
herein and not otherwise defined herein shall have the meaning given to them in
the Agreement.

 

The undersigned hereby certifies, on behalf of the Buyer on the Closing Date,
that:

 

(a)       he is the Chief Executive Officer of Buyer, and

 

(b)       each of the conditions specified in clauses (a) through (f) of
Section 8.1 of the Agreement are satisfied in all respects.

 

(c)       the representations and warranties of Buyer contained in Article 6 of
Agreement that are qualified as to materiality are true and correct, and all
other representations and warranties of Seller contained in Article 5 of the
Agreement are true and correct except for breaches of, or inaccuracies in, such
representations and warranties that, in the aggregate, would not have a material
adverse effect on the expected benefits to Seller or the Selling Member of the
transactions contemplated by the Agreement taken as a whole.

 

 

Dated as of December 9, 2016.

 

 

ALLIANCE MMA, INC.

 

 

By: /s/ Paul K. Danner                         

Name: Paul K. Danner, III

Title: Chief Executive Officer

  

 

 

 

Exhibit I

 

OFFICER’S CERTIFICATE

OF

OHIO FITNESS AND MARTIAL ARTS, LLC

 

Reference is made to that certain ASSET PURCHASE AGREEMENT (the “Agreement”),
dated as of December 9, 2016 (the “Effective Date”) by and among OHIO FITNESS
AND MARTIAL ARTS, LLC, a Ohio limited liability company (“Seller”), ALLIANCE
MMA, INC., a Delaware corporation (“Buyer”), and Scott Sheeley, an individual
and resident of the State of Ohio (the “Selling Member”). Capitalized terms used
herein and not otherwise defined herein shall have the meaning given to them in
the Agreement.

 

The undersigned hereby certifies, on behalf of the Seller on the Closing Date,
that:

 

(a)       he is the Managing Member of Seller, and

 

(b)       each of the conditions specified in clauses (a) through (j) of
Section 8.2 of the Agreement are satisfied in all respects.

 

(c)       the representations and warranties of Seller and the Selling Member
contained in Article 5 of Agreement that are qualified as to materiality are
true and correct, and all other representations and warranties of Seller and the
Selling Member contained in Article 5 of the Agreement are true and correct
except for breaches of, or inaccuracies in, such representations and warranties
that, in the aggregate, would not have a material adverse effect on the expected
benefits to Buyer of the transactions contemplated by the Agreement taken as a
whole.

 

 

Dated as of December 9, 2016.

 

 

OHIO FITNESS AND MARTIAL ARTS, LLC

 

By: /s/ Scott Sheeley                           

Name: Scott Sheeley

Title: Managing Member