Exhibit 10.2

 

SUBSCRIPTION AGREEMENT

AND JOINDER

 

This SUBSCRIPTION AGREEMENT AND JOINDER (this “Agreement”) is dated as of August
8, 2016, between XpresSpa Holdings, LLC, a Delaware limited liability company
(the “Company”), and FORM Holdings Corp., a Delaware corporation (the
“Purchaser”).

 

WHEREAS, subject to the terms and conditions set forth in this Agreement and
pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended (the
“Act”), and Rule 506 promulgated thereunder, the Company desires to issue and
sell to the Purchaser, and the Purchaser desires to purchase from the Company,
units of the Company’s Series C Preferred Units (the “Series C Preferred Units”)
pursuant to the terms and conditions of this Agreement;

 

NOW, THEREFORE, upon the execution and delivery of this Agreement, the Company
and the Purchaser agree as follows:

 

1.          Subscription.  The Purchaser, intending to be legally bound, hereby
irrevocably subscribes for and agrees to purchase the number of Series C
Preferred Units (the “Purchased Units”) listed on the Purchaser’s signature page
hereto, at a per unit purchase price of $1.00 (the “Per Unit Purchase Price”)
for an aggregate purchase price of $1,733,826, and the Company, intending to be
legally bound, hereby agrees to issue and sell the Purchased Units to the
Purchaser, provided, however, that the Company reserves the right to accept or
reject this subscription for Purchased Units, in whole or in part. If the
Company elects to accept this subscription for Purchased Units in part, it shall
promptly notify the Purchaser on the signature page countersigned by the Company
and delivered to the Purchaser.

 

2.          Accredited Investors. The offering and sale of the Purchased Units
(the “Offering”) is being made to “accredited investors” (as such term is
defined in Regulation D promulgated by the U. S. Securities and Exchange
Commission (the “SEC”) under the Act).

 

3.          Purchase and Sale of Purchased Units.  The Company agrees to issue
and sell to the Purchaser and the Purchaser agree to purchase the Purchased
Units at a closing to take place at the offices of the Company, or such other
place as the Purchaser and the Company shall mutually agree, including by way of
the exchange of facsimile or “pdf” copies of signatures (the “Closing”), no
later than the first Trading Day (as such term is defined below) following the
date hereof (the “Closing Date”).  The Purchaser shall deliver to the Company,
via wire transfer, immediately available funds equal to the aggregate amount to
be paid for the Purchased Units purchased hereunder as specified below the
Purchaser’s name on the signature page of this Agreement and next to the heading
“Subscription Amount,” in United States dollars and in immediately available
funds (the “Subscription Amount”), and the Company shall deliver to the
Purchaser its Purchased Units and the Company and the Purchaser shall deliver
the other items set forth in Section 4 deliverable at the Closing. Upon
satisfaction of the covenants and conditions set forth in Sections 4 and 5, the
Closing shall occur at the offices of Mintz, Levin, Cohn, Ferris, Glovsky and
Popeo, P.C., 666 3rd Avenue, New York, New York 10017. The term “Trading Day”
means a day on which the NASDAQ Stock Market is open for trading.

 

4.          Deliveries

 

(a)        On or prior to the Closing Date, the Company shall deliver or cause
to be delivered to the Purchaser the following:

 

(i)         this Agreement duly executed by the Company;

 

 

 

 

(ii)        a copy of Amendment No. 3 to the Operating Agreement (which includes
the terms of the Series C Preferred Units);

 

(iii)       a copy of the Register (as defined in the Operating Agreement),
after giving effect to the issuance of the Purchased Units.

 

(b)        On or prior to the Closing Date, the Purchaser shall deliver or cause
to be delivered to the Company the following:

 

(i)         This Agreement duly executed by the Purchaser; and

 

(ii)        The Purchaser’s Subscription Amount by wire transfer to the account
specified by the Company on Schedule I.

 

5.          Closing Conditions.

 

(a)        The obligations of the Company hereunder are subject to the following
conditions being met:

 

(i)         the accuracy in all material respects as of the date hereof of the
representations and warranties by the Purchaser contained herein;

 

(ii)        all obligations, covenants and agreements of the Purchaser required
to be performed at or prior to the Closing Date shall have been performed; and

 

(iii)       the delivery by the Purchaser of the items set forth in Section 4(b)
of this Agreement.

 

(b)        The obligations of the Purchaser hereunder are subject to the
following conditions being met:

 

(i)         the accuracy in all material respects as of the date hereof of the
representations and warranties by the Company contained herein;

 

(ii)        all obligations, covenants and agreements of the Company required to
be performed at or prior to the Closing Date shall have been performed; and

 

(iii)       the delivery by the Company of the items set forth in Section 4(a)
of this Agreement.

 

6.          Representations and Warranties of the Company.  Each of the
Fundamental Representations (as defined in that certain Agreement and Plan of
Merger by and among the Purchaser, FHXMS, LLC, the Company, the unitholders of
the Company party thereto or who become a party thereto and Mistral XH
Representative, LLC, as representative of the unitholders of the Company, dated
as of the date hereof (the “Merger Agreement”)) is hereby incorporated herein by
reference as though fully restated herein, subject to any applicable sections of
the Company Disclosure Schedule (as defined in the Merger Agreement). In
addition, as of the date hereof, the Company hereby represents and warrants to
the Purchaser that:

 

(a)        Organization.  The Company is a limited liability company, duly
formed, validly existing and in good standing under the laws of the State of
Delaware.

 

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(b)        Authority and Validity.  The Company has all requisite limited
liability company power and authority to execute, deliver and perform its
obligations under this Agreement and to consummate the transactions contemplated
hereby.  The execution, delivery and performance by the Company of this
Agreement and the consummation of the transactions contemplated hereby have been
duly and validly authorized by all necessary action required on the part of the
Company, and no other proceedings on the part of the Company are necessary to
authorize this Agreement or for the Company to perform its obligations under
this Agreement.  This Agreement constitutes the lawful, valid and legally
binding obligation of the Company, enforceable in accordance with its terms,
except as the same may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the enforcement of
creditors’ rights generally and general equitable principles regardless of
whether such enforceability is considered in a proceeding at law or in equity.

 

(c)        Valid Issuance of Purchased Units.  The Purchased Units, when issued,
sold and delivered in accordance with the terms hereof, will be duly and validly
authorized and issued, fully paid and nonassessable and free of restrictions on
transfer other than (i) applicable state and federal securities laws and (ii)
those contained in the Operating Agreement.

 

(d)        No Violation or Conflict.  The execution, delivery and performance of
this Agreement and the transactions contemplated hereby do not (i) violate,
conflict with or result in the breach of any provision of the Company’s Fourth
Amended and Restated Limited Liability Company Operating Agreement, dated as of
April 22, 2015, as amended (the “Operating Agreement”), (ii) conflict with or
violate any law, rule, regulation, order, judgment or decree applicable the
Company or any of its assets, properties or businesses, or (iii) conflict with,
result in any breach of, constitute a default (or event that with the giving of
notice or lapse of time, or both, would become a default) under, require any
consent under, or give to others any rights of termination, amendment,
acceleration, suspension, revocation or cancellation of, or result in the
creation of any encumbrance on any of the assets or properties of the Company,
pursuant to any note, bond, mortgage or indenture, contract, agreement, lease,
sublease, license, permit, franchise or other instrument or arrangement to which
the Company is a party except, in the case of clauses (ii) and (iii), to the
extent that such conflicts, breaches, defaults or other matters would not,
individually or in the aggregate, reasonably be expected to have a material
adverse effect on the Company.

 

(e)        Governmental/Regulatory Consents and Approvals.  Except for filings
under federal securities laws and, if required, NASDAQ Stock Market rules and
regulations, the execution, delivery and performance of this Agreement by the
Company do not, and the consummation of the transactions contemplated hereby do
not and will not, require any permits, consents, approvals, orders,
authorizations of, or declarations to or filings with any federal, state, local
or foreign government or regulatory authority, which has not already been
obtained, effected or provided.

 

(f)         Capitalization. Except as provided in the Operating Agreement or as
set forth on Schedule 6(f), there are no outstanding Units (as defined in the
Operating Agreement), options, unit appreciation rights, warrants or other
rights, contracts, arrangements, or commitments of any character relating to the
issued or unissued Units, or obligating the Company to issue, grant or sell any
Units, or other equity interests in, or securities convertible into equity
interests in, the Company. None of the outstanding equity securities or other
securities of the Company was issued in violation of the Act or any other law,
rule, or regulation.

 

(g)        Operating Agreement. The Company has delivered to the Purchaser a
copy of the Operating Agreement, as currently in effect.

 

7.          Representations, Warranties and Covenants of the Purchaser.  As of
the date hereof, the Purchaser hereby represents and warrants to the Company
that:

 

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(a)        Organization; Authority. The Purchaser is either an individual or an
entity duly incorporated or formed, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or formation with full right,
corporate, partnership, limited liability company or similar power and authority
to enter into and to consummate the transactions contemplated hereby and
otherwise to carry out its obligations hereunder and thereunder. The execution
and delivery of this Agreement and performance by the Purchaser of the
transactions contemplated hereby have been duly authorized by all necessary
corporate, partnership, limited liability company or similar action, as
applicable, on the part of the Purchaser. This Agreement has been duly executed
by the Purchaser, and when delivered by the Purchaser in accordance with the
terms hereof, will constitute the valid and legally binding obligation of the
Purchaser, enforceable against it in accordance with its terms, except: (i) as
limited by general equitable principles and applicable bankruptcy, insolvency,
reorganization, moratorium and other laws of general application affecting
enforcement of creditors’ rights generally, (ii) as limited by laws relating to
the availability of specific performance, injunctive relief or other equitable
remedies and (iii) insofar as indemnification and contribution provisions may be
limited by applicable law.

 

(b)        Own Account. The Purchaser understands that the Purchased Units are
“restricted securities” and have not been registered under the Act or any
applicable state securities law and is acquiring the Purchased Units as
principal for its own account and not with a view to or for distributing or
reselling such Purchased Units or any part thereof in violation of the Act or
any applicable state securities law, has no present intention of distributing
any of such Purchased Units in violation of the Act or any applicable state
securities law and has no direct or indirect arrangement or understandings with
any other persons to distribute or regarding the distribution of such Purchased
Units in violation of the Act or any applicable state securities law (this
representation and warranty not limiting the Purchaser’s right to sell the
Purchased Units in compliance with applicable federal and state securities
laws). The Purchaser is acquiring the Purchased Units hereunder in the ordinary
course of its business.

 

(c)        Purchaser Status. At the time the Purchaser was offered the Purchased
Units, it was, and as of the date hereof it is, an “accredited investor” as
defined in Rule 501 under the Act.

 

(d)        Experience of The Purchaser. The Purchaser, either alone or together
with its representatives, has such knowledge, sophistication and experience in
business and financial matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Purchased Units, and has so evaluated
the merits and risks of such investment. The Purchaser is able to bear the
economic risk of an investment in the Purchased Units and, at the present time,
is able to afford a complete loss of such investment.

 

(e)        General Solicitation. The Purchaser is not purchasing the Purchased
Units as a result of any advertisement, article, notice or other communication
regarding the Purchased Units published in any newspaper, magazine or similar
media or broadcast over television or radio or presented at any seminar or any
other general solicitation or general advertisement.

 

(f)        Access to Information. The Purchaser acknowledges that it has had the
opportunity to review this Agreement and the Operating Agreement, and has been
afforded (i) the opportunity to ask such questions as it has deemed necessary
of, and to receive answers from, representatives of the Company concerning the
terms and conditions of the offering of the Purchased Units and the merits and
risks of investing in the Purchased Units; (ii) access to information about the
Company and its financial condition, results of operations, business,
properties, management and prospects sufficient to enable it to evaluate its
investment; and (iii) the opportunity to obtain such additional information that
the Company possesses or can acquire without unreasonable effort or expense that
is necessary to make an informed investment decision with respect to the
investment. In addition, the Purchaser acknowledges and agrees that it has such
knowledge concerning the Company and the contemplated transaction with the
Company and has such knowledge, sophistication and experience in business and
financial matters so as to be capable of evaluating the merits and risks of the
prospective investment in the Purchased Units.

 

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(g)        Certain Transactions and Confidentiality. Other than to other Persons
party to this Agreement, to investors in the Company, or to the Purchaser’s
representatives, including, without limitation, its officers, directors,
partners, legal and other advisors, agents and Affiliates, the Purchaser has
maintained the confidentiality of all disclosures made to it in connection with
this transaction (including the existence and terms of this transaction).

 

(h)        No Other Representations. No representations or warranties have been
made to the Purchaser with respect to the investment in the Purchased Units or
the Company other than the representations set forth herein, and the Purchaser
has not relied upon any representation or warranty not provided herein in making
its investment in the Company.

 

8.          Transfer Restrictions. The Purchaser understands and acknowledges
that the Purchased Units are subject to substantial restrictions on transfer as
provided in the Operating Agreement.

 

9.          Headings. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.

 

10.        Notices. Any notice or other communication required or permitted
hereunder must be in writing and sent by either (i) registered or certified
mail, postage prepaid, return receipt requested, (ii) overnight delivery with
confirmation of delivery, or (iii) email transmission, in each case addressed to
the address set forth on the signature page hereto.

 

11.        Governing Law.  This Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York, without regard to its
conflicts of laws principles.

 

12.        Further Assurances. The Company and the Purchaser agree to execute
any and all such other and further instruments and documents, and to take any
and all such further actions, which are reasonably required to effectuate this
Agreement and the intents and purposes hereof.

 

13.        Binding Agreement. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their heirs, executors, administrators,
personal representatives, successors and assigns.

 

14.        Entire Agreement.  This Agreement and the Operating Agreement
constitute the entire agreement between the Company and the Purchaser with
respect to the matters covered hereby and supersede all prior agreements and
understanding with respect to such matters between the Company and the
Purchaser.

 

15.        Severability.  In case any provision contained in this Agreement
should be invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein will
not in any way be affected or impaired thereby.

 

16.        Waiver. Except as otherwise expressly provided herein, no waiver of
any covenant, condition, or provision of this Agreement shall be deemed to have
been made unless expressly set forth in writing and signed by the party against
whom such waiver is charged; and, (i) the failure of any party to insist in any
one or more cases upon the performance of any of the provisions, covenants, or
conditions of this Agreement or to exercise any option herein contained, shall
not be construed as a waiver or relinquishment for the future of any such
provisions, covenants, or conditions and (ii) no waiver by any party of one
breach by another party shall be construed as a waiver with respect to any other
or subsequent breach.

 

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17.        Subscription Irrevocable. Except as set forth herein, this
subscription is irrevocable, is subject to all of the terms and provisions
contained in this Agreement, and will survive the death, dissolution, or
disability of the Purchaser.

 

18.        Assignability. This Agreement is not transferable or assignable by
the Purchaser.

 

19.        Counterparts; Facsimile or “pdf” Copies.  This Agreement may be
executed in counterparts, each of which, when executed, shall be deemed an
original but all of which, taken together, shall constitute one and the same
Agreement.  Delivery of an executed copy of a signature page to this Agreement
by facsimile or “pdf” transmission shall be as effective as delivery of a
manually executed copy of this Agreement and shall be as effective and
enforceable as the original.

 

20.        Joinder to Operating Agreement. By executing this Agreement,
Purchaser agrees to be bound by, and to comply with, all of the terms and
conditions of the Operating Agreement in the same manner as if Purchaser were an
original signatory to the Operating Agreement. Purchaser, as a Member under the
Operating Agreement, confirms that the representations and warranties set forth
in Section 12.01 of the Operating Agreement (except for the representation and
warranty set forth in Section 12.01(l) of the Operating Agreement) are true and
correct as to the Purchaser. From and after Closing, the Purchaser will be
entitled to the rights of, and be subject to the obligations of, a Member under
the Operating Agreement.

 

SIGNATURES FOLLOW ON NEXT PAGE

 

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Exhibit 10.2

 

IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly
executed by its authorized signatory as of the date first indicated above.

 

  FORM Holdings Corp.       By: /s/ Andrew Perlman   Name: Andrew Perlman  
Title: Chief Executive Officer     Subscription Amount: $1,733,826       No. of
Purchased Units: 1,733,826         Address for Notice:   780 Third Avenue, 12th
Floor   New York, NY  10017   Telephone: (212) 309-7549   E-mail:
Notices@FORMHoldings.com   Attention: Chief Executive Officer       With a copy
(which shall not constitute effective notice) to:   Mintz, Levin, Cohn, Ferris,
Glovsky and Popeo, P.C.   Chrysler Center   666 Third Avenue   New York, NY
10017   Telephone: (212) 935-3000   E-mail: KRKoch@mintz.com   Attention:
Kenneth R. Koch, Esq.     Agreed and accepted as of   the date first written
above:     XpresSpa Holdings, LLC       By: /s/ Andrew R. Heyer   Name: Andrew
R. Heyer   Title: Chairman       Address for Notices:   c/o Mistral Capital
Management, LLC   650 Fifth Avenue, 31st Floor   New York, NY  10019  
Attention: Andrew R. Heyer   Email: aheyer@mistralequity.com       With a copy
(which shall not constitute effective notice) to:   DLA Piper LLP (US)   1251
Avenue of the Americas   New York, NY 10020   Attention: Sidney Burke   E-mail:
sidney.burke@dlapiper.com