Exhibit 10.58a

 

OMNIBUS WAIVER AND ACKNOWLEDGEMENT AGREEMENT

 

This Omnibus Waiver And Acknowledgement Agreement (this “Agreement”) is entered
into as of February 7, 2020 (the “Effective Date”), by and among Verb Technology
Company, Inc., a Nevada corporation (the “Company”), and the parties signatory
hereto (each, an “Investor”; and, collectively, the “Investors”).

 

WHEREAS, effective as of August 14, 2019, the Company and each of the Investors
entered into that certain Securities Purchase Agreement (the “SPA”);

 

WHEREAS, Section 4.12(a) of the SPA provides in pertinent part “[f]rom the date
hereof until the date that is the 24-month anniversary of the Effective Date,
upon any issuance by the Company or any of its Subsidiaries of Common Stock or
Common Stock Equivalents for cash consideration, Indebtedness, or a combination
of units thereof (a “Subsequent Financing”), each Purchaser shall have the right
to participate, on a pro-rata basis, in up to an amount of the Subsequent
Financing equal to fifty percent (50%) of the Subsequent Financing (the
“Participation Maximum”) on the same terms, conditions and price provided for in
the Subsequent Financing” (the “Future Participation Right”);

 

WHEREAS, in connection with the SPA, the Company sold and issued to each of the
signatories thereto shares of the Company’s Series A Convertible Preferred
Stock, par value $.0001 per share (the “Series A Pref”);

 

WHEREAS, Section 7(b) of the Certificate of Designation of Rights, Preferences,
and Restrictions of the Series A Pref (the “Series A Pref Designation”)
provides, “[i]f, at any time while this Preferred Stock is outstanding, the
Corporation or any Subsidiary, as applicable, shall sell or grant any option to
purchase or sells or grants any right to reprice, or otherwise disposes of or
issues (or announce any sale, grant, or any option to purchase or other
disposition) any Common Stock or Common Stock Equivalents entitling any Person
to acquire shares of Common Stock at an effective price per share that is lower
than the then-Conversion Price (such lower price, the “Base Conversion Price”;
and such issuances, collectively, a “Dilutive Issuance”) . . . , then,
simultaneously with the consummation (or, if earlier, the announcement) of each
Dilutive Issuance, the Conversion Price shall be reduced to equal the Base
Conversion Price (the “Series A Pref Base Conversion Price Protection”);

 

WHEREAS, as of the Effective Date, certain of the Investors have converted their
respective shares of Series A Pref into shares of the Company’s common stock,
par value $.0001 per share (the “Common Stock”) (the Investors who have not so
converted their shares of Series A Pref into shares of Common Stock are referred
to herein as the “Current Series A Pref Holders”);

 

WHEREAS, in connection with the SPA, the Company sold and granted to each of the
Investors certain Common Stock Purchase Warrants, exercisable for the purchase
of shares of Common Stock in accordance with the provisions thereof (the
“Original Warrants”);

 

WHEREAS, Section 3(b) of each of the Original Warrants provides, “[i]f the
Company or any Subsidiary thereof, as applicable, at any time while this Warrant
is outstanding, shall sell or grant any option to purchase, or sell or grant any
right to reprice, or otherwise dispose of or issue (or announce any offer, sale,
grant, or any option to purchase or other disposition) any Common Stock or
Common Stock Equivalents, at an effective price per share less than the Exercise
Price then in effect (such lower price, the “Base Share Price”; and such
issuances, collectively, a “Dilutive Issuance”) . . ., then, simultaneously with
the consummation (or, if earlier, the announcement) of each Dilutive Issuance,
the Exercise Price shall be reduced and only reduced to equal the Base Share
Price . . .” (the “Original Warrants Base Share Price Protection”);

 

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WHEREAS, the Company is proposing to sell up to 5,000,000 shares of its
unregistered restricted Common Stock to one or more otherwise unaffiliated third
parties at a per-share price of $1.20, in one or more closings (the “2020
Offering”);

 

WHEREAS, in connection with the 2020 Offering, the Company has requested that
each of the Investors waive his or its respective Future Participation Right
solely with respect to the 2020 Offering and each of the Investors has so agreed
(the “2020 FPA Waiver”);

 

WHEREAS, in connection with the 2020 FPA Waiver, the Company has requested that
each of the Current Series A Pref Holders waive his or its entitlement to the
Series A Pref Base Conversion Price Protection solely with respect to the 2020
Offering and each of the undersigned Preferred Current Series A Pref Holders has
so agreed (the “2020 Series A Pref Waiver”; and, collectively with the 2020 FPA
Waiver, the “2020 Waivers”);

 

WHEREAS, in connection with the 2020 Waivers, the Company has acknowledged that
the Base Share Price (as defined in the Original Warrants) of the Original
Warrants has been reduced from $1.88 per share to $1.20 per share (the “Original
Warrant Reduced Exercise Price”);

 

WHEREAS, in connection with the 2020 Waivers, the Company has agreed to grant to
each Investor a Common Stock Purchase Warrant substantially equivalent to the
Original Warrants in the form attached hereto as Exhibit A, with the exception
that the per-share exercise price of the newly granted Common Stock Purchase
Warrants is $1.55 (the “2020 Warrants”).

 

NOW, THEREFORE, in consideration of these presents and for such other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the Company and each of the Investors, in the capacities set forth
in their respective signature blocks, intending to be legally bound hereby,
agree as follows:

 

1. 2020 FPA Waiver and Acknowledgement. Solely in connection with, and
contemporaneously with each closing of, the 2020 Offering, the undersigned
Investor hereby waives his or its respective Future Participation Right solely
with respect to the 2020 Offering. The Company acknowledges and agrees that this
2020 FPA Waiver, is a one-time waiver of the Investor’s Future Participation
Right and shall not apply to any event wherein the Investor has a Future
Participation Right (including, without limitation, any Subsequent Financing (as
defined in the SPA)) other than to the 2020 Offering.

 

2. Waiver of Series A Pref Base Conversion Price Protection. Solely in
connection with, and contemporaneously with each closing of, the 2020 Offering,
the undersigned Investor hereby waives his or its respective entitlement to the
Series A Pref Base Conversion Price Protection. The Company acknowledges and
agrees that this Waiver of Series A Pref Base Conversion Price Protection is a
one-time waiver of the Series A Pref Base Conversion Price Protection and shall
not apply to any event wherein the Investor has Series A Pref Base Conversion
Price Protection (including, without limitation, any Dilutive Issuance (as
defined in the Series A Pref Designation)) other than to the 2020 Offering.

 

3. Acknowledgement of Original Warrants Reduced Exercise Price. Each of the
Company and the undersigned Investor hereby acknowledges and agrees that, upon
the Company’s execution of definitive documentation with respect to the 2020
Offering, in accordance with the Original Warrants Base Share Price Protection,
the Base Share Price (as defined in the Original Warrants) of the Original
Warrants shall automatically be reduced from $1.88 per share to $1.20 per share
(the “Original Warrants Exercise Price Reduction”).

 

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4. Issuance of 2020 Warrants. Pursuant to Section 4(a)(2) of the Securities Act,
and Rule 506 promulgated thereunder, for good and valuable consideration, the
Company hereby agrees to issue, in accordance with this Section 4, to the
undersigned Investor (if a Current Series A Pref Holder) the 2020 Warrants,
exercisable for that number of shares of Common Stock equivalent to the number
of shares of Common Stock exercisable by such Investor pursuant to the
provisions of such Investor’s Original Warrants. The 2020 Warrants shall be
unconditionally issued to the undersigned Investors, without the payment by the
Investor of any cash consideration, upon execution of this Agreement for the
purchase of that number of shares of Common Stock (i) as set forth in Schedule A
hereto (with an issue date of February 7, 2020) and (ii) as set forth in
Schedule B hereto (with an issue date as of the initial closing of the 2020
Offering, but, under no circumstances, not later than February 25, 2020). The
Company shall deliver the 2020 Warrants to the Investor, in each case, promptly
following the issuance thereof to such address as set forth on the books and
records of the Company (or such other address as the Investor may designate to
the Company on or prior thereto).

 

5. Miscellaneous Provisions.

 

5.1 Conditions; Standstill; Form 8-K. The 2020 Waivers shall not be effective
unless and until the Company has received executed copies of this Agreement from
Current Series A Pref Holders who own a majority of the outstanding Series A
Pref, including an executed copy from each “Required Purchaser” (as that term is
defined in the SPA). Further, the 2020 Offering must have a final closing not
later than the close of business on March 31, 2020. Upon the Company receiving
such executed copies, then all Current Series A Pref Holders shall be deemed to
have executed this Agreement, shall be entitled to the benefits and burdens of
this Agreement, and none of the “Purchasers” (as that term is defined in the
SPA) shall be deemed to be disproportionately impacted by the provisions hereof.
The final material terms and conditions of the 2020 Offering are set forth in
Section 5.13 below. The Company acknowledges and agrees that such terms and
conditions shall not be modified, supplemented, or amended and, in the event
that such terms and conditions are modified, supplemented, or amended, the 2020
Waivers shall automatically be deemed null and void. Notwithstanding anything to
the contrary contained in this Agreement or in any agreement referenced herein,
each undersigned Investor (if a Current Series A Pref Holder) agrees that, from
and after the date of this Agreement through and including the earlier of (i)
the initial closing of the 2020 Offering, or (ii) the close of business on
February 25, 2020, he or it will neither convert any of such Investor’s shares
of Series A Pref nor sell, assign, transfer, hypothecate, pledge, give, or
otherwise obtain any value from any of such Investor’s shares of Series A Pref
or any shares of Common Stock; provided, however, that such limitations shall
not modify or limit in any way any rights to which such Investors are otherwise
entitled pursuant to the terms and conditions of the Series A Pref Designation,
the SPA, the Original Warrants, or any transaction, agreement, or document
affecting the rights of holders of Common Stock generally. Upon the earlier of
(i) 9:01 a.m. (New York City time) on the Trading Day immediately following the
date of the initial closing of the 2020 Offering, or (ii) February 25, 2020, the
Company shall file a Current Report on Form 8-K (the “8-K”) with the Securities
and Exchange Commission, which shall (i) disclose and describe the terms and
conditions of this Agreement, (ii) file as an exhibit the form of 2020 Warrants
and disclose and describe the terms thereof, (iii) disclose and describe the
terms of the 2020 Offering, and (iv) file as an exhibit(s) to the 8-K the form
of transaction document(s) for the 2020 Offering, if applicable, as executed by
the investing parties in the 2020 Offering or in connection therewith. From and
after the issuance of such 8-K, the Company represents to the Investor that it
shall have publicly disclosed all material, non-public information delivered to
the Investor by the Company or any of its Subsidiaries, or any of their
respective officers, directors, employees, or agents in connection with the
transactions contemplated hereby and with respect to the 2020 Offering. In
addition, effective upon the issuance of such 8-K, the Company acknowledges and
agrees that any and all confidentiality or similar obligations under any
agreement in respect of the transactions contemplated hereby and with respect to
the 2020 Offering, whether written or oral, between the Company, any of its
Subsidiaries, or any of their respective officers, directors, agents, employees,
or Affiliates, on the one hand, and the Investor or any of its Affiliates, on
the other hand, shall terminate. Notwithstanding the foregoing, the Company
shall not publicly disclose the name of the Investor, or include the name of the
Investor in any filing with the Commission or any regulatory agency or Trading
Market, without the prior written consent of the Investor, except (a) as
required by federal securities law in connection with (i) any registration
statement in which the Company is registering the resale of securities of the
Company issued to the Investor (or issuable upon exercise or conversion of
securities issued to the Investor) and (ii) the filing of this Agreement with
the Commission and (b) to the extent such disclosure is required by law or
Trading Market regulations, in which case the Company shall provide the Investor
with prior notice of such disclosure permitted under this clause (b).

 

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5.2 Entire Agreement. This Agreement and the 2020 Warrants contain the entire
understanding of the parties with respect to the subject matter hereof and
thereof and supersede all prior agreements and understandings, oral or written,
with respect to such matters, which the parties acknowledge have been merged
into this Agreement and 2020 Warrants.

 

5.3 Notices. Any and all notices or other communications or deliveries required
or permitted to be provided hereunder shall be in writing and shall be deemed
given and effective on the earliest of: (a) the time of transmission, if such
notice or communication is delivered via facsimile at the facsimile number or
e-mail attachment at the e-mail address as set forth on the signature pages
attached hereto at or prior to 5:30 p.m. (New York City time) on a “Trading Day”
(as that term is defined in the SPA), (b) the next Trading Day after the time of
transmission, if such notice or communication is delivered via facsimile or
e-mail attachment at the facsimile number or e-mail address as set forth on the
signature pages attached hereto on a day that is not a Trading Day or later than
5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading
Day following the date of mailing, if sent by U.S. nationally recognized
overnight courier service, or (d) upon actual receipt by the party to whom such
notice is required to be given. The address for such notices and communications
of each Investor shall be as set forth on the signature pages attached hereto
and of the Company shall be as provided in its most recent filings with the
Securities and Exchange Commission.

 

5.4 Headings. The headings herein are for convenience only, do not constitute a
part of this Agreement, and shall not be deemed to limit or affect any of the
provisions hereof.

 

5.5 Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.

 

5.6 No Third-Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective successors and permitted assigns and is
not for the benefit of, nor may any provision hereof be enforced by, any other
person or entity.

 

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5.7 Governing Law. All questions concerning the construction, validity,
enforcement, and interpretation of this Agreement shall be governed by and
construed and enforced in accordance with the internal laws of the State of New
York, without regard to the principles of conflicts of law thereof. Each party
agrees that all legal proceedings concerning the interpretations, enforcement,
and defense of the transactions contemplated by this Agreement (whether brought
against a party hereto or its respective affiliates, directors, officers,
stockholders, partners, members, employees, or agents) shall be commenced
exclusively in the state and federal courts sitting in the City of New York.
Each party hereby irrevocably submits to the exclusive jurisdiction of the state
and federal courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any action or proceeding, any claim to which
it is not personally subject under the jurisdiction of any such court, that such
action or proceeding is improper, or that such court is an inconvenient venue
for such proceeding. Each party hereby irrevocably waives personal service of
process and consents to process being served in any such action or proceeding by
mailing a copy thereof via registered or certified mail or overnight delivery
(with evidence of delivery) to such party at the address in effect for notices
to it under this Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof. Nothing contained herein
shall be deemed to limit in any way any right to serve process in any other
manner permitted by law. If any party shall commence an action or proceeding to
enforce any provisions of this Agreement, then the prevailing party in such
action or proceeding shall be reimbursed by the non-prevailing party for its
reasonable attorneys’ fees and other costs and expenses incurred with the
investigation, preparation, and prosecution of such action or proceeding.

 

5.8 Execution. This Agreement may be executed in two or more counterparts, all
of which when taken together shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each party and
delivered to each other party, it being understood that the parties need not
sign the same counterpart. In the event that any signature is delivered by
facsimile transmission or by e-mail delivery of a “.pdf” format data file, such
signature shall create a valid and binding obligation of the party executing (or
on whose behalf such signature is executed) with the same force and effect as if
such facsimile or “.pdf” signature page were an original thereof.

 

5.9 Severability. If any term, provision, covenant, or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void, or unenforceable, the remainder of the terms, provisions, covenants, and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired, or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant, or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants, and restrictions without including any of such
that may be hereafter declared invalid, illegal, void, or unenforceable.

 

5.10 Construction. The parties agree that each of them and/or their respective
counsel have reviewed and had an opportunity to revise this Agreement and the
2020 Warrants and, therefore, the normal 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 and the 2020 Warrants or any
amendments thereto.

 

5.11 No Other Amendments, Supplements, Modifications or Waivers. Nothing
contained in this Agreement shall be deemed or construed to amend, supplement,
or modify the SPA, Series A Pref Designation, the Original Warrants or otherwise
affect the rights and obligations of any party thereto, all of which remain in
full force and effect, subject only to this Agreement. For the avoidance of
doubt, (i) other than with respect to the 2020 Offering, the 2020 Waivers do not
apply to any other Subsequent Financing (as defined in the SPA) or any other
Dilutive Issuance (as defined in the Series A Pref Designation), and (ii) except
with respect to the 2020 Waivers, this Agreement shall not be deemed or
construed to be a waiver of any of the undersigned Investors’ rights under the
SPA, Series A Pref Designation, or the Original Warrants.

 

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5.12 WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT, OR PROCEEDING IN ANY
JURISDICTION BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH
KNOWINGLY AND INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW,
HEREBY ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY, AND EXPRESSLY WAIVES FOREVER
TRIAL BY JURY.

 

5.13 Final, Material Terms and Conditions With Respect To the 2020 Offering. The
Company intends to sell and issue shares of its Common Stock in a private
placement to one or more otherwise unaffiliated third-party investors (the “2020
Offering Investors”) at a per-share purchase price of $1.20 per share. The
shares of Common Stock sold and issued in the 2020 Offering shall constitute
“restricted securities” (as that term is defined in Rule 144(a)(3)) of the
Securities Act of 1933, as amended. The 2020 Offering does not provide any of
the 2020 Offering Investors with any registration rights or equivalent rights.
The 2020 Offering does not provide any of the 2020 Offering Investors with any
warrants, options, convertible rights, or other rights. The 2020 Offering
Investors are being offered a maximum of 5,000,000 shares of Common Stock by the
Company (gross proceeds of up to $6 million) without the requirement of any
specific minimum number of shares of Common Stock required to be sold and issued
for any closing of the 2020 Offering.

 

[Signatures on following pages]

 

* * *

 

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IN WITNESS WHEREOF, the Company and each Investor has caused this Omnibus Waiver
And Acknowledgement Agreement to be duly executed by their respective authorized
signatories as of the Effective Date.

 

THE “COMPANY”:         VERB TECHNOLOGY COMPANY, INC.         By:       Rory J.
Cutaia, Chief Executive Officer         “THE INVESTORS”:                   By:  
  Name:      Title:    

 

Record and beneficial owner of _____ shares of Series A Pref Record and
beneficial owner of _____ Original Warrants   Record and beneficial owner of
_____ 2020 Warrants                   By:          Name:     Title:          
Record and beneficial owner of _____ shares of Series A Pref Record and
beneficial owner of _____ Original Warrants   Record and beneficial owner of
_____ 2020 Warrants  

 

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