EXHIBIT 10.1

 

SETTLEMENT AGREEMENT AND RELEASE

 

This SETTLEMENT AGREEMENT AND RELEASE (“Agreement”) is made and entered into as
of November 20, 2019 (the “Effective Date”), by and among Genius Brands
International, Inc. (the “Company”) and each of the holders of Series A
Convertible Preferred Stock of the Company identified on the signature pages
hereto (each, a “Preferred Holder” and collectively, the “Preferred Holders”).

 

WHEREAS, the Preferred Holders are holders of at least a majority of the
outstanding shares of 0% Series A Convertible Preferred Stock of the Company
(the “Preferred Shares”), the terms of which are set forth in the Certificate of
Designations, Preferences and Rights of the 0% Series A Convertible Preferred
Stock of the Company filed with the Nevada Secretary of State on May 14, 2014
(the “Certificate of Designations”);

 

WHEREAS, capitalized terms used in this Agreement without definition have the
respective meanings given to them in the Certificate of Designations;

 

WHEREAS, a dispute has arisen between the parties with respect to certain rights
under the Certificate of Designations, as further described below, and the
parties wish to settle all potential and actual issues arising therefrom.

 

NOW, THEREFORE, in consideration for the agreements and undertakings set forth
herein and for other good and valuable consideration, the receipt and
sufficiency of which is acknowledged by all parties hereto, the parties agree as
follows:

 

1.                  Dispute. The parties acknowledge that a dispute has arisen
between them with respect to the determination of the adjusted Conversion Price
resulting from issuances of securities at prices less than the applicable
Conversion Price pursuant to Section 7(a) of the Certificate of Designations and
other matters relating to ownership of the Preferred Shares (the “Dispute”). The
parties hereto desire to resolve the Dispute on the terms specified below.

 

2.                  Settlement. All parties hereto hereby agree to settle all
claims, demands, or grievances of any kind whatsoever related to the Dispute
that the Preferred Holders and the Company may have against each other as of the
Effective Date.

 

3.                  Consideration for Settlement. In consideration of each
party’s execution of this Agreement, the parties agree as follows:

 

(a)   The Company shall agree to an adjusted Conversion Price of $0.21 as of the
Effective Date.

 

(b)   The Preferred Holders, constituting the Required Holders, hereby agree and
consent to an amendment and restatement of the Certificate of Designations in
the form attached attached hereto (the “Amended and Restated Certificate of
Designations”).

 

(c)   The Securities Purchase Agreement, dated as of May 14, 2014, by and among
the Preferred Holders and the other parties signatory thereto, is hereby
terminated and deemed null and void with respect to the Preferred Holders.

 

 

 

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4.                  Release. Each Preferred Holder, on behalf of itself and each
of its successors, assigns and affiliates, hereby releases and forever
discharges the Company and each of its officers, directors, managers, members,
shareholders, partners, employees, agents, successors, assigns and affiliates
(individually, a “Releasee” and collectively, “Releasees”) from any and all
claims, demands, proceedings, causes of action, orders, obligations, costs,
expenses (including attorneys’ fees), losses, contracts, agreements, debts and
liabilities whatsoever, whether known or unknown, suspected or unsuspected, both
at law and in equity, which such party or any of its respective officers,
directors, managers, members, shareholders, partners, employees, agents,
successors, assigns or affiliates now has, have ever had or may hereafter have
against any Releasee except for those that relate to the enforcement of this
Agreement or their rights solely as a security holder after the Effective Date.

 

5.                  Covenant Not to Sue. To the maximum extent permitted by law,
the parties covenant not to initiate or exercise any litigation or arbitration
proceeding under the Certificate of Designations or to otherwise sue or to
institute or cause to be instituted any kind of claim or action with respect to
the Dispute (except to enforce this Agreement) in any federal, state or local
agency or court against any of the Releasees arising out of the matters covered
in this Agreement.

 

6.                  Filing of Form 8-K. Prior to 9:00 am ET on the next business
day following the Effective Date, the Company shall issue a Current Report on
Form 8-K disclosing the material terms of this Agreement, which shall include
this form of Agreement and the Amended and Restated Certificate of Designations.

 

7.                  Severability/Interpretation. In the event that any
paragraph, subparagraph or provision of this Agreement shall be determined to be
contrary to governing law or otherwise unenforceable, all remaining portions of
this Agreement shall be enforced to the maximum extent permitted by law; the
unenforceable paragraph, subparagraph or provision shall first be construed or
interpreted, if possible, to render it enforceable and, if that is not possible,
then the provision shall be severed and disregarded, and the remainder of this
Agreement shall be enforced to the maximum extent permitted by law.

 

8.                  Counterparts. The parties agree that signatures to the
Agreement may be by facsimile signature page and in counter-parts. The parties
further warrant that the person executing this Agreement on behalf of each of
them does so with full authority to represent and bind them to the fullest
extent of the law.

 

9.                  Governing Law. This Agreement shall be governed by and
construed under the laws of the State of New York without regard to principles
of conflicts of law.

 

10.              Entire Agreement/Amendment. Except as otherwise set forth
herein, this Agreement supersedes all prior agreements and understandings
between the parties relating to the subject matter hereof and is intended by the
parties as a complete and exclusive statement thereof. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their respective
successors, assigns, heirs, executors and legal representatives. This Agreement
shall not be amended or modified except by a written instrument executed by all
the parties hereto.

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by the undersigned, thereunto duly authorized, as of the Effective Date.

 

  GENIUS BRANDS INTERNATIONAL, INC.         By: /s/ Michael Jaffa   Name:
Michael Jaffa   Title: General Counsel

 

 

 

 

 

 

[Preferred Holder Signature Pages Follow]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by the undersigned, thereunto duly authorized, as of the Effective Date.

 

 

Andrew Heyward & Amy Heyward JTWROS   [Print Name of Preferred Holder]          
    /s/ Andrew Heyward   [Signature]               Name:  Andrew Heyward  
Title: President           Number of Preferred Shares Held:   100  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by the undersigned, thereunto duly authorized, as of the Effective Date.

 

Silverado Holdings LDC   [Print Name of Preferred Holder]               /s/
Simon Chehebar   [Signature]               Name:  Simon Chehebar   Title:
President           Number of Preferred Shares Held:   334  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by the undersigned, thereunto duly authorized, as of the Effective Date.

 

 

Hana Resources (Bahamas), LTD   [Print Name of Preferred Holder]              
/s/ Moises Chehebar   [Signature]               Name:  Moises Chehebar   Title:
President           Number of Preferred Shares Held:   333  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by the undersigned, thereunto duly authorized, as of the Effective Date.

 

 

ECL MSSB FBO: Leister Capital Limited   [Print Name of Preferred Holder]        
      /s/ Moises Chehebar   [Signature]               Name:  Moises Chehebar  
Title: President           Number of Preferred Shares Held:   333  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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EXHIBIT A

 

Form of Amended and Restated Series A Preferred Stock Certificate of
Designations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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