Exhibit 10.1


 





WARRANT EXERCISE AGREEMENT


 


This Warrant Exercise
Agreement (this “Agreement”), dated as of February 9, 2017, is by and between Genius Brands International, Inc.
a Nevada corporation (the “Company”), and the undersigned holder (the “Holder”) of warrants
to purchase shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), issued
by the Company, which warrant is exercisable until November 3, 2020 at an exercise price (the “Exercise Price”) of
$3.30 per share (the “Original Warrant”).


 


WHEREAS, the Holder’s
Original Warrant is exercisable into a number of shares of Common Stock as set forth on such Holder’s signature page hereto
(the “Warrant Shares”);


 


WHEREAS, the Holder
wishes to exercise such Original Warrant in full and, immediately prior to such exercise and in consideration of the Holder’s
exercise of such Original Warrant, the Company has agreed to issue the Holder, in addition to the shares of Common Stock to which
such exercising Holder is entitled, (i) a new warrant identical to the Original Warrants except that the termination date of such
warrants shall be five years after the Closing Date (the “Reload Warrants”) and, (ii) depending on the number
of Original Warrants exercised by all holders of the Original Warrants in the aggregate as more fully set forth in Section 2.1(b),
a new warrant identical to the Original Warrants except that (x) the exercise price of such warrant shall be "$[ ][1],
subject to adjustment hereunder", (y) such warrant shall not be exercisable for six months and one day after the Closing
Date (the "Initial Exercisability Date") and (z) the termination date of such warrants shall be five years after
the Initial Exercisability Date (the “Market Price Warrants” and collectively with the Reload Warrants, the
“New Warrants”). The shares of Common Stock underlying the New Warrants are referred to herein as the "New
Warrant Shares" and collectively with the New Warrants, the "Securities". The number of shares of Common
Stock underlying the Reload Warrants and Market Price Warrants issued with respect to each exercised Original Warrant shall be
as determined pursuant to Section 2.1(b), it being understood that Nasdaq rules prevent the Company from issuing Reload Warrants
exercisable for more than an aggregate of 801,728 shares of Common Stock without first obtaining approval of its stockholders.


 


NOW, THEREFORE, IN
CONSIDERATION of the mutual covenants contained in this Agreement, and for good and valuable consideration the receipt and adequacy
of which are hereby acknowledged, the Holder and the Company agree as follows:


 


ARTICLE I


DEFINITIONS


 


Section 1.1 Definitions. Capitalized
terms not defined in this Agreement shall have the meanings ascribed to such terms in the Warrant.


 


ARTICLE II


EXERCISE OF EXISTING WARRANTS


 


Section 2.1 Exercise of Warrants.
(a) Subject to the conditions in Section 2.3 below, the Company and the Holder hereby agree that the Holder shall exercise all
of the Original Warrants at the current Exercise Price per share, for aggregate cash proceeds to the Company in the amount set
forth on the Holder’s signature page hereto, pursuant to the terms of the Original Warrants. Holder shall execute and deliver
the aggregate cash exercise price for such Original Warrants to the bank account set forth on the Company’s signature page
hereto within two business days after notice from the Company that the condition set forth in Section 2.3 has been met and the
Company shall deliver the Warrant Shares to the Holder via the Depository Trust Company Deposit or Withdrawal at Custodian system
pursuant to the terms of the Original Warrants, but pursuant to wire transfer instructions set forth on the Holder’s signature
page hereto. The date of the closing of the exercise of the Original Warrants shall be referred to as the “Closing Date”.


 


 


__________________


[1] Insert exercise price equal
to 105% of the market price on the date this Agreement is signed as determined in compliance with applicable Nasdaq rules and
regulations.






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(b) If 801,728 or fewer of the Original
Warrants are exercised by all holders of such Original Warrants, then each exercising Holder shall receive one Reload Warrant for
each Original Warrant exercised by such Holder and no Market Price Warrants. If more than 801,728 Original Warrants are exercised
in the aggregate, then the number of shares of Common Stock underlying the Reload Warrants and Market Price Warrants to be received
by Holder shall be determined as follows:


 


The number of shares of Common Stock underlying
the Reload Warrants to be received by such Holder shall be determined by multiplying 801,728 by a fraction, the numerator of which
shall be the number of Original Warrants exercised by such Holder and the denominator of which shall be the number of Original
Warrants exercised at the closing by all holders of Original Warrants. The number of shares of Common Stock underlying the Market
Price Warrants to be received by Holder shall be determined first (a) by determining the total number of shares of Common Stock
underlying the Market Price Warrants to be issued to all exercising holders of the Original Warrants, which number shall be determined
by subtracting 801,728 from the total number of Original Warrants exercised by all holders thereof and then (b) multiplying the
total number of Market Price Warrants to be issued by a fraction, the numerator of which shall be the number of Original Warrants
exercised by Holder and the denominator of which shall be the number of Original Warrants exercised at the closing by all holders
of Original Warrants.


 


Section 2.2 Issuance of New Warrants.
Within 3 Trading Days of the Closing Date, the Company shall deliver to the Holder the New Warrants to which such Holder is entitled.


 


Section 2.3 Legends; Restricted
Securities. (a) The Holder understands that the New Warrants and the shares of Common Stock underlying New Warrants are not,
and will not be, registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities
laws of any state and, accordingly, each certificate, if any, representing such securities shall bear a legend substantially similar
to the following:


 


“THIS
SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE
UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH
APPLICABLE STATE SECURITIES LAWS. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT WITH A REGISTERED
BROKER-DEALER OR OTHER LOAN WITH A FINANCIAL INSTITUTION THAT IS AN “ACCREDITED INVESTOR” AS DEFINED IN RULE 501(a)
UNDER THE SECURITIES ACT OR OTHER LOAN SECURED BY SUCH SECURITIES.”


 


(b)       Certificates
evidencing shares of Common Stock underlying the New Warrants shall not contain any legend (including the legend set forth in Section
2.3(a) hereof), (i) while a registration statement covering the resale of such Common Stock is effective under the Securities Act,
(ii) following any sale of such Common Stock pursuant to Rule 144, (iii) if such Common Stock is eligible for sale under Rule 144,
without the requirement for the Company to be in compliance with the current public information required under Rule 144 as to such
Common Stock and without volume or manner-of-sale restrictions, (iv) if such Common Stock may be sold under Rule 144 and the
Company is then in compliance with the current public information required under Rule 144 as to such Common Stock, or (v) if such
legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements
issued by the staff of the Securities and Exchange Commission (the “Commission”)). The Company shall cause its
counsel to issue a legal opinion to the transfer agent promptly after the Delegend Date (as defined below) if required by the Company
and/or the transfer agent to effect the removal of the legend hereunder, which opinion shall be in form and substance reasonably
acceptable to the Holder. If such Common Stock may be sold under Rule 144 without the requirement for the Company to be in compliance
with the current public information required under Rule 144 or if such legend is not otherwise required under applicable requirements
of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission) then such Common
Stock shall be issued free of all legends. The Company agrees that following the Delegend Date or at such time as such legend is
no longer required under this Section


 


 


 






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2.3(b), it will, no later than three (3) Trading Days following the delivery by a Holder
to the Company or the transfer agent of a certificate representing the Common Stock underlying the New Warrants issued with a restrictive
legend (such third Trading Day, the “Legend Removal Date”), deliver or cause to be delivered to such Holder
a certificate representing such shares that is free from all restrictive and other legends or, at the request of the Holder shall
credit the account of the Holder’s prime broker with the Depository Trust Company System as directed by such Holder. The
Company may not make any notation on its records or give instructions to the transfer agent that enlarge the restrictions on transfer
set forth in this Section 2.3(b). “Delegend Date” means the earliest of the date that (a) a registration statement
with respect to the Common Stock has been declared effective by the Commission or (b) all of the Common Stock has been sold pursuant
to Rule 144 or may be sold pursuant to Rule 144 without the requirement for the Company to be in compliance with the current public
information required under Rule 144 and without volume or manner-of-sale restrictions or (c) following the six (6) month anniversary
of (I) the Closing Date if a New Warrant is exercised pursuant to a cashless exercise or (II) the date of the related cash exercise
of the New Warrants provided, in each case that the holder of the New Warrants or the Common Stock, as the case may be, is not
an Affiliate of the Company, the Company is in compliance with the current public information required under Rule 144 (“Current
Public Information Requirement”) and all such Common Stock may be sold pursuant to Rule 144 or an exemption from registration
under Section 4(a)(1) of the Securities Act without volume or manner-of-sale restrictions; provided, further, however, that if
the Company fails to comply with the Current Public Information Requirement at any time following the applicable six (6) month
anniversary set forth above and the one (1) year anniversary of the Closing Date, the Company shall promptly provide notice to
the Holder and the Holder undertakes not to sell such Common Stock pursuant to Rule 144 until the Company notifies the Holder that
it has regained compliance with the Current Public Information Requirement; and provided further, that if a delegending
is in effect solely as the result of the effectiveness of a registration statement covering the resale of any Common Stock, the
Holder undertakes not to sell any such Common Stock if the Holder is notified or otherwise becomes aware that such registration
statement has been withdrawn or suspended, contains a material misstatement or omission or has become stale. Each Holder, severally
and not jointly with the other Holders, agrees with the Company that such Holder will sell or transfer any New Warrants or shares
of Common Stock underlying New Warrants pursuant to either the registration requirements of the Securities Act, including any applicable
prospectus delivery requirements, or an exemption therefrom, and that if such securities are sold pursuant to a registration statement,
they will be sold in compliance with the plan of distribution set forth therein, and acknowledges that the removal of the restrictive
legend from certificates representing any such securities as set forth in this Section 2.3 or otherwise is predicated upon the
Company’s reliance upon this understanding.


 


Section 2.4 Filing of Form 8-K
and Amendment to Registration Statement. Prior to 5:00 pm ET on the Trading Day following the date hereof, the Company shall
issue a Current Report on Form 8-K, reasonably acceptable to the Holder disclosing the material terms of the transactions contemplated
hereby, which shall include this Agreement (the “8-K Filing”). From and after the issuance of the 8-K Filing,
the Company represents to the Holder that it shall not be in possession of any material, nonpublic information received from the
Company, any of its Subsidiaries or any of their respective officers, directors, employees or agents, that is not disclosed in
the 8-K Filing. In addition, effective upon the filing of the 8-K Filing, the Company acknowledges and agrees that any and all
confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries
or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and the Holder or any of its
affiliates, on the other hand, shall terminate. The Company shall not, and shall cause each of its Subsidiaries and its and each
of their respective officers, directors, employees and agents, not to, provide the Holder with any material, nonpublic information
regarding the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent of the
Holder. To the extent that the Company, any of its Subsidiaries or any of their respective officers, directors, employees or agents,
delivers any material, non-public information to the Holder without such Holder’s consent, the Company hereby covenants and
agrees that such Holder shall not have any duty of confidentiality with respect to, or a duty not to trade on the basis of, such
material, non-public information. Such 8-K Filing shall be incorporated by reference into the registration statement on Form S-3
(No. 333-208540) (the “Registration Statement”), thereby updating the prospectus included therein.


 


 


 






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ARTICLE III


REPRESENTATIONS AND WARRANTIES


 


Section 3.1 Representations and
Warranties of the Company. The Company hereby makes the representations and warranties set forth below to the Holder that as
of the date of its execution of this Agreement:


 


(a) Authorization;
Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated
by this Agreement and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement
by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by all necessary action
on the part of such Company and no further action is required by such Company, its board of directors or its stockholders in connection
therewith. This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof will constitute
the valid and binding obligation of the Company enforceable against the Company 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) Organization.
The Company is a duly organized and validly existing corporation in good standing under the laws of the State of Nevada.


 


(c) Registration
Statement. The Warrant Shares are registered for issuance and resale by the Holder on the Registration Statement and the Company
knows of no reasons why such registration statement shall not remain available for the issuance and resale of such Warrant Shares
for the foreseeable future. The Company shall use commercially reasonable efforts to keep the Registration Statement effective
and available for use by the Holder until all Warrant Shares are sold by the Holder.


 


(d) No Conflicts.
The execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby do not and will not: (i) conflict with or violate any provision of the Company’s certificate or
articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default
(or an event that with notice or lapse of time or both would become a default) under, result in the creation of any lien upon any
of the properties or assets of the Company, or give to others any rights of termination, amendment, acceleration or cancellation
(with or without notice, lapse of time or both) of, any material agreement, credit facility, debt or other material instrument
(evidencing Company debt or otherwise) or other material understanding to which the Company is a party or by which any property
or asset of the Company is bound or affected, or (iii) conflict with or result in a violation of any law, rule, regulation,
order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company is subject
(including federal and state securities laws and regulations), or by which any property or asset of the Company is bound or affected.


 


(e) Disclosure.
Except with respect to the material terms and conditions of the transactions contemplated by this Agreement, the Company confirms
that neither it nor any other Person acting on its behalf has provided any of Holder or their agents or counsel with any information
that it believes constitutes or might constitute material, non-public information. The Company understands and confirms that the
Holder will rely on the foregoing representation in effecting transactions in securities of the Company. All of the disclosure
furnished by or on behalf of the Company to the Holder regarding the Company and its Subsidiaries, their respective businesses
and the transactions contemplated hereby, including but not limited to the disclosure set forth in the SEC Reports, is true and
correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make
the statements made therein, in light of the circumstances under which they were made, not misleading. As used herein, “SEC
Reports” means all reports, schedules, forms, statements and other documents required to be filed by the Company with
the Commission pursuant to the reporting requirements of the 1934 Act, including all exhibits included therein and financial statements,
notes and schedules thereto and documents incorporated by reference therein.


 


 


 


 






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(f) Issuance of
Securities. The issuance of the New Warrants are duly authorized and, upon issuance in accordance with the terms of this Agreement,
the New Warrants shall be validly issued and free from all preemptive or similar rights (except for those which have been validly
waived prior to the date hereof), taxes, liens and charges and other encumbrances with respect to the issue thereof. As of the
Closing Date, a number of shares of Common Stock shall have been duly authorized and reserved for issuance which equals or exceeds
the maximum number of Warrant Shares issuable upon exercise of the New Warrants (without taking into account any limitations on
the exercise of the New Warrants set forth therein). Upon exercise of the New Warrants in accordance with the New Warrants, the
Warrant Shares when issued will be validly issued, fully paid and nonassessable and free from all preemptive or similar rights,
taxes, liens, charges and other encumbrances with respect to the issue thereof, with the holders being entitled to all rights accorded
to a holder of Common Stock. Assuming the accuracy of each of the representations and warranties set forth in Section 3.2 of this
Agreement, the offer and issuance by the Company of the New Warrants is exempt from registration under the 1933 Act.


 


(g) No General Solicitation.
Neither the Company, nor any of its Subsidiaries or affiliates, nor any Person acting on its or their behalf, has engaged in any
form of general solicitation or general advertising (within the meaning of Regulation D) in connection with the offer or sale of
the New Warrants.


 


(h) No Integrated
Offering. None of the Company, its Subsidiaries or any of their affiliates, nor any Person acting on their behalf has, directly
or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would
require registration of the issuance of any of the New Warrants or the shares of Common Stock underlying the New Warrants (collectively,
the “Securities”) under the 1933 Act, whether through integration with prior offerings or otherwise, or cause
this offering of the Securities to require approval of shareholders of the Company for purposes of the 1933 Act or any applicable
shareholder approval provisions, including, without limitation, under the rules and regulations of any exchange or automated quotation
system on which any of the securities of the Company are listed or designated for quotation. None of the Company, its Subsidiaries,
their affiliates nor any Person acting on their behalf will take any action or steps that would require registration of the issuance
of any of the Securities under the 1933 Act or cause the offering of any of the Securities to be integrated with other offerings
for purposes of any such applicable shareholder approval provisions.


 


(i) No Disqualification
Events. With respect to Securities to be offered and sold hereunder in reliance on Rule 506(b) under the 1933 Act ("Regulation
D Securities"), none of the Company, any of its predecessors, any affiliated issuer, any director, executive officer,
other officer of the Company participating in the offering hereunder, any beneficial owner of 20% or more of the Company's outstanding
voting equity securities, calculated on the basis of voting power, nor any promoter (as that term is defined in Rule 405 under
the 1933 Act) connected with the Company in any capacity at the time of sale (each, an "Issuer Covered Person"
and, together, "Issuer Covered Persons") is subject to any of the "Bad Actor" disqualifications described
in Rule 506(d)(1)(i) to (viii) under the 1933 Act (a "Disqualification Event"), except for a Disqualification
Event covered by Rule 506(d)(2) or (d)(3). The Company has exercised reasonable care to determine whether any Issuer Covered Person
is subject to a Disqualification Event. The Company has complied, to the extent applicable, with its disclosure obligations under
Rule 506(e), and has furnished to the Buyers a copy of any disclosures provided thereunder.


 


Section 3.2 Representations and
Warranties of the Holder. The Holder hereby makes the representations and warranties set forth below to the Company that as
of the date of its execution of this Agreement:


 


(a) Due Authorization.
The Holder represents and warrants that (i) the execution and delivery of this Agreement by it and the consummation by it
of the transactions contemplated hereby have been duly authorized by all necessary action on its behalf and (ii) this Agreement
has been duly executed and delivered by the Holder and constitutes the valid and binding obligation of the Holder, enforceable
against it in accordance with its terms.


 


(b) No Conflicts.
The execution, delivery and performance of this Agreement by the Holder and the consummation by the Holder of the transactions
contemplated hereby do not and will not: (i) conflict with or violate any provision of the Holder’s organizational or
charter documents, or (ii) conflict with or result in a violation of any agreement, law, rule, regulation, order, judgment,
injunction, decree or other restriction of any court or governmental authority which would interfere with the ability of the Holder
to perform its obligations under this Agreement.


 


 


 


 


 






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(c) Access to Information.
The Holder acknowledges that it has had the opportunity to review this Agreement and the SEC Reports 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 exercise of the Existing Warrants and the merits and risks of investing in the Warrant Shares;
(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. The Holder acknowledges and agrees that neither Chardan Capital Markets, LLC (the
“Advisor”) nor any Affiliate of the Advisor has provided the Holder with any information or advice with respect
to the Securities nor is such information or advice necessary or desired. Neither the Advisor nor any Affiliate has made or
makes any representation as to the Company or the quality of the securities issued and issuable hereunder and the Advisor and any
Affiliate may have acquired non-public information with respect to the Company which the Holder agrees need not be provided to
it. In connection with the issuance of the securities hereunder to the Holder, neither the Advisor nor any of its Affiliates
has acted as a financial advisor or fiduciary to the Holder.


 


(d) Holder Status.
The Holder is an “accredited investor” as defined in Rule 501 under the Securities Act.


 


(e) Knowledge. The Holder,
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 Warrant Shares, and has so
evaluated the merits and risks of such investment. The Holder is able to bear the economic risk of an investment in the Warrant
Shares and, at the present time, is able to afford a complete loss of such investment.


 


ARTICLE IV


MISCELLANEOUS


 


Section
4.1 Leak-Out Restrictions.


 


(a)               
For a period commencing on the date hereof and ending ninety (90) days after the Closing Date (the “Leak-Out Period”),
the Holder agrees, on behalf of itself and each affiliate (as defined in Rule 405 under the Securities Act) of such Holder which
(x) had knowledge of the transactions contemplated hereby, (y) has or shares discretion relating to such Holder’s investments
or trading or information concerning such Holder’s investments, including in respect of the securities issuable hereunder,
or (z) is subject to such Holder’s review or input concerning such affiliate’s investments or trading (collectively,
“Trading Affiliates”), not to sell, dispose or otherwise transfer, directly or indirectly, (including,
without limitation, any sales, short sales, swaps or any derivative transactions that would be equivalent to any sales or short
positions) shares of Common Stock on any Trading Day during the Leak-Out Period; provided, however,
that these trading restrictions shall not apply to any sale, disposal or other transfer at a price at or greater than $5.00 per
share (as appropriately adjusted for any stock split, reverse stock split, stock dividend or other reclassification or combination
of the Common Stock occurring after the date hereof). As used herein, “Trading Day” means a day on which the
principal Trading Market is open for trading and “Trading Market” means any of the following markets or exchanges
on which the Common Stock is listed or quoted for trading on the date in question: the NYSE MKT, the NASDAQ Stock Market, the New
York Stock Exchange, OTCQB or OTCQX (or any successors to any of the foregoing). To assist the Company in assuring compliance by
the Holder and its Trading Affiliates with the provisions of this Section 4.1(a), the Company may from time to time, deliver a
written request (which may be by email) at any time during the Leak-Out Period requesting that the Holder provide (i) trading records
of any direct or indirect sales of Common Stock (as contemplated above) by the Holder and its Trading Affiliates during the period
beginning on the date hereof and ending on the earlier of (x) the date of such request and (y) the end of the Leak-Out Period or
(ii) records showing the number of shares of Common Stock held by the Holder and its Trading Affiliates as of the earlier of (x)
the date of such request and (y) the end of the Leak-Out Period. Upon receipt of any such request, the Holder shall provide such
information no later than three Trading Days after the date of the applicable request. Notwithstanding anything to the contrary,
the Company may not make more than five requests for information pursuant to this Section 4.1(a); provided, that any request
made to a Trading Affiliate of the Holder shall count as a request made to the Holder.


 


 


 


 






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(b)               
The Company hereby represents and warrants as of the date hereof and covenants and agrees from and after the date hereof
that none of the terms offered to any other holder of Original Warrants (each, an "Other Holder") with respect
to any restrictions on the sale of Common Stock substantially in the form of this Agreement (or any amendment, modification, waiver
or release thereof) (each a “Settlement Document”), is or will be more favorable to such Other Holder than those
of the Holder and this Agreement. If, and whenever on or after the date hereof, the Company enters into a Settlement Document,
then (i) the Company shall provide notice thereof to the Holder promptly following the occurrence thereof and (ii) the terms and
conditions of this Agreement shall be, without any further action by the Holder or the Company, automatically amended and modified
in an economically and legally equivalent manner such that the Holder shall receive the benefit of the more favorable terms and/or
conditions (as the case may be) set forth in such Settlement Document, provided that upon written notice to the Company at any
time the Holder may elect not to accept the benefit of any such amended or modified term or condition, in which event the term
or condition contained in this Agreement shall apply to the Holder as it was in effect immediately prior to such amendment or modification
as if such amendment or modification never occurred with respect to the Holder. The provisions of this paragraph shall apply similarly
and equally to each Settlement Document.


 


Section 4.2 Subsequent
Equity Sales.


 


(a)              
From the date hereof until 90 days after the Closing Date, neither the Company nor
any subsidiary shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common
Stock or Common Stock Equivalents. As used herein “Common Stock Equivalents” means any securities of the Company
or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation,
any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable
for, or otherwise entitles the holder thereof to receive, Common Stock.


 


(b)              
From the date hereof until such time as no Purchaser holds any of the New Warrants,
the Company shall be prohibited from effecting or entering into an agreement to effect any issuance by the Company or any of its
subsidiaries of Common Stock or Common Stock Equivalents (or a combination of units thereof) involving a Variable Rate Transaction.
“Variable Rate Transaction” means a transaction in which the Company (i) issues or sells any debt or equity
securities that are convertible into, exchangeable or exercisable for, or include the right to receive additional shares of Common
Stock either (A) at a conversion price, exercise price or exchange rate or other price that is based upon and/or varies with the
trading prices of or quotations for the shares of Common Stock at any time after the initial issuance of such debt or equity securities,
or (B) with a conversion, exercise or exchange price that is subject to being reset at some future date after the initial issuance
of such debt or equity security upon the occurrence of specified or contingent events directly or indirectly related to the business
of the Company or the market for the Common Stock or (ii) enters into any agreement, including, but not limited to, an equity line
of credit, whereby the Company may issue securities at a future determined price, provided that nothing herein shall prevent the
Company from entering into agreements providing for customary price-only adjustment full ratchet, half ratchet or weighted average
anti-dilution provisions or customary price and share adjustment weighted average anti-dilution provisions. Any Purchaser shall
be entitled to obtain injunctive relief against the Company to preclude any such issuance, which remedy shall be in addition to
any right to collect damages. The provisions of this Section 4.2(b) may be waived or amended by the Company and holders of the
New Warrants then outstanding representing a majority in the interest of all such New Warrants.


 


(c)              
Notwithstanding the foregoing, this Section 4.2 shall not apply in respect of an Exempt
Issuance, except that no Variable Rate Transaction shall be an Exempt Issuance. As set used herein “Exempt Issuance”
means the issuance of (a) shares of Common Stock or options to employees, independent contractors, vendors, officers or directors
of the Company pursuant to any stock or option or similar plan duly adopted for such purpose, by a majority of the non-employee
members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose
for services rendered to the Company including but not limited to the Company’s 2015 Incentive Plan, Amended 2015 Incentive
Plan and Vendor Stock Issuance Plan, (b) securities upon the exercise or exchange of or conversion of any Securities issued hereunder
and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the
date of this Agreement, provided that such securities have not been amended since the date of this Agreement to increase the number
of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection
with stock splits or combinations) or to extend the term of such securities, and (c) securities issued pursuant to acquisitions,
strategic transactions or a transaction with vendors or other non-affiliated business partners approved by a majority of the disinterested
directors of the Company, provided that any such issuance shall only be to a Person (or to the equityholders of a Person) which
is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business
of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include
a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary
business is investing in securities; provided, however, that any securities issued to independent contractors, venders
or non-affiliated business partners shall only be considered to be Exempt Issuances to the extent they are issued as "restricted
securities" (as defined in Rule 144).


 


 


 


 


 






    	 	7	 



     

    

 


Section 4.3 Notices. Any and all
notices or other communications or deliveries required or permitted to be provided hereunder shall be made by email to the email
address of Holders set forth on Holders’ signature page.


 


Section 4.4 Survival. All warranties
and representations (as of the date such warranties and representations were made) made herein or in any certificate or other instrument
delivered by it or on its behalf under this Agreement shall be considered to have been relied upon by the parties hereto and shall
survive the issuance of the Warrants. This Agreement shall inure to the benefit of and be binding upon the successors and permitted
assigns of each of the parties; provided however that no party may assign this Agreement or the obligations and rights of such
party hereunder without the prior written consent of the other parties hereto.


 


Section 4.5 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 the other party, it being understood
that both parties need not sign the same counterpart. In the event that any signature is delivered by facsimile transmission, 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 signature page were an original thereof.


 


Section 4.6 Severability. If
any provision of this Agreement is held to be invalid or unenforceable in any respect, the validity and enforceability of the remaining
terms and provisions of this Agreement shall not in any way be affected or impaired thereby and the parties will attempt to agree
upon a valid and enforceable provision that is a reasonable substitute therefor, and upon so agreeing, shall incorporate such substitute
provision in this Agreement.


 


Section 4.7 Governing Law.
All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be determined pursuant
to the Governing Law provision of the Warrant.


 


Section 4.8 Entire Agreement.
The Agreement, together with the exhibits and schedules thereto, contain the entire understanding of the parties with respect to
the subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters,
which the parties acknowledge have been merged into such documents, exhibits and schedules.


 


Section 4.9 Construction. 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. The language used in this Agreement will be deemed to be the language chosen by the parties to express
their mutual intent, and no rules of strict construction will be applied against any party.


 


Section 4.10 Fees and Expenses.
Except as expressly set forth herein, each party shall pay the fees and expenses of its advisers, counsel, accountants and other
experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and
performance of this Agreement. The Company shall pay all transfer agent fees, stamp taxes and other taxes and duties levied in
connection with the delivery of any Warrant Shares.


 


 


 


 


 


 


 


 


 






    	 	8	 



     

    

 


IN WITNESS WHEREOF, the undersigned
have executed this Warrant Exercise Agreement as of the date first written above.


 


 


COMPANY:


 


 


GENIUS BRANDS INTERNATIONAL, INC.


 


 


By:  _______________________________


Name:   ____________________________


Title:  ______________________________


 


  


Bank Account and Wire Instructions


 





	Bank Name:	U.S. Bank
	 	 
	Bank Address:	633 W. Fifth Street
	 	29th Floor
	 	Los Angeles, CA 90071
	 	213-615-6625
	 	 
	ABA No.	XXXXXXXX
	 	 
	A/C No.	XXXXXXXX



 





Beneficiary name and address:


 


Genius Brands International, Inc.


DBA A Squared Entertainment, LLC


301 N. Canon Drive #305


Beverly Hills, CA 90210


 


 


 


 


 


 


 


 


 


 






    	 	9	 



     

    

 




[PURCHASER SIGNATURE PAGES TO GENIUS BRANDS INTERNATIONAL 


WARRANT EXERCISE AGREEMENT] 


 


IN WITNESS WHEREOF, the undersigned have caused this Agreement
to be duly executed by their respective authorized signatories as of the date first indicated above.


 


	 	 	 
	Name of Holder:	 	
 




	 	 	 
	Signature of Authorized Signatory of Holder:	 	
 




	 	 	 
	Name of Authorized Signatory:	 	
 




	 	 	 
	Title of Authorized Signatory:	 	
 




	 	 	 
	Email Address of Holder:	 	
 




	 	 	 
	Number of  Warrants Held:	 	
 




	 	 	 
	Number of  Warrants to be exercised:	 	
 




	 	 	 
	Aggregate Exercise Price of  Warrants to be Exercised:	 	
 


	 	 	 
	 	 
	Warrant Shares underlying  Warrants:	 	                                                     
	 	 	 	 	 


DWAC Instructions for Warrant Shares
to be issued upon exercise of Existing Warrants:_________________


 


 


	
        Number of New Warrants to be issued
        to Holder:                             

	 
	Address for Delivery of New Shares for Holder: _______________________________________________















 


 


 


 


 


 


 


 


 


 






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