Exhibit 10.1


 


	        , 2021	 
	
    Lionheart III Corp

    4218 NE 2nd Avenue

    Miami, Florida 33137

     
	 


 


Re: Initial Public Offering


 


Ladies and Gentlemen:


 


This letter (this “Letter
Agreement”) is being delivered to you in accordance with the Underwriting Agreement (the “Underwriting Agreement”)
entered into by and between Lionheart III Corp, a Delaware corporation (the “Company”), and Nomura Securities
International, Inc., as representative (the “Representative”) of the several underwriters named therein
(each, an “Underwriter” and collectively, the “Underwriters”), relating to an underwritten
initial public offering (the “Public Offering”), of 10,000,000 of the Company’s units (and up to an additional
1,500,000 units that may be purchased to cover over-allotments, if any) (the “Units”), each comprised of one
share of the Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”), and
one-half of one redeemable warrant. Each whole warrant (each, a “Warrant”) entitles the holder thereof to purchase
one share of Common Stock at a price of $11.50 per share, subject to adjustment. The Units will be sold in the Public Offering pursuant
to a registration statement on Form S-1 and the accompanying prospectus (the “Prospectus”) filed by the
Company with the U.S. Securities and Exchange Commission (the “Commission”) and the Company has applied to have
the Units listed on The Nasdaq Global Market. Certain capitalized terms used herein are defined in paragraph 11 hereof.


 


In order to induce the Company
and the Representative to enter into the Underwriting Agreement and to proceed with the Public Offering and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, each of Lionheart Equities, LLC (the “Sponsor”)
and the undersigned individuals, each of whom is a member of the Company’s board of directors and/or management team (each, an “Insider”
and collectively, the “Insiders”), hereby agrees with the Company as follows:


 


1.            The
Sponsor and each Insider agrees that if the Company seeks stockholder approval of a proposed Business Combination (as defined below),
then in connection with such proposed Business Combination, it, he or she shall (i) vote any shares of Capital Stock (as defined
below) owned by it, him or her in favor of any proposed Business Combination and (ii) not redeem any shares of Capital Stock owned
by it, him or her in connection with such stockholder approval. If the Company engages in a tender offer in connection with any proposed
Business Combination, the Sponsor and each Insider agrees that it, he or she will not seek to sell its, his or her shares of Capital Stock
to the Company in connection with such tender offer.


 


2.            The
Sponsor and each Insider hereby agrees that in the event that the Company fails to consummate a Business Combination within 12 months
from the closing of the Public Offering (or up to 18 months if the period to complete a Business Combination is extended as set forth
in the Company’s second amended and restated certificate of incorporation (the “Charter”)) , or such later
period approved by the Company’s stockholders in accordance with the Charter, the Sponsor and each Insider shall take all reasonable
steps to cause the Company to (i) cease all operations except for the purpose of winding up, (ii) as promptly as reasonably
possible but not more than 10 Business Days (as defined below) thereafter, subject to lawfully available funds therefor, redeem 100% of
the Common Stock sold as part of the Units in the Public Offering (the “Offering Shares”), at a per-share price,
payable in cash, equal to the aggregate amount then on deposit in the Trust Account (as defined below), including interest earned on the
funds held in the Trust Account and not previously released to the Company to pay its taxes (as described in the Prospectus) (less up
to $100,000 of interest to pay dissolution expenses), divided by the number of then outstanding Offering Shares, which redemption will
completely extinguish all Public Stockholders’ (as defined below) rights as stockholders (including the right to receive further
liquidation distributions, if any), subject to applicable law, and (iii) as promptly as reasonably possible following such redemption,
subject to the approval of the Company’s remaining stockholders and the Company’s board of directors, dissolve and liquidate,
subject in each case to the Company’s obligations under the laws of the State of Delaware to provide for claims of creditors and
other requirements of applicable law. The Sponsor and each Insider agrees not to propose any amendment to the Charter to modify (i) the
substance or timing of the ability of holders of Offering Shares to seek redemption in connection with a Business Combination or the Company’s
obligation to redeem 100% of the Offering Shares if the Company does not complete a Business Combination by the date set forth in the
Charter or (ii) the other provisions relating to stockholders’ rights or pre-initial Business Combination activities, unless
the Company provides Public Stockholders with the opportunity to redeem their shares of Common Stock upon approval of any such amendment
at a per-share price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including interest earned on
the funds held in the Trust Account and not previously released to the Company to pay its taxes (as described in the Prospectus), divided
by the number of then outstanding Offering Shares.


 






     


     


    

 


The Sponsor and each Insider
acknowledges that, with respect to the Founder Shares (as defined below) and the Private Placement Shares (as defined below) held by it,
him or her, it, he or she has no right, title, interest or claim of any kind in or to any monies held in the Trust Account as a result
of any liquidation of the Company (although the Sponsor, the Insiders and their respective affiliates shall be entitled to redemption
and liquidation rights with respect to any Offering Shares it or they hold if the Company fails to consummate a Business Combination within
the time period set forth in the Charter). The Sponsor and each Insider hereby further waives, with respect to any shares of Capital Stock
held by it, him or her, if any, any redemption rights it, he or she may have in connection with the consummation of a Business Combination,
including, without limitation, any such rights available in the context of a stockholder vote to approve such Business Combination or
a stockholder vote to approve an amendment to the Charter to (i) modify the substance or timing of the Company’s obligation
to redeem 100% of the Offering Shares if the Company has not consummated a Business Combination within the time period set forth in the
Charter or in the context of a tender offer made by the Company to purchase shares of Capital Stock or (ii) with respect to any other
provision relating to stockholders’ rights or pre-initial Business Combination activity.


 


3.            During
the period commencing on the effective date of the Underwriting Agreement and ending 180 days after such date, the Sponsor and each Insider
shall not, without the prior written consent of the Representative, (i) sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase or otherwise dispose of or agree to dispose of, directly or indirectly, any Units, Private Placement
Units (as defined below), shares of Common Stock (including Private Placement Shares), Founder Shares, Warrants, Private Placement Warrants
(as defined below) or any securities convertible into, or exercisable, or exchangeable for, shares of Common Stock owned by it, him or
her, (ii) establish or increase a put equivalent position or liquidate or decrease a call equivalent position within the meaning
of Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and
regulations of the Commission promulgated thereunder, with respect to any Units, Private Placement Units, shares of Common Stock (including
Private Placement Shares), Founder Shares, Warrants, Private Placement Warrants or any securities convertible into, or exercisable, or
exchangeable for, shares of Common Stock owned by it, him or her, (iii) enter into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of any Units, Private Placement Units, shares of Common Stock
(including Private Placement Shares), Founder Shares, Warrants, Private Placement Warrants or any securities convertible into, or exercisable,
or exchangeable for, shares of Common Stock owned by it, him or her, whether any such transaction is to be settled by delivery of such
securities, in cash or otherwise, or (iv) publicly announce any intention to effect any transaction specified in clause (i), (ii) or
(iii). Each of the Insiders and the Sponsor acknowledges and agrees that, prior to the effective date of any release or waiver of the
restrictions set forth in this paragraph 3 or paragraph 7 below, the Company shall announce the impending release or waiver by press release
through a major news service at least two Business Days before the effective date of the release or waiver. Any release or waiver granted
shall only be effective two Business Days after the publication date of such press release. The provisions of this paragraph will not
apply if the release or waiver is effected solely to permit a transfer not for consideration and the transferee has agreed in writing
to be bound by the same terms described in this Letter Agreement to the extent and for the duration that such terms remain in effect at
the time of the transfer.


 






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4.            In
the event of the liquidation of the Trust Account upon the failure of the Company to consummate its initial Business Combination within
the time period set forth in the Charter, the Sponsor (the “Indemnitor”) agrees to indemnify and hold harmless
the Company against any and all loss, liability, claim, damage and expense whatsoever (including, but not limited to, any and all legal
or other expenses reasonably incurred in investigating, preparing or defending against any litigation, whether pending or threatened)
to which the Company may become subject as a result of any claim by (i) any third party for services rendered or products sold to
the Company or (ii) any prospective target business with which the Company has entered into a written letter of intent, confidentiality
or other similar agreement or Business Combination agreement (a “Target”); provided, however, that such indemnification
of the Company by the Indemnitor (x) shall apply only to the extent necessary to ensure that such claims by a third party or a Target
do not reduce the amount of funds in the Trust Account to below the lesser of (i) $10.10 per Offering Share and (ii) the actual
amount per Offering Share held in the Trust Account as of the date of the liquidation of the Trust Account, if less than $10.10 per Offering
Share is then held in the Trust Account due to reductions in the value of the trust assets, less interest earned on the Trust Account
which may be withdrawn to pay taxes, (y) shall not apply to any claims by a third party or a Target which executed a waiver of any
and all rights to the monies held in the Trust Account (whether or not such waiver is enforceable) and (z) shall not apply to any
claims under the Company’s indemnity of the Underwriters against certain liabilities, including liabilities under the Securities
Act of 1933, as amended. The Indemnitor shall have the right to defend against any such claim with counsel of its choice reasonably satisfactory
to the Company if, within 15 days following written receipt of notice of the claim to the Indemnitor, the Indemnitor notifies the Company
in writing that it shall undertake such defense.


 


5.            To
the extent that the Underwriters do not exercise their over-allotment option to purchase up to an additional 1,500,000 Units within 45
days from the date of the Prospectus (and as further described in the Prospectus), the Sponsor agrees to forfeit, at no cost, a number
of Founder Shares in the aggregate equal to 375,000 multiplied by a fraction, (i) the numerator of which is 1,500,000 minus the number
of Units purchased by the Underwriters upon the exercise of their over-allotment option, and (ii) the denominator of which is 1,500,000.
The forfeiture will be adjusted to the extent that the over-allotment option is not exercised in full by the Underwriters so that the
Initial Stockholders (as defined below) will own an aggregate of 20.0% of the Company’s issued and outstanding shares of Capital
Stock after the Public Offering (excluding any Private Placement Shares).


 


6.            The
Sponsor and each Insider hereby agrees and acknowledges that: (i) the Underwriters and the Company would be irreparably injured in
the event of a breach by the Sponsor or an Insider of its, his or her obligations under paragraphs 1, 2, 3, 4, 5, 7(a), 7(b), and 9, as
applicable, of this Letter Agreement (ii) monetary damages may not be an adequate remedy for such breach and (iii) the non-breaching
party shall be entitled to injunctive relief, in addition to any other remedy that such party may have in law or in equity, in the event
of such breach.


 


7.            (a) The
Sponsor and each Insider agrees that it, he or she shall not Transfer (as defined below) any Founder Shares (or shares of Common Stock
issuable upon conversion thereof) until the earlier of (A) six months after the completion of the Company’s initial Business
Combination or (B) subsequent to the Company’s initial Business Combination, (x) if the last reported sale price of the
Common Stock equals or exceeds $12.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and
the like) for any 20 trading days within any 30-trading day period commencing at least 30 days after the Company’s initial Business
Combination or (y) the date on which the Company completes a liquidation, merger, capital stock exchange, reorganization or other
similar transaction that results in all of the Company’s stockholders having the right to exchange their shares of Common Stock
for cash, securities or other property (the “Founder Shares Lock-up Period”).


 


(b) The Sponsor and each
Insider agrees that to the extent that it, she or he holds Private Placement Units, Private Placement Shares or Private Placement Warrants
(or shares of Common issued or issuable upon the exercise of the Private Placement Warrants) it, he or she shall not Transfer any of such
securities until 30 days after the completion of a Business Combination (the “Private Placement Units Lock-up Period”,
together with the Founder Shares Lock-up Period, the “Lock-up Periods”).


 






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(c) Notwithstanding the
provisions set forth in paragraphs 7(a) and (b), Transfers of the Founder Shares, Private Placement Units, Private Placement Shares,
Private Placement Warrants and shares of Common Stock issued or issuable upon the exercise or conversion of the Private Placement Warrants
or the Founder Shares and that are held by the Sponsor, any Insider or any of their permitted transferees (that have complied with this
paragraph 7(c)), are permitted (a) to the Company’s officers or directors, any affiliate or family member of any of the Company’s
officers or directors, any affiliate of the Sponsor or any member of the Sponsor; (b) in the case of an individual, by gift to a
member of such individual’s immediate family or to a trust, the beneficiary of which is a member of such individual’s immediate
family, an affiliate of such individual or to a charitable organization; (c) in the case of an individual, by virtue of laws of descent
and distribution upon death of such individual; (d) in the case of an individual, pursuant to a qualified domestic relations order;
(e) by private sales or transfers made in connection with any forward purchase agreement or similar arrangement or in connection
with the consummation of the Company’s initial Business Combination at prices no greater than the price at which the Founder Shares,
Private Placement Shares, shares of Common Stock or Private Placement Warrants or warrants were originally purchased; (f) in the
event of the Company’s liquidation prior to the completion of an initial Business Combination; or (g) by virtue of the laws
of the State of Delaware or the Sponsor’s limited liability company agreement upon dissolution of the Sponsor; provided, however,
that in the case of clauses (a) through (e) or (g), any such permitted transferees must enter into a written agreement with
the Company agreeing to be bound by the transfer restrictions herein in this paragraph 7(c) and the other restrictions contained
in this Letter Agreement.


 


8.            The
Sponsor and each Insider represents and warrants that it, he or she has never been suspended or expelled from membership in any securities
or commodities exchange or association or had a securities or commodities license or registration denied, suspended or revoked. Each Insider’s
biographical information furnished to the Company (including any such information included in the Prospectus) is true and accurate in
all respects and does not omit any material information with respect to the Insider’s background. Each Insider’s questionnaire
furnished to the Company is true and accurate in all respects. Each Insider represents and warrants that: it, he or she is not subject
to or a respondent in any legal action for, any injunction, cease-and-desist order or order or stipulation to desist or refrain from any
act or practice relating to the offering of securities in any jurisdiction; it, he or she has never been convicted of, or pleaded guilty
to, any crime (i) involving fraud, (ii) relating to any financial transaction or handling of funds of another person, or (iii) pertaining
to any dealings in any securities and it, he or she is not currently a defendant in any such criminal proceeding.


 


9.            Except
as disclosed in the Prospectus, none of the Sponsor, our officers and directors, or any affiliate of the Sponsor or our officers shall
receive from the Company any finder’s fee, reimbursement, consulting fee, monies in respect of any repayment of a loan or other
compensation prior to, or in connection with any services rendered in order to effectuate, the consummation of the Company’s initial
Business Combination (regardless of the type of transaction that it is).


 


10.          The
Sponsor and each Insider has full right and power, without violating any agreement to which it is bound (including, without limitation,
any non-competition or non-solicitation agreement with any employer or former employer), to enter into this Letter Agreement and, as applicable,
to serve as an officer or director of the Company and hereby consents to being named in the Prospectus as an officer or director of the
Company.


 






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11.          As
used in this Letter Agreement, (i) “Business Combination” shall mean a merger, capital stock exchange,
asset acquisition, stock purchase, reorganization or similar business combination, involving the Company and one or more businesses; (ii) “Business
Day” means each day that is not a Saturday, Sunday or other day on which banking institutions in The City of New York, New
York, are authorized or required by law to close; (iii) “Capital Stock” shall mean, collectively, the Common
Stock (including the Private Placement Shares) and the Founder Shares; (iv) “Founder Shares” shall mean
the 2,875,000 shares of the Company’s Class B common stock, par value $0.0001 per share, (up to 375,000 Shares of which are
subject to complete or partial forfeiture by the Sponsor if the over-allotment option is not exercised by the Underwriters) outstanding
immediately prior to the consummation of the Public Offering; (v) “Initial Stockholders” shall mean the
Sponsor and any Insider that holds Founder Shares prior to the consummation of the Public Offering; (vi) “Private Placement
Shares” shall mean the shares of Common Stock comprising a part of the Private Placement Units; (vii)“Private
Placement Units” shall mean the 375,000 units (405,000 units if the Underwriters’ overallotment option is exercised
in full) of the Company, each comprised of one share of Common Stock and one-half of one warrant to purchase one share of Common Stock,
that the Sponsor and the Underwriters have agreed to purchase for an aggregate purchase price of $3,750,000 ($4,050,000 if the Underwriters’
overallotment option is exercised in full) in the aggregate, or $10.00 per Private Placement Unit, in a private placement that shall occur
simultaneously with the consummation of the Public Offering; (viii) “Private Placement Warrants” shall
mean the warrants comprising a part of the Private Placement Units and the 1,750,000 warrants to purchase one share of Common Stock, that
the Sponsor has agreed to purchase for an aggregate purchase price of $1,750,000 in the aggregate, or at $1.00 per warrant, in a private
placement that shall occur simultaneously with the consummation of the Public Offering; (ix) “Public Stockholders”
shall mean the holders of the Offering Shares; (x) “Trust Account” shall mean the trust fund into which
a portion of the net proceeds of the Public Offering and the sale of Private Placement Units shall be deposited; and (xi) “Transfer”
shall mean the (a) sale of, offer to sell, contract or agreement to sell, hypothecate, pledge, grant of any option to purchase or
otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or increase of a put equivalent position or
liquidation with respect to or decrease of a call equivalent position within the meaning of Section 16 of the Exchange Act, and the
rules and regulations of the Commission promulgated thereunder with respect to, any security, (b) entry into any swap or other
arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any security, whether any
such transaction is to be settled by delivery of such securities, in cash or otherwise, or (c) public announcement of any intention
to effect any transaction specified in clause (a) or (b).


 


12.          The
Company will maintain an insurance policy or policies providing directors’ and officers’ liability insurance, and each Director
shall be covered by such policy or policies, in accordance with its or their terms, to the maximum extent of the coverage available for
any of the Company’s directors or officers.


 


13.          This
Letter Agreement constitutes the entire agreement and understanding of the parties hereto in respect of the subject matter hereof and
supersedes all prior understandings, agreements, or representations by or among the parties hereto, written or oral, to the extent they
relate in any way to the subject matter hereof or the transactions contemplated hereby. This Letter Agreement may not be changed, amended,
modified or waived (other than to correct a typographical error) as to any particular provision, except by a written instrument executed
by all parties hereto.


 


14.          No
party hereto may assign either this Letter Agreement or any of its rights, interests, or obligations hereunder without the prior written
consent of the other parties. Any purported assignment in violation of this paragraph shall be void and ineffectual and shall not operate
to transfer or assign any interest or title to the purported assignee. This Letter Agreement shall be binding on the Sponsor and each
Insider and their respective successors, heirs and assigns and permitted transferees.


 


15.          Nothing
in this Letter Agreement shall be construed to confer upon, or give to, any person or corporation other than the parties hereto any right,
remedy or claim under or by reason of this Letter Agreement or of any covenant, condition, stipulation, promise or agreement hereof. All
covenants, conditions, stipulations, promises and agreements contained in this Letter Agreement shall be for the sole and exclusive benefit
of the parties hereto and their successors, heirs, personal representatives and assigns and permitted transferees.


 


16.          This
Letter Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.


 


17.          This
Letter Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the
validity or enforceability of this Letter Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid
or unenforceable term or provision, the parties hereto intend that there shall be added as a part of this Letter Agreement a provision
as similar in terms to such invalid or unenforceable provision as may be possible and be valid and enforceable.


 






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18.            This
Letter Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving
effect to conflicts of law principles that would result in the application of the substantive laws of another jurisdiction. The parties
hereto (i) all agree that any action, proceeding, claim or dispute arising out of, or relating in any way to, this Letter Agreement
shall be brought and enforced in the courts of New York City, in the State of New York, and irrevocably submit to such jurisdiction and
venue, which jurisdiction and venue shall be exclusive and (ii) waive any objection to such exclusive jurisdiction and venue or
that such courts represent an inconvenient forum.


 


19.            Any
notice, consent or request to be given in connection with any of the terms or provisions of this Letter Agreement shall be in writing
and shall be sent by express mail or similar private courier service, by certified mail (return receipt requested), by hand delivery or
facsimile transmission.


 


20.            This
Letter Agreement shall terminate on the earlier of (i) the expiration of the Lock-up Periods or (ii) the liquidation of the
Company; provided, however, that this Letter Agreement shall earlier terminate in the event that the Public Offering is not consummated
by        ; provided further that paragraph 4 of this Letter Agreement shall survive such liquidation.


 


[Signature Page Follows]


 






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	 	Sincerely,
	 	 
	 	LIONHEART EQUITIES, LLC
	 	 
	 	By:	              
	 	Name: Ophir Sternberg
	 	Title: Manager
	 	 
	 	 
	 	OPHIR STERNBERG
	 	 
	 	 
	 	 
	 	 
	 	PAUL RAPISARDA
	 	 
	 	 
	 	 
	 	 
	 	FAQUIRY DIAZ CALA
	 	 
	 	 
	 	 
	 	 
	 	JAMES ANDERSON
	 	 
	 	 
	 	 
	 	 
	 	THOMAS BYRNE
	 	 
	 	 
	 	 
	 	 
	 	THOMAS HAWKINS
	 	 
	 	 
	 	 
	 	 
	 	ROGER MELTZER 
	 	 
	 	 




 


	Acknowledged and Agreed:	 
	 	 
	LIONHEART III CORP	 
	 	 
	By:	           	 
	Name: Ophir Sternberg	 
	Title: Chairman, President and Chief
    Executive Officer	 




 


[Signature Page to Insider Letter Agreement]