Document:

ex_181089.htm

Exhibit 4.2

 

DESCRIPTION OF THE REGISTRANT’S SECURITIES

REGISTERED PURSUANT TO SECTION 12 OF THE

SECURITIES EXCHANGE ACT OF 1934

 

The following summary describes the common stock, $0.01 par value per share, of Build-A-Bear Workshop, Inc. (the “Company,” “we,” “us,” and “our”), which are the only securities of the Company registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended.

 

The following description is a summary and does not purport to be complete. It is subject to and qualified in its entirety by reference to (i) our Third Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”), and (ii) our Amended and Restated Bylaws (the “Bylaws”), each of which are incorporated by reference as an exhibit to the Annual Report on Form 10-K of which this Exhibit 4.2 is a part. We encourage you to read our Certificate of Incorporation, our Bylaws and the applicable provisions of the Delaware General Corporation Law for additional information.

 

Authorized and Outstanding Capital Stock

 

Our authorized capital stock consists of 50,000,000 shares of common stock, $0.01 par value per share, and 15,000,000 shares of preferred stock, $0.01 par value per share. As of January 30, 2021, there were 15,930,958 shares of our common stock issued and outstanding and no shares of our preferred stock issued and outstanding.

 

Common Stock

 

Voting Rights. Holders of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the stockholders. On all matters other than the election of directors, when a quorum is present at any meeting, the vote of the holders of a majority of the stock entitled to vote shall decide any question brought before such meeting, unless otherwise required by the Certificate of Incorporation, the Bylaws or Delaware law. The holders of a majority in voting power of the stock issued and outstanding and entitled to vote will constitute a quorum at all meetings of the stockholders for the transaction of business. Our stockholders do not have cumulative voting rights in the election of directors. Accordingly, holders of a majority of the shares voting are able to elect all of the directors, subject to any rights to elect directors that may be granted to any then-outstanding preferred stock.

 

Liquidation Rights. In the event of our liquidation, dissolution or winding up, holders of common stock are entitled to share ratably in all of our assets remaining after we pay our liabilities and distribute the liquidation preference of any then outstanding preferred stock.

 

Dividend Rights. Subject to preferences that may be granted to any then-outstanding preferred stock, holders of common stock are entitled to receive ratably only those dividends as may be declared by the board of directors out of funds legally available therefor, as well as any distributions to the stockholders.

 

Other Rights and Preferences. Holders of our common stock have no preemptive or other subscription or conversion rights. Shares of our common stock have no redemption or sinking fund provisions, and are not liable for further call or assessment. The rights, preferences and privileges of holders of common stock are subject to the right of holders of shares of any series of preferred stock that may be issued in the future.

 

Listing. Our common stock currently trades on the New York Stock Exchange under the symbol “BBW.”

 

Anti-Takeover Provisions

 

The material provisions of Delaware law and our Certificate of Incorporation and Bylaws which may have an anti-takeover effect and delay, deter or prevent a tender offer, proxy contest or other takeover attempt that stockholders might consider to be in their best interests, including such an attempt that might result in payment of a premium over the market price for their shares of our common stock, are summarized in the following paragraphs.

 

Interested stockholder transactions. We are subject to Section 203 of the Delaware General Corporation Law, which, subject to certain exceptions specified therein, prohibits a Delaware corporation from engaging in any “business combination” with any “interested stockholder” for a period of three years after the date that such stockholder became an interested stockholder, unless:

 

	 	
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			before such date, the board of directors of the corporation approved either the business combination or the transaction that resulted in the stockholder becoming an interested holder;

			

 

	 	
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			upon consummation of the transaction that resulted in the stockholder becoming an interested stockholder, the interested stockholder owned at least 85% of the voting stock of the corporation outstanding at the time the transaction began, excluding for purposes of determining the number of shares outstanding those shares owned by persons who are directors and also officers and by employee stock plans in which employee participants do not have the right to determine confidentially whether shares held subject to the plan will be tendered in a tender or exchange offer; or

			

 

	 	
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			on or after such date, the business combination is approved by the board of directors and authorized at an annual or special meeting of the stockholders, and not by written consent, by the affirmative vote of at least 66-2/3% of the outstanding voting stock that is not owned by the interested stockholder.

			

 

Section 203 defines “business combination” to include the following:

 

	 	
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			any merger or consolidation involving the corporation and the interested stockholder;

			

 

	 	
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			any sale, transfer, pledge or other disposition of 10% or more of the assets of the corporation involving the interested stockholder;

			

 

	 	
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			subject to certain exceptions, any transaction that results in the issuance or transfer by the corporation of any stock of the corporation to the interested stockholder;

			

 

	 	
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			any transaction involving the corporation that has the effect of increasing the proportionate share of the stock or any class or series of the corporation beneficially owned by the interested stockholder; or

			

 

	 	
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			the receipt by the interested stockholder of the benefit of any loans, advances, guarantees, pledges or other financial benefits by or through the corporation.

			

 

In general, Section 203 defines “interested stockholder” as an entity or person beneficially owning 15% or more of the outstanding voting stock of the corporation or any entity or person affiliated with or controlling or controlled by such entity or person.

 

Cumulative Voting. Our Certificate of Incorporation expressly denies stockholders the right to cumulative voting in the election of directors.

 

Classified Board of Directors; Director Removal and Board Vacancies; Size of Board. Our board of directors is divided into three classes of directors serving staggered three-year terms. As a result, approximately one-third of the board of directors are elected each year, which has the effect of requiring at least two annual stockholder meetings, instead of one, to replace a majority of the members of the board. These provisions, when coupled with the provisions of our Certificate of Incorporation authorizing only the board of directors to fill vacant directorships or increase the size of the board of directors, may deter a stockholder from removing incumbent directors and simultaneously gaining control of the board of directors by filling the vacancies created by such removal with its own nominees. The Certificate of Incorporation also provides that directors may be removed by stockholders only for cause. Since the board of directors has the power to retain and discharge our officers, these provisions could also make it more difficult for existing stockholders or another party to effect a change in management.

 

Stockholder Action by Written Consent; Special Meeting of Stockholders. Our Certificate of Incorporation eliminates the ability of stockholders to act by written consent, provided that holders of preferred stock may vote by written consent to the extent expressly provided in any certificate of designation authorizing issuance of a particular series of preferred stock. It also provides that special meetings of our stockholders may be called only by the chairman of our board of directors, our chief executive officer, our president or a majority of our directors.

 

Advance Notice Requirements for Stockholder Proposals and Director Nominations. Our Bylaws provide that stockholders seeking to bring business before an annual meeting of stockholders, or to nominate candidates for election as directors at an annual meeting of stockholders, must provide timely notice in writing. To be timely, a stockholder’s notice must be delivered to or mailed and received at our principal executive offices not more than 120 days or less than 90 days prior to the anniversary date of the immediately preceding annual meeting of stockholders. However, in the event that no annual meeting was held in the previous year or the annual meeting is called for a date that is not within 30 days before or after such anniversary date, notice by the stockholder in order to be timely must be received not later than the close of business on the 10th day following the date on which notice of the date of the annual meeting was mailed to stockholders or made public, whichever first occurs. Our Bylaws also specify requirements as to the form and content of a stockholder’s notice. These provisions may preclude stockholders from bringing matters before an annual meeting of stockholders or from making nominations for directors at an annual meeting of stockholders.

 

Authorized But Unissued Shares. Our authorized but unissued shares of common stock and preferred stock are available for future issuance without stockholder approval. The preferred stock may be issued with voting rights, dividend rights, conversion privileges, redemption rights and liquidation rights and other rights, preferences, privileges, powers, qualifications, limitations or restrictions as may be specified by our board of directors, which rights may be superior to those of the common stock in one or more respects. These additional shares may be utilized for a variety of corporate purposes, including future public offerings to raise additional capital, corporate acquisitions and employee benefit plans. The existence of authorized but unissued shares of common stock and preferred stock could render more difficult or discourage an attempt to obtain control of the Company by means of a proxy contest, tender offer, merger or otherwise.

 

Amendments; Supermajority Vote Requirements. The Delaware General Corporation Law provides generally that the affirmative vote of a majority of the shares entitled to vote on any matter is required to amend a corporation’s certificate of incorporation or bylaws, unless either a corporation’s certificate of incorporation or bylaws require a greater percentage. Our Certificate of Incorporation requires the affirmative vote of more than 80% of our capital stock in connection with the amendment of certain provisions, including those relating to (1) the classified board of directors and related director matters, (2) the ability of stockholders to act by written consent or call special meetings, (3) limitations of liability of directors, (4) indemnification of our directors, officers, employees and agents and (5) the amendment of our Bylaws. Similarly, our Bylaws provide that they may be amended by our board of directors, or by our stockholders with the affirmative vote of at least 80% of the voting power of all outstanding shares.

 

Limitation of Liability and Indemnification

 

Our Certificate of Incorporation provides that our directors shall not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except for liability for: (i) any breach of the director’s duty of loyalty to us or our stockholders; (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; (iii) liability for payments of dividends or stock purchases or redemptions in violation of Section 174 of the Delaware General Corporation Law; or (iv) any transaction from which the director derived an improper personal benefit. In addition, our Certificate of Incorporation provides that we will, to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits us to provide broader indemnification rights than such law permitted us to provide prior to such amendment), indemnify and hold harmless any person who was or is a party, or is threatened to be made a party to or is otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative by reason of the fact that such person is or was our director or officer, or is or was serving at our request as a director, officer, employee or agent of another corporation, or as our representative in a partnership, joint venture, trust or other entity, (an “indemnitee”) against expenses, liabilities, and losses (including attorneys’ fees, judgments, fines, and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith. We have also entered into separate indemnification agreements with our directors and executive officers that require us, among other things, to indemnify each of them against certain liabilities that may arise by reason of their status or service other than liabilities unless it is determined that he or she did not act in good faith and in a manner he or she reasonably believed to be in or not opposed to our best interests, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.

 

The right to indemnification set forth above includes the right for us to pay the expenses (including attorneys’ fees) incurred in defending any such proceeding in advance of its final disposition; provided, however, that, if the Delaware General Corporation Law requires an advancement of expenses incurred by an indemnitee in his capacity as a director or officer (and not in any other capacity in which service was or is rendered by such indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to us of an undertaking, by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is not further right to appeal that such indemnitee is not entitled to be indemnified for such expenses under this section or otherwise. The rights to indemnification and to the advancement of expenses conferred herewith are contract rights and continue as to an indemnitee who has ceased to be a director, officer, employee or agent and inures to the benefit of the indemnitee’s heirs, executors, and administrators.

 

The Delaware General Corporation Law provides that indemnification is permissible only when the director, officer, employee, or agent acted in good faith and in a manner reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the conduct was unlawful. The Delaware General Corporation Law also precludes indemnification in respect of any claim, issue, or matter as to which an officer, director, employee, or agent shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such action or suit was brought shall determine that, despite such adjudication of liability, but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court deems proper.

 

We currently have a directors’ and officers’ liability insurance policy that insures such persons against the costs of defense, settlement or payment of a judgment under certain circumstances. We believe that these indemnification and liability provisions are essential to attracting and retaining qualified persons as officers and directors.EXHIBIT
10.81

 

AMENDED
AND RESTATED ASSET PURCHASE AGREEMENT

 

This
Asset Purchase Agreement (this “Agreement”), dated as of March __, 2021, is entered into between CBAV1 LLC,
a Nevada limited liability company (“Seller”), and BTL Diffusion SARL, a French corporate entity or its nominee
(“Buyer”). This Agreement amends and supersedes that certain asset purchase agreement dated January 21, 2021
between the parties.

 

RECITALS:

 

A.
Seller is the owner of the Acquired Assets as defined in Section 2.01, used by a licensee to conduct the business of selling
children’s products, including products sold under the Cloud b trade name (the “Business”) and owns various
assets related to the Business.

 

B.
On October 30, 2020, Seller filed a voluntary petition for relief under Chapter 11 of Title 11, United States Code, 11 U.S.C.
Sections 101 et seq. (the “Bankruptcy Code”) in the United States Bankruptcy Court for the Eastern District
of Pennsylvania, Case 20-14310-pmm (the “Chapter 11 Case”).

 

C.
Buyer desires to purchase the Acquired Assets free and clear of interests, claims, liens and encumbrances, and Seller desires
to sell, convey, assign and transfer to Buyer, the Acquired Assets, all in the manner and subject to the terms and conditions
set forth in this Agreement and in accordance with Sections 105, and 363 and other applicable provisions of the Bankruptcy Code.

 

D.
Buyer, in exchange for the transfer to Buyer of the Acquired Assets, desires to provide certain consideration (as set forth
below) to Seller.

 

E.
The Acquired Assets are assets of Seller, which are to be purchased by Buyer pursuant to a final, non-appealable order of
the Bankruptcy Court, whose terms are acceptable to Buyer in its sole and absolute discretion, approving such sale pursuant to
Sections 105 and 363 of the Bankruptcy Code with a finding of good faith on the part of Buyer (the “Sale Order”),
in the manner and subject to the terms and conditions set forth in this Agreement and the Sale Order and in accordance with the
applicable provisions of the Bankruptcy Code.

 

F.
Buyer was determined to be the highest and best bidder after consideration of alternative bids at an auction held pursuant to
§363 of the Bankruptcy Code on March 9-10, 2021.

 

NOW,
THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

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ARTICLE
I

DEFINITIONS

 

The
following terms have the meanings specified or referred to in this Article I:

 

“Acquired
Assets” has the meaning set forth in Section 2.01.

 

“Acquired
Intellectual Property” has the meaning set forth in Section 4.07(a).

 

“Affiliate”
of a Person means any other Person that directly or indirectly, through one or more intermediaries, controls, is controlled by,
or is under common control with, such Person. The term “control” (including the terms “controlled by”
and “under common control with”) means the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

 

“Agreement”
has the meaning set forth in the preamble.

 

“AR
List” has the meaning set forth in Section 3.02(b).

 

“Assigned
Contracts” has the meaning set forth in Section 4.05(a).

 

“Assignment
and Assumption Agreement” has the meaning set forth in Section 3.02(a)(ii).

 

“Assumed
Liabilities” has the meaning set forth in Section 2.03.

 

“Bill
of Sale” has the meaning set forth in Section 3.02(a)(i).

 

“Books
and Records” has the meaning set forth in Section 2.01(k).

 

“Business”
has the meaning set forth in the recitals.

 

“Business
Day” means any day except Saturday, Sunday or any government holiday in France, New York or Pennsylvania.

 

“Buyer”
has the meaning set forth in the preamble.

 

“Cash
Consideration” has the meaning set forth in Section 2.04.

 

“Contracts”
means all contracts, leases, deeds, mortgages, licenses, instruments, notes, commitments, undertakings, indentures, joint ventures
and all other agreements, commitments and legally binding arrangements, whether written or oral relating to the Business.

 

“Deposit”
has the meaning set forth in Section 2.05.

 

“Disclosure
Schedules” means the Disclosure Schedules delivered by Seller and Buyer concurrently with the execution and delivery
of this Agreement.

 

“Dollars
or $” means the lawful currency of the United States.

 

“Escrow
Agent” Buyer’s counsel and Seller’s counsel shall jointly serve as escrow agent.

 

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“Escrow
Agreement” means the agreement among Buyer’s counsel and Seller’s counsel whereby they jointly hold Buyer
funds for the benefit of Seller or Seller funds for the benefit of Buyer in accordance with the terms of this Agreement.

 

“Excluded
Assets” has the meaning set forth in Section 2.02.

 

“Excluded
Liabilities” has the meaning set forth in Section 2.04.

 

“First
Closing” has the meaning set forth in Section 3.01.

 

“Governmental
Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or
instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory
authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority
have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.

 

“Governmental
Order” means any order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any
Governmental Authority.

 

“Intellectual
Property” means all of Seller’s intellectual property used in, material to or otherwise necessary to the Business
as currently conducted, regardless of form, including: (a) United States and foreign copyrights and mask work rights, whether
registered or unregistered, and registrations and applications in connection therewith; (b) United States and foreign patents
and patent applications, including provisional patent applications, continuations, continuations-in-part, divisions, revisions,
reissues, reexaminations, extensions, and any foreign equivalents; (c) United States, state and foreign trademarks and service
marks, logos, designs, slogans, product and service names, product descriptions, trade dress, trade names, corporate names and
other trade designations, whether the foregoing are registered or unregistered, and all United States, state and foreign registrations
and applications to register the foregoing; (d) internet domain names and social media account or
user names, whether or not trademarks, all associated web addresses, URLs, websites and web pages, social media accounts and pages,
and all content and data thereon or relating thereto, whether or not copyrighted; (e) to the extent transferrable, computer programs,
operating systems, applications, firmware and other code, including all source code, object code, application programming interfaces,
data files, databases, protocols, specifications, and other documentation thereof; and (f) trade secret rights and other
similar rights in confidential ideas, know-how, concepts, methods, processes, formulae, reports, data, customer lists, mailing
lists, business plans, and other proprietary information, all of which derive value, monetary or otherwise, from being maintained
in confidence and not known to the Sellers’ competitors.

 

“Intellectual
Property Assignments” has the meaning set forth in Section 3.02(a)(iii).

 

“Knowledge
of Seller or Seller’s Knowledge” or any other similar knowledge qualification, means the knowledge of Rachel Cheli
and Christopher Ferguson, or any other individual who, as of the date of this Purchase Agreement, is an officer, director or manager,
as applicable of Seller.

 

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“Law”
means any statute, law, ordinance, regulation, rule, code, order, constitution, treaty, common law, judgment, decree, other requirement
or rule of law of any Governmental Authority.

 

“Liabilities”
means Losses, liabilities, obligations or commitments of any nature whatsoever, asserted or unasserted, known or unknown, absolute
or contingent, accrued or unaccrued, matured or unmatured or otherwise.

 

“License
Agreement” means that certain license agreement between Seller and Edison Nation, LLC, dated as of February 11, 2019.

 

“Permits”
means all permits, licenses, franchises, approvals, authorizations, registrations, certificates, variances and similar rights
obtained, or required to be obtained, from Governmental Authorities.

 

“Person”
means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated
organization, trust, association or other entity.

 

“Registered
Intellectual Property” has the meaning set forth in Section 4.07(b).

 

“Representative”
means, with respect to any Person, any and all directors, officers, employees, consultants, financial advisors, counsel, accountants
and other agents of such Person.

 

“Required
Consents” has the meaning set forth in Section 4.03.

 

“Retained
Books and Records” means (a) any personnel records, books, files or other documentation relating to any Excluded Employee
or relating to any Transferring Employee that under applicable Law must be retained by Seller, (b) all records relating to Taxes,
(c) corporate minutes and governing documents of Seller and its Affiliates, and (d) all records related to the Excluded Liabilities.

 

“Royalty
Agreement” means the agreement whereby Buyer shall guarantee payment of US$150,000 on April 15, 2022 and US$200,000
on April 15, 2023, which agreement shall be provided to Seller at the Second Closing. For the avoidance of doubt, the Royalty
Agreement is an independent obligation of Buyer and is unrelated to the Cash Consideration.

 

“Schedule”
means any of the Disclosure Schedules.

 

“Second
Closing” has the meaning set forth in Section 3.01.

 

“Seller”
has the meaning set forth in the preamble.

 

“Stock
List” has the meaning set forth in Section 3.02(b).

 

“Taxes”
mean all federal, state, local, foreign and other income, gross receipts, sales, use, value added, production, ad valorem, transfer,
documentary, franchise, registration, profits, license, lease, service, service use, withholding, payroll, employment, unemployment,
estimated, excise, severance, environmental, stamp, occupation, premium, property (real or personal), real property gains, windfall
profits, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest, additions
or penalties with respect thereto and any interest in respect of such additions or penalties.

 

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“Tax
Return” means any return, declaration, report, claim for refund, information return or statement or other document relating
to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

 

“Transaction
Documents” means this Agreement, the Bill of Sale, the Assignment and Assumption Agreement, Intellectual Property Assignments,
and the other agreements, instruments and documents required to be delivered at the First Closing or the Second Closing in connection
with this Agreement.

 

ARTICLE
II

PURCHASE
AND SALE

 

2.01
Purchase and Sale of Assets. Subject to the terms and conditions set forth herein, at the Second Closing, and pursuant to
Sections 105 and 363 of the Bankruptcy Code, Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer shall
purchase from Seller, free and clear of any and all interests, claims, liens and encumbrances, all of the right, title and interest
in, to and under all of the assets, properties and rights of every kind and nature, whether real, personal or mixed, tangible
or intangible (including goodwill), wherever located and whether now existing or hereafter acquired (other than the Excluded Assets),
which are used in the operation of the Business (collectively, the “Acquired Assets”), including the following:

 

(a)
The patents and patent applications set forth on Schedule 2.01 under Intellectual Property;

 

(b)
The trademarks and trademark applications set forth on Schedule 2.01 under Intellectual Property, together with any unregistered
trademarks used in the Business;

 

(c)
The copyrights and copyright applications set forth on Schedule 2.01under Intellectual Property and any unregistered copyrights
used in the Business;

 

(d)
The tradenames, domain names, social media and other platforms set forth on Schedule 2.01;

 

(e)
[Intentionally Reserved];

 

(f)
The product working files for product, sales and marketing used in the Business, described on Schedule 2.01;

 

(g)
all rights to any Actions by Seller against third parties to the extent related the Acquired Assets or the Assumed Liabilities,
whether arising by way of counterclaim or otherwise.

 

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2.02
Excluded Assets. Notwithstanding the foregoing, the Acquired Assets shall not include the following assets (collectively,
the “Excluded Assets”):

 

(a)
Cash and Cash Equivalents;

 

(b)
all Contracts that are not Assigned Contracts;

 

(c)
Insurance Policies and any refunds or recoveries thereunder (other than casualty claims related to Acquired Assets);

 

(d)
any real property leases (other than Assigned Contracts);

 

(e)
any equity securities or other ownership interests in any other Person;

 

(f)
all bank accounts and securities accounts (other than the Collection Accounts);

 

(g)
all rights and claims relating to the Excluded Liabilities;

 

(h)
such other Excluded Assets as are listed in Schedule 2.02.

 

2.03
Assumed Liabilities. Subject to the terms and conditions set forth herein, Buyer shall assume and agree to pay, perform and
discharge only the following Liabilities of Seller to the extent relating to the Business (collectively, the “Assumed
Liabilities”), and no other Liabilities:

 

(a)
the Liabilities in respect of purchase orders (or, to the extent applicable, other Assigned Contracts) arising on or after the
First Closing Date, but only to the extent that such Liabilities thereunder are required to be performed
after the First Closing Date and were incurred in the ordinary course of business and except to the extent that such Liabilities
arise out of any breach, default or violation thereof by Seller occurring prior to the First Closing Date;

 

(b)
all Liabilities and obligations arising out of or relating to Buyer’s ownership or operation of the Business and the Acquired
Assets after the Second Closing, except to the extent attributable to facts, circumstances or events occurring prior to the Second
Closing.

 

2.04
Excluded Liabilities. Notwithstanding the provisions of Section 2.03 or any other provision in this Agreement to the
contrary, Buyer shall not assume and shall not be responsible to pay, perform or discharge the following (the “Excluded
Liabilities”):

 

(a)
all Liabilities under or relating to the Excluded Assets;

 

(b)
the Accounts Payable as of the date of the Second Closing, unless otherwise specifically agreed by Seller and Buyer;

 

(c)
all Liabilities of Seller, its Member or any of their respective or Affiliates of any kind or nature whatsoever other than the
Assumed Liabilities.

 

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2.05
Cash Consideration. The aggregate cash consideration for the Acquired Assets shall be Two Million Six Hundred Fifty Thousand
U.S. Dollars (US$2,650,000.00) (the “Cash Consideration”). The Cash Consideration shall be paid, in cash, as
follows:

 

(a)
At the First Closing, Buyer will pay to Seller (or such other recipients as the Bankruptcy Court may indicate) the aggregate amount
of US$700,000 (the “Deposit”) to be held in escrow pursuant to the Escrow Agreement pending mutually acceptable
confirmation that Seller has transferred title to all Acquired Assets to Buyer.

 

(b)
At the Second Closing, which shall occur no later than April 15, 2021, Buyer will pay to Seller the amount of US$1,950,000, (the
“Additional Cash Consideration”); provided, that such Additional Cash Consideration shall be reduced
by the amount of revenue for all product sold or delivered under the License Agreement for the period between the First Closing
and the Second Closing; provided, further, that to the extent Seller is unable to convey certain of the Acquired Assets,
Buyer and Seller shall work to agree to a mutually acceptable reduction of the Cash Consideration, which shall be released by
the Escrow Agent back to Buyer. The parties are mindful of recording issues with respect to Seller’s record title to certain
of the Acquired Assets and understand that professional costs will have to be incurred to properly transfer and record title to
such Acquired Assets to Buyer. The parties have agreed that it will be more expeditious for Buyer to engage counsel and such other
professionals necessary to assist in the preparation for transfer of the Acquired Assets from Seller to Buyer (the “Transfer
Work”). However, as the Transfer Work is inherently a Seller obligation, all costs of the Transfer Work shall be borne
by Seller in the form of a dollar-for-dollar reduction to the Additional Cash Consideration (whether before the Second Closing,
or if after the Second Closing, through a credit to the Buyer against the Deposit held in escrow). Seller shall accept Buyer’s
business judgment as to the Transfer Work and shall not seek reduction of the offset of such Transfer Work from the Additional
Cash Consideration, provided, however, that Seller shall be entitled to reasonable transparency as to the scope and cost of such
Transfer Work.

 

ARTICLE
III

CLOSINGS

 

3.01
First and Second Closing. Subject to the terms and conditions of this Agreement, the consummation of the transactions contemplated
by this Agreement (the “Second Closing”) shall take place via the electronic exchange of documents and signatures
on at such date as Seller and Buyer may mutually agree upon in writing, provided that the Second Closing shall occur on or before
April 15, 2021 absent mutual agreement to extend such date. The date on which the Buyer delivers proof of transfer of the Deposit
shall be the “First Closing.” The First Closing shall occur no earlier than the first day following the date
on which the Sale Order becoming final and not subject to appeal, subject to waiver of Bankruptcy Rule 6004(h), if applicable.

 

3.02
Closing Deliverables.

 

(a)
At the First Closing, Buyer shall deliver to the Escrow Agent:

 

(i)
the Deposit, to be held in escrow pending the Second Closing; and

 

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(ii)
the Escrow Agreement duly executed by Buyer;

 

(b)
At the First Closing, Seller shall deliver to Buyer the following:

 

(i)
an order signed by the Bankruptcy Court approving the sale of the Acquired Assets free and clear of all interests, claims, liens
and encumbrances;

 

(ii)
A true and complete reporting of all stock as of March 1, 2021, wherever located, owned or controlled by the Seller or Edison
Nation, including but not limited to the stock associated with the Amazon.com store owned and controlled by Edison Nation (the
“Stock List”);

 

(iii)
A true and complete reporting of all accounts receivable associated with the Cloud b business, whether due to Seller or Edison
Nation as of March 10, 2021 (the “AR List”);

 

(iv)
Evidence that the framework has been established for all product sold or delivered under the License Agreement for the period
between the First Closing and the Second Closing will be paid into escrow for Buyer’s benefit, i.e. to be credited
from the Additional Cash Consideration due from Buyer to Seller at the Second Closing;

 

(v)
The ability for Buyer to monitor changes to the Stock List, the AR List and any other items relevant to the Cloud b business,
in real time, for the time period between the First Closing and the Second Closing; and

 

(vi)
the Escrow Agreement duly executed by Seller.

 

(c)
At the Second Closing, Buyer shall deliver the following:

 

(i)
the Additional Cash Consideration to Seller or Escrow Agent, as applicable (for the avoidance of doubt, as such amount is reduced
by the credit referenced in Section 3.02(b)(iv), above); provided that between the First Closing and the Second Closing, in the
event Seller requires payment of documented renewal, maintenance fees and/or other office actions due on or before August 31,
2021, Seller may request that Buyer pay such fees and, if paid, any such payment shall reduce the Additional Cash Consideration
by the same amount;

 

(ii)
the Royalty Agreement duly executed by Buyer;;

 

(iii)
the Assignment Agreement duly executed by Buyer;

 

(iv)
the Edison Nation Agreement (as described below) duly executed by Buyer;

 

    	 	8	 

    	 

    

 

(d)
At the Second Closing, Seller shall deliver to Buyer the following:

 

(i)
A bill of sale in form and substance satisfactory to Buyer (the “Bill of Sale”) and duly executed by Seller,
transferring the tangible personal property included in the Acquired Assets to Buyer;

 

(ii)
an assignment agreement in form and substance satisfactory to Buyer (the “Assignment Agreement”) and duly executed
by Seller, effecting the assignment of the Acquired Assets ;

 

(iii)
one or more duly executed assignments from Seller to Buyer of (i) the trademark and patent registrations and applications included
in the Acquired Intellectual Property, in a form suitable for recording in the U.S. Patent and Trademark Office (and equivalent
offices in jurisdictions outside the United States), (ii) copyright registrations and applications included in the Acquired Intellectual
Property, in a form suitable for recording in the U.S. Copyright Office (and equivalent offices in jurisdictions outside the United
States), (iii) the Internet domain name registrations and applications included in the Acquired Intellectual Property registered
in the name of Seller, in a form suitable for filing with all applicable domain name registries (and Seller shall have completed
any and all procedures with all applicable domain name registries and provided Buyer with all login and account information to
allow Buyer to take over ownership and management of such Internet domain name registrations and applications), (iii) any social
media accounts included in the Acquired Intellectual Property (and Seller shall have completed any and all procedures with all
applicable social media outlets and provided Buyer with all login and account information to allow Buyer to take over ownership
and management of such social media accounts), and (iv) general assignments of all other Acquired Intellectual Property, in each
case in form and substance customary for transactions of this nature and reasonably acceptable to Buyer and Seller (each, an “Acquired
Intellectual Property Assignment”, collectively the “Intellectual Property Assignments”); duly executed
by Seller;

 

(iv)
written evidence of the release of all interests, claims, liens and encumbrances and the transfer of title to Buyer’s name,
as recorded on the U.S. Patent and Trademark Office, all foreign intellectual property registries, all domain name registries,
all social media registries, and all distribution platforms;

 

(v)
a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Seller certifying (A) that attached thereto
are true and complete copies of all resolutions adopted by the manager and/or member of Seller, as required by the Seller’s
limited liability company operating agreement, authorizing the execution, delivery and performance of this Agreement and the other
Transaction Documents and the consummation of the transactions contemplated hereby and thereby, and that all such resolutions
are in full force and effect and are all the resolutions adopted in connection with the transactions contemplated hereby and thereby;
and (B) the names and signatures of the officers of Seller authorized to sign this Agreement, the Transaction Documents and the
other documents to be delivered hereunder and thereunder;

 

(vi)
any Required Consents;

 

(vii)
an agreement between Edison Nation (as the licensee of Seller), Buyer and Seller, duly executed by Edison Nation and Seller, providing
for the termination of the License Agreement and the transfer of certain assets of Edison Nation related to the assets used in
the Business to Buyer (the “Edison Nation Agreement”); and

 

    	 	9	 

    	 

    

 

(viii)
the Escrow Agreement duly executed by Seller.

 

ARTICLE
IV

REPRESENTATIONS
AND WARRANTIES OF SELLER

 

Except
as set forth in the Disclosure Schedules, Seller represents and warrants to Buyer that the statements contained in this Article
IV are true and correct as of the date hereof.

 

4.01
Organization and Qualification. Seller is a limited liability company duly formed and organized, validly existing and in good
standing under the Laws of the State of Nevada. Seller has full power and authority to own, license or lease the properties and
assets now owned, operated or leased by it and to carry on the Business as currently conducted. Schedule 4.01 sets forth
each jurisdiction in which the ownership of the Acquired Assets or the operation of the Business as currently conducted makes
such licensing or qualification necessary.

 

4.02
Authority. Seller has full limited liability company power and authority to enter into this Agreement and the other Transaction
Documents to which it is a party, to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated
hereby and thereby. The execution and delivery by Seller of this Agreement and any other Transaction Document, the performance
by Seller of its obligations hereunder and thereunder and the consummation by Seller of the transactions contemplated hereby and
thereby have been duly authorized by all requisite corporate action on the part of Seller. This Agreement has been duly executed
and delivered by Seller and constitutes a legal, valid and binding obligation of Seller enforceable against Seller in accordance
with its terms. When each other Transaction Document to which Seller is or will be a party has been duly executed and delivered
by Seller, such Transaction Document will constitute a legal and binding obligation of Seller enforceable against it in accordance
with its terms.

 

4.03
No Conflicts; Consents. The execution, delivery and performance by Seller of this Agreement and each of the other Transaction
Documents, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or
result in a violation or breach of, or default under, any provision of the certificate of formation, limited liability company
agreement or other organizational documents of Seller; (b) conflict with or result in a violation or breach of any provision of
any Law or Governmental Order applicable to Seller, the Business or the Acquired Assets; (c) except as set forth in Schedule
4.03 (the “Required Consents”), require the consent, notice or other action by any Person under, conflict
with, result in a violation or breach of, constitute a default or an event that, with or without notice or lapse of time or both,
would constitute a default under, result in the acceleration of or create in any party the right to accelerate, terminate, modify
or cancel any Assigned Contract or material Permit to which Seller is a party or any Assigned Contract by which Seller or the
Business is bound or to which any of the Acquired Assets are subject; or (d) result in the creation or imposition of any interest,
claim, lien or encumbrance on the Acquired Assets.

 

    	 	10	 

    	 

    

 

4.04
Title to Acquired Assets. Seller has good and valid title to all Acquired Assets, and Seller shall convey good and valid title
to all of the Acquired Assets at the Second Closing. All such Acquired Assets shall befree and clear of interests, claims, liens
and encumbrances. The records of the U.S. Patent and Trademark Office, the U.S. Copyright Office, domain registries, social media
registries, and the foreign intellectual property offices in which any Acquired Intellectual Property is registered or for which
application has been made will reflect the Seller’s ownership of the Acquired Intellectual Property at and as of the date
of the Second Closing. To the extent any such offices or registries do not reflect Seller’s ownership of the Acquired Intellectual
Property as of the First Closing, Seller will ensure that such ownership is so reflected prior to and as a condition to Seller’s
receipt of the Additional Cash Consideration.

 

4.05
Condition and Sufficiency of Assets. [Intentionally Reserved].

 

4.06
Real Property. Seller does not own or lease any real property in connection with the Business.

 

4.07
Intellectual Property.

 

(a)
Seller exclusively owns all of the Intellectual Property used in the Business (the “Acquired Intellectual Property”),
all of which is included in the Acquired Assets. Through the Bankruptcy Court Seller shall transfer all of its right, title, and
interest in and to all Acquired Intellectual Property, to the extent such right, title, and interest is transferred under this
Agreement. Seller is not obligated to transfer or license any of the Acquired Intellectual Property to a third party. The Acquired
Intellectual Property represents all of the intellectual property used in the operation the Business.

 

(b)
Schedule 4.07(b) lists (or cross-references another Schedule which lists) all registered Intellectual Property, including
patents, trademarks, copyrights, applications for the foregoing, domain names and trademark registrations and applications related
to the domain names and websites included in the Acquired Assets (the “Registered Intellectual Property”).

 

(c)
Seller has not granted licenses to use any Acquired Intellectual Property to any party other than to licensee and such license
agreement will terminate upon the Second Closing.

 

(d)
The conduct of the Business has not infringed, misappropriated or otherwise violated, and does not infringe, misappropriate, or
otherwise violate, the intellectual property rights of a third party. Seller has not received notice of a claim that the conduct
of the Business infringes, misappropriates, or otherwise violates the intellectual property rights of a third party.

 

(e)
To Seller’s Knowledge, no third party is currently infringing, misappropriating or violating any of Seller’s rights
in and to the Intellectual Property.

 

    	 	11	 

    	 

    

 

(f)
All personnel, including employees, agents, consultants and contractors, who have contributed to or participated in the conception
and development of Intellectual Property, have executed a customary nondisclosure agreement and all those Persons who have contributed
to the development of Acquired Intellectual Property either (i) have been a party to a valid and enforceable “work-for-hire”
arrangement or Contract with Seller in accordance with applicable Law that has accorded Seller full, effective, exclusive and
original ownership of all tangible and intangible property thereby arising, or (ii) have executed appropriate instruments of assignment
in favor of Seller as assignee that have conveyed to Seller effective and exclusive ownership of all tangible and intangible property
thereby arising.

 

(g)
Seller has no employees.

 

4.8
Accounts Receivable. Seller does not have Any Accounts Receivables.

 

4.9
Insurance. Schedule 4.09 of the Disclosure Schedules sets forth a true and complete list of all current policies or binders
of fire, liability, product liability, umbrella liability, real and personal property, workers’ compensation, vehicular,
fiduciary liability and other casualty and property insurance maintained by Seller or its Affiliates and relating to the Business,
the Acquired Assets or the Assumed Liabilities, including the amount of coverage under each policy (collectively, the “Insurance
Policies”).

 

4.10
Legal Proceedings; Governmental Orders.

 

(a)
Except as set forth in Schedule 4.10(a), there are no Actions pending or, to Seller’s Knowledge, threatened against
or by Seller or any stockholder or Affiliate (i) relating to or affecting the Business, the Acquired Assets or the Assumed Liabilities;
or (ii) that challenge or seek to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. To Seller’s
Knowledge, no event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action.

 

(b)
Schedule 4.10(b) sets forth a complete list of all product recalls issued in 2019 and 2020.

 

(c)
There are no outstanding Governmental Orders and no unsatisfied judgments, penalties or awards against, relating to or affecting
the Business.

 

4.11
Compliance With Laws; Permits.

 

(a)
Seller is in compliance in all material respects with all Laws applicable to the conduct of the Business as currently conducted
or the ownership and use of the Acquired Assets.

 

(b)
All material Permits required to conduct the Business as currently conducted or for the ownership and use of the Acquired Assets
have been obtained by Seller or Subsidiary and are valid and in full force and effect.

 

4.12
Environmental Matters. Seller is in compliance in all material respects with all applicable environmental Laws related to
the Business and the Acquired Assets, which compliance includes the possession by of all environmental Permits required under
applicable environmental Laws, and compliance with the terms and conditions thereof.

 

    	 	12	 

    	 

    

 

4.13
Employees and Employment Matters. The Seller has no Employees or employee benefit plans.

 

4.14
Taxes. Seller is a disregarded entity for tax purposes and does not generate income from operations.

 

4.15
Privacy and Security. Seller has been and is in compliance in all material respects with all applicable Laws relating to personally
identifiable information of employees, customers and website visitors, as well as Seller’s own privacy policies and notices
and the privacy policies of Amazon or other distributors on which Seller sells any products of the Business.

 

4.16
Foreign Corrupt Practices Act. Neither Seller nor any of its respective Affiliates or their respective Representatives, directly
or indirectly (a) has used or is using any corporate funds for any illegal contributions, gifts, entertainment or other unlawful
expenses relating to political activity, (b) has used or is using any corporate funds for any direct or indirect unlawful payments
to any foreign or domestic governmental officials or employees or any employees of a foreign or domestic government-owned entity,
(c) has violated or is violating any provision of the Foreign Corrupt Practices Act of 1977 or any other anticorruption law applicable
to Seller or any of its Affiliates.

 

4.17
Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in
connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made
by or on behalf of Seller or any Subsidiary.

 

4.18
Ordinary Course Operations. Seller and Edison Nation will operate in the ordinary course of business with respect to all transactions
between the date of this Agreement and the Second Closing.

 

ARTICLE
V

REPRESENTATIONS
AND WARRANTIES OF BUYER

 

Buyer
represents and warrants to Seller that the statements contained in this Article V are true and correct as of the date hereof.

 

5.01
Organization. Buyer is a company duly organized, validly existing and in good standing under the Laws of the Republic of France.

 

5.02
Authority of Buyer. Buyer has full corporate power and authority to enter into this Agreement and the other Transaction Documents,
to carry out its obligations hereunder and thereunder and to consummate the transactions contemplated hereby and thereby. The
execution and delivery by Buyer of this Agreement and any other Transaction Document to which it is a party, the performance by
Buyer of its obligations hereunder and thereunder and the consummation by Buyer of the transactions contemplated hereby and thereby
have been duly authorized by all requisite corporate action on the part of Buyer. This Agreement has been duly executed and delivered
by Buyer and constitutes a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms.
When each other Transaction Document has been duly executed and delivered by Buyer, such Transaction Document will constitute
a legal and binding obligation of Buyer enforceable against it in accordance with its terms.

 

    	 	13	 

    	 

    

 

5.03
No Conflicts; Consents; Financial Wherewithal.

 

(a)
The execution, delivery and performance by Buyer of this Agreement and the other Transaction Documents, and the consummation of
the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of,
or default under, any provision of the certificate of incorporation, by-laws or other organizational documents of Buyer; (b) conflict
with or result in a violation or breach of any provision of any Law or Governmental Order applicable to Buyer; or (c) require
the consent, notice or other action by any Person under any contract to which Buyer is a party.

 

(b)
The execution, delivery and performance of this Agreement and other Transaction Documents do not and will not require the consent
or approval of, or filing with, any Government or any other Person, other than (i) as may be required to be obtained by Buyer
after the Second Closing in order to own or operate any of the Acquired Assets; and (ii) for entry of the Sale Order by the Bankruptcy
Court.

 

(c)
Buyer has the financial wherewithal to pay the consideration set forth in this Agreement.

 

5.04
Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in
connection with the transactions contemplated by this Agreement or any other Transaction Document based upon arrangements made
by or on behalf of Buyer.

 

ARTICLE
VI

ADDITIONAL
COVENANTS

 

6.01
Notice to Holders of Liens, Claims and Interests. Seller has provided notice of the Sale to all holders of Liens, Claims and
Interests in accordance with the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, the Local Rules for the Bankruptcy
Court and any other applicable Order of the Bankruptcy Court.

 

6.02
Entry of Sale Order. Seller has filed with the Bankruptcy Court one or more motions which, collectively, seek the entry of
the Sale Order. The Sale Order provides that, without limitation and notwithstanding anything to the contrary in this Agreement
(including any Assigned Contract), Buyer is not liable for, and is taking the Acquired Assets free and clear of any liens, claims,
interests and encumbrances free of, any Excluded Liability. Seller and Buyer shall use best efforts to cooperate, assist and consult
with each other to secure the entry of the Sale Order, and to consummate the transactions contemplated by this Agreement.

 

    	 	14	 

    	 

    

 

6.03
Confidentiality. This Agreement will be filed with the Bankruptcy Court. To the extent possible, from and after the First
Closing Date, except as expressly contemplated by this Agreement, Seller shall, and shall cause its Affiliates to, hold, and shall
use its reasonable best efforts to cause its or their respective representatives to hold, in confidence any and all information,
whether written or oral, concerning the Acquired Assets and the Business, Buyer or Buyer’s businesses, except to the extent
such information (a) is generally available to and known by the public through no fault of Seller or any of its Affiliates or
their respective Representatives; or (b) is lawfully acquired by Seller or any of its Affiliates or their respective Representatives
from and after the First Closing from sources which are not prohibited from disclosing such information by a legal, contractual
or fiduciary obligation. If Seller, or any of its Affiliates or their respective Representatives are compelled to disclose any
information by judicial or administrative process or by other requirements of Law, Seller shall promptly notify Buyer in writing
and shall disclose only that portion of such information which Seller is advised by its counsel in writing is legally required
to be disclosed, provided that Seller shall use commercially reasonable efforts to obtain an appropriate protective order
or other reasonable assurance that confidential treatment will be accorded such information.

 

6.04
Conduct of Business in Ordinary Course. Seller will ensure that the license shall remain in full force and effect for use
by the licensee for the Business pending the Second Closing, subject to any requirements of the Bankruptcy Court.

 

6.05
Further Assurances. Following the Second Closing, each of the parties hereto shall, and shall cause their respective Affiliates
to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may
be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement and
the other Transaction Documents.

 

ARTICLE
VII

TAXES

 

7.01
Taxes Related to Purchase of Assets. All recording and filing fees and all federal, state and local sales, transfer, excise,
value-added or other similar Taxes, including, without limitation, all state and local Taxes in connection with the transfer of
the Acquired Assets, but excluding all income taxes and other fees based upon gain realized by Seller as a result of the sale
of the Acquired Assets (collectively, “ Transaction Taxes “), that may be imposed by reason of the sale, transfer,
assignment and delivery of the Acquired Assets, and which are not exempt under Section 1146(c) of the Bankruptcy Code, shall be
paid 50-50 by Buyer and Seller. Buyer and Seller agree to cooperate to determine the amount of Transaction Taxes payable in connection
with the transactions contemplated under this Agreement in the preparation and filing of any and all required returns for or with
respect to such Transaction Taxes with any and all appropriate taxing authorities.

 

    	 	15	 

    	 

    

 

7.02
Information. Buyer and Seller agree to furnish or cause to be furnished to each other, as promptly as practicable, such information
and assistance relating to the Acquired Assets as is reasonably necessary for the preparation and filing of any Tax Return, claim
for refund or other required or optional filings relating to Tax matters, for the preparation for and proof of facts during any
Tax audit, for the preparation for any Tax protest, for the prosecution or defense of any suit or other proceeding relating to
Tax matters and for the answer to any governmental or regulatory inquiry relating to Tax matters.

 

ARTICLE
VIII

CONDITIONS
PRECEDENT TO PERFORMANCE BY PARTIES

 

8.01
Conditions Precedent to Performance by Seller. The obligation of Seller to consummate the transactions contemplated by this
Agreement is subject to the fulfillment, at or before the date of the Second Closing, of the following conditions, any one or
more of which may be waived by Seller in its sole discretion:

 

(a)
Representations and Warranties of Buyer. All representations and warranties made by Buyer in Article 5 shall be accurate
in all material respects on and as of the date of the Second Closing as if again made by Buyer on and as of such date, except
for (i) those representations and warranties that speak solely as of a specific date and that were true and correct as of such
date, Buyer’s ability to perform its obligations hereunder, and Seller shall have received a certificate, dated as of the
Second Closing and signed by a duly authorized officer of Buyer, to that effect.

 

(b)
Consents and Approvals. The Bankruptcy Court shall have entered the Sale Order, and no order staying, modifying, or amending
the Sale Order shall be in effect on the date of the Second Closing.

 

(c)
No Violation of Orders. No preliminary or permanent injunction or other order that declares this Agreement invalid or unenforceable
in any respect or which prevents the consummation of the transactions contemplated by this Agreement shall be in effect.

 

(d)
Buyer’s Deliveries. Buyer shall have delivered to Seller all of the items set forth in Section 3.02(b) & (d).

 

8.02
Conditions Precedent to Performance by Buyer. The obligations of Buyer to consummate the transactions contemplated by this
Agreement are subject to the fulfillment, at or before the date of the Second Closing, of the following conditions, any one or
more of which may be waived by Buyer in its sole discretion:

 

(a)
Representations and Warranties of Seller. All representations and warranties made by Seller in Article 4 shall be accurate
in all material respects on and as of the date of the Second Closing as if again made by Seller on and as of such date, and Buyer
shall have received a certificate, dated as of the Second Closing and signed by a duly authorized officer of Seller, solely in
such capacity on behalf of Seller, to that effect.

 

    	 	16	 

    	 

    

 

(b)
Consents and Approvals. The Bankruptcy Court shall have entered the Sale Order, and no order staying, modifying, reversing
or amending the Sale Order shall be in effect on the date of the First Closing.

 

(d)
Title to Acquired Intellectual Property; Records. Upon the transfer of the Additional Cash Consideration to the Seller,
the Seller will begin to transfer title to all of the Registered Acquired Intellectual Property by Seller (or Buyer) effecting
the filing of assignment or transfer of ownership documents with the United States Patent and Trademark Office, United States
Copyright Office, all foreign patent, trademark, and copyright authorities, all domain name authorities, and all other applicable
intellectual property authorities. Interests, liens, claims, and encumbrances on all Registered Acquired Intellectual Property
will be removed by Seller effecting the filing of the appropriate documents with the United States Patent and Trademark Office,
United States Copyright Office, all foreign patent, trademark, and copyright authorities, all domain name authorities, and all
other applicable intellectual property authorities. Documentation of such filings shall be provided by Seller to Buyer as of the
date which is immediately prior to the Second Closing. The records of the U.S. Patent and Trademark Office, the U.S. Copyright
Office, domain registries, social media registries, and the foreign intellectual property offices in which any Acquired Intellectual
Property is registered or for which application has been made will reflect the Seller’s ownership of the Acquired Intellectual
Property at and as of the date of the Second Closing. To the extent any such offices or registries do not reflect Seller’s
ownership of the Acquired Intellectual Property as of the Second Closing, Seller will ensure that such ownership is so reflected
prior to and as a condition to Seller’s receipt of the Additional Cash Consideration.

 

(e)
Renewals. No Registered Intellectual Property registrations, to the extent renewable, will lapse before August 31, 2021.
Without limitation, Seller will, prior to the Second Closing, ensure that the renewals, responses, maintenance or other action
with respect to the Intellectual Property, to the extent renewable, noted on Schedule 8.02(e) has or shall be been taken,
such that no further action shall be required with respect to any Registered Intellectual Property until after August 31, 2021.
Seller shall have provided Buyer with written evidence of all renewals and other actions.

 

(f)
Due Diligence. Seller shall have responded to all of Buyer’s due diligence inquiries to Seller’s reasonable
satisfaction.

 

(g)
No Violation of Orders. No preliminary or permanent injunction or other Order that declares this Agreement invalid in any
respect or prevents the consummation of the transactions contemplated by this Agreement shall be in effect.

 

(h)
Seller’s Deliveries. Seller shall have delivered to Buyer all of the items set forth in Section 3.02(a) & (c).

 

    	 	17	 

    	 

    

 

ARTICLE
IX

TERMINATION

 

9.01
Termination. Prior to the Second Closing, this Agreement shall terminate on the earliest to occur of any of the following
events:

 

(a)
Termination by Buyer. Buyer may terminate this Agreement upon written notice to Seller if, five (5) days prior to the date
of the Second Closing, Seller has failed to complete the conditions to closing set forth in Section 8.02 and furnish to Buyer
the final forms of each closing deliverable set forth in Section 3.02(d).

 

(b)
Termination by Mutual written agreement. Buyer and Seller may terminate this Agreement by mutual written agreement.

 

9.02
Surviving Provisions. In the event of termination of this Agreement, the parties will have no further liability under this
Agreement, except that the provisions of Section 6.03 (Confidentiality), this Article IX (Termination) and Article X (Miscellaneous)
will survive.

 

ARTICLE
X

MISCELLANEOUS

 

10.01
Expenses. Except as otherwise expressly provided herein, all costs and expenses, including fees and disbursements of counsel,
financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall
be paid by the party incurring such costs and expenses, whether or not the Second Closing shall have occurred.

 

10.02
Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing
and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by
the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail
of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business
Day if sent after normal business hours of the recipient or (d) on the third day after the date mailed, by certified or registered
mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses
(or at such other address for a party as shall be specified in a notice given in accordance with this Section 9.02):

 

	 	If
    to Seller:	CBAV1
    LLC
	 	 	1
    West Broad Street
	 	 	Suite
    1004
	 	 	Bethlehem,
    PA 18018
	 	 	Att:
    Rachel Cheli, Manager
	 	 	E-mail:
    rcheli@vincoventures.com

 

    	 	18	 

    	 

    

 

	 	with
    a copy to:	Ciardi,
    Ciardi & Astin
	 	 	1905
    Spruce Street
	 	 	Philadelphia,
    PA 19103
	 	 	Attn:
    Albert A. Ciardi, III
	 	 	Attn:
    Nicole M. Nigrelli
	 	 	Email:
    aciardi@ciardilaw.com
	 	 	           nnigrelli@ciardilaw.com
	 	 	 
	 	If
    to Buyer:	BTL
    Diffusion SARL
	 	 	16
    rue Anatole Moussu
	 	 	78490
    Méré
	 	 	France
	 	 	Attention:
    Laurent Benichou, CEO
	 	 	E-mail
    : laurent@btl-diffusion.com
	 	 	 
	 	with
    a copy to:	Pearl
    Cohen Zedek Latzer Baratz LLP
	 	 	7
    Times Square
	 	 	New
    York, NY 10036
	 	 	Attention:
    Francine Alfandary, Esq.
	 	 	E-mail:
    FAlfandary@pearlcohen.com

 

10.03
Disclosure Schedules. The Disclosure Schedules and Exhibits referred to herein shall be construed
with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein. The Disclosure
Schedule will be arranged to correspond to the representations and warranties of this Agreement, and the disclosure in any portion
of the Disclosure Schedule shall qualify the corresponding provision in this Agreement and any other provision of this Agreement
only to the extent to which it is reasonably apparent from such disclosure that such disclosure relates.

 

10.04
Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

 

10.05
Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable
such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal
or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent
of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated
as originally contemplated to the greatest extent possible.

 

    	 	19	 

    	 

    

 

10.06
Entire Agreement. This Agreement and the other Transaction Documents constitute the sole and entire agreement of the parties
to this Agreement with respect to the subject matter contained herein and therein, and supersede all prior and contemporaneous
understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between
the statements in the body of this Agreement and those in the other Transaction Documents, the Exhibits and Disclosure Schedules
(other than an exception expressly set forth as such in the Disclosure Schedules), the statements in the body of this Agreement
will control.

 

10.07
Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their
respective successors and permitted assigns. Neither party may assign its rights or obligations hereunder without the prior written
consent of the other party, which consent shall not be unreasonably withheld or delayed; provided that Buyer may assign
its rights hereunder to an Affiliate of Buyer without Seller’s consent.

 

10.08
No Third-party Beneficiaries. Except as provided in Article VII, this Agreement is for the sole benefit of the parties
hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer
upon any other Person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of
this Agreement.

 

10.09
Amendment and Modification. This Agreement may be amended, modified or supplemented by an agreement in writing signed by Buyer
and Seller. Seller agrees to consent to any amendment to the schedules of Acquired Assets proposed by Buyer, and to modify the
Consideration accordingly.

 

10.10
Waiver. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and
signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach
or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring
before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from
this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power
or privilege.

 

10.11
Governing Law; Submission to Jurisdiction; Waiver of Jury Trial.

 

(a)
This Agreement shall be construed, performed and enforced in accordance with, and governed by, the laws of the State of New York
(without giving effect to the principles of conflicts of Laws thereof), except to the extent that the laws of such State are superseded
by the Bankruptcy Code. For so long as Seller is subject to the jurisdiction of the Bankruptcy Court, the parties to this Agreement
irrevocably elect as the sole judicial forum for the adjudication of any matters arising under or in connection with the Agreement,
and consent to the exclusive jurisdiction of, the Bankruptcy Court. After Seller is no longer subject to the jurisdiction of the
Bankruptcy Court, the parties to this Agreement irrevocably elect as the sole judicial forum for the adjudication of any matters
arising under or in connection with this Agreement, and consent to the jurisdiction of, any state or federal court having competent
jurisdiction over the Southern District of New York.

 

10.09
Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which
together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other
means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this
Agreement.

 

[SIGNATURE
PAGE FOLLOWS]

 

    	 	20	 

    	 

    

 

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.

 

	BTL
    DIFFUSION SARL	 
	 	 
	 	 
	LAURENT
    BENICHOU, CEO	 
	 	 
	CBAV1
    LLC	 
	 	 
	 	 
	RACHEL
    CHELI, MANAGER	 
	 	 
	Solely
    with respect to Sections 3.02(b) and 4.18	 
	 	 
	EDISON
    NATION, LLC	 
	 	 
	 	 
	Name :	        	 
	Title :

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