Document:

Exhibit
10.1

 

 

 

CONTRIBUTION
AGREEMENT

 

by
and among

 

ZVV
MEDIA PARTNERS, LLC

VINCO
VENTURES, INC.

 

and

 

ZASH
GLOBAL MEDIA AND ENTERTAINMENT CORPORATION

 

Dated
as of January 19, 2021

 

 

 

    	 

     

    

 

Annexes:

 

	Annex
    A:	Definitions
	Annex
    B:	Vinco
    Ventures Contributed Assets 
	Annex
    C:	ZASH
    Contributed Assets
	Annex
    D:	Form
    of Operating Agreement
	Annex
    E:	Vinco
    Ventures Assumed Liabilities 
	Annex
    F:	ZASH
    Assumed Liabilities

 

Schedules:

 

Vinco
Ventures Disclosure Schedule

ZASH
Disclosure Schedule

 

    	 

     

    

 

CONTRIBUTION
AGREEMENT

 

This
Contribution Agreement (“Agreement”), dated as of January 19, 2021, is entered into by and among ZVV Media
Partners, LLC (“Company”), Vinco Ventures, Inc., a Nevada corporation (“Vinco Ventures”),
and ZASH Global Media and Entertainment Corporation (“ZASH”). Annex A hereto contains definitions of
certain initially capitalized terms used in this Agreement.

 

W
I T N E S S E T H:

 

WHEREAS,
Vinco Ventures is a mergers and acquisitions company with vertically integrated digital media company;

 

WHEREAS,
ZASH is the owner of the ZASH brand and produces various consumer content, including clip-show content, educational content, and
more. Additionally, ZASH has assets that include a production studio and video editing facilities;

 

WHEREAS,
Vinco Ventures and ZASH desire to establish a newly formed company in order to engage in the
development and production of consumer facing content and related activities;

 

WHEREAS,
Vinco Ventures and ZASH have executed an Agreement to Complete a Plan of Merger as set forth in the
terms and conditions;

 

WHEREAS,
in furtherance of the foregoing, Vinco Ventures desires to contribute (the “Vinco Ventures Contribution”) to
the Company the assets set forth on Annex B hereto (the “Vinco Ventures Contributed Assets”), and ZASH
desires to contribute (the “ZASH Contribution”) to the Company the assets set forth on Annex C hereto
(the “ZASH Contributed Assets”); and

 

WHEREAS,
at the Closing, Vinco Ventures and ZASH shall enter into a limited liability company operating agreement for the Company, substantially
in the form of Annex D hereto (the “Operating Agreement”).

 

WHEREAS,
substantially in the form of Annex G hereto (the “Distribution Agreement”).

 

NOW,
THEREFORE, in consideration of the foregoing premises and the representations, warranties, covenants and undertakings contained
herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties,
intending to be legally bound, agree as follows:

 

ARTICLE
1 at the

 

Closing,
Vinco

 

Ventures
and

 

ZASH
shall enter

 

into
a content

 

distribution

 

agreement
with

 

American

 

Syndication
Media

 

Corporation

 

(“ASMC”),

 

CONTRIBUTIONS

 

Section
1.1 Contribution of Assets; Excluded Assets.

 

(a)
On the terms and subject to the conditions of this Agreement, at Closing, Vinco Ventures will contribute, assign, transfer, convey
and deliver to the Company, or cause each applicable Affiliate of Vinco Ventures to contribute, assign, transfer, convey and deliver
to the Company, and the Company will accept from Vinco Ventures and such Affiliates, free and clear of all Liens (other than Permitted
Liens), all of Vinco Ventures’ and such Affiliates’ right, title and interest in and to the Vinco Ventures Contributed
Assets.

 

    	 

     

    

 

(b)
On the terms and subject to the conditions of this Agreement, at Closing, ZASH will contribute, assign, transfer, convey and deliver
to the Company, or cause each applicable Affiliate of ZASH to contribute, assign, transfer, convey and deliver to the Company,
and the Company will accept from ZASH and such Affiliates free and clear of all Liens (other than Permitted Liens), all of ZASH’s
and such Affiliates right, title and interest in and to the ZASH Contributed Assets.

 

Section
1.2 Assumption of Liabilities.

 

(a)
No liabilities of Vinco Ventures shall be assumed by the Company except for the following (the “Vinco Ventures Assumed
Liabilities”): (i) those liabilities arising in or specifically relating to periods, events or occurrences happening
with respect to the Vinco Ventures Contributed Assets on or after the Closing Date; and (ii) the liabilities set forth on Annex
E hereto.

 

(b)
No liabilities of ZASH shall be assumed by the Company except for the following (the “ZASH Assumed Liabilities”):
(i) those liabilities arising in or specifically relating to periods, events or occurrences happening with respect to the ZASH
Contributed Assets on or after the Closing Date; and (ii) the liabilities set forth on Annex F hereto.

 

Section
1.3 Consideration.

 

(a)
In consideration of the Vinco Ventures Contribution to the Company, and for the other covenants and agreements contained herein,
at Closing: (i) the Company shall issue to Vinco Ventures 5,000 of the Company’s Units (the “Vinco Ventures, Inc.
Interest”).

 

(b)
In consideration of the ZASH Contribution to the Company, and for the other covenants and agreements contained herein, at Closing,
the Company shall issue to ZASH 5,000 of the Company’s Units (the “ZASH Corporation Interest”).

 

Section
1.4 Closing. The closing of the Contribution (the “Closing”) shall take place via the remote exchange
of executed documents and other deliverables by PDF concurrently with the execution of this Agreement (the “Closing Date”).
The Closing shall be deemed to be effective as of January 19, 2021 (the “Effective Time”), except as may otherwise
be expressly provided herein.

 

Section
1.5 Deliveries by Vinco Ventures. At the Closing, Vinco Ventures shall deliver, or cause each applicable Affiliate of Vinco
Ventures to deliver, to ZASH and the Company the following:

 

(a)
an Assignment and Assumption Agreement in the form of Annex I hereto, duly executed by Vinco Ventures and each Affiliate
of Vinco Ventures that owns Vinco Ventures Contributed Assets;

 

    	 

     

    

 

(b)
a copy of the Operating Agreement, duly executed by Vinco Ventures as a member of the Company;

 

(c)
a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of Vinco Ventures certifying (i) that attached
thereto are true and complete copies of all resolutions adopted by the board of directors of Vinco Ventures authorizing the execution,
delivery and performance of this Agreement and the Transaction Documents and the consummation of the transactions contemplated
hereby and thereby, (ii) that all such resolutions are in full force and effect, and (iii) the names and signatures of the officers
of Vinco Ventures authorized to sign this Agreement and the Transaction Documents to which Vinco Ventures is a party;

 

(d)
a counterpart to each other Transaction Document to which Vinco Ventures or any Affiliate thereof is party, or by which any such
Person is bound;

 

(e)
such other documents as ZASH may reasonably request for the purpose of facilitating the consummation of any of the transactions
contemplated hereby or by the Transaction Documents.

 

Section
1.6 Deliveries by ZASH. At the Closing, ZASH shall deliver, or cause each applicable Affiliate of ZASH to deliver, to Vinco
Ventures and the Company, the following:

 

(a)
an Assignment and Assumption Agreement in the form of Annex K hereto, duly executed by ZASH and each Affiliate of ZASH
that owns ZASH Contributed Assets;

 

(b)
a copy of the Operating Agreement, duly executed by ZASH as a member of the Company;

 

(c)
a certificate of the Secretary or an Assistant Secretary (or equivalent officer) of ZASH certifying (i) that attached thereto
are true and complete copies of all resolutions adopted by the manager of ZASH authorizing the execution, delivery and performance
of this Agreement and the Transaction Documents and the consummation of the transactions contemplated hereby and thereby, (ii)
that all such resolutions are in full force and effect, and (iii) the names and signatures of the officers of ZASH authorized
to sign this Agreement and the Transaction Documents to which ZASH is a party;

 

(d)
a counterpart to each other Transaction Document to which ZASH or any Affiliate thereof is party, or by which any such Person
is bound;

 

(e)
such other documents as Vinco Ventures may reasonably request for the purpose of facilitating the consummation of any of the transactions
contemplated hereby or by the Transaction Documents.

 

    	 

     

    

 

ARTICLE
2

 

REPRESENTATIONS
AND WARRANTIES WITH RESPECT TO VINCO VENTURES

 

As
further inducement to ZASH to enter into this Agreement and to consummate the transactions contemplated hereby, Vinco Ventures
represents and warrants to ZASH and the Company as of the date hereof as follows (except as set forth in the corresponding section
of the Vinco Ventures Disclosure Schedule or in any other section of the Vinco Ventures Disclosure Schedule if the application
of the disclosure to the first section is reasonably apparent):

 

Section
2.1 Organization and Power. Vinco Ventures is a corporation duly incorporated, validly existing and in good standing under
the Laws of the State of Nevada. Vinco Ventures has the organizational power and authority to own or lease the assets it purports
to own or lease and to carry on its business in substantially the same manner as currently conducted. Vinco Ventures is qualified
to conduct its business and is in good standing in every jurisdiction where it is required to be so qualified, except where the
failure to be so qualified would not have an Vinco Ventures Material Adverse Effect.

 

Section
2.2 Authority and Enforceability. Vinco Ventures has all requisite corporate power and authority, and has taken all
action necessary, to execute, deliver and perform this Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. This Agreement has been duly authorized, executed and delivered by Vinco Ventures and
(assuming the due authorization, execution and delivery by ZASH and the Company) this Agreement constitutes the legal, valid
and binding obligation of Vinco Ventures, and is enforceable against Vinco Ventures.

 

Section
2.3 Conflicts. The execution and delivery by Vinco Ventures of this Agreement and the performance by it of its obligations
hereunder, do not and will not:

 

(a)
violate any provision of the certificate of incorporation or bylaws of Vinco Ventures;

 

(b)
(i) violate any provision of Law relating to Vinco Ventures or (ii) conflict with or violate any Order to which Vinco
Ventures is subject, require a registration, filing, application, notice, consent, approval, order, qualification, or waiver
with, to or from any Governmental Authority on the part of Vinco Ventures, except in each case under this clause, any
violation, breach, default or noncompliance that would not individually or in the aggregate be reasonably likely to have a
Vinco Ventures Material Adverse Effect; or

 

(c)
materially conflict with, or result in the material breach of, or constitute a material default under, or result in the termination,
cancellation, material modification or acceleration (whether after the filing of notice or the lapse of time or both) of any material
right or obligation of Vinco Ventures under any Vinco Ventures Contract comprising the Vinco Ventures Contributed Assets.

 

Section
2.4 No Liens. Except as set forth in Section 2.4 of the Vinco Ventures Disclosure Schedule, there are no Liens on
any of the Vinco Ventures Contributed Assets.

 

Section
2.5 Compliance with Laws; Data Privacy. Vinco Ventures is and has been in material compliance with all applicable Laws
as same relate to any Vinco Ventures Contributed Assets. Vinco Ventures has not received any written or, to the Knowledge of Vinco
Ventures, verbal notice during the past two (2) years alleging it is not in material compliance with any Law as same relates to
any Vinco Ventures Contributed Asset. Vinco Ventures is and has been in material compliance with all contractual obligations and
the privacy policies of Vinco Ventures concerning data privacy and security as same relate to any Vinco Ventures Contributed Asset,
except to the extent not reasonably likely to result in an Vinco Ventures Material Adverse Effect.

 

    	 

     

    

 

Section
2.6 Vinco Ventures Contracts. Except as set forth in Section 2.7 of the Vinco Ventures Disclosure Schedule, all
Vinco Ventures Contracts comprising the Vinco Ventures Contributed Assets are in full force and effect against Vinco Ventures
or an Affiliate of Vinco Ventures (as applicable) and, to the Knowledge of Vinco Ventures, each other party thereto, in each case
in accordance with the express terms thereof. There does not exist under any Vinco Ventures Contract any material violation, breach
or event of default, or alleged material violation, breach or event of default, or event or condition that, after notice or lapse
of time or both, would constitute a material violation, breach or event of default thereunder on the part of Vinco Ventures or
the applicable Affiliate of Vinco Ventures. Neither Vinco Ventures or the applicable Affiliate of Vinco Ventures party to such
Vinco Ventures Contract nor, to the Knowledge of Vinco Ventures, any other party to any Vinco Ventures Contract has repudiated
any provision of any such Vinco Ventures Contract. Vinco Ventures has not received written notice that any party to an Vinco Ventures
Contract intends to cancel or terminate such Vinco Ventures Contract.

 

Section
2.7 Personal Property. Except as set forth in Section 2.9 of the Vinco Ventures Disclosure Schedule, Vinco Ventures
owns, leases, licenses, or otherwise has the right to use all of the assets, personal properties and rights comprising the Vinco
Ventures Contributed Assets. All material tangible assets comprising the Vinco Ventures Contributed Assets are in operational
condition, normal wear and tear excepted, have been regularly and properly serviced and maintained in a manner that, to the Knowledge
of Vinco Ventures, would not void or limit the coverage of any warranty thereon, other than items currently under, or scheduled
for, repair or construction, and are adequate and fit to be used for the purposes for which they are currently used in the manner
they are currently used.

 

Section
2.8 Brokers’ Fees. Except as set forth on Section 2.10 of the Vinco Ventures Disclosure Schedule, Vinco Ventures
has not become obligated to pay any fee or commission to any broker, finder or intermediary, for or on account of the transactions
contemplated by this Agreement.

 

ARTICLE
3

 

REPRESENTATIONS
AND WARRANTIES WITH RESPECT TO ZASH

 

As
further inducement to Vinco Ventures to enter into this Agreement and to consummate the transactions contemplated hereby, ZASH
represents and warrants to Vinco Ventures and the Company as of the date hereof as follows (except as set forth in the corresponding
section of the ZASH Disclosure Schedule or in any other section of the ZASH Disclosure Schedule if the application of the disclosure
to the first section is reasonably apparent):

 

Section
3.1 Organization and Power. ZASH is a limited liability company duly formed, validly existing and in good standing under
the Laws of the State of Delaware. ZASH has the organizational power and authority to own or lease the assets it purports to own
or lease and to carry on its business in substantially the same manner as currently conducted. ZASH is qualified to conduct its
business and is in good standing in every jurisdiction where it is required to be so qualified, except where the failure to be
so qualified would not have a ZASH Material Adverse Effect.

 

    	 

     

    

 

Section
3.2 Authority and Enforceability. ZASH has all requisite company power and authority, and has taken all action necessary,
to execute, deliver and perform this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated
hereby. This Agreement has been duly authorized, executed and delivered by ZASH and (assuming the due authorization, execution
and delivery by ZASH and the Company) this Agreement constitutes the legal, valid and binding obligation of ZASH, and is enforceable
against ZASH.

 

Section
3.3 Conflicts. The execution and delivery by ZASH of this Agreement and the performance by it of its obligations hereunder,
do not and will not:

 

(a)
violate any provision of the article of formation or operating agreement of ZASH;

 

(b)
(i) violate any provision of Law relating to ZASH or (ii) conflict with or violate any Order to which ZASH is subject,
require a registration, filing, application, notice, consent, approval, order, qualification, or waiver with, to or from any
Governmental Authority on the part of ZASH, except in each case under this clause, any violation, breach, default or
noncompliance that would not individually or in the aggregate be reasonably likely to have a ZASH Material Adverse Effect;
or

 

(c)
materially conflict with, or result in the material breach of, or constitute a material default under, or result in the termination,
cancellation, material modification or acceleration (whether after the filing of notice or the lapse of time or both) of any material
right or obligation of ZASH under any ZASH Contract comprising the ZASH Contributed Assets.

 

Section
3.4 No Liens. Except as set forth in Section 3.4 of the ZASH Disclosure Schedule, there are no Liens on any of the
ZASH Contributed Assets.

 

Section
3.5 Compliance with Laws; Data Privacy. ZASH is and has been in material compliance with all applicable Laws as same relate
to any ZASH Contributed Assets. ZASH has not received any written or, to the Knowledge of ZASH, verbal notice during the past
two (2) years alleging it is not in material compliance with any Law as same relates to any ZASH Contributed Asset. ZASH is and
has been in material compliance with all contractual obligations and the privacy policies of ZASH concerning data privacy and
security as same relate to any ZASH Contributed Asset, except to the extent not reasonably likely to result in a ZASH Material
Adverse Effect.

 

Section
3.6 ZASH Contracts. Except as set forth in Section 3.7 of the ZASH Disclosure Schedule, all ZASH Contracts comprising
the ZASH Contributed Assets are in full force and effect against ZASH or an Affiliate of ZASH (as applicable) and, to the Knowledge
of ZASH, each other party thereto, in each case in accordance with the express terms thereof. There does not exist under any ZASH
Contract any material violation, breach or event of default, or alleged material violation, breach or event of default, or event
or condition that, after notice or lapse of time or both, would constitute a material violation, breach or event of default thereunder
on the part of ZASH or the applicable Affiliate of ZASH. Neither ZASH or the applicable Affiliate of ZASH party to such ZASH Contract
nor, to the Knowledge of ZASH, any other party to any ZASH Contract has repudiated any provision of any such ZASH Contract. ZASH
has not received written notice that any party to a ZASH Contract intends to cancel or terminate such ZASH Contract.

 

    	 

     

    

 

Section
3.7 Personal Property.

 

(a)
Except as set forth in Section 3.9 of the ZASH Disclosure Schedule, ZASH owns, leases, licenses or otherwise has the right
to use all of the assets, personal properties and rights comprising the ZASH Contributed Assets. All material tangible assets
comprising the ZASH Contributed Assets are in operational condition, normal wear and tear excepted, have been regularly and properly
serviced and maintained in a manner that, to the Knowledge of ZASH, would not void or limit the coverage of any warranty thereon,
other than items currently under, or scheduled for, repair or construction, and are adequate and fit to be used for the purposes
for which they are currently used in the manner they are currently used.

 

Section
3.8 Brokers’ Fees. Except as set forth on Section 3.10 of the ZASH Disclosure Schedule, ZASH has not become
obligated to pay any fee or commission to any broker, finder or intermediary, for or on account of the transactions contemplated
by this Agreement.

 

ARTICLE
4

 

COVENANTS

 

Section
4.1 Public Disclosure; Confidentiality.

 

(a)
Notwithstanding anything to the contrary contained in this Agreement, except as may be required to comply with the requirements
of any applicable Law (including any filing and disclosure requirements under the rules and regulations of the SEC, which each
party shall be entitled to review and approve prior to any such filing, not to be unreasonably withheld, conditioned or delayed),
from and after the date hereof, no party shall make any press release or similar public announcement or public communication relating
to this Agreement unless specifically approved in advance by the other party, which approval shall not be unreasonably withheld,
conditioned or delayed.

 

(b)
From and after the date hereof, each of ZASH and Vinco Ventures shall, and shall cause each of their respective Affiliates to,
keep confidential the terms and existence of this Agreement and the Transaction Documents, the negotiations relating thereto,
and all confidential or proprietary information of the other party acquired by a party pursuant to or in the course of fulfilling
its obligations under the Transaction Documents (collectively, the “Confidential Information”) except (i) to
the extent that it is reasonably necessary to disclose the Confidential Information to obtain the regulatory approvals or third
party consents, (ii) for disclosures otherwise made in satisfaction of any of the obligations under this Agreement, (iii) to the
extent required by applicable Law (including any filing and disclosure requirements under the rules and regulations of the SEC),
(iv) as made public prior to the date hereof by either party not in violation of this Agreement and (v) each of ZASH and Vinco
Ventures may disclose such information to such Person’s equity holders (other than public equity holders) or Affiliates,
and their respective Representatives but subject to the provisions of the Confidentiality Agreement.

 

    	 

     

    

 

(c)
The terms of the Confidentiality Agreement are hereby incorporated herein by reference and shall continue in full force and effect
until the Closing, at which time the Confidentiality Agreement shall terminate. If this Agreement is terminated prior to the Closing,
then the Confidentiality Agreement shall continue in full force and effect in accordance with its terms.

 

Section
4.2 Vinco Ventures Access to Records after Closing

 

(a)
For a period of six (6) years after the Closing Date, regardless of whether it is a member of the Company, Vinco Ventures and
its Representatives shall have reasonable access to all of the books and records of the Company that comprise a portion of the
Vinco Ventures Contributed Assets, to the extent that such access may reasonably be required in connection with matters relating
to or affected by the operations of Vinco Ventures or the Vinco Ventures Contributed Assets prior to the Closing Date, including
the preparation of Vinco Ventures or Vinco Ventures’ financial reports or Tax Returns, any Tax audits, the defense or prosecution
of Legal Proceedings, and any other reasonable need of Vinco Ventures to consult such books and records. Such access shall be
afforded by the Company upon receipt of reasonable advance notice and during normal business hours. If any such books or records,
or any other documents which Vinco Ventures has the right to have access to pursuant to this Section 4.2(a) are produced by the
Company or its Affiliates, to an actual or potentially adverse party (e.g., in litigation or in connection with a government investigation),
the Company shall endeavor to immediately make all such books, records and/or documents produced available for inspection and
copying by Vinco Ventures concurrently with the production of such books, records and/or documents. In addition, if the Company
or its Affiliates, shall desire to dispose of any of such books or records prior to the expiration of such six (6) year period,
the Company shall, prior to such disposition, give Vinco Ventures a reasonable opportunity to segregate and remove such books
and records as Vinco Ventures may select. The Company shall provide to Vinco Ventures or any of its Representatives so requesting,
reasonable assistance, at Vinco Ventures’ expense, by providing employees of the Company to act as witnesses and preparing
documents, reports and other information requested by Vinco Ventures or such Representative in support of the activities described
in this Section 4.2(a).

 

(b)
Vinco Ventures may retain copies of any Contracts, documents or records of Vinco Ventures: (i) for archival purposes, (ii) which
relate to properties or activities of Vinco Ventures, (iii) which are required to be retained pursuant to any legal requirement
or are subject to the attorney-client privilege, or (iv) for financial reporting purposes, for Tax purposes or for legal defense
or prosecution purposes. The Company shall promptly forward to Vinco Ventures (and shall not review to the extent possible) any
telephone calls and any email, facsimile or other communication that the Company receives that is intended for Vinco Ventures.

 

    	 

     

    

 

Section
4.3 ZASH Access to Records after Closing.

 

(a)
For a period of six (6) years after the Closing Date, regardless of whether it is a member of the Company, ZASH and its Representatives
shall have reasonable access to all of the books and records of the Company that comprise a portion of the ZASH Contributed Assets,
to the extent that such access may reasonably be required in connection with matters relating to or affected by the operations
of ZASH or the ZASH Contributed Assets prior to the Closing Date, including the preparation of ZASH’s financial reports
or Tax Returns, any Tax audits, the defense or prosecution of Legal Proceedings, and any other reasonable need of ZASH to consult
such books and records. Such access shall be afforded by the Company upon receipt of reasonable advance notice and during normal
business hours. If any such books or records, or any other documents which ZASH has the right to have access to pursuant to this
Section 4.3(a) are produced by the Company or its Affiliates to an actual or potentially adverse party (e.g., in litigation or
in connection with a government investigation), the Company shall endeavor to immediately make all such books, records and/or
documents produced available for inspection and copying by ZASH concurrently with the production of such books, records and/or
documents. In addition, if the Company or any of its Affiliates, shall desire to dispose of any of such books or records prior
to the expiration of such ten (10) year period, the Company shall, prior to such disposition, give ZASH a reasonable opportunity
to segregate and remove such books and records as ZASH may select. The Company shall provide to ZASH or any of its Representatives
so requesting, reasonable assistance, at ZASH’s expense, by providing employees of the Company to act as witnesses and preparing
documents, reports and other information requested by Vinco Ventures or such Representative in support of the activities described
in this Section 4.3(a).

 

(b)
ZASH may retain copies of any Contracts, documents or records of ZASH: (i) for archival purposes, (ii) which relate to
properties or activities of ZASH, (iii) which are required to be retained pursuant to any legal requirement or are subject to
the attorney-client privilege, or (iv) for financial reporting purposes, for Tax purposes or for legal defense or prosecution
purposes. The Company shall promptly forward to ZASH (and shall not review to the extent possible) any telephone calls and
any email, facsimile or other communication that the Company receives that is intended for ZASH.

 

Section
4.4 Tax Matters.

 

(a)
The parties shall cooperate (and cause their respective Affiliates to cooperate) fully, as and to the extent reasonably requested
by the other parties, in connection with the preparation and filing of tax returns and any Tax audit, litigation or other proceeding
with respect to Taxes and payments in respect thereof. Such cooperation shall include the retention and (upon the other parties’
request) the provision of records and information which are reasonably relevant to any such Tax audit, litigation or other proceeding
and making employees available on a mutually convenient basis to provide additional information and explanation of any material
provided hereunder. The Company, Vinco Ventures and ZASH shall retain all books and records with respect to their respective Tax
matters relating to any taxable period beginning before the Closing Date until six (6) months after the expiration of the statute
of limitations (and, to the extent notified by the Company, any extensions thereof) of the respective taxable periods, and to
abide by all record retention agreements entered into with any Governmental Authority. Each of the parties shall furnish the other
parties with copies of all relevant correspondence received from any Governmental Authority in connection with any Tax audit or
information request with respect to any Taxes for which any other party may have an indemnification obligation under this Agreement.
Each party, upon request of another party, agrees to provide such other party with all information that either party may be required
to report pursuant to the Code and all Treasury Regulations promulgated thereunder. Notwithstanding any provision of this Agreement,
neither Vinco Ventures, on the one hand, nor ZASH, on the other hand, shall be required to disclose any consolidated, combined,
unitary or similar income Tax Return of which it or its Affiliates is the common parent or any other information relating to Taxes
or Tax Returns other than information relating solely to Vinco Ventures, the Vinco Ventures Contributed Assets, or the Vinco Ventures
Assumed Liabilities, in the case of Vinco Ventures, and ZASH, the ZASH Contributed Assets, or the ZASH Assumed Liabilities, in
the case of ZASH.

 

    	 

     

    

 

(b)
The Company shall pay all transfer, documentary, sales, use, value-added, gross receipts, stamp, registration, or other similar
transfer taxes (“Transfer Taxes”) incurred in connection with the consummation of the transactions contemplated
by this Agreement when due, and the Company will file all necessary Tax Returns and other documentation with respect to all such
Transfer Taxes, and if required by applicable Law, the other applicable parties hereunder will join in the execution of any such
Tax Returns and other documentation. The parties hereto shall cooperate to minimize or avoid any such Transfer Taxes that might
be imposed to the extent permitted by applicable Law.

 

(c)
Tax Prorations.

 

(i)
Any Taxes applicable to the Vinco Ventures Contributed Assets and the Vinco Ventures Assumed Liabilities for a taxable period
that includes but does not end on the Closing Date shall be paid by Vinco Ventures or the Company, as applicable, and such Taxes
shall be apportioned between Vinco Ventures and the Company based on the number of days in the portion of the taxable period that
ends on and includes the Closing Date (the “Vinco Ventures Pre- Closing Apportioned Taxes”) and the number
of days in the entire taxable period. Vinco Ventures shall pay to the Company an amount equal to any such Taxes payable by the
Company which are attributable to the Vinco Ventures Pre-Closing Apportioned Taxes, and the Company shall pay to Vinco Ventures
an amount equal to any such Taxes payable by Vinco Ventures which are not attributable to the Vinco Ventures Pre-Closing Apportioned
Taxes. Such payments shall be made on or prior to the Closing Date or, if later, on the date such Taxes are due (or thereafter,
promptly after request by the Company or Vinco Ventures if such Taxes are not identified by the Company or Vinco Ventures on or
prior to the Closing Date).

 

(ii)
Any Taxes applicable to the ZASH Contributed Assets and the ZASH Assumed Liabilities for a taxable period that includes but does
not end on the Closing Date shall be paid by ZASH or the Company, as applicable, and such Taxes shall be apportioned between ZASH
and the Company based on the number of days in the portion of the taxable period that ends on and includes the Closing Date (the
“ZASH Pre-Closing Apportioned Taxes”) and the number of days in the entire taxable period. ZASH shall pay to
the Company an amount equal to any such Taxes payable by the Company which are attributable to the ZASH Pre-Closing Apportioned
Taxes, and the Company shall pay to ZASH an amount equal to any such Taxes payable by ZASH which are not attributable to the ZASH
Pre-Closing Apportioned Taxes. Such payments shall be made on or prior to the Closing Date or, if later, on the date such Taxes
are due (or thereafter, promptly after request by the Company or ZASH if such Taxes are not identified by the Company or ZASH
on or prior to the Closing Date).

 

    	 

     

    

 

(d)
For U.S. federal and applicable state and local income Tax purposes, Vinco Ventures, ZASH, the Company, and their respective Affiliates,
agree to treat the contributions of the Vinco Ventures Contributed Assets and the ZASH Contributed Assets as tax-deferred contributions.
The Vinco Ventures Contributed Assets shall be contributed to the Company in exchange for the Vinco Ventures, Inc. Interest and
the ZASH Contributed Assets shall be contributed to the Company in exchange for the ZASH Corporation Interest, in each case, which
Vinco Ventures, ZASH, the Company, and their respective affiliates agree shall be treated as tax- deferred contributions pursuant
to Section 721 of the Code (and any corresponding or similar provision of state, local, or foreign income Tax Law). Each of Vinco
Ventures, ZASH, the Company, and their respective affiliates agree to report, act, and file all Tax Returns in all respects and
for all purposes in a manner consistent with this Section 4.4(d).

 

Section
4.5 Further Assurances. After Closing and without additional consideration, (a) Vinco Ventures will execute and
deliver to ZASH and the Company such further instruments and certificates of conveyance and transfer as ZASH may reasonably
request in order to more effectively convey and transfer the Vinco Ventures Contributed Assets from Vinco Ventures to the
Company; (b) ZASH will execute and deliver to Vinco Ventures and the Company such further instruments and certificates of
conveyance and transfer as Vinco Ventures may reasonably request in order to more effectively convey and transfer the ZASH
Contributed Assets from ZASH to the Company; and (c) each of the parties will use commercially reasonable efforts to take, or
cause to be taken, all appropriate action, do or cause to be done all things necessary, proper or advisable under applicable
Law, and execute and deliver such documents and other papers as may be required to carry out the provisions of this Agreement
and the Transaction Documents and consummate and make effective the transactions contemplated by this Agreement and the
Transaction Documents.

 

ARTICLE
5

 

INDEMNIFICATION

 

Section
5.1 Survival.

 

(a)
The representations and warranties contained herein or in any certificate delivered by a party at the Closing pursuant hereto
shall survive the Closing and will continue in full force and effect for a period from the date hereof until the first
(1st) anniversary of the Closing (the “General Survival Date”); provided, however,
that the representations and warranties contained in Section 2.1 (Organization and Power), Section 2.2 (Authority
and Enforceability), Section 2.8 (Brokers’ Fees), Section 3.1 (Organization and Power), Section
3.2 (Authority and Enforceability), and Section 3.11 (Brokers’ Fees), (collectively, the
“Fundamental Representations”) shall survive the Closing and will continue in full force and effect for a
period from the date hereof until the date that is the earlier of (i) five (5) years from the Closing Date and (ii) the date
of the expiration of the applicable statute of limitations, including any extensions (the last date to which a representation
survives, being the “Survival Date.” None of the covenants or other agreements contained in this Agreement
shall survive the Closing other than those which by their terms contemplate performance after the Closing, and each such
surviving covenant and agreement shall survive the Closing for the period contemplated by its terms.

 

    	 

     

    

 

(b)
No Indemnified Person shall be entitled to make any claim in respect of any representation, warranty, covenant or agreement after
the expiration of its applicable Survival Date, except that any bona fide claim initiated by an Indemnified Person prior to the
expiration of the applicable Survival Date in accordance with the provisions hereof with respect to Losses incurred prior thereto
shall survive until it is settled or resolved pursuant to this Agreement to the extent that an Indemnified Person provides written
notice of such breach or inaccuracy (which notice shall describe the applicable breach or inaccuracy in reasonable detail, include
copies of all available material written evidence thereof and indicate the estimated amount, if reasonably practicable, of Losses
that have been or may be sustained by the applicable Indemnified Person in connection therewith) to the party to provide indemnity
prior to the applicable Survival Date.

 

Section
5.2 Indemnification by Vinco Ventures. Subject to the terms of this Section 5.2, from and after the Closing, Vinco Ventures
shall indemnify ZASH and the Company, and their respective Affiliates, officers, directors, shareholders, members, employees,
successors and permitted assigns (collectively, the “ZASH Indemnified Persons”) and hold them harmless from
and against any and all Losses incurred or suffered by a ZASH Indemnified Person resulting from or arising out of:

 

(a)
any breach or inaccuracy of any representation or warranty made by Vinco Ventures in this Agreement or in any certificate delivered
by Vinco Ventures at the Closing pursuant hereto;

 

(b)
any breach of any covenant or agreement (if to be performed following the Closing) of Vinco Ventures contained in this Agreement;
and

 

(c)
any Taxes with respect to the Vinco Ventures Contributed Assets for any Pre-Closing Tax Period.

 

Section
5.3 Indemnification by ZASH. Subject to the terms of this Section 5.3, from and after the Closing, ZASH shall indemnify
Vinco Ventures and the Company and their respective Affiliates, officers, directors, shareholders, members, employees, successors
and permitted assigns (collectively, the “Vinco Ventures Indemnified Persons” and with the ZASH Indemnified
Persons, the “Indemnified Persons”) and hold them harmless from and against any and all Losses incurred or
suffered by a Vinco Ventures Indemnified Person resulting from or arising out of:

 

(a)
any breach or inaccuracy of any representation or warranty made by ZASH in this Agreement or in any certificate delivered by ZASH
at the Closing pursuant hereto;

 

(b)
any breach of any covenant or agreement (if to be performed following the Closing) of ZASH contained in this Agreement; and

 

(c)
any Taxes with respect to the ZASH Contributed Assets for any Pre-Closing Tax Period.

 

Section
5.4 Limitations on Indemnification.

 

(a)
Vinco Ventures shall have no liability pursuant to Section 5.2 with respect to Losses if the amount of such Losses do not
exceed one hundred thousand dollars ($100,000 in the aggregate (the “Basket”), and then only in respect of
such excess and subject to the other limitations herein provided; provided, however, that such limitation shall
not apply to any breach or inaccuracy of any Fundamental Representation or breach or inaccuracy of any representation or warranty
based on Fraud by Vinco Ventures. Vinco Ventures shall not have liability under this Agreement in an aggregate amount greater
than Three Million Dollars ($3,000,000).

 

    	 

     

    

 

(b)
ZASH shall have no liability pursuant to Section 5.3 with respect to Losses if the amount of such Losses do not exceed
the Basket, and then only in respect of such excess and subject to the other limitations herein provided; provided, however,
that such limitation shall not apply to any breach or inaccuracy of any Fundamental Representation or breach or inaccuracy of
any representation or warranty based on Fraud by ZASH. ZASH shall not have liability under this Agreement in an aggregate amount
greater than Three Million Dollars ($3,000,000).

 

Section
5.5 Further Limitations.

 

(a)
For all purposes of this Section 5.5, “Losses” shall be net of any amounts paid or payable to an Indemnified
Person under any insurance policy or Contract in connection with the facts giving rise to the right of indemnification hereunder,
and each Indemnified Person shall use its reasonable commercial efforts to recover all amounts payable from an insurer or other
third party under any such insurance policy or Contract prior to seeking indemnification hereunder; provided, however, that the
amount deemed to be paid under such insurance policies shall be net of the deductible for such policies.

 

(b)
If the amount to be netted hereunder from any indemnification payment required hereunder is determined after payment by an Indemnifying
Person to an Indemnified Person of any amount otherwise required to be paid as indemnification pursuant hereto, the Indemnified
Person shall repay, promptly after such determination, any amount that the Indemnifying Person would not have had to pay pursuant
hereto had such determination been made at the time of such payment.

 

(c)
Notwithstanding the fact that any Indemnified Person may have the right to assert claims for indemnification under or in respect
of more than one provision of this Agreement in respect of any fact, event, condition or circumstance, no Indemnified Person shall
be entitled to recover the amount of any Loss suffered by such Indemnified Person more than once, regardless of whether such Loss
may be as a result of a breach of more than one representation, warranty, obligation or covenant or otherwise. In addition, any
liability for indemnification hereunder shall be determined without duplication of recovery by reason of the state of facts giving
rise to such liability, or a breach of more than one representation, warranty, covenant or agreement, as applicable.

 

(d)
Each Indemnified Person shall use its reasonable commercial efforts to mitigate any indemnifiable Loss, and in the event that
it fails to so mitigate an indemnifiable Loss, the Indemnifying Person shall have no liability for any portion of such Loss that
reasonably could have been avoided had the Indemnified Person made such efforts.

 

(e)
The covenants of a party contained in this Agreement may not be used to circumvent the negotiated limitations (e.g., knowledge
qualifiers, materiality standards, dollar thresholds, survival periods and the like) contained in the representations and warranties
and procedures with respect to the recovery by Indemnified Persons on account of the breach of such representations or warranties.

 

    	 

     

    

 

(f)
For the purpose of clarity, even if a representation and warranty of Vinco Ventures or ZASH is not accurate by reason of any means,
methods, practices, processes or other manner by which such party operated its business prior to the Closing, such party (as applicable)
will not be responsible for post-Closing liabilities arising from operating the Company by using the same means, methods, practices,
processes or other manner.

 

Section
5.6 Third-Party Claim Indemnification Procedures.

 

(a)
In the event that any written claim or demand for which a party (in such capacity, an “Indemnifying Person”)
may have liability to any Indemnified Person hereunder is asserted against or sought to be collected from any Indemnified Person
by a third party (a “Third- Party Claim”), such Indemnified Person shall promptly, but in no event more than
ten (10) days following such Indemnified Person’s receipt of a Third-Party Claim, notify the Indemnifying Person of such
Third-Party Claim, the amount or the estimated amount of damages sought thereunder to the extent then ascertainable, any other
remedy sought thereunder, any relevant time constraints relating thereto, a reasonably detailed explanation of the events giving
rise to such Third-Party Claim and any other material details pertaining thereto (a “Claim Notice”); provided,
however, that the failure to timely give a Claim Notice shall not relieve the Indemnifying Person of its obligations hereunder,
except to the extent that the Indemnifying Person shall have been actually prejudiced by such failure or as provided in Section
5.1. Thereafter, the Indemnified Person shall deliver to the Indemnifying Person, promptly following the Indemnified Person’s
receipt thereof, copies of all notices and documents (including court papers) received by the Indemnified Person relating to the
Third-Party Claim.

 

(b)
In the event that the Indemnifying Person notifies the Indemnified Person that it elects to defend the Indemnified Person against
a Third-Party Claim, the Indemnifying Person shall have the right to defend the Indemnified Person by appropriate proceedings
and shall have the sole power to direct and control such defense at its expense. Once the Indemnifying Person has made such election,
the Indemnified Person shall have the right to participate in (but not control) any such defense and to employ separate counsel
of its choosing at such Indemnified Person’s expense. Whether or not the Indemnifying Person assumes the defense of a Third-Party
Claim, the Indemnified Person shall not admit any liability with respect to, settle, compromise or discharge, such Third-Party
Claim without the Indemnifying Person’s prior written consent, not to be unreasonably withheld. If the Indemnifying Person
assumes the defense of a Third-Party Claim and is in good faith contesting such Third-Party Claim, the Indemnified Person shall
agree to and cooperate fully with the Indemnifying Person in connection with any settlement, compromise or discharge of a Third-Party
Claim that the Indemnifying Person may reasonably recommend pursuant to which (i) there is no finding or admission of any violation
of Law or Contract by the Indemnified Person, and (ii) the sole relief provided to the third party is monetary damages that are
paid in full by (A) insurance, and/or (B) the Indemnifying Person to the extent that the Indemnifying Person is liable in connection
with such Third-Party Claim.

 

    	 

     

    

 

(c)
The Indemnified Person and the Indemnifying Person shall cooperate in order to ensure the proper and adequate defense of a Third-Party
Claim, including by providing reasonable access to each other’s relevant books and records, by preserving such books and
records and by making employees and representatives available on a mutually convenient basis during normal business hours to provide
additional information and explanation of any material provided hereunder. The Indemnified Person and the Indemnifying Person
shall use reasonable commercial efforts to avoid production of confidential information (consistent with applicable Law), and
to cause all communications among employees, counsel and others representing any party to a Third- Party Claim to be made so as
to preserve any applicable attorney-client or work-product privileges.

 

Section
5.7 Direct Claim Indemnification Procedures.

 

(a)
Each Indemnified Person shall assert any claim on account of any Losses as to which an Indemnifying Person may have liability
hereunder, and which do not result from a Third-Party Claim (a “Direct Claim”) by giving the Indemnifying Person
written notice thereof reasonably promptly. Such notice by the Indemnified Person shall describe the Direct Claim in reasonable
detail, include copies of all available material written evidence thereof and indicate the estimated amount, if reasonably practicable,
of Losses that have been or may be sustained by the Indemnified Person; provided, however, that the failure to timely
give such notice shall not affect the rights of an Indemnified Person hereunder (i) unless such failure has a prejudicial effect
on the defenses or other rights available to the Indemnifying Person with respect to such Direct Claim or on the Indemnifying
Person’s ability to mitigate such Direct Claim, (ii) unless the indemnification obligations are materially increased as
a result of such failure or (iii) as provided in Section 5.1.

 

(b)
In the event the Company has the right to assert a Direct Claim pursuant to Section 5.2 or Section 5.3, then notwithstanding
anything set forth in the Operating Agreement, the Member (as such term is defined in the Operating Agreement) who is not the
Indemnifying Person with respect to such Direct Claim shall have the right to control all decisions of the Company with respect
to such Direct Claim, including the assertion and resolution thereof.

 

(c)
In the event the Company has the right to assert a Direct Claim against an Indemnifying Person which Direct Claim arises from
or relates to Vinco Ventures or ZASH’s failure to contribute any of the Vinco Ventures Contributed Assets or the ZASH Contributed
Assets, as applicable, then such Indemnifying Person shall be able to satisfy such indemnification obligation to the Company by
contributing, or causing the contribution of, to the Company, any such additional Vinco Ventures Contributed Assets or ZASH Contributed
Assets.

 

Section
5.8 Investigation by Indemnifying Persons. In connection with any claim pursuant to this ARTICLE 5:

 

(a)
The Indemnified Person shall allow the Indemnifying Person and its financial, accounting or legal advisers to investigate the
fact, matter or circumstance alleged to (or which may) give rise to such claim and whether and to what extent any amount is or
may be payable in respect of such claim.

 

(b)
The Indemnified Person shall disclose to the Indemnifying Person all materials of which such Indemnified Person is aware which
relate to the claim and shall, and shall cause such Indemnified Person’s Affiliates and Representatives to, provide such
information and assistance as the Indemnifying Person or its financial, accounting or legal advisers shall reasonably request,
including:

 

(i)
access to premises and personnel (including any employee with knowledge relating to the relevant facts, matters or circumstances
or who can otherwise reasonably assist the Indemnifying Person); and

 

    	 

     

    

 

(ii)
the right to examine and copy or photograph any relevant assets, accounts, correspondence, documents and records.

 

Section
5.9 Exclusive Remedy. From and after the Closing, the rights and remedies of ZASH, Vinco Ventures, and any Indemnified
Persons under this ARTICLE 5 are exclusive and in lieu of any and all other rights and remedies which ZASH, Vinco Ventures,
or any Indemnified Person, may have for breaches under this Agreement; provided, however, the foregoing shall not affect the rights,
duties or obligations of any Person under any other Transaction Document.

 

ARTICLE
6

 

MISCELLANEOUS

 

Section
6.1 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); or (b) when
received by the addressee if sent by a nationally recognized overnight courier (receipt requested); or (c) on the third (3rd)
day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Notice shall not be
permitted by email under the terms of this Agreement. 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 6.1):

 

To
ZASH:

 

ZASH
Global Media and Entertainment Corporation

 

With
a copy (which shall not constitute notice) to:

 

To Vinco Ventures:

 

Vinco
Ventures, Inc.

 

	 	 	Attention:
    Brian McFadden
	 	 	 
	 	 	1
    West Broad Street
	 	 	 
	 	 	Suite
    1004
	 	 	 
	 	 	Bethlehem,
    PA 18018

 

    	 

     

    

 

Section
6.2 Entire Agreement. This Agreement (including all Schedules and Annexes hereto), the Confidentiality Agreement between
Vinco Ventures and ZASH, and the Transaction Documents contain the entire agreement among the parties with respect to the subject
matter hereof and thereof, and supersede all prior agreements and understandings, oral or written, with respect to such matters.
All representations and warranties set forth in this Agreement are contractual in nature only and subject to the sole and exclusive
remedies set forth herein. No Person is asserting the truth of any factual statements contained in any representation and warranty
set forth in this Agreement; rather, the parties have agreed that should any representations and warranties of any party prove
inaccurate, the other party shall have the specific remedies herein specified as the exclusive remedy therefor.

 

Section
6.3 Amendment; Waiver. Any provision of this Agreement may be amended or waived if, and only if, such amendment or waiver
is in writing and signed, in the case of an amendment, by ZASH and Vinco Ventures, or in the case of a waiver, by the party against
whom such waiver is intended to be effective. No failure or delay by any party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof
or the exercise of any other right, power or privilege.

 

Section
6.4 No Assignment or Benefit to Third Parties. This Agreement shall be binding upon and inure to the benefit of the parties
and their respective successors, legal representatives and permitted assigns. No party may assign any of its rights or delegate
any of its obligations under this Agreement without the prior written consent of the other parties and any purported assignment
in violation of the foregoing shall be null and void ab initio; provided, however, that each of ZASH and Vinco Ventures shall
be entitled to assign or delegate this Agreement or all or any part of its rights or obligations hereunder (a) to any one or more
of its Affiliates or (b) for collateral security purposes to any lender providing financing to ZASH or Vinco Ventures (as applicable).
No assignment or delegation shall relieve the assigning or delegating party of any of its obligations hereunder.

 

Section
6.5 Disclosure Schedules.

 

(a)
The “Vinco Ventures Disclosure Schedule” means that certain document identified as the Vinco Ventures
Disclosure Schedules, dated as of the date hereof (as may be modified from time to time in accordance with the terms hereof),
delivered by Vinco Ventures to ZASH and the Company in connection with this Agreement and which: (i) sets forth the
information specifically described in certain of the representations and warranties contained in ARTICLE 2 and (b) sets forth
exceptions or qualifications to the representations and warranties contained in ARTICLE 2. It is specifically acknowledged
that the Vinco Ventures Disclosure Schedule may expressly provide exceptions to a particular Section of ARTICLE 2
notwithstanding that the Section does not state “except as set forth in Section
‘_’  of the Vinco Ventures Disclosure Schedule” or words of similar effect.

 

    	 

     

    

 

(b)
The “ZASH Disclosure Schedule” means that certain document identified as the ZASH Disclosure Schedules,
dated as of the date hereof (as may be modified from time to time in accordance with the terms hereof), delivered by ZASH to
Vinco Ventures, Vinco Ventures and the Company in connection with this Agreement and which: (i) sets forth the information
specifically described in certain of the representations and warranties contained in ARTICLE 3 and (b) sets forth
exceptions or qualifications to the representations and warranties contained in ARTICLE 3. It is specifically
acknowledged that the ZASH Disclosure Schedule may expressly provide exceptions to a particular Section of ARTICLE 3
notwithstanding that the Section does not state “except as set forth in Section ‘ ’ of the ZASH Disclosure
Schedule” or words of similar effect.

 

(c) For
purpose of this Section 6.5, “Disclosure Schedule” refers to the Vinco Ventures Disclosure Schedule
or the ZASH Disclosure Schedule as the case may be, and “Material Adverse Effect” refers to a “Vinco
Ventures Material Adverse Effect” or “ZASH Material Adverse Effect” as the case may be. Neither the
specification of any dollar amount in any representation or warranty contained in this Agreement nor the inclusion of any specific
item in the Disclosure Schedule is intended to vary the definition of “Material Adverse Effect” or to imply that such
amount, or higher or lower amounts, or the item so included or other items, are or are not material, and no party shall use the
fact of the setting forth of any such amount or the inclusion of any such item in any dispute or controversy between the parties
as to whether any obligation, item or matter not described herein or included in the Disclosure Schedule is or is not material
for purposes of this Agreement. Unless this Agreement specifically provides otherwise, neither the specification of any item or
matter in any representation or warranty contained in this Agreement nor the inclusion of any specific item in the Disclosure
Schedule is intended to imply that such item or matter, or other items or matters, are or are not in the ordinary course of business,
and no party shall use the fact of the setting forth or the inclusion of any such item or matter in any dispute or controversy
between the parties as to whether any obligation, item or matter not described herein or included in the Disclosure Schedule is
or is not in the ordinary course of business for purposes of this Agreement.

 

(d) Each
Section of each Disclosure Schedule is qualified in its entirety by reference to specific provisions of this Agreement and does
not constitute, and shall not be construed as constituting, representations, warranties or covenants of any party, except as and
to the extent provided in this Agreement. Certain matters set forth in each Disclosure Schedule are included for informational
purposes only notwithstanding that, because they do not rise above applicable materiality thresholds or otherwise, they may not
be required by the terms of this to be set forth herein. All attachments to the Disclosure Schedule are incorporated by reference
into the Section of the Disclosure Schedule in which they are referenced.

 

Section
6.6 Governing Law. This Agreement shall be governed by, and construed in accordance with, the internal laws of the State
of Delaware, without regard to the laws of any other jurisdiction that might be applied because of the conflicts of laws principles
of such state.

 

    	 

    	 

    

 

Section
6.7 Arbitration. All actions or proceedings arising in connection with, touching upon or relating to this Agreement, the
breach thereof and/or the scope of the provisions of this Section 6.7 shall be submitted to JAMS Worldwide (“JAMS”)
for binding arbitration under its Comprehensive Arbitration Rules and Procedures if the matter in dispute is over Two Hundred
Fifty Thousand Dollars ($250,000) or under its Streamlined Arbitration Rules and Procedures if the matter in dispute is Two Hundred
Fifty Thousand Dollars ($250,000) or less to be held solely in Dover County, Delaware, in the English language in accordance with
the provisions below.

 

(a) Each
arbitration shall be conducted by a single arbitrator (the “Arbitrator”) who shall be mutually agreed upon
by the parties. If the parties are unable to agree on the Arbitrator, the Arbitrator shall be appointed by JAMS. The Arbitrator
shall be a retired judge with at least ten (10) years of experience in commercial matters.

 

(b) The
Arbitrator’s fees shall be split equally between the parties and each party shall be responsible for the payment of its
own costs, attorneys’ fees, expert fees and all of its other fees, costs and expenses in connection with any arbitration,
unless the Arbitrator finds that a party proceeded in bad faith, in which case the Arbitrator may award fees or costs in the exercise
of discretion.

 

(c) The
parties shall be entitled to conduct discovery as the Arbitrator authorizes as reasonable under all of the circumstances, based
on findings that the material sought is relevant to the issues in dispute and that the nature and scope of such discovery is reasonable
under all the circumstances. Such discovery ordered by the Arbitrator shall be limited to depositions and production of documents.

 

(d) There
shall be a record of the proceedings at the arbitration hearing and the Arbitrator shall issue a Statement of Decision setting
forth its factual and legal basis. The Arbitrator’s decision shall be final and binding as to all matters of substance and
procedure and may be enforced by a petition to the Delaware County Superior Court.

 

(e) The
Arbitrator shall have the power to enter temporary restraining orders and preliminary and permanent injunctions as proper under
Delaware law. Neither party is permitted to commence or maintain any action in a court of law with respect to dispute until such
matter has been submitted to arbitration as provided here, and then only for the purpose of enforcing the Arbitrator’s award;
provided, however, that prior to the appointment of the Arbitrator, either party may seek pre-arbitration relief in a court of
competent jurisdiction in Dover County, Delaware. All arbitration proceedings shall be closed to the public and confidential and
all records relating thereto shall be permanently sealed, except as necessary to obtain court confirmation of the arbitration
award.

 

    	 

    	 

    

 

Section
6.8 Construction. Unless the express context otherwise requires: (a) the words “hereof”, “herein”,
and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole
and not to any particular provision of this Agreement; (b) the terms defined in the singular have a comparable meaning when used
in the plural, and vice versa; (c) the terms “Dollars” and “$” mean United States Dollars; (d) references
herein to a specific Article, Section, clause, Schedule or Exhibit shall refer, respectively, to the Articles, Sections and clauses
of, and Schedules and Exhibits to, this Agreement; (e) wherever the word “include,” “includes,” or “including”
is used in this Agreement, it shall be deemed to be followed by the words “without limitation”; (f) any reference
to the masculine, feminine or neuter gender shall include each other gender; (g) when reference is made herein to “the business
of” a Person, such reference shall be deemed to include the business of all direct and indirect Subsidiaries of such Person,
(h) all accounting and financial terms shall be deemed to have the meanings assigned thereto under GAAP unless expressly stated
otherwise, (i) any reference to any applicable Law in this Agreement refers to such applicable Law as in effect at the date hereof
and the Closing Date, (j) in the computation of periods of time from a specified date to a later specified date, the word “from”
means “from and including” and the words “to” and “until” each mean “to but excluding”
and if the last day of any such period is not a Business Day, such period will end on the next Business Day, (k) when calculating
the period of time “within” which or “following” which any act or event is required or permitted to be
done, notice given or steps taken, the date which is the reference date in calculating such period is to be excluded from the
calculation and if the last day of any such period is not a Business Day, such period will end on the next Business Day, (l) the
provision of a table of contents and the insertion of headings are for convenience of reference only and shall not affect or be
utilized in construing or interpreting this Agreement, (m) references to “day” means calendar days unless Business
Days are expressly specified and (n) references to any Person includes such Person’s predecessors, successors and assigns
to the extent, in the case of successors and assigns, such successors and assigns are permitted by the terms of any applicable
agreement, and reference to a Person in a particular capacity excludes such Person in any other capacity or individually. When
this Agreement states that a party has “made available,” “delivered” or “provided” (or terms
of similar import) a particular document or information to another party, it shall mean such document or information was made
available by the delivering party or its Representatives via (i) the posting of such items or information to the Electronic Data
Room, (ii) the provision of access to hard copies of such items or information, or (iii) the provision of such items or information
in electronic format (including by fax, e-mail or by other electronic means). Any representation and warranty made as to any past
fact, situation, circumstance, status, condition, activity, practice, plan, occurrence, event, incident, action, failure to act,
or transaction shall be made deemed to have been with respect to the three (3)-year period prior to the date hereof, except if
another period is expressly stated. All Schedules and Annexes attached hereto or referred to herein are incorporated in and made
a part of this Agreement as if set forth in full herein. The parties agree that they have been represented by counsel during the
negotiation and execution of this Agreement and, therefore, waive the application of any applicable Law or rule of construction
providing that ambiguities in an agreement or other document will be construed against the party or parties drafting such agreement
or document.

 

Section
6.9 Counterparts; Effectiveness. This Agreement may be executed in several counterparts (any of which counterparts may
be delivered by facsimile, portable document format (pdf) or any electronic signature complying with the U.S. federal ESIGN Act
of 2000 (including DocuSign)), each of which shall be deemed an original and all of which shall together constitute one and the
same instrument. This Agreement shall become effective when each party shall have received a counterpart hereof signed by all
of the other parties. Until and unless each party has received a counterpart hereof signed by the other parties, this Agreement
shall have no effect and no party shall have any right or obligation hereunder (whether by virtue of any other oral or written
agreement or other communication). Minor variations in the form of the signature page, including footers, will be disregarded
in determining a party’s intent or the effectiveness of such signature.

 

    	 

    	 

    

 

Section
6.10 Severability. The provisions of this Agreement shall be deemed severable and the invalidity or unenforceability of
any provision hereof shall not affect the validity or enforceability of the other provisions hereof. If any provision of this
Agreement, or the application thereof to any Person or any circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision shall be substituted therefor in order to carry out, so far as may be valid and enforceable, the intent and purpose
of such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision to other
Persons or circumstances shall not be affected by such invalidity or unenforceability, nor shall such invalidity or unenforceabilityaffect
the validity or enforceability of such provision, or the application thereof, in any other jurisdiction.

 

Section
6.11 Specific Performance. The parties agree that irreparable harm would occur and that the parties would not have an adequate
remedy at law if any of the provisions of this Agreement were not performed in accordance with their specific terms on a timely
basis or were otherwise breached. It is accordingly agreed that, without posting a bond or other undertaking, the parties shall
be entitled to injunctive or other equitable relief to prevent breaches of this Agreement and to enforce specifically the terms
and provisions of this Agreement in any court of competent jurisdiction, this being in addition to any other remedy to which they
are entitled at law or in equity. In the event that any such action is brought in equity to enforce the provisions of this Agreement,
no party hereto will allege, and each party hereto hereby waives the defense or counterclaim, that there is an adequate remedy
at law. The parties further agree that (a) by seeking any remedy provided for in this Section 6.11, a party hereto shall
not in any respect waive its right to seek any other form of relief that may be available to such party hereto under this Agreement
and (b) nothing contained in this Section 6.11 shall require any party hereto to institute any action for (or limit such
party’s right to institute any action for) specific performance under this Section 6.11 before exercising any other
right under this Agreement.

 

[Remainder
of Page Intentionally Left Blank]

 

    	 

    	 

    

 

IN
WITNESS WHEREOF, the parties have executed and delivered or caused this Agreement to be executed and delivered as of the date
first written above.

 

	 	ZASH
    GLOBAL MEDIA AND ENTERTAINMENT CORPORATION
	 	 	 
	 	By:	                                 
	 	Name:	 
	 	Title:	 

 

	 	VINCO
    VENTURES, INC.
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	            
	 	 	 
	 	ZVV
    MEDIA PARTNERS, LLC
	 	 	 
	 	By:	 
	 	Name:	 
	 	Title:	 

 

    	 

    	 

    

 

ANNEX
A

 

DEFINITIONS

 

In
this Annex, and in the Agreement and the other Annexes and Schedules thereto, unless the context otherwise requires, the following
terms shall have the meanings assigned below and the terms listed in the chart below shall have the meanings assigned to them
in the Section set forth opposite to such term (unless otherwise specified, section references in this Annex are to Sections of
this Agreement):

 

“Affiliate”
means, with respect to any subject Person, any other Person directly or indirectly controlling, controlled by, or under common
control with, such subject Person as of the date on which, or at any time during the period for which, the determination of affiliation
is being made. For purposes of this definition, the term “control” (including the correlative meanings of the terms
“controlled by” and “under common control with”), as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the management policies of such Person, whether through
the ownership of voting securities or by contract or otherwise. In no event shall the Company be deemed an “Affiliate”
of Vinco Ventures or ZASH for purposes of the representations and warranties contained in this Agreement.

 

“Business
Day” means a day other than any day on which banks are authorized or obligated by Law or executive order to close in
Los Angeles, California.

 

“Code”
means the Internal Revenue Code of 1986, as amended.

 

“Contracts”
means all agreements, contracts, leases and binding commitments. “Copyrights” means all registered U.S. and
registered foreign works of authorship and all applications to register and renewals of any of the foregoing.

 

“ZASH
Intellectual Property” means all Intellectual Property owned by ZASH or any Affiliate thereof that comprises part of
the ZASH Contributed Assets.

 

“ZASH
Material Adverse Effect” means a material adverse effect on the ZASHE Contributed Assets or the ability of ZASH to consummate
the transactions contemplated by this Agreement; provided, however, that none of the following shall constitute
or be deemed to contribute to a Material Adverse Effect, or shall otherwise be taken into account in determining whether a Material
Adverse Effect has occurred or would reasonably be likely to occur: any adverse effect arising out of, resulting from or attributable
to (a) changes or proposed changes in applicable Laws, GAAP or in the interpretation or enforcement thereof, (b) changes in general
economic, business or regulatory conditions in the United States, (c) changes in the industries in which ZASH participates (including
fluctuating conditions resulting from cyclicality or seasonality affecting ZASH), (d) changes in United States or global financial
or securities markets or conditions, including changes in prevailing interest rates, currency exchange rates or price levels or
trading volumes in the United States or foreign securities markets, (e) changes in global or national political conditions (including
the outbreak or escalation of war, military action, sabotage or acts of terrorism) or changes due to natural disasters, (f) the
effects of the actions or omissions under this Agreement of ZASH under this Agreement that are taken with the consent of Vinco
Ventures, or not taken because Vinco Ventures did not give its consent, in connection with the transactions contemplated hereby,
or (g) the negotiation, announcement, pendency or consummation of this Agreement and the transactions contemplated hereby.

 

    	 

    	 

    

 

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

 

“Vinco
Ventures Intellectual Property” means all Intellectual Property owned by Vinco Ventures or any Affiliate thereof that
comprises part of the Vinco Ventures Contributed Assets.

 

“Vinco
Ventures Material Adverse Effect” means a material adverse effect on the Vinco Ventures Contributed Assets or the ability
of Vinco Ventures to consummate the transactions contemplated by this Agreement; provided, however, that none of
the following shall constitute or be deemed to contribute to a Material Adverse Effect, or shall otherwise be taken into account
in determining whether a Material Adverse Effect has occurred or would reasonably be likely to occur: any adverse effect arising
out of, resulting from or attributable to (a) changes or proposed changes in applicable Laws, GAAP or in the interpretation or
enforcement thereof, (b) changes in general economic, business or regulatory conditions in the United States, (c) changes in the
industries in which Vinco Ventures participates (including fluctuating conditions resulting from cyclicality or seasonality affecting
Vinco Ventures), (d) changes in United States or global financial or securities markets or conditions, including changes in prevailing
interest rates, currency exchange rates or price levels or trading volumes in the United States or foreign securities markets,
(e) changes in global or national political conditions (including the outbreak or escalation of war, military action, sabotage
or acts of terrorism) or changes due to natural disasters, (f) the effects of the actions or omissions under this Agreement of
Edison under this Agreement that are taken with the consent of ZASH, or not taken because ZASH did not give its consent, in connection
with the transactions contemplated hereby, or (g) the negotiation, announcement, pendency or consummation of this Agreement and
the transactions contemplated hereby.

 

“Fraud”
means, with respect to any party, such party’s actual and intentional fraud with respect to the making of representations
and warranties herein; provided, however, such actual and intentional fraud of such party shall only be deemed to exist
if such party makes a knowing and intentional misrepresentation of a material fact with the intent that the other party rely on
such fact, coupled with such other party’s detrimental reliance on such fact under circumstances that constitute common
law fraud under applicable Law.

 

“GAAP”
means United States generally accepted accounting principles, consistently applied during the periods involved.

 

“Governmental
Authority” means any United States or foreign federal, state, provincialor local government or other political subdivision
thereof, any entity, authority or body exercising executive, legislative, judicial, regulatory or administrative functions of
any such government or political subdivision, and any supranational organization of sovereign states exercising such functions
for such sovereign states.

 

“Governmental
Authorizations” means all licenses, permits, certificates, grants, franchises, waivers, consents and other similar authorizations
or approvals issued by or obtained from a Governmental Authority.

 

    	 

    	 

    

 

“Intellectual
Property” means any and all of the following: Patents, copyrightable works, Copyrights, film and television rights,
exhibition rights, technology, know-how, processes, Trade Secrets, proprietary software, source code, inventions and designs (including
inventions and/or designs conceived prior to the Closing Date but not documented as of the Closing Date), and all improvements
to any of the foregoing, proprietary data, formulae, research and development data, Marks, Internet domain names, Internet addresses
and other computer identifiers, websites or web pages, brand names or corporate names, logos and symbols (including, in each case,
the goodwill associated therewith).

 

“IRS”
means the U.S. Internal Revenue Service.

 

“Knowledge
of ZASH” or any variant thereof means the actual knowledge as of the date hereof of any of the following individuals:
William J. Rouhana, Jr. or the knowledge that such individual would be expected to become aware of in the course of conducting
a reasonable internal investigation regarding the accuracy of any representation or warranty of ZASH contained in this Agreement.

 

“Knowledge
of Vinco Ventures” or any variant thereof means the actual knowledge as of the date hereof of any of the following individuals:
Chris Ferguson and ______________, or the knowledge that such individuals would be expected to become aware of in the course of
conducting a reasonable internal investigation within Vinco Ventures regarding the accuracy of any representation or warranty
of Vinco Ventures contained in this Agreement.

 

“Law”
means any statute, law, ordinance, rule or regulation of any Governmental Authority.

 

“Legal
Proceeding” means any civil, criminal or administrative actions, proceedings, suits, demands or claims filed by or before
any Governmental Authority or arbitrator.

 

“Lien”
means any charge, mortgage, pledge, security interest, lien, or encumbrance, other than those that customarily arise under securities
Laws in private transactions.

 

“Losses”
means any damages, losses, charges, liabilities, judgments, settlements, awards, interest, penalties, fees, costs and expenses
actually incurred or paid, but shall not include any consequential, indirect, incidental, special, unforeseen, exemplary or punitive
damages, including diminution of value, lost profits, lost revenues, business interruption, loss of business reputation or opportunity
or any damages based on any type of multiple.

 

“Marks”
means all registered U.S. and foreign trade names, trademarks, trade dress and service marks, together with any applications related
thereto.

 

“Order”
means any judgment, order, writ, decision, injunction, award or decree of any foreign, federal, state, local or other court or
tribunal and any ruling or award in any binding arbitration proceeding.

 

“Patent
Claim” means any claim, right, or action arising from or related to any class or type of patents, including utility
models and design patents and applications for these classes or types of patent rights and any equivalent claim, right or action
in any country of the world.

 

    	 

    	 

    

 

“Patents”
means all issued U.S. and foreign patents and pending patent applications, including design patents and industrial designs.

 

“Permits”
means all licenses, permits, franchises, approvals, authorizations, consents or orders of, or filings with, any Governmental Authority
that are necessary for the operation of Vinco Ventures.

 

“Permitted
Liens” means (a) landlords’, lessors’, mechanics’, materialmen’s, warehousemen’s,
carriers’, workers’, manufacturer’s or repairmen’s Liens or other similar Liens arising or incurred
in the ordinary course of business, (b) Liens for Taxes, assessments and other governmental charges not yet due and payable
or being contested in good faith by appropriate Legal Proceedings for which adequate reserves have been established in
accordance with GAAP, (c) Liens incurred in the ordinary course of business that would not materially impair the value of the
assets of a party, (d) Liens to lenders incurred in deposits made in the ordinary course in connection with maintaining bank
accounts, (e) Liens arising in the ordinary course of business of production of a program, film or show or other video
content (including obligations to pay participations, residuals and other contractual obligations under entertainment
industry guild collective bargaining agreements, security interests related to guild collective bargaining agreements, or
security interests granted to secure the payment of participations in favor of guilds, production lenders or completion
guarantors), (f) Liens created under or in connection with any distribution agreement entered into with a distributor in the
ordinary course of business in connection with the distribution, subdistribution or other exploitation of a program, film or
show or other video content, (g) deposits or pledges to secure the payment of workers’ compensation, unemployment
insurance, social security benefits or obligations arising under similar Laws, or to secure the performance of public or
statutory obligations, surety or appeal bonds, and other obligations of a like nature, (h) Liens created by this Agreement or
any of the Transaction Documents, or in connection with the transactions contemplated hereby, and (i) except in the case of
real property, liens arising under original purchase price conditional sales contracts and equipment leases with third
parties.

 

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

 

“Pre-Closing
Tax Period” means any tax period that ends on or prior to the Closing Date, and with respect to any Straddle Period,
the portion of such Straddle Period ending on the Closing Date.

 

“Premises”
means the premises that are leased by a party pursuant to a Lease.

 

“Publicly
Available Software” means any software that is or is derived in any manner in whole or in part from, software that is
distributed as free software, open source or under similar licensing or distribution models.

 

“Registered
Vinco Ventures Intellectual Property” means all Patents, Copyrights, Marks and Internet domain names that are Vinco
Ventures Intellectual Property.

 

“Registered
ZASH Intellectual Property” means all Patents, Copyrights, Marks and Internet domain names that are ZASH Intellectual
Property.

 

    	 

    	 

    

 

“Representative”
or “Representatives” means, with respect to a particular Person, any director, member, limited or general partner,
equity holder, officer, employee, agent, consultant, advisor or other representative of such Person, including outside legal counsel,
accountants and financial advisors.

 

“Straddle
Period” means any tax period that begins on or before the Closing date and ends after the Closing Date.

 

“Taxes”
means all federal, state or local and all foreign taxes, including income, gross receipts, windfall profits, value added, severance,
property, escheat, abandoned or unclaimed property, production, sales, use, duty, license, excise, franchise, employment, withholding
or similar taxes, together with any interest, additions or penalties with respect thereto and any interest with respect to such
additions or penalties or penalties for failure to file any Tax Return.

 

“Trade
Secrets” mean trade secrets, confidential business information and other proprietary information including, without
limitation, designs, research and development information, technical information, specifications, operating and maintenance manuals,
methods, engineering drawings, know-how, data, discoveries, inventions, industrial designs and other proprietary rights (whether
or not patentable or subject to copyright, mask work, or trade secret protection); in each of the foregoing cases which (i) has
economic value to party by virtue of its secrecy; and (ii) that party elects to maintain as a trade secret under applicable Law.

 

“Transaction
Documents” means, with respect to a party, all agreements, certificates and other instruments to be delivered by such
party at Closing pursuant to this Agreement.

 

“Units”
has the meaning set forth in the Operating Agreement.

 

    	 

    	 

    

 

ANNEX
B

 

VINCO
VENTURES, INC. CONTRIBUTED ASSETS

 

Everyday
Edisons (Sixty Episodes)

 

Everyday
Edison Academy

 

Social
show concepts Clip show concepts

 

Influencer
Academy

 

Direct
Response Agreement

 

General
Social Monetization Knowledge and Model

 

    	 

    	 

    

 

ANNEX
C

 

ZASH
CONTRIBUTED ASSETS

 

Assets
Contributed by ZASH

 

ZASH
Content Production Studio

 

Access
ZASH Content Editing

 

Capabilities
American Syndication

 

Media
Capabilities

 

ZASH
and its affiliate’s content libraries.

 

To
include but not limited to:

 

	 	-	Just
    Jared
	 	-	Animal
    / Nature Contentfv
	 	-	Historical
    Reality Show Content
	 	-	Clip
    Show libraries
	 	-	Behind
    the scenes movie and interview

 

access
General Content Production Knowledge

 

    	 

    	 

    

 

ANNEX
D

 

OPERATING
AGREEMENT

 

[Attached.]

 

    	 

    	 

    

 

ANNEX
E

 

VINCO
VENTURES ASSUMED LIABILITIES

 

Vinco
Ventures will assume no outstanding liabilities.

 

    	 

    	 

    

 

ANNEX
F

 

ZASH
ASSUMED LIABILITIES

 

Zash
will assume no outstanding liabilities.

 

    	 

    	 

    

 

ANNEX
G

 

ASMC
DISTRIBUTION AGREEMENT

 

For
good and valuable consideration, receipt of which is hereby acknowledged, American Syndication Media Corporation (“ASMC”)
has agreed to provide ZVV (“ZVV”), with a “Revolving Minimum Guarantee Facility” and ZVV has agreed to
appoint ASMC its exclusive distributor for all of ZVV’s intellectual property (“Programs”) as provided herein.

 

Programs

 

Individually
“Program” and collectively, “Programs” shall mean any and all audiovisual works ZVV owns, controls rights
to, acquires, produces, creates and/or develops, including but not be limited to individual unscripted programs or unscripted
series During the term, ASMC will distribute each Program pursuant to the terms and conditions contained in a Program-specific
distribution agreement (“Distribution Agreement”).

 

Current
Programs owned and controlled by ZVV shall be set forth on Schedule B. The parties acknowledge and agree that Schedule
B shall be modified from time-to-time.

 

	1.	Capital
    Investment
	 	 
	 	ZVV
    shall seek up to raise up to Twenty Million Dollars ($20,000,000) pursuant to terms and conditions mutually agreeable to Zash
    and the Company and ASMC. A portion of the proceeds from the investment shall be used for the Minimum Guarantee Obligation
    (“MG Obligation”). The MG Obligation shall be set forth in a mutually agreed recoupable solely against “Gross
    Receipts” (defined in Section 10 herein) and shall be paid as follows:

 

	 	a.	Ten
    percent (10%) upon delivery to and acceptance by ASMC of the “Delivery Materials “(as defined herein Exhibit
    A);
	 	 	 
	 	b.	Twenty
    Percent (20%) six (6) months thereafter
	 	 	 
	 	c.	Twenty-Five
    Percent (25%) six (6) months thereafter

 

	2.	Distribution
    Fee.
	 	 
	 	For
    the distribution of each Program, ASMC shall be paid the following distribution fees (“Distribution Fees”):

 

	 	a.	If
    ASMC provides the MG Obligation to ZVV for any rights or territories, ASMC shall receive Thirty Percent (15%) of Gross Receipts
    for the territory and rights that the MG Obligation applies to:
	 	 	 
	 	b.	For
    any rights or territories that ASMC does not provide an MG Obligation, ASMC shall receive the following Distribution Fees
    for those territories and/or rights:

 

	 	(i)	If
    the ZVV or its representatives brings to ASMC multiple licensees to exploit the Program on a multi-territory basis and ASMC
    enters into a valid license agreement with those licensee, ASMC shall receive Five Percent (5%) of all Gross Receipts attributed
    to each license;

 

    	 

     

    

 

	 	(ii)	If
    ASMC finds a licensee to exploit the Program and enters into a valid license agreement with such licensees, ASMC shall receive
    Ten Percent (10%) of Gross Receipts from those licensees.

 

	 	c.	Notwithstanding
    7(b)(i) and (ii) above, if ZVV or its representatives brings to ASMC a single licensee who acquires worldwide distribution
    rights to a Program and ASMC enters into a valid license agreement with such licensee, then ASMC shall receive One Percent
    (1%) of all Gross Receipts attributed to that licensee.
	 	 	 
	 	d.	For
    any completed Programs currently owned by or acquired by ZVV, ASMC shall receive Five (5%) of all Gross Receipts attributed
    to that licensee.
	 	 	 
	 	e.	For
    all sales after the initial license in a particular territory (“Second Sale”), ASMC shall receive a Ten Percent
    (10%) Distribution Fee for all Second Sales.

 

	3.	Distribution
    Costs.
	 	 
	 	All
    reasonable direct, actual, verifiable third party out of pocket distribution costs (collectively “Distribution Costs”)
    incurred by ASMC with respect to the Program shall be advanced by ASMC and shall be recouped from Gross Receipts. Distribution
    Costs shall include but not be limited to any Delivery Material costs incurred by ASMC, Theatrical Release costs, all home
    video costs (including but not limited to replication, manufacturing, shipping, returns, reserves for returns, marketing incentive
    programs (i.e., SPIFF and MDFs), and internal rebate programs), guild obligations (of which ASMC has prior awareness of),
    advertising, marketing, MPAA rating fees guild residuals, digital encoding costs, streaming, broadband, shipping, satellite
    feeds, reserves, bad debts not recovered, reasonable and customary discounts, rebates, allowances, adjustments, tape duplication,
    tape shipping, satellite feeds, advertising agency closed captioning, subtitling, taxes actually paid, Nielsen ratings pro-rated
    on a reasonable basis to the Program., editing, re-mastering, , contract enforcement (provided any revenue recovered shall
    be included in Gross Receipts), , collection costs and other expenditures.
	 	 
	4.	Allocation
    of Gross Receipts.
	 	 
	 	“Gross
    Receipts” shall be defined and comprised of all monies received by or credited to ASMC from its licensing, broadcast,
    exhibition, distribution and/or exploitation of the Program, or any element thereof, in any manner or media. ZVV acknowledges
    that ASMC makes no representation or warranty as to the amount of Gross Receipts that may be achieved. Gross Receipts shall
    be allocated as follows and in the following order:

 

	 	a.	Payment
    of the Distribution Fee;

 

    	 

     

    

 

	 	b.	Recoupment
    of Distribution Costs;
	 	c.	ASMC
    shall recoup the MG Obligation (if paid by SMV) and interest (calculated at 8%) per Annum until recoupment; and
	 	d.	100%
    of remaining Gross Receipts to ZVV.

 

	5.	Cross
    Collateralization:
	 	 
	 	For
    the avoidance of doubt, ASMC and ZVV each acknowledge and agree that:

 

	 	a.	ZVV
    and ASMC shall treat the Program licensed by ZVV to ASMC hereunder as separate and distinct from any other rights to any other
    motion pictures, television programs or other content that has been or hereafter may be licensed by ZVV to ASMC under any
    other agreement now existing or hereafter arising (collectively, the “Outside Content”); and
	 	 	 
	 	b.	there
    shall be no crossing or cross-collateralization between the rights in and to the Program licensed hereunder and any rights
    that have been or hereafter may be licensed by ZVV to ASMC with respect to Outside Content. Without limiting the generality
    of the foregoing, ASMC agrees that it shall account for and make payments with respect to Gross Receipts, Distribution Costs
    and any other amounts with respect to the Program without consideration for any Gross Receipts, Distribution Costs or other
    amounts that may be owing or payable with respect to any Outside Content, and in no event shall ASMC offset, cross- collateralize
    or apply any Gross Receipts, Distribution Costs and/or other amounts with respect to any Outside Content against any amounts
    payable to ZVV with respect to the Program under the terms of this Agreement.

 

	6.	Delivery
    Date.
	 	Essential
    Delivery Materials shall be delivered to and approved by ASMC on or before _______ (“Delivery Date”). ZVV acknowledges
    that the Delivery Date is of the essence of this Agreement.
	 	 
	7.	Third
    Party Obligations.
	 	 
	 	Excluding
    supplying the MG Obligation and ZVV’s share of Gross Receipts (including directing such Gross Receipts to the applicable
    Financers) and any guild residuals, ASMC shall not have any obligation or responsibility for payments that are or may become
    due to ZVV or third parties by way of profit on revenue participations, royalties, talent or license fees, production related
    costs, and any such like items whether by way of ASMC’s authorized exploitation of its rights hereunder, the revenues
    generated there from or otherwise.

 

    	 

     

    

 

	8.	Sub-distribution.
	 	 
	 	With
    respect to any Program for which (i) ZVV does not request ASMC to provide an MG to facilitate production financing for such
    Program and (ii) ZVV identifies a proposed licensee who will acquire all rights to exploit such Program as contemplated by
    Section 8(c) in Schedule A (attached hereto) and provide a minimum guarantee in excess of the production budget for
    such Program, ASMC shall negotiate in good faith and enter into sub-licenses or sub-distribution agreements with such licensee
    covering such rights or territories on terms reasonably comparable to the then prevailing market terms.

 

	9.	Remedies.
	 	 
	 	In
    the event of a breach by either party hereunder the other party’s sole remedy shall be an action at law for money damages
    and in no event shall either party be entitled to an injunction, rescission, termination, or any equitable relief.
	 	 
	10.	Assignment.
	 	 
	 	ASMCshall
    have the right to assign this Agreement as part of a sale, merger, transfer or other disposition of all or substantially all
    of ASMC’s assets, or to a lender of ASMC. ZVV shall not have the right to assign this Agreement without ASMC’s
    written consent.
	 	 
	11.	Notice
    and Cure.
	 	 
	 	No
    failure by either Party to perform any of its obligations under this Agreement shall be deemed a material breach, until the
    Party claiming breach has given the Party alleged to be in breach written notice of its failure to perform and such failure
    has not been corrected within thirty (30) days from and after the giving of such notice, provided that such notice has specifically
    delineated the alleged breach in sufficient detail to enable a cure. In the event the alleged breach is incapable of cure
    within thirty (30) days, the cure period shall be extended for a reasonable time to enable the cure to be affected.
	 	 
	12.	Representations
    and Warranties.
	 	 
	 	Both
    parties hereto warrant and represent that they each have the right and power to enter into this Agreement, to grant all rights
    granted herein, and to perform all their respective obligations.
	 	 
	13.	Governing
    Law.
	 	 
	 	This
    Agreement shall be governed and construed exclusively in accordance with the laws of the State of New York applicable to contracts
    entered and fully to be performed therein. Each of the parties hereto agree that any proceeding arising out of or relating
    to this Agreement or the breach or threatened breach of this Agreement shall be commenced and prosecuted exclusively in Federal
    Court in the State of New York, Southern District.

 

If
the terms set forth above meet with your approval, please so indicate by signing in the space provided below.

 

    	 

    	 

    

 

Yours
truly,

 

	AMERICAN SYNDICATION MEDIA CORPORATION	 
	 	 
	By:	  	 
		Chief Executive Officer	 

 

	 	AGREED
    TO AND ACCEPTED
	 	 
	 	ZVV
    MEDIA PARTNERS, LLC
	 	 	 
	 	By:ex_221717.htm

Exhibit 10.1

 

SECURITIES PURCHASE AGREEMENT

 

This Securities Purchase Agreement (this “Agreement”) is dated as of January 19, 2021, between Gevo, Inc. a Delaware corporation (the “Company”), and each purchaser identified on the signature pages hereto (each, including its successors and assigns, a “Purchaser” and collectively the “Purchasers”).

 

WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”), the Company desires to issue and sell to each Purchaser, and each Purchaser, severally and not jointly, desires to purchase from the Company, securities of the Company as more fully described in this Agreement.

 

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

 

ARTICLE I.

DEFINITIONS

 

1.1      Definitions. In addition to the terms defined elsewhere in this Agreement, for all purposes of this Agreement, the following terms have the meanings set forth in this Section 1.1:

 

“Acquiring Person” shall have the meaning ascribed to such term in Section 4.5.

 

“Action” shall have the meaning ascribed to such term in Section 3.1(j).

 

“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person as such terms are used in and construed under Rule 405 under the Securities Act.

 

“Board of Directors” means the board of directors of the Company.

 

“Business Day” means any day other than Saturday, Sunday or other day on which commercial banks in The City of New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee”  or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in The City of New York generally are open for use by customers on such day.

 

“Closing” means the closing of the purchase and sale of the Shares pursuant to Section 2.1.

 

 

1

 

 

“Closing Date” means the Trading Day on which all of the Transaction Documents have been executed and delivered by the applicable parties thereto, and all conditions precedent to (i) the Purchasers’ obligations to pay the Subscription Amount and (ii) the Company’s obligations to deliver the Shares, in each case, have been satisfied or waived, but in no event later than the second (2nd) Trading Day following the date hereof.

 

“Commission” means the United States Securities and Exchange Commission.

 

“Common Stock” means the common stock of the Company, par value $0.01 per share, and any other class of securities into which such securities may hereafter be reclassified or changed.

 

“Common Stock Equivalents” means any securities of the Company or the Subsidiaries which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.

 

“Company Counsel” means Perkins Coie LLP with offices located at 1900 Sixteenth Street, Suite 1400, Denver, Colorado 80202-5255.

 

“Disclosure Schedules” means the Disclosure Schedules of the Company delivered concurrently herewith.

 

“Disclosure Time” means, (i) if this Agreement is signed on a day that is not a Trading Day or after 9:00 a.m. (New York City time) and before midnight (New York City time) on any Trading Day, 9:01 a.m. (New York City time) on the Trading Day immediately following the date hereof, unless otherwise instructed as to an earlier time by the Placement Agent, and (ii) if this Agreement is signed between midnight (New York City time) and 9:00 a.m. (New York City time) on any Trading Day, no later than 9:01 a.m. (New York City time) on the date hereof, unless otherwise instructed as to an earlier time by the Placement Agent.

 

“EGS” means Ellenoff Grossman & Schole LLP, with offices located at 1345 Avenue of the Americas, New York, New York 10105-0302.

 

“Evaluation Date” shall have the meaning ascribed to such term in Section 3.1(s).

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

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“Exempt Issuance” means the issuance of (a) shares of Common Stock, options, restricted stock or restricted stock units to employees, officers or directors of the Company pursuant to any stock or option plan duly adopted for such purpose, by a majority of the non-employee members of the Board of Directors or a majority of the members of a committee of non-employee directors established for such purpose for services rendered to the Company, (b) securities upon the exercise or exchange of or conversion of any securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the date of this Agreement or upon the exercise or vesting of options, restricted stock, restricted stock units or other securities pursuant to any stock or option plan of the Company, provided that such securities have not been amended since the date of this Agreement to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities, and (c) securities issued pursuant to acquisitions or strategic transactions approved by a majority of the disinterested directors of the Company, provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith from the date hereof until thirty (30) days following the Closing Date, and provided that any such issuance shall only be to a Person (or to the equityholders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities.

 

“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.

 

“FDA” shall have the meaning ascribed to such term in Section 3.1(hh).

 

“FDCA” shall have the meaning ascribed to such term in Section 3.1(hh).

 

“GAAP” shall have the meaning ascribed to such term in Section 3.1(h).

 

“Indebtedness” shall have the meaning ascribed to such term in Section 3.1(aa).

 

“Intellectual Property Rights” shall have the meaning ascribed to such term in Section 3.1(p).

 

“Liens” means a lien, charge, pledge, security interest, encumbrance, right of first refusal, preemptive right or other restriction (other than restrictions on transfer under applicable securities laws).

 

“Lock-Up Agreement” means the Lock-Up Agreement, dated as of the date hereof, by and among the Company and the directors and officers, in the form reasonably acceptable to the Placement Agent.

 

“Material Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).

 

“Material Permits” shall have the meaning ascribed to such term in Section 3.1(n).

 

“Per Share Purchase Price” equals $8.00, subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.

 

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“Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

 

“Pharmaceutical Product” shall have the meaning ascribed to such term in Section 3.1(hh).

 

“Placement Agent” means H.C. Wainwright & Co., LLC.

 

“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or threatened.

 

“Prospectus” means the final prospectus filed for the Registration Statement.

 

“Prospectus Supplement” means the supplement to the Prospectus complying with Rule 424(b) of the Securities Act that is filed with the Commission and delivered by the Company to each Purchaser at the Closing.

 

“Purchaser Party” shall have the meaning ascribed to such term in Section 4.8.

 

“Registration Statement” means the effective registration statement with Commission (File No. 333-252229), which registers the sale of the Shares to the Purchasers.

 

“Required Approvals” shall have the meaning ascribed to such term in Section 3.1(e).

 

“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

 

“Rule 424” means Rule 424 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.

 

“SEC Reports” shall have the meaning ascribed to such term in Section 3.1(h).

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“Shares” means the shares of Common Stock issued or issuable to the Purchasers pursuant to this Agreement.

 

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“Short Sales” means all “short sales” as defined in Rule 200 of Regulation SHO under the Exchange Act (but shall not be deemed to include locating and/or borrowing shares of Common Stock). 

 

“Subscription Amount” means, as to each Purchaser, the aggregate amount to be paid for Shares purchased hereunder as specified below such Purchaser’s name on the signature page of this Agreement and next to the heading “Subscription Amount,” in United States dollars and in immediately available funds.

 

“Subsidiary” means any subsidiary of the Company as set forth on Schedule 3.1(a), and shall, where applicable, also include any direct or indirect subsidiary of the Company formed or acquired after the date hereof.

 

“Trading Day” means a day on which the principal Trading Market is open for trading.

 

“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, or the New York Stock Exchange (or any successors to any of the foregoing).

 

“Transaction Documents” means this Agreement, the Lock-Up Agreement, all exhibits and schedules thereto and hereto and any other documents or agreements executed in connection with the transactions contemplated hereunder.

 

“Transfer Agent” means American Stock Transfer & Trust Company, LLC, the current transfer agent of the Company, with a mailing address of 6201 15th Avenue, Brooklyn, New York 11219 and a telephone number of (718) 921-8300, and any successor transfer agent of the Company.

 

ARTICLE II.

PURCHASE AND SALE

 

2.1     Closing. On the Closing Date, upon the terms and subject to the conditions set forth herein, substantially concurrent with the execution and delivery of this Agreement by the parties hereto, the Company agrees to sell, and the Purchasers, severally and not jointly, agree to purchase, up to an aggregate of $350,000,000 of Shares. Each Purchaser’s Subscription Amount as set forth on the signature page hereto executed by such Purchaser shall be made available for “Delivery Versus Payment” settlement with the Company or its designee. The Company shall deliver to each Purchaser its respective Shares, and the Company and each Purchaser shall deliver the other items set forth in Section 2.2 deliverable at the Closing. Upon satisfaction of the covenants and conditions set forth in Sections 2.2 and 2.3, the Closing shall occur at the offices of EGS or such other location as the parties shall mutually agree. Unless otherwise directed by the Placement Agent, settlement of the Shares shall occur via “Delivery Versus Payment” (“DVP”) (i.e., on the Closing Date, the Company shall issue the Shares registered in the Purchasers’ names and addresses and released by the Transfer Agent directly to the account(s) at the Placement Agent identified by each Purchaser; upon receipt of such Shares, the Placement Agent shall promptly electronically deliver such Shares to the applicable Purchaser, and payment therefor shall be made by the Placement Agent (or its clearing firm) by wire transfer to the Company). Notwithstanding anything herein to the contrary, if at any time on or after the time of execution of this Agreement by the Company and an applicable Purchaser, through, and including the time immediately prior to the Closing (the “Pre-Settlement Period”), if such Purchaser sells to any Person all, or any portion, of any Common Stock to be issued hereunder to such Purchaser at the Closing (collectively, the “Pre-Settlement Shares”), such Purchaser shall, automatically hereunder (without any additional required actions by such Purchaser or the Company), be deemed to be unconditionally bound to purchase such Pre-Settlement Shares at the Closing; provided, that the Company hereby acknowledges and agrees that the forgoing shall not constitute a representation or covenant by such Purchaser as to whether or not such Purchaser will elect to sell any Pre-Settlement Shares during the Pre-Settlement Period.  The decision to sell any shares of Common Stock will be made in the sole discretion of such Purchaser from time to time, including during the Pre-Settlement Period.

 

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2.2      Deliveries.

 

(a)     On or prior to the Closing Date, the Company shall deliver or cause to be delivered to each Purchaser the following:

 

(i)     this Agreement duly executed by the Company;

 

(ii)     a legal opinion of Company Counsel, in form and substance reasonably acceptable to the Placement Agent, addressed to the Purchasers and the Placement Agent;

 

(iii)     subject to the penultimate sentence of Section 2.1, the Company shall have provided each Purchaser with the Company’s wire instructions, on Company letterhead and executed by the Chief Executive Officer or Chief Financial Officer;

 

(iv)     subject to the penultimate sentence of Section 2.1, a copy of the irrevocable instructions to the Transfer Agent instructing the Transfer Agent to deliver on an expedited basis via The Depository Trust Company Deposit or Withdrawal at Custodian system (“DWAC”) Shares equal to such Purchaser’s Subscription Amount divided by the Per Share Purchase Price, registered in the name of such Purchaser;

 

(v)     the duly executed Lock-Up Agreements; and

 

(vi)     the Prospectus and the Prospectus Supplement (which may be delivered in accordance with Rule 172 under the Securities Act).

 

(b)     On or prior to the Closing Date, each Purchaser shall deliver or cause to be delivered to the Company the following:

 

(i)     this Agreement duly executed by such Purchaser; and

 

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(ii)     such Purchaser’s Subscription Amount, which shall be made available for “Delivery Versus Payment” settlement with the Company or its designee.

 

2.3     Closing Conditions. 

 

(a)     The obligations of the Company hereunder in connection with the Closing are subject to the following conditions being met:

 

(i)     the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Purchasers contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);

 

(ii)     all obligations, covenants and agreements of each Purchaser required to be performed at or prior to the Closing Date shall have been performed; and

 

(iii)     the delivery by each Purchaser of the items set forth in Section 2.2(b) of this Agreement.

 

(b)     The respective obligations of the Purchasers hereunder in connection with the Closing are subject to the following conditions being met:

 

(i)     the accuracy in all material respects (or, to the extent representations or warranties are qualified by materiality or Material Adverse Effect, in all respects) when made and on the Closing Date of the representations and warranties of the Company contained herein (unless as of a specific date therein in which case they shall be accurate as of such date);

 

(ii)     all obligations, covenants and agreements of the Company required to be performed at or prior to the Closing Date shall have been performed;

 

(iii)     the delivery by the Company of the items set forth in Section 2.2(a) of this Agreement;

 

(iv)     there shall have been no Material Adverse Effect with respect to the Company since the date hereof; and

 

(v)     from the date hereof to the Closing Date, trading in the Common Stock shall not have been suspended by the Commission or the Company’s principal Trading Market, and, at any time prior to the Closing Date, trading in securities generally as reported by Bloomberg L.P. shall not have been suspended or limited, or minimum prices shall not have been established on securities whose trades are reported by such service, or on any Trading Market, nor shall a banking moratorium have been declared either by the United States or New York State authorities nor shall there have occurred any material outbreak or escalation of hostilities or other national or international calamity of such magnitude in its effect on, or any material adverse change in, any financial market which, in each case, in the reasonable judgment of such Purchaser, makes it impracticable or inadvisable to purchase the Shares at the Closing.

 

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ARTICLE III.

REPRESENTATIONS AND WARRANTIES

 

3.1     Representations and Warranties of the Company. Except as set forth in the Disclosure Schedules, which Disclosure Schedules shall be deemed a part hereof and shall qualify any representation or otherwise made herein to the extent of the disclosure contained in the corresponding section of the Disclosure Schedules, the Company hereby makes the following representations and warranties to each Purchaser:

 

(a)     Subsidiaries. All of the direct and indirect subsidiaries of the Company are set forth on Schedule 3.1(a). Except as set forth on Schedule 3.1(a), the Company owns, directly or indirectly, all of the capital stock or other equity interests of each Subsidiary free and clear of any Liens, and all of the issued and outstanding shares of capital stock of each Subsidiary are validly issued and are fully paid, non-assessable and free of preemptive and similar rights to subscribe for or purchase securities. If the Company has no subsidiaries, all other references to the Subsidiaries or any of them in the Transaction Documents shall be disregarded.

 

(b)     Organization and Qualification. The Company and each of the Subsidiaries is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization, with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. Neither the Company nor any Subsidiary is in violation nor default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents. Each of the Company and the Subsidiaries is duly qualified to conduct business and is in good standing as a foreign corporation or other entity in each jurisdiction in which the nature of the business conducted or property owned by it makes such qualification necessary, except where the failure to be so qualified or in good standing, as the case may be, could not have or reasonably be expected to result in: (i) a material adverse effect on the legality, validity or enforceability of any Transaction Document, (ii) a material adverse effect on the results of operations, assets, business, prospects or condition (financial or otherwise) of the Company and the Subsidiaries, taken as a whole, or (iii) a material adverse effect on the Company’s ability to perform in any material respect on a timely basis its obligations under any Transaction Document (any of (i), (ii) or (iii), a “Material Adverse Effect”) and no Proceeding has been instituted in any such jurisdiction revoking, limiting or curtailing or seeking to revoke, limit or curtail such power and authority or qualification.

 

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(c)     Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and each of the other Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of this Agreement and each of the other Transaction Documents by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, the Board of Directors or the Company’s stockholders in connection herewith or therewith other than in connection with the Required Approvals. This Agreement and each other Transaction Document to which it is a party has been (or upon delivery will have been) duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

 

(d)     No Conflicts. The execution, delivery and performance by the Company of this Agreement and the other Transaction Documents to which it is a party, the issuance and sale of the Shares and the consummation by it of the transactions contemplated hereby and thereby do not and will not (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, anti-dilution or similar adjustments, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) subject to the Required Approvals, conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected; except in the case of each of clauses (ii) and (iii), such as could not have or reasonably be expected to result in a Material Adverse Effect.

 

(e)     Filings, Consents and Approvals. The Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other Person in connection with the execution, delivery and performance by the Company of the Transaction Documents, other than: (i) the filings required pursuant to Section 4.4 of this Agreement, (ii) the filing with the Commission of the Prospectus Supplement, (iii) application(s) to each applicable Trading Market for the listing of the Shares for trading thereon in the time and manner required thereby, (iv) such filings as may be required by the rules and regulations of the Financial Industry Regulatory Authority, if any, and (v) such filings as are required to be made under applicable state securities laws (collectively, the “Required Approvals”).

 

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(f)     Issuance of the Shares; Registration. The Shares are duly authorized and the Shares, when issued and paid for in accordance with the applicable Transaction Documents, will be duly and validly issued, fully paid and nonassessable, free and clear of all Liens imposed by the Company. The Company has reserved from its duly authorized capital stock the maximum number of shares of Common Stock issuable pursuant to this Agreement. The Company has prepared and filed the Registration Statement in conformity with the requirements of the Securities Act, which became effective on January 19, 2021 (the “Effective Date”), including the Prospectus, and such amendments and supplements thereto as may have been required to the date of this Agreement. The Registration Statement is effective under the Securities Act and no stop order preventing or suspending the effectiveness of the Registration Statement or suspending or preventing the use of the Prospectus has been issued by the Commission and no Proceedings for that purpose have been instituted or, to the knowledge of the Company, are threatened by the Commission. The Company, if required by the rules and regulations of the Commission, shall file the Prospectus with the Commission pursuant to Rule 424(b). At the time the Registration Statement and any amendments thereto became effective, at the date of this Agreement and at the Closing Date, the Registration Statement and any amendments thereto conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading; and the Prospectus and any amendments or supplements thereto, at the time the Prospectus or any amendment or supplement thereto was issued and at the Closing Date, conformed and will conform in all material respects to the requirements of the Securities Act and did not and will not contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Company was at the time of the filing of the Registration Statement eligible to use Form S-3. As of the filing date of the Registration Statement, the Company is a “well-known seasoned issuer” as defined in Rule 405 of the Securities Act.

 

(g)     Capitalization. The capitalization of the Company as of the date hereof is as set forth on Schedule 3.1(g). The Company has not issued any capital stock since its most recently filed periodic report under the Exchange Act, other than pursuant to the Company’s existing at-the-market facility and other than pursuant to the grant, exercise, vesting or settlement of equity awards under the Company’s stock or option plans, the issuance of shares of Common Stock to employees pursuant to the Company’s employee stock purchase plans and pursuant to the conversion and/or exercise of Common Stock Equivalents outstanding as of the date of the most recently filed periodic report under the Exchange Act. No Person has any right of first refusal, preemptive right, right of participation, or any similar right to participate in the transactions contemplated by the Transaction Documents. Except as a result of the purchase and sale of the Shares or as set forth on Schedule 3.1(g), there are no outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any Person any right to subscribe for or acquire, any shares of Common Stock or the capital stock of any Subsidiary, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents or capital stock of any Subsidiary. The issuance and sale of the Shares will not obligate the Company or any Subsidiary to issue shares of Common Stock or other securities to any Person (other than the Purchasers). There are no outstanding securities or instruments of the Company or any Subsidiary with any provision that adjusts the exercise, conversion, exchange or reset price of such security or instrument upon an issuance of securities by the Company or any Subsidiary. There are no outstanding securities or instruments of the Company or any Subsidiary that contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to redeem a security of the Company or such Subsidiary. The Company does not have any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement. All of the outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable, have been issued in compliance with all federal and state securities laws, and none of such outstanding shares was issued in violation of any preemptive rights or similar rights to subscribe for or purchase securities. No further approval or authorization of any stockholder, the Board of Directors or others is required for the issuance and sale of the Shares. There are no stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s stockholders.

 

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(h)     SEC Reports; Financial Statements. The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company under the Securities Act and the Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the two years preceding the date hereof (or such shorter period as the Company was required by law or regulation to file such material) (the foregoing materials, including the exhibits thereto and documents incorporated by reference therein, together with the Prospectus and the Prospectus Supplement, being collectively referred to herein as the “SEC Reports”) on a timely basis or has received a valid extension of such time of filing and has filed any such SEC Reports prior to the expiration of any such extension. As of their respective dates, the SEC Reports complied in all material respects with the requirements of the Securities Act and the Exchange Act, as applicable, and none of the SEC Reports, when filed, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading. The Company has never been an issuer subject to Rule 144(i) under the Securities Act. The financial statements of the Company included in the SEC Reports comply in all material respects with applicable accounting requirements and the rules and regulations of the Commission with respect thereto as in effect at the time of filing. Such financial statements have been prepared in accordance with United States generally accepted accounting principles applied on a consistent basis during the periods involved (“GAAP”), except as may be otherwise specified in such financial statements or the notes thereto and except that unaudited financial statements may not contain all footnotes required by GAAP, and fairly present in all material respects the financial position of the Company and its consolidated Subsidiaries as of and for the dates thereof and the results of operations and cash flows for the periods then ended, subject, in the case of unaudited statements, to normal, immaterial, year-end audit adjustments.

 

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(i)     Material Changes; Undisclosed Events, Liabilities or Developments. Since the date of the latest audited financial statements included within the SEC Reports, except as set forth on Schedule 3.1(i), (i) there has been no event, occurrence or development that has had or that could reasonably be expected to result in a Material Adverse Effect, (ii) the Company has not incurred any liabilities (contingent or otherwise) other than (A) trade payables and accrued expenses incurred in the ordinary course of business consistent with past practice and (B) liabilities not required to be reflected in the Company’s financial statements pursuant to GAAP or disclosed in filings made with the Commission, (iii) the Company has not altered its method of accounting, (iv) the Company has not declared or made any dividend or distribution of cash or other property to its stockholders or purchased, redeemed or made any agreements to purchase or redeem any shares of its capital stock and (v) the Company has not issued any equity securities to any officer, director or Affiliate, except pursuant to existing Company stock option plans. The Company does not have pending before the Commission any request for confidential treatment of information. Except for the issuance of the Shares contemplated by this Agreement or as set forth on Schedule 3.1(i), no event, liability, fact, circumstance, occurrence or development has occurred or exists or is reasonably expected to occur or exist with respect to the Company or its Subsidiaries or their respective businesses, prospects, properties, operations, assets or financial condition that would be required to be disclosed by the Company under applicable securities laws at the time this representation is made or deemed made that has not been publicly disclosed at least 1 Trading Day prior to the date that this representation is made.

 

(j)     Litigation. Except as set forth on Schedule 3.1(j), there is no action, suit, inquiry, notice of violation, Proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company, any Subsidiary or any of their respective properties before or by any court, arbitrator, governmental or administrative agency or regulatory authority (federal, state, county, local or foreign) (collectively, an “Action”) which (i) adversely affects or challenges the legality, validity or enforceability of any of the Transaction Documents or the Shares or (ii) could, if there were an unfavorable decision, have or reasonably be expected to result in a Material Adverse Effect. Neither the Company nor any Subsidiary, nor any director or officer thereof, is or has been the subject of any Action involving a claim of violation of or liability under federal or state securities laws or a claim of breach of fiduciary duty. There has not been, and to the knowledge of the Company, there is not pending or contemplated, any investigation by the Commission involving the Company or any current or former director or officer of the Company. The Commission has not issued any stop order or other order suspending the effectiveness of any registration statement filed by the Company or any Subsidiary under the Exchange Act or the Securities Act.

 

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(k)     Labor Relations. No labor dispute exists or, to the knowledge of the Company, is imminent with respect to any of the employees of the Company, which could reasonably be expected to result in a Material Adverse Effect. None of the Company’s or its Subsidiaries’ employees is a member of a union that relates to such employee’s relationship with the Company or such Subsidiary, and neither the Company nor any of its Subsidiaries is a party to a collective bargaining agreement, and the Company and its Subsidiaries believe that their relationships with their employees are good. To the knowledge of the Company, no executive officer of the Company or any Subsidiary, is, or is now expected to be, in violation of any material term of any employment contract, confidentiality, disclosure or proprietary information agreement or non-competition agreement, or any other contract or agreement or any restrictive covenant in favor of any third party, and the continued employment of each such executive officer does not subject the Company or any of its Subsidiaries to any liability with respect to any of the foregoing matters. The Company and its Subsidiaries are in compliance with all U.S. federal, state, local and foreign laws and regulations relating to employment and employment practices, terms and conditions of employment and wages and hours, except where the failure to be in compliance could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

(l)     Compliance. Neither the Company nor any Subsidiary: (i) is in default under or in violation of (and no event has occurred that has not been waived that, with notice or lapse of time or both, would result in a default by the Company or any Subsidiary under), nor has the Company or any Subsidiary received notice of a claim that it is in default under or that it is in violation of, any indenture, loan or credit agreement or any other agreement or instrument to which it is a party or by which it or any of its properties is bound (whether or not such default or violation has been waived), (ii) is in violation of any judgment, decree or order of any court, arbitrator or other governmental authority or (iii) is or has been in violation of any statute, rule, ordinance or regulation of any governmental authority, including without limitation all foreign, federal, state and local laws relating to taxes, environmental protection, occupational health and safety, product quality and safety and employment and labor matters, except in each case as could not have or reasonably be expected to result in a Material Adverse Effect.

 

(m)     Environmental Laws.     The Company and its Subsidiaries (i) are in compliance with all federal, state, local and foreign laws relating to pollution or protection of human health or the environment (including ambient air, surface water, groundwater, land surface or subsurface strata), including laws relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, or toxic or hazardous substances or wastes (collectively, “Hazardous Materials”) into the environment, or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Hazardous Materials, as well as all authorizations, codes, decrees, demands, or demand letters, injunctions, judgments, licenses, notices or notice letters, orders, permits, plans or regulations, issued, entered, promulgated or approved thereunder (“Environmental Laws”); (ii) have received all permits licenses or other approvals required of them under applicable Environmental Laws to conduct their respective businesses; and (iii) are in compliance with all terms and conditions of any such permit, license or approval where in each clause (i), (ii) and (iii), the failure to so comply could be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.

 

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(n)     Regulatory Permits. The Company and the Subsidiaries possess all certificates, authorizations and permits issued by the appropriate federal, state, local or foreign regulatory authorities necessary to conduct their respective businesses as described in the SEC Reports, except where the failure to possess such permits could not reasonably be expected to result in a Material Adverse Effect (“Material Permits”), and neither the Company nor any Subsidiary has received any notice of Proceedings relating to the revocation or modification of any Material Permit.

 

(o)     Title to Assets. Except as set forth on Schedule 3.1(o), the Company and the Subsidiaries have good and marketable title in fee simple to all real property owned by them and good and marketable title in all personal property owned by them that is material to the business of the Company and the Subsidiaries, in each case free and clear of all Liens, except for (i) Liens as do not materially affect the value of such property and do not materially interfere with the use made and proposed to be made of such property by the Company and the Subsidiaries and (ii) Liens for the payment of federal, state or other taxes, for which appropriate reserves have been made therefor in accordance with GAAP and, the payment of which is neither delinquent nor subject to penalties. Any real property and facilities held under lease by the Company and the Subsidiaries are held by them under valid, subsisting and enforceable leases with which the Company and the Subsidiaries are in compliance.

 

(p)     Intellectual Property. The Company and the Subsidiaries have, or have rights to use, all patents, patent applications, trademarks, trademark applications, service marks, trade names, trade secrets, inventions, copyrights, licenses and other intellectual property rights and similar rights necessary or required for use in connection with their respective businesses as described in the SEC Reports and which the failure to so have could have a Material Adverse Effect (collectively, the “Intellectual Property Rights”). None of, and neither the Company nor any Subsidiary has received a notice (written or otherwise) that any of, the Intellectual Property Rights has expired, terminated or been abandoned, or is expected to expire or terminate or be abandoned, within two (2) years from the date of this Agreement. Neither the Company nor any Subsidiary has received, since the date of the latest audited financial statements included within the SEC Reports, a written notice of a claim or otherwise has any knowledge that the Intellectual Property Rights violate or infringe upon the rights of any Person, except as could not have or reasonably be expected to not have a Material Adverse Effect. To the knowledge of the Company, all such Intellectual Property Rights are enforceable and there is no existing infringement by another Person of any of the Intellectual Property Rights. The Company and its Subsidiaries have taken reasonable security measures to protect the secrecy, confidentiality and value of all of their intellectual properties, except where failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

(q)     Insurance. The Company and the Subsidiaries are insured by insurers of recognized financial responsibility against such losses and risks and in such amounts as are prudent and customary in the businesses in which the Company and the Subsidiaries are engaged, including, but not limited to, directors and officers insurance coverage at least equal to the aggregate Subscription Amount. Neither the Company nor any Subsidiary has any reason to believe that it will not be able to renew its existing insurance coverage as and when such coverage expires or to obtain similar coverage from similar insurers as may be necessary to continue its business without a significant increase in cost.

 

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(r)     Transactions With Affiliates and Employees. Except as set forth on Schedule 3.1(r), none of the officers or directors of the Company or any Subsidiary and, to the knowledge of the Company, none of the employees of the Company or any Subsidiary is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors), including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, providing for the borrowing of money from or lending of money to or otherwise requiring payments to or from any officer, director or such employee or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee, stockholder, member or partner, in each case in excess of $120,000 other than for (i) payment of salary or consulting fees for services rendered, (ii) reimbursement for expenses incurred on behalf of the Company and (iii) other employee benefits, including stock option agreements under any stock option plan of the Company.

 

(s)     Sarbanes-Oxley; Internal Accounting Controls. The Company and the Subsidiaries are in compliance with any and all applicable requirements of the Sarbanes-Oxley Act of 2002 that are effective as of the date hereof, and any and all applicable rules and regulations promulgated by the Commission thereunder that are effective as of the date hereof and as of the Closing Date. The Company and the Subsidiaries maintain a system of internal accounting controls sufficient to provide reasonable assurance that: (i) transactions are executed in accordance with management’s general or specific authorizations, (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability, (iii) access to assets is permitted only in accordance with management’s general or specific authorization, and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. The Company and the Subsidiaries have established and maintains and evaluates disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and the Subsidiaries and designed such disclosure controls and procedures to ensure that information required to be disclosed by the Company in the reports it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. The Company’s certifying officers have evaluated the effectiveness of the disclosure controls and procedures of the Company and the Subsidiaries as of the end of the period covered by the most recently filed periodic report under the Exchange Act (such date, the “Evaluation Date”). The Company presented in its most recently filed periodic report under the Exchange Act the conclusions of the certifying officers about the effectiveness of the disclosure controls and procedures based on their evaluations as of the Evaluation Date. Since the Evaluation Date, there have been no changes in the internal control over financial reporting (as such term is defined in the Exchange Act) of the Company and its Subsidiaries that have materially affected, or is reasonably likely to materially affect, the internal control over financial reporting of the Company and its Subsidiaries.

 

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(t)     Certain Fees. Except as set forth in the Prospectus Supplement, no brokerage or finder’s fees or commissions are or will be payable by the Company or any Subsidiary to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other Person with respect to the transactions contemplated by the Transaction Documents. The Purchasers shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other Persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by the Transaction Documents.

 

(u)     Investment Company. The Company is not, and is not an Affiliate of, and immediately after receipt of payment for the Shares, will not be or be an Affiliate of, an “investment company” within the meaning of the Investment Company Act of 1940, as amended. The Company shall conduct its business in a manner so that it will not become an “investment company” subject to registration under the Investment Company Act of 1940, as amended.

 

(v)     Registration Rights. Except as set forth on Schedule 3.1(v), no Person has any right to cause the Company or any Subsidiary to effect the registration under the Securities Act of any securities of the Company or any Subsidiary.

 

(w)     Listing and Maintenance Requirements. The Common Stock is registered pursuant to Section 12(b) or 12(g) of the Exchange Act, and the Company has taken no action designed to, or which to its knowledge is likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act nor has the Company received any notification that the Commission is contemplating terminating such registration. Except as disclosed in the SEC Reports, the Company has not, in the 12 months preceding the date hereof, received notice from any Trading Market on which the Common Stock is or has been listed or quoted to the effect that the Company is not in compliance with the listing or maintenance requirements of such Trading Market. Except as disclosed in the SEC Reports, the Company is, and has no reason to believe that it will not in the foreseeable future continue to be, in compliance with all such listing and maintenance requirements. The Common Stock is currently eligible for electronic transfer through the Depository Trust Company or another established clearing corporation and the Company is current in payment of the fees to the Depository Trust Company (or such other established clearing corporation) in connection with such electronic transfer.

 

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(x)     Application of Takeover Protections. The Company and the Board of Directors have taken all necessary action, if any, in order to render inapplicable any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or other similar anti-takeover provision under the Company’s certificate of incorporation (or similar charter documents) or the laws of its state of incorporation that is or could become applicable to the Purchasers as a result of the Purchasers and the Company fulfilling their obligations or exercising their rights under the Transaction Documents, including without limitation as a result of the Company’s issuance of the Shares and the Purchasers’ ownership of the Shares.

 

(y)     Disclosure. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, the Company confirms that neither it nor any other Person acting on its behalf has provided any of the Purchasers or their agents or counsel with any information that it believes constitutes or might constitute material, non-public information which is not otherwise disclosed in the Prospectus Supplement. The Company understands and confirms that the Purchasers will rely on the foregoing representation in effecting transactions in securities of the Company. All of the disclosure furnished by or on behalf of the Company to the Purchasers regarding the Company and its Subsidiaries, their respective businesses and the transactions contemplated hereby, including the Disclosure Schedules to this Agreement, is true and correct and, taken as a whole, does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The press releases disseminated by the Company during the twelve months preceding the date of this Agreement taken as a whole do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made and when made, not misleading. The Company acknowledges and agrees that no Purchaser makes or has made any representations or warranties with respect to the transactions contemplated hereby other than those specifically set forth in Section 3.2 hereof.

 

(z)     No Integrated Offering. Assuming the accuracy of the Purchasers’ representations and warranties set forth in Section 3.2, neither the Company, nor any of its Affiliates, nor any Person acting on its or their behalf has, directly or indirectly, made any offers or sales of any security or solicited any offers to buy any security, under circumstances that would cause this offering of the Shares to be aggregated with prior offerings by the Company for purposes of any applicable shareholder approval provisions of any Trading Market on which any of the securities of the Company are listed or designated.

 

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(aa)     Solvency. Based on the consolidated financial condition of the Company as of the Closing Date, after giving effect to the receipt by the Company of the proceeds from the sale of the Shares hereunder, (i) the fair saleable value of the Company’s assets exceeds the amount that will be required to be paid on or in respect of the Company’s existing debts and other liabilities (including known contingent liabilities) as they mature, (ii) the Company’s assets do not constitute unreasonably small capital to carry on its business as now conducted and as proposed to be conducted including its capital needs taking into account the particular capital requirements of the business conducted by the Company, consolidated and projected capital requirements and capital availability thereof, and (iii) the current cash flow of the Company, together with the proceeds the Company would receive, were it to liquidate all of its assets, after taking into account all anticipated uses of the cash, would be sufficient to pay all amounts on or in respect of its liabilities when such amounts are required to be paid. The Company does not intend to incur debts beyond its ability to pay such debts as they mature (taking into account the timing and amounts of cash to be payable on or in respect of its debt). The Company has no knowledge of any facts or circumstances which lead it to believe that it will file for reorganization or liquidation under the bankruptcy or reorganization laws of any jurisdiction within one year from the Closing Date. Schedule 3.1(aa) sets forth as of the date hereof all outstanding secured and unsecured Indebtedness of the Company or any Subsidiary, or for which the Company or any Subsidiary has commitments. For the purposes of this Agreement, “Indebtedness” means (x) any liabilities for borrowed money or amounts owed in excess of $50,000 (other than trade accounts payable incurred in the ordinary course of business), (y) all guaranties, endorsements and other contingent obligations in respect of indebtedness of others, whether or not the same are or should be reflected in the Company’s consolidated balance sheet (or the notes thereto), except guaranties by endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of business; and (z) the present value of any lease payments in excess of $50,000 due under leases required to be capitalized in accordance with GAAP. Except as set forth on Schedule 3.1(aa), neither the Company nor any Subsidiary is in default with respect to any Indebtedness.

 

(bb)     Tax Status. Except for matters that would not, individually or in the aggregate, have or reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries each (i) has made or filed all United States federal, state and local income and all foreign income and franchise tax returns, reports and declarations required by any jurisdiction to which it is subject, (ii) has paid all taxes and other governmental assessments and charges that are material in amount, shown or determined to be due on such returns, reports and declarations and (iii) has set aside on its books provision reasonably adequate for the payment of all material taxes for periods subsequent to the periods to which such returns, reports or declarations apply. There are no unpaid taxes in any material amount claimed to be due by the taxing authority of any jurisdiction, and the officers of the Company or of any Subsidiary know of no basis for any such claim.

 

(cc)     Foreign Corrupt Practices. Neither the Company nor any Subsidiary, nor to the knowledge of the Company or any Subsidiary, any agent or other person acting on behalf of the Company or any Subsidiary, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company or any Subsidiary (or made by any person acting on its behalf of which the Company is aware) which is in violation of law, or (iv) violated in any material respect any provision of FCPA.

 

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(dd)     Accountants. The Company’s independent registered public accounting firm is Grant Thornton LLP. To the knowledge and belief of the Company, such accounting firm (i) is a registered public accounting firm as required by the Exchange Act and (ii) shall express its opinion with respect to the financial statements to be included in the Company’s Annual Report for the fiscal year ending December 31, 2020.     

 

(ee)      Acknowledgment Regarding Purchasers’ Purchase of Shares. The Company acknowledges and agrees that each of the Purchasers is acting solely in the capacity of an arm’s length purchaser with respect to the Transaction Documents and the transactions contemplated thereby. The Company further acknowledges that no Purchaser is acting as a financial advisor or fiduciary of the Company (or in any similar capacity) with respect to the Transaction Documents and the transactions contemplated thereby and any advice given by any Purchaser or any of their respective representatives or agents in connection with the Transaction Documents and the transactions contemplated thereby is merely incidental to the Purchasers’ purchase of the Shares. The Company further represents to each Purchaser that the Company’s decision to enter into this Agreement and the other Transaction Documents has been based solely on the independent evaluation of the transactions contemplated hereby by the Company and its representatives.

 

(ff)     Acknowledgment Regarding Purchaser’s Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding (except for Sections 3.2(f) and 4.14 hereof), it is understood and acknowledged by the Company that: (i) none of the Purchasers has been asked by the Company to agree, nor has any Purchaser agreed, to desist from purchasing or selling, long and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Shares for any specified term; (ii) past or future open market or other transactions by any Purchaser, specifically including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii) any Purchaser, and counter-parties in “derivative” transactions to which any such Purchaser is a party, directly or indirectly, presently may have a “short” position in the Common Stock, and (iv) each Purchaser shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands and acknowledges that (y) one or more Purchasers may engage in hedging activities at various times during the period that the Shares are outstanding, and (z) such hedging activities (if any) could reduce the value of the existing stockholders' equity interests in the Company at and after the time that the hedging activities are being conducted.  The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of the Transaction Documents.

 

(gg)     Regulation M Compliance.  The Company has not, and to its knowledge no one acting on its behalf has, (i) taken, directly or indirectly, any action designed to cause or to result in the stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of any of the Shares, (ii) sold, bid for, purchased, or, paid any compensation for soliciting purchases of, any of the Shares, or (iii) paid or agreed to pay to any Person any compensation for soliciting another to purchase any other securities of the Company, other than, in the case of clauses (ii) and (iii), compensation paid to the Company’s placement agent in connection with the placement of the Shares.

 

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(hh)     FDA. Except as disclosed in the Prospectus:

 

(A)     As to each product subject to the jurisdiction of the U.S. Food and Drug Administration (“FDA”) under the Federal Food, Drug and Cosmetic Act, as amended, and the regulations thereunder (“FDCA”) that is manufactured, packaged, labeled, tested, distributed, sold, and/or marketed by the Company or any of its Subsidiaries (each such product, a “Pharmaceutical Product”), such Pharmaceutical Product is being manufactured, packaged, labeled, tested, distributed, sold and/or marketed by the Company in compliance with all applicable requirements under FDCA and similar laws, rules and regulations relating to registration, investigational use, premarket clearance, licensure, or application approval, good manufacturing practices, good laboratory practices, good clinical practices, product listing, quotas, labeling, advertising, record keeping and filing of reports, except where the failure to be in compliance would not have a Material Adverse Effect.

 

(B)     There is no pending, completed or, to the Company's knowledge, threatened, action (including any lawsuit, arbitration, or legal or administrative or regulatory Proceeding, charge, complaint, or investigation) against the Company or any of its Subsidiaries, and none of the Company or any of its Subsidiaries has received any notice, warning letter or other communication from the FDA or any other governmental entity, which (i) contests the premarket clearance, licensure, registration, or approval of, the uses of, the distribution of, the manufacturing or packaging of, the testing of, the sale of, or the labeling and promotion of any Pharmaceutical Product, (ii) withdraws its approval of, requests the recall, suspension, or seizure of, or withdraws or orders the withdrawal of advertising or sales promotional materials relating to, any Pharmaceutical Product, (iii) imposes a clinical hold on any clinical investigation by the Company or any of its Subsidiaries, (iv) enjoins production at any facility of the Company or any of its Subsidiaries, (v) enters or proposes to enter into a consent decree of permanent injunction with the Company or any of its Subsidiaries, or (vi) otherwise alleges any violation of any laws, rules or regulations by the Company or any of its Subsidiaries, and which, either individually or in the aggregate, would have a Material Adverse Effect.

 

(C)     The properties, business and operations of the Company have been and are being conducted in all material respects in accordance with all applicable laws, rules and regulations of the FDA.  The Company has not been informed by the FDA that the FDA will prohibit the marketing, sale, license or use in the United States of any product proposed to be developed, produced or marketed by the Company nor has the FDA expressed any concern as to approving or clearing for marketing any product being developed or proposed to be developed by the Company. 

 

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(ii)     Stock Option Plans. Each stock option granted by the Company under the Company’s stock option plan was granted (i) in accordance with the terms of the Company’s stock option plan and (ii) with an exercise price at least equal to the fair market value of the Common Stock on the date such stock option would be considered granted under GAAP and applicable law. No stock option granted under the Company’s stock option plan has been backdated. The Company has not knowingly granted, and there is no and has been no Company policy or practice to knowingly grant, stock options prior to, or otherwise knowingly coordinate the grant of stock options with, the release or other public announcement of material information regarding the Company or its Subsidiaries or their financial results or prospects.

 

(jj)     Office of Foreign Assets Control. Neither the Company nor any Subsidiary nor, to the Company's knowledge, any director, officer, agent, employee or affiliate of the Company or any Subsidiary is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”).

 

(kk)     U.S. Real Property Holding Corporation. The Company is not and has never been a U.S. real property holding corporation within the meaning of Section 897 of the Internal Revenue Code of 1986, as amended, and the Company shall so certify upon Purchaser’s request.

 

(ll)     Bank Holding Company Act. Neither the Company nor any of its Subsidiaries or Affiliates is subject to the Bank Holding Company Act of 1956, as amended (the “BHCA”) and to regulation by the Board of Governors of the Federal Reserve System (the “Federal Reserve”). Neither the Company nor any of its Subsidiaries or Affiliates owns or controls, directly or indirectly, five percent (5%) or more of the outstanding shares of any class of voting securities or twenty-five percent or more of the total equity of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve. Neither the Company nor any of its Subsidiaries or Affiliates exercises a controlling influence over the management or policies of a bank or any entity that is subject to the BHCA and to regulation by the Federal Reserve.

 

(mm)     Money Laundering. The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial record-keeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, applicable money laundering statutes and applicable rules and regulations thereunder (collectively, the “Money Laundering Laws”), and no Action or Proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any Subsidiary with respect to the Money Laundering Laws is pending or, to the knowledge of the Company or any Subsidiary, threatened.

 

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3.2     Representations and Warranties of the Purchasers. Each Purchaser, for itself and for no other Purchaser, hereby represents and warrants as of the date hereof and as of the Closing Date to the Company as follows (unless as of a specific date therein, in which case they shall be accurate as of such date):

 

(a)     Organization; Authority. Such Purchaser is either an individual or an entity duly incorporated or formed, validly existing and in good standing under the laws of the jurisdiction of its incorporation or formation with full right, corporate, partnership, limited liability company or similar power and authority to enter into and to consummate the transactions contemplated by the Transaction Documents and otherwise to carry out its obligations hereunder and thereunder. The execution and delivery of the Transaction Documents and performance by such Purchaser of the transactions contemplated by the Transaction Documents have been duly authorized by all necessary corporate, partnership, limited liability company or similar action, as applicable, on the part of such Purchaser. Each Transaction Document to which it is a party has been duly executed by such Purchaser, and when delivered by such Purchaser in accordance with the terms hereof, will constitute the valid and legally binding obligation of such Purchaser, enforceable against it in accordance with its terms, except: (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

 

(b)     Understandings or Arrangements. Such Purchaser is acquiring the Shares as principal for its own account and has no direct or indirect arrangement or understandings with any other persons to distribute or regarding the distribution of such Shares (this representation and warranty not limiting such Purchaser’s right to sell the Shares pursuant to the Registration Statement or otherwise in compliance with applicable federal and state securities laws). Such Purchaser is acquiring the Shares hereunder in the ordinary course of its business.

 

(c)     Purchaser Status. At the time such Purchaser was offered the Shares, it was, and as of the date hereof it is, either: (i) an “accredited investor” as defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities Act or (ii) a “qualified institutional buyer” as defined in Rule 144A(a) under the Securities Act.

 

(d)     Experience of Such Purchaser. Such Purchaser, either alone or together with its representatives, has such knowledge, sophistication and experience in business and financial matters so as to be capable of evaluating the merits and risks of the prospective investment in the Shares, and has so evaluated the merits and risks of such investment. Such Purchaser is able to bear the economic risk of an investment in the Shares and, at the present time, is able to afford a complete loss of such investment.

 

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(e)     Access to Information. Such Purchaser acknowledges that it has had the opportunity to review the Transaction Documents (including all exhibits and schedules thereto) and the SEC Reports and has been afforded, (i) the opportunity to ask such questions as it has deemed necessary of, and to receive answers from, representatives of the Company concerning the terms and conditions of the offering of the Shares and the merits and risks of investing in the Shares; (ii) access to information about the Company and its financial condition, results of operations, business, properties, management and prospects sufficient to enable it to evaluate its investment; and (iii) the opportunity to obtain such additional information that the Company possesses or can acquire without unreasonable effort or expense that is necessary to make an informed investment decision with respect to the investment.  Such Purchaser acknowledges and agrees that neither the Placement Agent nor any Affiliate of the Placement Agent has provided such Purchaser with any information or advice with respect to the Shares nor is such information or advice necessary or desired.  Neither the Placement Agent nor any Affiliate has made or makes any representation as to the Company or the quality of the Shares and the Placement Agent and any Affiliate may have acquired non-public information with respect to the Company which such Purchaser agrees need not be provided to it.  In connection with the issuance of the Shares to such Purchaser, neither the Placement Agent nor any of its Affiliates has acted as a financial advisor or fiduciary to such Purchaser.

 

(f)     Certain Transactions and Confidentiality. Other than consummating the transactions contemplated hereunder, such Purchaser has not, nor has any Person acting on behalf of or pursuant to any understanding with such Purchaser, directly or indirectly executed any purchases or sales, including Short Sales, of the securities of the Company during the period commencing as of the time that such Purchaser first received a term sheet (written or oral) from the Company or any other Person representing the Company setting forth the material pricing terms of the transactions contemplated hereunder and ending immediately prior to the execution hereof. Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the representation set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Shares covered by this Agreement. Other than to other Persons party to this Agreement or to such Purchaser’s representatives, including, without limitation, its officers, directors, partners, legal and other advisors, employees, agents and Affiliates, such Purchaser has maintained the confidentiality of all disclosures made to it in connection with this transaction (including the existence and terms of this transaction). Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.

 

The Company acknowledges and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect such Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the transactions contemplated hereby. Notwithstanding the foregoing, for the avoidance of doubt, nothing contained herein shall constitute a representation or warranty, or preclude any actions, with respect to locating or borrowing shares in order to effect Short Sales or similar transactions in the future.

 

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ARTICLE IV.

OTHER AGREEMENTS OF THE PARTIES

 

4.1     [RESERVED]

 

4.2     Furnishing of Information. Until the time that no Purchaser that originally entered into this Agreement on the date hereof (or an Affiliate of a Purchaser) owns Shares, the Company covenants to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to Section 12 of the Exchange Act even if the Company is not then subject to the reporting requirements of the Exchange Act.

 

4.3     Integration. The Company shall not sell, offer for sale or solicit offers to buy or otherwise negotiate in respect of any security (as defined in Section 2 of the Securities Act) that would be aggregated with the offer or sale of the Shares for purposes of the rules and regulations of any Trading Market such that it would require shareholder approval prior to the closing of such other transaction unless shareholder approval is obtained before the closing of such subsequent transaction.

 

4.4     Securities Laws Disclosure; Publicity. The Company shall (a) by the Disclosure Time, issue a press release disclosing the material terms of the transactions contemplated hereby, and (b) file a Current Report on Form 8-K, including the Transaction Documents as exhibits thereto, with the Commission within the time required by the Exchange Act. From and after the issuance of such press release, the Company represents to the Purchasers that it shall have publicly disclosed all material, non-public information delivered to any of the Purchasers by the Company or any of its Subsidiaries, or any of their respective officers, directors, employees or agents. In addition, effective upon the issuance of such press release, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates on the one hand, and any of the Purchasers or any of their Affiliates on the other hand, shall terminate. The Company and each Purchaser shall consult with each other in issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Purchaser shall issue any such press release nor otherwise make any such public statement without the prior consent of the Company, with respect to any press release of any Purchaser, or without the prior consent of each Purchaser, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication. Notwithstanding the foregoing, the Company shall not publicly disclose the name of any Purchaser, or include the name of any Purchaser in any filing with the Commission or any regulatory agency or Trading Market, without the prior written consent of such Purchaser, except (a) as required by federal securities law in connection with the filing of final Transaction Documents with the Commission and (b) to the extent such disclosure is required by law or Trading Market regulations, in which case the Company shall provide the Purchasers with prior notice of such disclosure permitted under this clause (b).

 

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4.5     Shareholder Rights Plan. No claim will be made or enforced by the Company or, with the consent of the Company, any other Person, that any Purchaser is an “Acquiring Person” under any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plan or arrangement in effect or hereafter adopted by the Company, or that any Purchaser could be deemed to trigger the provisions of any such plan or arrangement, by virtue of receiving Shares under the Transaction Documents or under any other agreement between the Company and the Purchasers.

 

4.6     Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by the Transaction Documents, which shall be disclosed pursuant to Section 4.4, the Company covenants and agrees that neither it, nor any other Person acting on its behalf will provide any Purchaser or its agents or counsel with any information that constitutes, or the Company reasonably believes constitutes, material non-public information, unless prior thereto such Purchaser shall have consented to the receipt of such information and agreed with the Company to keep such information confidential. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company. To the extent that the Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates delivers any material, non-public information to a Purchaser without such Purchaser’s consent, the Company hereby covenants and agrees that such Purchaser shall not have any duty of confidentiality to the Company, any of its Subsidiaries, or any of their respective officers, directors, agents, employees or Affiliates, or a duty to the Company, any of its Subsidiaries or any of their respective officers, directors, agents, employees or Affiliates not to trade on the basis of, such material, non-public information, provided that the Purchaser shall remain subject to applicable law. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K. The Company understands and confirms that each Purchaser shall be relying on the foregoing covenant in effecting transactions in securities of the Company.

 

4.7     Use of Proceeds. Except as set forth in the Prospectus Supplement, the Company shall use the net proceeds from the sale of the Shares hereunder for working capital purposes and shall not use such proceeds: (a) for the satisfaction of any portion of the Company’s debt (other than payment of trade payables in the ordinary course of the Company’s business and prior practices), (b) for the redemption of any Common Stock or Common Stock Equivalents, (c) for the settlement of any outstanding litigation or (d) in violation of FCPA or OFAC regulations.

 

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4.8     Indemnification of Purchasers. Subject to the provisions of this Section 4.8, the Company will indemnify and hold each Purchaser and its directors, officers, shareholders, members, partners, employees and agents (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title), each Person who controls such Purchaser (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees (and any other Persons with a functionally equivalent role of a Person holding such titles notwithstanding a lack of such title or any other title) of such controlling persons (each, a “Purchaser Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Purchaser Party may suffer or incur as a result of or relating to (a) any breach of any of the representations, warranties, covenants or agreements made by the Company in this Agreement or in the other Transaction Documents or (b) any action instituted against the Purchaser Parties in any capacity, or any of them or their respective Affiliates, by any stockholder of the Company who is not an Affiliate of such Purchaser Party, with respect to any of the transactions contemplated by the Transaction Documents (unless such action is solely based upon a material breach of such Purchaser Party’s representations, warranties or covenants under the Transaction Documents or any agreements or understandings such Purchaser Party may have with any such stockholder or any violations by such Purchaser Party of state or federal securities laws or any conduct by such Purchaser Party which is finally judicially determined to constitute fraud, gross negligence or willful misconduct). If any action shall be brought against any Purchaser Party in respect of which indemnity may be sought pursuant to this Agreement, such Purchaser Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Purchaser Party. Any Purchaser Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Purchaser Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing, (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel or (iii) in such action there is, in the reasonable opinion of counsel, a material conflict on any material issue between the position of the Company and the position of such Purchaser Party, in which case the Company shall be responsible for the reasonable fees and expenses of no more than one such separate counsel. The Company will not be liable to any Purchaser Party under this Agreement (y) for any settlement by a Purchaser Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (z) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to any Purchaser Party’s breach of any of the representations, warranties, covenants or agreements made by such Purchaser Party in this Agreement or in the other Transaction Documents. The indemnification required by this Section 4.8 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or are incurred. The indemnity agreements contained herein shall be in addition to any cause of action or similar right of any Purchaser Party against the Company or others and any liabilities the Company may be subject to pursuant to law.

 

4.9     Reservation of Common Stock. As of the date hereof, the Company has reserved and the Company shall continue to reserve and keep available at all times, free of preemptive rights, a sufficient number of shares of Common Stock for the purpose of enabling the Company to issue Shares pursuant to this Agreement.

 

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4.10     Listing of Common Stock. The Company hereby agrees to use best efforts to maintain the listing or quotation of the Common Stock on the Trading Market on which it is currently listed, and concurrently with the Closing, the Company shall apply to list or quote all of the Shares on such Trading Market and promptly secure the listing of all of the Shares on such Trading Market. The Company further agrees, if the Company applies to have the Common Stock traded on any other Trading Market, it will then include in such application all of the Shares, and will take such other action as is necessary to cause all of the Shares to be listed or quoted on such other Trading Market as promptly as possible. The Company will then take all action reasonably necessary to continue the listing and trading of its Common Stock on a Trading Market and will comply in all respects with the Company’s reporting, filing and other obligations under the bylaws or rules of the Trading Market. The Company agrees to maintain the eligibility of the Common Stock for electronic transfer through the Depository Trust Company or another established clearing corporation, including, without limitation, by timely payment of fees to the Depository Trust Company or such other established clearing corporation in connection with such electronic transfer.

 

4.11     [RESERVED]

 

4.12     Subsequent Equity Sales. From the date hereof until thirty (30) days following the Closing Date, neither the Company nor any Subsidiary shall issue, enter into any agreement to issue or announce the issuance or proposed issuance of any shares of Common Stock or Common Stock Equivalents or file any registration statement or any amendment or supplement to any registration statement, other than the Prospectus Supplement. Notwithstanding the foregoing, this Section 4.12 shall not apply in respect of an Exempt Issuance.

 

4.13     Equal Treatment of Purchasers. No consideration (including any modification of this Agreement) shall be offered or paid to any Person to amend or consent to a waiver or modification of any provision of this Agreement unless the same consideration is also offered to all of the parties to this Agreement. For clarification purposes, this provision constitutes a separate right granted to each Purchaser by the Company and negotiated separately by each Purchaser, and is intended for the Company to treat the Purchasers as a class and shall not in any way be construed as the Purchasers acting in concert or as a group with respect to the purchase, disposition or voting of Shares or otherwise.

 

4.14     Certain Transactions and Confidentiality. Each Purchaser, severally and not jointly with the other Purchasers, covenants that neither it nor any Affiliate acting on its behalf or pursuant to any understanding with it will execute any purchases or sales, including Short Sales of any of the Company’s securities during the period commencing with the execution of this Agreement and ending at such time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4.  Each Purchaser, severally and not jointly with the other Purchasers, covenants that until such time as the transactions contemplated by this Agreement are publicly disclosed by the Company pursuant to the initial press release as described in Section 4.4, such Purchaser will maintain the confidentiality of the existence and terms of this transaction and the information included in the Disclosure Schedules.  Notwithstanding the foregoing and notwithstanding anything contained in this Agreement to the contrary, the Company expressly acknowledges and agrees that (i) no Purchaser makes any representation, warranty or covenant hereby that it will not engage in effecting transactions in any securities of the Company after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4, (ii) no Purchaser shall be restricted or prohibited from effecting any transactions in any securities of the Company in accordance with applicable securities laws from and after the time that the transactions contemplated by this Agreement are first publicly announced pursuant to the initial press release as described in Section 4.4 and (iii) no Purchaser shall have any duty of confidentiality or duty not to trade in the securities of the Company to the Company or its Subsidiaries after the issuance of the initial press release as described in Section 4.4.  Notwithstanding the foregoing, in the case of a Purchaser that is a multi-managed investment vehicle whereby separate portfolio managers manage separate portions of such Purchaser’s assets and the portfolio managers have no direct knowledge of the investment decisions made by the portfolio managers managing other portions of such Purchaser’s assets, the covenant set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision to purchase the Shares covered by this Agreement.

 

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4.15     Capital Changes. Until the one year anniversary of the Closing Date, the Company shall not undertake a reverse or forward stock split or reclassification of the Common Stock without the prior written consent of the Purchasers holding a majority in interest of the Shares, other than a stock split that, in the good faith determination of the Board of Directors, is required to enable the Company to comply with the required listing standards of the Company’s principal Trading Market or with the initial listing requirements of another Trading Market.

 

4.16     Lock-Up Agreements. The Company shall not amend, modify, waive or terminate any provision of any of the Lock-Up Agreements except to extend the term of the lock-up period and shall enforce the provisions of each Lock-Up Agreement in accordance with its terms. If any party to a Lock-Up Agreement breaches any provision of a Lock-Up Agreement, the Company shall promptly use its best efforts to seek specific performance of the terms of such Lock-Up Agreement.

 

ARTICLE V.

MISCELLANEOUS

 

5.1     Termination.  This Agreement may be terminated by any Purchaser, as to such Purchaser’s obligations hereunder only and without any effect whatsoever on the obligations between the Company and the other Purchasers, by written notice to the other parties, if the Closing has not been consummated on or before the fifth (5th) Trading Day following the date hereof; provided, however, that no such termination will affect the right of any party to sue for any breach by any other party (or parties).

 

5.2     Fees and Expenses. Except as expressly set forth in the Transaction Documents to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all Transfer Agent fees (including, without limitation, any fees required for same-day processing of any instruction letter delivered by the Company), stamp taxes and other taxes and duties levied in connection with the delivery of any Shares to the Purchasers.

 

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

 

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5.4     Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be in writing and shall be deemed given and effective on the earliest of: (a) the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto at or prior to 5:30 p.m. (New York City time) on a Trading Day, (b) the next Trading Day after the time of transmission, if such notice or communication is delivered via facsimile at the facsimile number or email attachment at the email address as set forth on the signature pages attached hereto on a day that is not a Trading Day or later than 5:30 p.m. (New York City time) on any Trading Day, (c) the second (2nd) Trading Day following the date of mailing, if sent by U.S. nationally recognized overnight courier service or (d) upon actual receipt by the party to whom such notice is required to be given. The address for such notices and communications shall be as set forth on the signature pages attached hereto. To the extent that any notice provided pursuant to any Transaction Document constitutes, or contains, material, non-public information regarding the Company or any Subsidiaries, the Company shall simultaneously file such notice with the Commission pursuant to a Current Report on Form 8-K.

 

5.5     Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed, in the case of an amendment, by the Company and Purchasers which purchased at least 50.1% in interest of the Shares based on the initial Subscription Amounts hereunder (or, prior to Closing, the Company and each Purchaser) or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought, provided that if any amendment, modification or waiver disproportionately and adversely impacts a Purchaser (or group of Purchasers), the consent of such disproportionately impacted Purchaser (or group of Purchasers) shall also be required. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right. Any proposed amendment or waiver that disproportionately, materially and adversely affects the rights and obligations of any Purchaser relative to the comparable rights and obligations of the other Purchasers shall require the prior written consent of such adversely affected Purchaser. Any amendment effected in accordance with this Section 5.5 shall be binding upon each Purchaser and holder of Shares and the Company.

 

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

 

5.7     Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their successors and permitted assigns. The Company may not assign this Agreement or any rights or obligations hereunder without the prior written consent of each Purchaser (other than by merger). Any Purchaser may assign any or all of its rights under this Agreement to any Person to whom such Purchaser assigns or transfers any Shares, provided that such transferee agrees in writing to be bound, with respect to the transferred Shares, by the provisions of the Transaction Documents that apply to the “Purchasers.”

 

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5.8     No Third-Party Beneficiaries. The Placement Agent shall be the third party beneficiary of the representations and warranties of the Company in Section 3.1 and the representations and warranties of the Purchasers in Section 3.2. This Agreement is intended for the benefit of the parties hereto and their respective successors and permitted assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other Person, except as otherwise set forth in Section 4.8 and this Section 5.8.

 

5.9     Governing Law. All questions concerning the construction, validity, enforcement and interpretation of the Transaction Documents shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal Proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and any other Transaction Documents (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, partners, members, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive jurisdiction of the state and federal courts sitting in the City of New York, Borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of the Transaction Documents), and hereby irrevocably waives, and agrees not to assert in any Action or Proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such Action or Proceeding is improper or is an inconvenient venue for such Proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such Action or Proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. If any party shall commence an Action or Proceeding to enforce any provisions of the Transaction Documents, then, in addition to the obligations of the Company under Section 4.8, the prevailing party in such Action or Proceeding shall be reimbursed by the non-prevailing party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such Action or Proceeding.

 

5.10     Survival. The representations and warranties contained herein shall survive the Closing and the delivery of the Shares.

 

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

 

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

 

5.13     Rescission and Withdrawal Right. Notwithstanding anything to the contrary contained in (and without limiting any similar provisions of) any of the other Transaction Documents, whenever any Purchaser exercises a right, election, demand or option under a Transaction Document and the Company does not timely perform its related obligations within the periods therein provided, then such Purchaser may rescind or withdraw, in its sole discretion from time to time upon written notice to the Company, any relevant notice, demand or election in whole or in part without prejudice to its future actions and rights.

 

5.14     Replacement of Shares. If any certificate or instrument evidencing any Shares is mutilated, lost, stolen or destroyed, the Company shall issue or cause to be issued in exchange and substitution for and upon cancellation thereof (in the case of mutilation), or in lieu of and substitution therefor, a new certificate or instrument, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction. The applicant for a new certificate or instrument under such circumstances shall also pay any reasonable third-party costs (including customary indemnity) associated with the issuance of such replacement Shares.

 

5.15     Remedies. In addition to being entitled to exercise all rights provided herein or granted by law, including recovery of damages, each of the Purchasers and the Company will be entitled to specific performance under the Transaction Documents. The parties agree that monetary damages may not be adequate compensation for any loss incurred by reason of any breach of obligations contained in the Transaction Documents and hereby agree to waive and not to assert in any Action for specific performance of any such obligation the defense that a remedy at law would be adequate.

 

5.16     Payment Set Aside. To the extent that the Company makes a payment or payments to any Purchaser pursuant to any Transaction Document or a Purchaser enforces or exercises its rights thereunder, and such payment or payments or the proceeds of such enforcement or exercise or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside, recovered from, disgorged by or are required to be refunded, repaid or otherwise restored to the Company, a trustee, receiver or any other Person under any law (including, without limitation, any bankruptcy law, state or federal law, common law or equitable cause of action), then to the extent of any such restoration the obligation or part thereof originally intended to be satisfied shall be revived and continued in full force and effect as if such payment had not been made or such enforcement or setoff had not occurred.

 

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5.17     Independent Nature of Purchasers’ Obligations and Rights. The obligations of each Purchaser under any Transaction Document are several and not joint with the obligations of any other Purchaser, and no Purchaser shall be responsible in any way for the performance or non-performance of the obligations of any other Purchaser under any Transaction Document. Nothing contained herein or in any other Transaction Document, and no action taken by any Purchaser pursuant hereto or thereto, shall be deemed to constitute the Purchasers as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Purchasers are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by the Transaction Documents. Each Purchaser shall be entitled to independently protect and enforce its rights including, without limitation, the rights arising out of this Agreement or out of the other Transaction Documents, and it shall not be necessary for any other Purchaser to be joined as an additional party in any Proceeding for such purpose. Each Purchaser has been represented by its own separate legal counsel in its review and negotiation of the Transaction Documents. For reasons of administrative convenience only, each Purchaser and its respective counsel have chosen to communicate with the Company through EGS. EGS does not represent any of the Purchasers and only represents the Placement Agent. The Company has elected to provide all Purchasers with the same terms and Transaction Documents for the convenience of the Company and not because it was required or requested to do so by any of the Purchasers. It is expressly understood and agreed that each provision contained in this Agreement and in each other Transaction Document is between the Company and a Purchaser, solely, and not between the Company and the Purchasers collectively and not between and among the Purchasers.

 

5.18     Liquidated Damages. The Company’s obligations to pay any partial liquidated damages or other amounts owing under the Transaction Documents is a continuing obligation of the Company and shall not terminate until all unpaid partial liquidated damages and other amounts have been paid notwithstanding the fact that the instrument or security pursuant to which such partial liquidated damages or other amounts are due and payable shall have been canceled.

 

5.19     Saturdays, Sundays, Holidays, etc.     If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall not be a Business Day, then such action may be taken or such right may be exercised on the next succeeding Business Day.

 

5.20     Construction. The parties agree that each of them and/or their respective counsel have reviewed and had an opportunity to revise the Transaction Documents and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of the Transaction Documents or any amendments thereto. In addition, each and every reference to share prices and shares of Common Stock in any Transaction Document shall be subject to adjustment for reverse and forward stock splits, stock dividends, stock combinations and other similar transactions of the Common Stock that occur after the date of this Agreement.

 

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

 

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(Signature Pages Follow)

 

33

 

 

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

 

 

	
			GEVO, INC.

			 

				
			Address for Notice:

			
	
			By:__________________________________________

			     Name:

			     Title:

			With a copy to (which shall not constitute notice):

				
			 

			E-Mail:

			Fax:

			
	
			 

			Perkins Coie LLP

			1900 Sixteenth Street, Suite 1400

			Denver, Colorado 80202-5255

			Attention: Ned Prusse

			Email: nprusse@perkinscoie.com

				 

 

 

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK

SIGNATURE PAGE FOR PURCHASER FOLLOWS]

34

 

 

[PURCHASER SIGNATURE PAGES TO GEVO SECURITIES PURCHASE AGREEMENT]

 

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

 

Name of Purchaser: ________________________________________________________

 

Signature of Authorized Signatory of Purchaser: _________________________________

 

Name of Authorized Signatory: _______________________________________________

 

Title of Authorized Signatory: ________________________________________________

 

Email Address of Authorized Signatory: _________________________________________

 

Facsimile Number of Authorized Signatory: __________________________________________

 

Address for Notice to Purchaser:

 

Address for Delivery of Shares to Purchaser (if not same as address for notice):

 

 

DWAC for Delivery of Shares:

 

 

Subscription Amount: $_________________

 

Shares: ____________________

 

EIN Number: _______________________

 

☐ Notwithstanding anything contained in this Agreement to the contrary, by checking this box (i) the obligations of the above-signed to purchase the securities set forth in this Agreement to be purchased from the Company by the above-signed, and the obligations of the Company to sell such securities to the above-signed, shall be unconditional and all conditions to Closing shall be disregarded, (ii) the Closing shall occur by the second (2nd) Trading Day following the date of this Agreement and (iii) any condition to Closing contemplated by this Agreement (but prior to being disregarded by clause (i) above) that required delivery by the Company or the above-signed of any agreement, instrument, certificate or the like or purchase price (as applicable) shall no longer be a condition and shall instead be an unconditional obligation of the Company or the above-signed (as applicable) to deliver such agreement, instrument, certificate or the like or purchase price (as applicable) to such other party on the Closing Date.

 

[SIGNATURE PAGES CONTINUE]

 

35

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