Document:

slgd-ex101_7.htm

Exhibit 10.1

 

AGREEMENT

This Agreement (this “Agreement”) is made and entered into as of January 6, 2021 by and among Scott’s Liquid Gold-Inc. (the “Company”) and Maran Capital Management, LLC, and the entities and natural persons set forth in the signature pages hereto (collectively, “Maran”) (each of the Company and Maran, a “Party” to this Agreement, and collectively, the “Parties”).

RECITALS

WHEREAS, the Company and Maran have engaged in various discussions and communications concerning the Company’s business, financial performance and strategic plans; 

WHEREAS, as of the date hereof, Maran has a beneficial ownership (as determined under Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended, or the rules or regulations promulgated thereunder (the “Exchange Act”)) interest in the Common Stock, $0.10 par value per share, of the Company (the Common Stock”) totaling, in the aggregate, 1,620,070 shares, or approximately 13.0% of the Common Stock issued and outstanding on the date hereof; and

WHEREAS, as of the date hereof, the Company and Maran have determined to come to an agreement with respect to the composition of the Board and certain other matters, as provided in this Agreement.

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

	
1.
	
Board Appointments; Leadership Structure and Related Agreements.

(a)Board Appointments

(i)The Company agrees that effective upon the execution of this Agreement, the Board and all applicable committees of the Board shall take all necessary actions to appoint R. Rimmy Malhotra, Tisha Pedrazzini (each a “Maran Independent Appointee” and collectively, the “Maran Independent Appointees”) and Daniel J. Roller (the “Maran Appointee”) as directors of the Company with terms expiring at the Company’s 2021 Annual Meeting of Shareholders (the “2021 Annual Meeting”). The Company agrees that it shall nominate the Maran Appointee and the Maran Independent Appointees for election to the Board at the 2021 Annual Meeting for terms expiring at the Company’s 2022 Annual Meeting of Shareholders (the “2022 Annual Meeting”) and shall recommend, support and solicit proxies for the election of the Maran Appointee and the Maran Independent Appointees at the 2021 Annual Meeting in the same manner as it recommends, supports, and solicits proxies for the election of the Company’s other director nominees.

(ii)If the Maran Appointee (or any Maran Replacement Director (as defined below)) is unable or unwilling to serve as a director and ceases to be a director (whether by resignation, removal or refusal to stand for election) at any time prior to the expiration of the Standstill Period (as defined below), and at such time Maran beneficially owns (as determined 

 

 

 

under Rule 13d-3 promulgated under the Exchange Act) in the aggregate at least 7% of the Company’s then-outstanding Common Stock (the “Minimum Ownership Threshold”), Maran shall have the ability to recommend a person to be a Maran Replacement Director in accordance with this Section 1(a)(ii) (any such replacement nominee, when appointed to the Board, shall be referred to as a “Maran Replacement Director”). Any Maran Replacement Director must (A) be reasonably acceptable to the Board (such acceptance not to be unreasonably withheld), (B) qualify as “independent” pursuant to The Nasdaq Stock Market (“Nasdaq”) listing standards, and (C) have the relevant financial and business experience to be a director of the Company.  The Nominating and Corporate Governance Committee of the Board (the “Nominating and Corporate Governance Committee”) shall make its determination and recommendation regarding whether such Maran Replacement Director meets the foregoing criteria within five (5) business days after (1) such nominee has submitted to the Company the documentation required by Section 1(c)(iii) and (2) representatives of the Board have conducted customary interview(s) of such nominee, if such interviews are requested by the Board or the Nominating and Corporate Governance Committee. The Company shall use its reasonable best efforts to conduct any interview(s) contemplated by this Section 1(a)(ii) as promptly as practicable, but in any case, assuming reasonable availability of the nominee, within ten (10) business days after Maran’s submission of such nominee. In the event the Nominating and Corporate Governance Committee does not accept a person recommended by Maran as the Maran Replacement Director, Maran shall have the right to recommend additional substitute person(s) whose appointment shall be subject to the Nominating and Corporate Governance Committee recommending such person in accordance with the procedures described above. Upon the recommendation of a Maran Replacement Director nominee by the Nominating and Corporate Governance Committee, the Board shall vote on the appointment of such Maran Replacement Director to the Board no later than five (5) business days after the Nominating and Corporate Governance Committee’s recommendation of such Maran Replacement Director; provided, however, that if the Board does not appoint such Maran Replacement Director to the Board pursuant to this Section 1(a)(ii), the Parties shall continue to follow the procedures of this Section 1(a)(ii) until a Maran Replacement Director is elected to the Board. Subject to applicable law and stock exchange rules, upon a Maran Replacement Director’s appointment to the Board, the Board and all applicable committees of the Board shall take all necessary actions to appoint such Maran Replacement Director to any applicable committee of the Board of which the replaced director was a member immediately prior to such director’s resignation or removal. Subject to applicable law and stock exchange rules, until such time as any Maran Replacement Director is appointed to any applicable committee of the Board, one of the Maran Independent Appointees (as designated by Maran) will serve as an interim member of such applicable committee.  Any Maran Replacement Director designated pursuant to this Section 1(a)(ii) replacing the Maran Appointee prior to the mailing of the Company’s definitive proxy statement for the 2021 Annual Meeting shall stand for election at the 2021 Annual Meeting together with the other director nominees.  

(iii)If at any time Maran beneficially owns (as determined under Rule 13d-3 promulgated under the Exchange Act) in the aggregate less than the Minimum Ownership Threshold, the Maran Appointee, or any Maran Replacement Director appointed in lieu of the Maran Appointee in accordance with Section 1(a)(ii), shall promptly tender their resignation from the Board to the Board.

 

 

(iv)During the period commencing with the date of this Agreement through the expiration of the Standstill Period, the Board and all applicable committees of the Board shall not increase the size of the Board to more than eight (8) directors provided, however, the Board may be increased during this period (i) solely to accommodate the appointment of any new director to the Board in accordance with Section 1(a)(ii), or (ii) upon Maran’s prior written consent to increase the size of the Board.

(v)The Company agrees that the Board, including the Maran Appointee and the Maran Independent Appointees, will hold a meeting of the Board as soon as practicable following the execution of this Agreement. At this meeting, which in any event shall be held no later than February 21, 2021, the Board will review the Company’s shareholder rights agreement to determine whether it continues to be in the best interests of the Company and its shareholders.

(vi)The Maran Appointee and the Maran Independent Appointees will be entitled to the same director benefits as other members of the Board, including (a) compensation for service as a director and reimbursement of such director’s expenses on the same basis as all other non-employee directors of the Company; (b) equity-based compensation grants and other benefits, if any, on the same basis as all other non-employee directors of the Company; and (c) the same rights of indemnification and directors’ and officers’ liability insurance coverage as the other non-employee directors of the Company as such rights may exist from time to time. Furthermore, the Parties agree that the Maran Appointee and the Maran Independent Appointees, during their service as directors of the Company, will not be prohibited from acting in their respective capacities as a director or from complying with their respective fiduciary duties as directors of the Company (including voting on any matter submitted for consideration by the Board, participating in deliberations or discussions of the Board, and making suggestions or raising any issues or recommendations to the Board).

(b)Board Committees.

Subject to Nasdaq rules applicable laws, the Board and all applicable committees of the Board shall take all actions necessary to ensure that during the Standstill Period, the following committees of the Board, as well as any new committee(s) and subcommittee(s) that may be established, shall include the following Maran Appointee or Maran Independent Appointee (or a Maran Replacement Director), as applicable:

(i)Audit Committee.

Immediately following the execution of this Agreement, the Board and all applicable committees of the Board shall take all necessary actions to appoint Mr. Malhotra to the Audit Committee.

(ii)Compensation Committee.

Immediately following the execution of this Agreement, the Board and all applicable committees of the Board shall take all necessary actions to appoint Mr. Malhotra to the Compensation Committee.

(iii)Nominating and Corporate Governance Committee.

 

 

Immediately following the execution of this Agreement, the Board and all applicable committees of the Board shall take all necessary actions to appoint the Maran Nominee to the Nominating and Corporate Governance Committee.

Without limiting the foregoing, the Board shall give each of the Maran Independent Appointees the same due consideration for membership to any committee of the Board as any other independent director.

(c)Additional Agreements. 

(i)Maran shall comply, and shall cause each of its controlled Affiliates and Associates to comply with the terms of this Agreement and shall be responsible for any breach of this Agreement by any such controlled Affiliate or Associate.  As used in this Agreement, the terms “Affiliate” and “Associate” shall have the respective meanings set forth in Rule 12b-2 promulgated by the Securities and Exchange Commission under the Exchange Act and shall include all persons or entities that at any time during the term of this Agreement become Affiliates or Associates of any person or entity referred to in this Agreement.

(ii)During the Standstill Period, at each annual or special meeting of the Company’s stockholders (including any adjournments, postponements or other delays thereof) or action by written consent, Maran shall vote all shares of Common Stock beneficially owned by Maran at such meeting (A) in favor of all directors nominated by the Board for election, and (B) in accordance with the Board’s recommendation with respect to any other Company proposal or shareholder proposal or nomination presented at such meetings; provided, however that Maran shall be permitted to vote as it determines in its sole discretion regarding any proposed tender offer, exchange offer, merger, amalgamation, consolidation, acquisition, business combination, recapitalization, consolidation, restructuring, liquidation, dissolution or similar extraordinary transaction involving Company, any of its subsidiaries or any of their respective securities or assets (each, an “Extraordinary Transaction”); provided, further, that in the event Institutional Shareholder Services Inc. (“ISS”) or Glass Lewis & Co., LLC (“Glass Lewis”) recommends otherwise with respect to any Company proposal or shareholder proposal presented at such meetings (other than proposals relating to the election of directors), Maran shall be permitted to vote in accordance with the ISS or Glass Lewis recommendation.

(iii)Maran acknowledges that, prior to the date of this Agreement, the Maran Appointee and each Maran Independent Appointee and prior to any appointment, each Maran Replacement Director, is required to submit to the Company a fully completed copy of the Company’s standard director & officer questionnaire and other reasonable and customary director onboarding documentation applicable to directors of the Company.

(iv)The Company agrees that the Board and all applicable committees of the Board shall take all necessary actions, effective no later than immediately following the execution of this Agreement, to determine, in connection with their initial appointment as a director and nomination by the Company at the 2021 Annual Meeting, that each of the Maran Independent Appointees is deemed to be (A) a member of the “Incumbent Board” or an “Applicable Director” (as such term may be defined in the definition of “Change in Control,” “Change of Control” (or any similar term) under the Company’s incentive plans, options plans, equity plans, deferred 

 

 

compensation plans, employment agreements, severance plans, retention plans, indemnification agreements, loan agreements, or indentures) and (B) a member of the Board as of the beginning of any applicable measurement period for the purposes of the definition of “Change in Control” or any similar term under the Company’s incentive plans, options plans, equity plans, deferred compensation plans, employment agreements, severance plans, retention plans, indemnification agreements, loan agreements, or indentures. The Company further agrees that during the Standstill Period, the Company shall not adopt or enter into any incentive plan, option plan, equity plan, deferred compensation plan, employment agreement, severance plan or agreement, change in control plan or agreement, retention plan, loan agreement, indenture, credit agreement, indemnification agreement or any other similar contract or agreement (each a “Future Company Agreement” and collectively, the “Future Company Agreements”), if such Future Company Agreement includes language regarding the election, appointment or nomination of an individual pursuant to an actual or threatened election contest or any other actual or threatened solicitation of proxies as not being deemed a member of the “Incumbent Board” or an “Applicable Director” (or any similar term) as such terms may be defined in the definition of, or provisions governing, a “Change in Control” or “Change of Control” (or any similar term) in such Future Company Agreement or as not being deemed a member of the Board as of the beginning of any applicable measurement period for the purposes of the definition of, or provisions governing, a “Change in Control” or “Change of Control” (or any similar term) in such Future Company Agreement.

	
2.
	
Standstill Provisions.

(a)Maran agrees that, from the date of this Agreement until the earlier of (i) the date that is fifteen (15) business days prior to the deadline for the submission of shareholder nominations for the 2022 Annual Meeting pursuant to the Company’s Bylaws (the “Standstill Period”), and (ii) the announcement of an Extraordinary Transaction that would result in a change of greater than 50% of the ownership or control of the Company, Maran shall not, and shall cause each of its controlled Affiliates and Associates not to, in each case directly or indirectly, in any manner:

(i)engage in or encourage any solicitation of proxies or become a “participant” in a “solicitation” (as such terms are defined in Regulation 14A under the Exchange Act) of proxies (including, without limitation, any solicitation of consents that seeks to call a special meeting of shareholders), in each case, with respect to securities of the Company;

(ii)form, join, or in any way knowingly participate in any “group” (within the meaning of Section 13(d)(3) of the Exchange Act) with respect to the shares of the Common Stock (other than a “group” that includes all or some of the members of Maran, but does not include any other entities or persons that are not members of Maran as of the date hereof); provided, however, that nothing herein shall limit the ability of an Affiliate of Maran to join the “group” following the execution of this Agreement, so long as any such Affiliate agrees to be bound by the terms and conditions of this Agreement;

(iii)deposit any shares of Common Stock in any voting trust or subject any shares of Common Stock to any arrangement or agreement with respect to the voting of any shares of Common Stock, other than any such voting trust, arrangement or agreement solely among the members of Maran and otherwise in accordance with this Agreement;

 

 

(iv)seek or submit, or knowingly encourage any person or entity to seek or submit, nomination(s) in furtherance of a “contested solicitation” for the appointment, election or removal of directors with respect to the Company or seek, or knowingly encourage or take any other action with respect to the appointment, election or removal of any directors, in each case in opposition to the recommendation of the Board; provided, however, that nothing in this Agreement shall prevent Maran or its Affiliates or Associates from taking actions in furtherance of identifying a Maran Replacement Director pursuant to Section 1(a)(ii) in connection with the 2021 Annual Meeting, so long as such actions do not create a public disclosure obligation for Maran or the Company and are undertaken on a basis reasonably designed to be confidential and in accordance in all material respects with Maran’s normal practices in the circumstances;

(v)(A) make any proposal for consideration by shareholders at any annual or special meeting of shareholders of the Company, (B) make any offer or proposal (with or without conditions) with respect to any merger, tender (or exchange) offer, acquisition, recapitalization, restructuring, liquidation, dividend, disposition or other business combination involving the Company, (C) solicit a third party to make an offer or proposal (with or without conditions) with respect to any merger, tender (or exchange) offer, acquisition, recapitalization, restructuring, disposition or other business combination involving the Company, or encourage, initiate or support any third party in making such an offer or proposal, (D) publicly comment on any third party proposal regarding any merger, tender (or exchange) offer, acquisition, recapitalization, restructuring, disposition, or other business combination with respect to the Company by such third party prior to such proposal becoming public or (E) call, encourage or seek to call a special meeting of shareholders;

(vi)seek, alone or in concert with others, representation on the Board, except as specifically permitted in Section 1; 

(vii)acquire securities (or rights or options to acquire securities) of the Company that would result in Maran in the aggregate owning, controlling or otherwise having any beneficial or other ownership interest of more than 14.9% of the then-outstanding Common Stock;

(viii)advise, knowingly encourage, knowingly support or knowingly influence any person or entity with respect to the acquisition or disposition of any securities of the Company or voting at any annual or special meeting of shareholders; 

(ix)make any request or submit any proposal to amend the terms of this Agreement other than through non-public communications with the Company or the Board that would not be reasonably determined to trigger public disclosure obligations for any Party; or 

(x)institute or join any litigation, arbitration or other proceeding (including any derivative action) against the Company or its directors or officers, except that the foregoing will not prevent Maran from (i) bringing litigation to enforce the provisions of this Agreement instituted in accordance with this Agreement; (ii) making counterclaims with respect to any proceeding initiated by, or on behalf of, Company or its Affiliates against Maran; (iii) bringing bona fide commercial disputes that do not in any manner relate to the subject matter of this Agreement; (iv) exercising statutory appraisal rights; or (v) responding to or complying with a validly issued legal process.

 

 

(b)Except as expressly provided in Section 1 or Section 2(a), Maran shall be entitled to vote any shares of Common Stock that it beneficially owns as Maran determines in its sole discretion.

(c)Nothing in Section 2(a) will prohibit or restrict Maran from (A) communicating privately with the Board or any officer or director of Company regarding any matter, so long as such communications are not intended to, and would not reasonably be expected to, require any public disclosure of such communications, subject in any case to any confidentiality obligations to Company of any such director or officer, (B) taking any action necessary to comply with any law, rule or regulation or any action required by any governmental or regulatory authority or stock exchange that has, or may have, jurisdiction over Maran, but only if a breach by Maran of this Agreement is not the cause of the applicable requirement, or (C) privately communicating to any of its investors or potential investors public information regarding Company, but only if such communications comply with applicable law, Company policies and this Agreement. For the avoidance of doubt, subject to applicable law and Company policies, Maran will not be prohibited from communicating privately with stockholders of the Company and others in a manner that does not otherwise violate this Section 2.

	
3.
	
Representations and Warranties of the Company.

The Company represents and warrants to Maran that (a) the Company has the corporate power and authority to execute this Agreement and to bind it thereto, (b) this Agreement has been duly and validly authorized, executed and delivered by the Company, and assuming due execution by each counterparty hereto, constitutes a valid and binding obligation and agreement of the Company, and is enforceable against the Company in accordance with its terms, except as enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or similar laws generally affecting the rights of creditors and subject to general equity principles, (c) prior to entering into this Agreement, the Board was composed of five (5) directors and there are no vacancies on the Board and (d) the execution, delivery and performance of this Agreement by the Company does not and will not (i) violate or conflict with any law, rule, regulation, order, judgment or decree applicable to the Company, or (ii) result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both would constitute such a breach, violation or default) under or pursuant to, or result in the loss of a material benefit under, or give any right of termination, amendment, acceleration or cancellation of, any organizational document or material agreement to which the Company is a party or by which it is bound. 

	
4.
	
Representations and Warranties of Maran.

Maran represents and warrants to the Company that (a) the authorized signatory of Maran set forth on the signature page hereto has the power and authority to execute this Agreement and any other documents or agreements to be entered into in connection with this Agreement and to bind Maran thereto, (b) this Agreement has been duly authorized, executed and delivered by Maran, and assuming due execution by each counterparty hereto, is a valid and binding obligation of Maran, enforceable against Maran in accordance with its terms except as enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or similar laws generally affecting the rights of creditors and subject to general equity 

 

 

principles, (c) the execution of this Agreement, the consummation of any of the transactions contemplated hereby, and the fulfillment of the terms hereof, in each case in accordance with the terms hereof, will not conflict with, or result in a breach or violation of the organizational documents of Maran as currently in effect, (d) the execution, delivery and performance of this Agreement by Maran does not and will not (i) violate or conflict with any law, rule, regulation, order, judgment or decree applicable to Maran, or (ii) result in any breach or violation of or constitute a default (or an event which with notice or lapse of time or both would constitute such a breach, violation or default) under or pursuant to, or result in the loss of a material benefit under, or give any right of termination, amendment, acceleration or cancellation of, any organizational document, agreement, contract, commitment, understanding or arrangement to which such member is a party or by which it is bound, (e) as of the date of this Agreement, Maran is deemed to beneficially own 1,620,070 shares of Common Stock, (f) as of the date hereof, and except as set forth in clause (e) above, Maran does not currently have, and does not currently have any right to acquire, any interest in any securities or assets of the Company or its Affiliates (or any rights, options or other securities convertible into or exercisable or exchangeable (whether or not convertible, exercisable or exchangeable immediately or only after the passage of time or the occurrence of a specified event) for such securities or assets or any obligations measured by the price or value of any securities of the Company or any of its controlled Affiliates, including any swaps or other derivative arrangements designed to produce economic benefits and risks that correspond to the ownership of shares of Common Stock or any other securities of the Company, whether or not any of the foregoing would give rise to beneficial ownership (as determined under Rule 13d-3 promulgated under the Exchange Act), and whether or not to be settled by delivery of shares of Common Stock or any other class or series of the Company’s stock, payment of cash or by other consideration, and without regard to any short position under any such contract or arrangement).

	
5.
	
Press Release.

Promptly following the execution of this Agreement, and in no event later than 2:30 p.m., Mountain time, on January 7, 2021, the Company and Maran shall jointly issue a mutually agreeable press release (the “Press Release”) announcing certain terms of this Agreement in the form attached hereto as Exhibit A. Prior to the issuance of the Press Release and subject to the terms of this Agreement, neither the Company (including the Board and any committee thereof) nor Maran shall issue any press release or make public announcement regarding this Agreement or the matters contemplated hereby without the prior written consent of the other Party. During the Standstill Period, neither the Company nor Maran shall make any public announcement or statement that is inconsistent with or contrary to the terms of this Agreement.

	
6.
	
Specific Performance.

Each of Maran, on the one hand, and the Company, on the other hand, acknowledges and agrees that irreparable injury to the other Party hereto may occur in the event any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached and that such injury may not be adequately compensable by the remedies available at law (including the payment of money damages). It is accordingly agreed that Maran, on the one hand, and the Company, on the other hand (the “Moving Party”), shall each be entitled to seek specific enforcement of, and injunctive relief to prevent any violation of, the terms hereof, and the 

 

 

other Party hereto will not take action, directly or indirectly, in opposition to the Moving Party seeking such relief on the grounds that any other remedy or relief is available at law or in equity. This Section 6 is not the exclusive remedy for any violation of this Agreement.

	
7.
	
Expenses.

The Company shall reimburse Maran for its reasonable, documented out-of-pocket fees and expenses (including specifically documented legal expenses) incurred in connection with Maran’s involvement at the Company through the date of this Agreement, including, but not limited to its Schedule 13D filings and the negotiation and execution of this Agreement, provided that such reimbursement shall not exceed $25,000 in the aggregate.

	
8.
	
Severability.

If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated. It is hereby stipulated and declared to be the intention of the Parties that the Parties would have executed the remaining terms, provisions, covenants and restrictions without including any of such which may be hereafter declared invalid, void or unenforceable. In addition, the Parties agree to use their best efforts to agree upon and substitute a valid and enforceable term, provision, covenant or restriction for any of such that is held invalid, void or enforceable by a court of competent jurisdiction.

	
9.
	
Notices.

Any notices, consents, determinations, waivers or other communications required or permitted to be given under the terms of this Agreement must be in writing and will be deemed to have been delivered: (a) upon receipt, when delivered personally; (b) upon confirmation of receipt, when sent by email (provided such confirmation is not automatically generated); or (c) two (2) business days after deposit with a nationally recognized overnight delivery service, in each case properly addressed to the Party to receive the same. The addresses and facsimile numbers for such communications shall be:

If to the Company:

Scott’s Liquid Gold, Inc. 

8400 E. Crescent Parkway, Suite 450

Greenwood Village, CO 80111
Attn: Mark Goldstein, Chairman and Chief Executive Officer

Email: mgoldstein@slginc.com

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

 

 

 

Holland & Hart

555 17th Street, Suite 3200

Denver, CO 80202

Attn: Amy Bowler

Email: abowler@hollandhart.com

 

If to Maran or any member thereof:

Maran Capital Management, LLC
1409 Columbine St

Denver, CO 80206
Attention:Daniel J. Roller
Email:droller@marancapital.com

 

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

Olshan Frome Wolosky LLP
1325 Avenue of the Americas
New York, New York 10019
Attention:Andrew Freedman, Esq.

Sebastian Alsheimer, Esq.
Facsimile:(212) 451-2222
Email:afreedman@olshanlaw.com

	

	
salsheimer@olshanlaw.com 

	
10.
	
Applicable Law.

This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of Delaware without reference to the conflict of laws principles thereof that would result in the application of the law of another jurisdiction. Each of the Parties hereto irrevocably agrees that any legal action or proceeding with respect to this Agreement and the rights and obligations arising hereunder, or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder brought by the other Party hereto or its successors or assigns, shall be brought and determined exclusively in the Delaware Court of Chancery and any state appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any federal court within the State of Delaware). Each of the Parties hereto hereby irrevocably submits with regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement in any court other than the aforesaid courts. Each of the Parties hereto hereby irrevocably waives, and agrees not to assert in any action or proceeding with respect to this Agreement, (a) any claim that it is not personally subject to the jurisdiction of the above-named courts for any reason, (b) any claim that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of 

 

 

judgment or otherwise) and (c) to the fullest extent permitted by applicable legal requirements, any claim that (i) the suit, action or proceeding in such court is brought in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.

	
11.
	
Counterparts.

This Agreement may be executed in two or more counterparts, each of which shall be considered one and the same agreement and shall become effective when counterparts have been signed by each of the Parties and delivered to the other Party (including by means of electronic delivery or facsimile).

	
12.
	
Mutual Non-Disparagement.

Subject to applicable law, each of the Parties covenants and agrees that, during the Standstill Period, or if earlier, until such time as the other Party or any of its agents, subsidiaries, affiliates, successors, assigns, officers, key employees or directors shall have breached this Section 12, neither it nor any of its respective agents, subsidiaries, affiliates, successors, assigns, officers, key employees or directors shall in any way publicly criticize, disparage, call into disrepute or otherwise defame or slander the other Party or such other Party’s subsidiaries, affiliates, successors, assigns, officers (including any current officer of a Party or a Party’s subsidiaries who no longer serves in such capacity following the execution of this Agreement), directors (including any current officer or director of a Party or a Party’s subsidiaries who no longer serves in such capacity in connection with the execution of this Agreement), employees, shareholders, agents, attorneys or representatives, or any of their businesses, products or services, in any manner that would reasonably be expected to damage the business or reputation of such other Party, their businesses, products or services or their subsidiaries, affiliates, successors, assigns, officers (or former officers), directors (or former directors), employees, shareholders, agents, attorneys or representatives.

	
13.
	
Securities Laws.

Maran acknowledges that it is aware, and will advise each of its representatives who are informed as to the matters that are the subject of this Agreement, that the United States securities laws may prohibit any person who directly or indirectly has received from an issuer material, non-public information from purchasing or selling securities of such issuer or from communicating such information to any other person under circumstances in which it is reasonably foreseeable that such person is likely to purchase or sell such securities.

	
14.
	
Entire Agreement; Amendment and Waiver; Successors and Assigns; Third Party Beneficiaries; Term.

This Agreement contains the entire understanding of the Parties with respect to its subject matter. There are no restrictions, agreements, promises, representations, warranties, covenants or undertakings between the Parties other than those expressly set forth herein. No modifications of this Agreement can be made except in writing signed by an authorized representative of each the Company and Maran. No failure on the part of any Party to exercise, and no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or 

 

 

partial exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other right, power or remedy. All remedies hereunder are cumulative and are not exclusive of any other remedies provided by law. The terms and conditions of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the Parties hereto and their respective successors, heirs, executors, legal representatives, and permitted assigns. No Party shall assign this Agreement or any rights or obligations hereunder without, with respect to Maran, the prior written consent of the Company, and with respect to the Company, the prior written consent of Maran. This Agreement is solely for the benefit of the Parties and is not enforceable by any other persons or entities. This Agreement shall terminate at the end of the Standstill Period, except provisions of Section 13 and Section 14, which shall survive such termination. 

[The remainder of this page intentionally left blank]

 

 

 

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized signatories of the Parties as of the date hereof.

				
	
 
	
Scott’s liquid gold, inc.

	
 
	
 

	
 
	
By:
	
/s/ Mark E. Goldstein

	
 
	
 
	
Name:
	
Mark E. Goldstein

	
 
	
 
	
Title:
	
President and CEO

 

 

 

 

	
MARAN CAPITAL MANAGEMENT, LLC

 

MARAN PARNTERS FUND, LP

 

MARAN PARTNERS GP, LLC

 

MARAN SPV, LP

 

MARAN SPV GP, LLC

 

DANIEL J. ROLLER

 

 

 

			
	
By:
	
/s/ Daniel J. Roller

	
 
	
Name:
	
Daniel J. Roller

	
 
	
Title:
	
Authorized SignatoryExhibit 10.1

 

ELEVENTH AMENDMENT TO LOAN AND SECURITY
AGREEMENT

This ELEVENTH AMENDMENT TO LOAN AND
SECURITY AGREEMENT dated as of December 31, 2020 (this “Amendment”) to the Loan and Security Agreement dated
as of August 17, 2016 (as amended by the First Amendment dated as of December 12, 2016, the Second Amendment dated as of November
13, 2017 (including the Allonge dated November 13, 2017 pursuant thereto to the Revolving Note and the Term Note), the Third Amendment
dated as of January 16, 2018, the Fourth Amendment dated as of April 27, 2018, the Fifth Amendment dated as of November 14, 2018
and a Joinder Agreement dated as of November 20, 2018, the Sixth Amendment dated as of November 6, 2019, the Seventh Amendment
dated as of December 17, 2019, the Eighth Amendment dated as of April 1, 2020, the Ninth Amendment dated as of September 29, 2020,
the Tenth Amendment dated as of November 30, 2020 and as it may be further amended, restated, supplemented, modified or otherwise
changed from time to time, the “Loan Agreement”), is by and among Creative Realities, Inc., a Minnesota corporation
(“CRI”), Creative Realities, LLC, a Delaware limited liability company (“CRLLC”), Conexus
World Global, LLC, a Kentucky limited liability company (“Conexus”), and Allure Global Solutions, Inc. a Georgia
corporation (“Allure” and collectively referred to together with CRI, CRLLC and Conexus as the “Borrower”),
and Slipstream Communications, LLC, an Anguillan limited liability company (the “Lender”). All terms used herein
that are defined in the Loan Agreement and not otherwise defined herein shall have the respective meanings assigned to them in
the Loan Agreement.

WHEREAS, Lender is the holder of that
certain Secured Convertible Special Loan Promissory Note issued on December 30, 2019 (the “Special Loan”) by
the Borrower;

WHEREAS, the Special Loan automatically
converts to New Preferred (as defined in the Loan Agreement) on December 31, 2020 and the Lender and Borrower desire to extend
the conversion date as set forth herein.

 

NOW THEREFORE,
in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged,
Borrower and the Lender, intending to be legally bound, hereby agree as follows:

 

1.         
Amendments.The Loan Agreement is hereby amended as follows:

 

a)                 
The first sentence of Section 1.7 is hereby amended to replace “December 31, 2020” with “January
31, 2021”.

 

b)                 
Schedule A is hereby amended by adding the following definitions, in appropriate alphabetical order:

 

i)                   
“Eleventh Amendment’ means the Eleventh Amendment to Loan and Security Agreement dated as of December
31, 2020, among Borrower and the Lender.”; and

 

ii)                
“Eleventh Amendment Effective Date” shall have the meaning specified therefor in Section 3 of
the Eleventh Amendment.”.

 

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2.         
Representations and Warranties.Borrower hereby represents and warrants to Lender as follows:

a)                     
Representations and Warranties; No Event of Default. The representations and warranties herein, in Article 3 of the
Loan Agreement and in each other Loan Document, certificate or other writing delivered by or on behalf of Borrower to the Lender
pursuant to this Amendment, the Loan Agreement or any other Loan Document on or prior to the Eleventh Amendment Effective Date
(as defined below) are true and correct in all material respects (except that such materiality qualifier shall not be applied to
any representations or warranties that already are qualified or modified as to “materiality” or “Material Adverse
Effect” in the text thereof, which representations and warranties shall be true and correct in all respects subject to such
qualification) on and as of the Eleventh Amendment Effective Date as though made on and as of such date (unless such representations
or warranties (after taking into account this Amendment) are stated to relate to an earlier date, in which case such representations
and warranties shall be true and correct on and as of such earlier date in all material respects (except that such materiality
qualifier shall not be applicable to any representations or warranties that already are qualified or modified as to “materiality”
or “Material Adverse Effect” in the text thereof, which representations and warranties shall be true and correct in
all respects subject to such qualification), and no Default or Event of Default has occurred and is continuing as of the Eleventh
Amendment Effective Date or would result from this Amendment becoming effective in accordance with its terms.

b)                    
Authorization, Etc. The execution, delivery and performance by Borrower of this Amendment and the other Loan
Documents being executed concurrently herewith, and the performance of the Loan Agreement, as amended hereby, and the other Loan
Documents, (i) have been duly authorized by all necessary action, (ii) do not and will not contravene any of the governing documents
of any Borrower or any applicable Requirement of Law, (iii) do not and will not contravene any Contractual Obligation binding on
or otherwise affecting any Borrower or any of its properties (except for those the conflict with which could not reasonably be
expected to result in a Material Adverse Effect), (iv) do not and will not result in or require the creation of any Lien (other
than pursuant to any Loan Document) upon or with respect to any properties of any Borrower, and (v) do not and will not result
in any default, noncompliance, suspension, revocation, impairment, forfeiture or non-renewal of any permit, license, authorization
or approval applicable to its operations or any of its properties, except in each case to the extent that such default, noncompliance,
contravention, suspension, revocation, impairment, forfeiture or non-renewal could not reasonably be expected to result in a Material
Adverse Effect.

c)                     
Enforceability of Loan Documents. This Amendment, the Loan Agreement as amended by this Amendment, and each
other Loan Document to which any Borrower is or will be a party, when delivered hereunder, will be, a legal, valid and binding
obligation of such Person, enforceable against such Person in accordance with its terms, except as enforceability may be limited
by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws and by general principles of equity .

3.         
Conditions to Effectiveness. This Amendment shall become effective only upon satisfaction in full, in a manner reasonably
satisfactory to the Lender and its counsel, of the following conditions precedent (the first date upon which all such conditions
shall have been satisfied (or waived) being herein called the “Eleventh Amendment Effective Date”):

a)                     
Representations and Warranties. The representations and warranties contained in this Amendment and in Article
3 of the Loan Agreement and in each other Loan Document, certificate or other document delivered to Lender pursuant to this Amendment,
the Loan Agreement or any other Loan Document on or prior to the Eleventh Amendment Effective Date are true and correct in all
material respects (except that such materiality qualifier shall not be applied to any representations or warranties that already
are qualified or modified as to “materiality” or “Material Adverse Effect” in the text thereof (which representations
and warranties shall be true and correct in all respects subject to such qualification), on and as of the Eleventh Amendment Effective
Date as though made on and as of such date, except to the extent that any such representation or warranty (after taking into account
this Amendment) expressly relates solely to an earlier date (in which case such representation or warranty shall be true and correct
on and as of such earlier date in all material respects (except that such materiality qualifier shall not be applicable to any
representations or warranties that already are qualified or modified as to “materiality” or “Material Adverse
Effect” in the text thereof, which representations and warranties shall be true and correct in all respects subject to such
qualification) on and as of such earlier date).

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b)                    
No Default; Event of Default. No Default or Event of Default shall have occurred and be continuing on the
Eleventh Amendment Effective Date or result from this Amendment becoming effective in accordance with its terms.

c)                     
Delivery of Documents. The Lender shall have received on or before the Eleventh Amendment Effective Date the
following, each in form and substance reasonably satisfactory to the Lender and, unless indicated otherwise, dated the Eleventh
Amendment Effective Date:

 

i)                                  
this Amendment, duly executed by each Borrower; and

 

ii)                                
a certificate of an authorized officer of each Borrower, certifying as to the matters set forth in subsections (a)
and (b) of this Section 3.

 

4.         
Continued Effectiveness of the Loan Agreement and Other Loan Documents. Each Borrower hereby (i) confirms and agrees
that the Loan Agreement and each other Loan Document to which it is a party is, and shall continue to be, in full force and effect
and is hereby ratified and confirmed in all respects except that on and after the Eleventh Amendment Effective Date all references
in any such Loan Document to “the Loan Agreement,” the “Agreement,” “thereto,” “thereof,”
“thereunder” or words of like import referring to the Loan Agreement shall mean the Loan Agreement as amended by this
Amendment, and (ii) confirms and agrees that to the extent that any Loan Document purports to assign or pledge to the Lender, or
to grant to the Lender a security interest in or Lien on, any Collateral as security for the Obligations of any Borrower from time
to time existing in respect of the Loan Agreement (as amended hereby) and the other Loan Documents, such pledge, assignment and/or
grant of the security interest or Lien is hereby ratified and confirmed in all respects. This Amendment does not and shall not
affect any of the obligations of any Borrower, other than as expressly provided herein, including, without limitation, the Borrower's
obligations to repay the Loans in accordance with the terms of the Loan Agreement, or the obligations of any Borrower under any
Loan Document to which it is a party, all of which obligations shall remain in full force and effect. Except as expressly provided
herein, the execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy
of the Lender under the Loan Agreement or any other Loan Document, nor constitute a waiver of any provision of the Loan Agreement
or any other Loan Document.

 

5.         
Release. (a) Each Borrower hereby acknowledges and agrees that: (i) no Borrower has any claim or cause of action
against the Lender (or any of its Affiliates or its or their officers, directors, employees, managers, members, partner, shareholders,
attorneys or consultants) in connection with the Loan Documents and (ii) the Lender has heretofore properly performed and satisfied
in a timely manner all of its obligations to Borrower under the Loan Agreement and the other Loan Documents that are required to
have been performed on or prior to the date hereof. Notwithstanding the foregoing, the Lender wishes (and Borrower agrees) to eliminate
any possibility that any past conditions, acts, omissions, events or circumstances would impair or otherwise adversely affect any
of the Lender's rights, interests, security and/or remedies under the Loan Agreement and the other Loan Documents. Accordingly,
for and in consideration of the agreements contained in this Amendment and other good and valuable consideration, each Borrower
(for itself and each other Borrower and the successors, assigns, heirs and representatives of each of the foregoing) (collectively,
the “Releasors”) does hereby fully, finally, unconditionally and irrevocably release and forever discharge Lender
and each of its Affiliates and its and their managers, members, partners, officers, directors, employees, shareholders attorneys
and consultants in their capacities as or for the Lender (collectively, the “Released Parties”) from any and
all debts, claims, obligations, damages, costs, attorneys' fees, suits, demands, liabilities, actions, proceedings and causes of
action, in each case, whether known or unknown, contingent or fixed, direct or indirect, and of whatever nature or description,
and whether in law or in equity, under contract, tort, statute or otherwise, which any Releasor has heretofore had or now or hereafter
can, shall or may have against any Released Party by reason of any act, omission or thing whatsoever done or omitted to be done
directly arising out of, connected with or related to this Amendment, the Loan Agreement or any other Loan Document, or any act,
event or transaction related or attendant thereto, or the agreements of the Lender contained therein, or the possession, use, operation
or control of any of the assets of any Borrower, or the making of any Loans or other Advances, or the management of such Loans
or Advances or the Collateral, in each case, solely to the extent arising from any act, omission or thing whatsoever done or omitted
to be done on or prior to the Eleventh Amendment Effective Date.

 

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6.         
Miscellaneous.

 

a)                     
Borrower will pay on demand all reasonable and documented out-of-pocket fees, costs and expenses of the Lender in
connection with the structuring, preparation, negotiation, execution and delivery of this Amendment and the transactions and all
documents contemplated herein and therein, and related transactions, and all documents with respect thereto.

 

b)                    
Section and paragraph headings herein are included for convenience of reference only and shall not constitute a part
of this Amendment for any other purpose.

 

c)                     
Borrower hereby acknowledges and agrees that this Amendment constitutes a “Loan Document” under the Loan
Agreement. Accordingly, it shall be an Event of Default under the Loan Agreement if (i) any representation or warranty made by
a Borrower under or in connection with this Amendment shall have been incorrect in any material respect when made, or (ii) any
Borrower shall fail to perform or observe any term, covenant or agreement contained in this Amendment.

d)                    
All representations, warranties, acknowledgements, agreements and other covenants of the Borrowers in this Amendment
are made on a joint and several basis and are made by each Borrower with respect to itself and all other Borrowers.

 

e)                     
Any provision of this Amendment that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining portions hereof or affecting
the validity or enforceability of such provision in any other jurisdiction.

 

f)                      
In the case of any conflict between the terms of this Amendment and any Loan Document (including any promissory notes
and allonges), the terms of this Amendment shall control.

 

7.         
Covenant by Borrower. Borrower covenants and agrees that at any time upon the request of Lender, Borrower will cause
Creative Realities Canada, Inc., a Canadian company and subsidiary of CRI to become a party to the Agreement.

 

8.         
Counterparts. This Amendment may be entered into in any number of separate counterparts by any one or more of the
parties hereto, and all of said counterparts taken together shall constitute one and the same instrument. Valid and binding signatures
to this Amendment may be delivered in original ink, by facsimile or by email or other means of electronic transmission.

 

9.         
Governing Law. This Amendment and the obligations arising hereunder shall be governed by, and construed and enforced
in accordance with, the laws of the State of New York applicable to contracts made and performed in such state, without regard
to the principles thereof regarding conflicts of laws.

 

    4 

     

    

  

10.      
Submission To Jurisdiction; Waiver Of Jury Trial.

 

a)                       
BORROWER HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN NEW YORK CITY, NEW YORK, SHALL
HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN BORROWER AND THE LENDER PERTAINING TO THIS AMENDMENT
OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS AMENDMENT OR ANY OF THE OTHER LOAN DOCUMENTS;
PROVIDED, HOWEVER, THAT NOTHING IN THIS AMENDMENT OR ANY OTHER LOAN DOCUMENT SHALL BE DEEMED OR OPERATE TO PRECLUDE THE LENDER
FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE OBLIGATIONS, TO REALIZE ON THE COLLATERAL
OR ANY OTHER SECURITY FOR THE OBLIGATIONS, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE LENDER. BORROWER EXPRESSLY
SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANYACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND BORROWER HEREBY WAIVES
ANY OBJECTION THAT IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS.

 

b)                    
THE PARTIES HERETO WAIVE ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT TO RESOLVE ANY DISPUTE,
WHETHER ARISING IN CONTRACT, TORT, OR OTHERWISE BETWEEN LENDER AND BORROWER ARISING OUT OF, CONNECTED WITH, RELATED OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED BETWEEN THEM IN CONNECTION WITH THIS AMENDMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS RELATED
HERETO OR THERETO.

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left blank

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IN WITNESS WHEREOF, the parties hereto
have caused this Amendment to be executed and delivered as of the date set forth on the first page hereof.

 

	BORROWER:	 	LENDER:
	 	 	 	 	 
	
        CREATIVE REALITIES, INC. 

        CREATIVE REALITIES, LLC 

        CONEXUS WORLD GLOBAL, LLC

        ALLURE GLOBAL SOLUTIONS, INC.
	 	SLIPSTREAM COMMUNICATIONS, LLC
	 	 	 	 	 
	By:	/s/ Richard C. Mills	 	By:	/s/ Brian Friedman
	Name	RICHARD C. MILLS	 	Name:	BRIAN FRIEDMAN
	Title:	Chief Executive Officer	 	Title:	General Counsel & Secretary
	 	 	 	 	 
	Address for Notice (for all Borrowers):	 	Address for Notice:
	
        Creative Realities, Inc.

        Attention: Chief Financial Officer

        13100 Magisterial Drive, Ste 100

        Louisville, KY 40223
	 	
        750 E. Main St., Suite 600

        Stamford, CT 06902 Attn: Mr. Brian Friedman

 

 

Signature Page to Eleventh Amendment
to Loan and Security Agreement

 

    6

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