UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
To Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of report (Date of earliest event reported): August 23, 2023
SEP
ACQUISITION CORP.
(Exact
Name of Registrant as Specified in its Charter)
Delaware |
|
001-40679 |
|
86-2365445 |
(State
or Other Jurisdiction |
|
(Commission |
|
(IRS
Employer |
of
Incorporation) |
|
File
Number) |
|
Identification
No.) |
3737
Buffalo Speedway, Suite
1750 Houston,
Texas 77098
(Address
of Principal Executive Offices) (Zip Code)
(713)
715-6820
(Registrant’s
telephone number, including area code)
Not
Applicable
(Former
name or former address, if changed since last report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant
under any of the following provisions (see General Instruction A.2. below):
| ☒ | Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each Class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
Units, each consisting
of one share of Class A common stock and one-half of one warrant |
|
SEPAU |
|
The Nasdaq Stock
Market LLC |
Class A common stock,
par value $0.0001 per share |
|
SEPA |
|
The Nasdaq Stock
Market LLC |
Warrants, each whole
warrant exercisable for one share of Class A common stock at an exercise price of $11.50 per share |
|
SEPAW |
|
The Nasdaq Stock
Market LLC |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging
growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
|
Item 1.01 | Entry
into A Material Definitive Agreement. |
Merger
Agreement
General
Terms
On
August 23, 2023, SEP Acquisition Corp., a Delaware corporation (“SEPA”), entered into an Agreement and Plan
of Merger (the “Merger Agreement”) by and among SEPA, SEP Acquisition Holdings Inc., a Nevada corporation and
a wholly owned subsidiary of SEPA (“Merger Sub”), and SANUWAVE Health, Inc., a Nevada corporation (the “SANUWAVE”).
Pursuant to the terms of the Merger Agreement, a business combination between SEPA and SANUWAVE (the “Merger”)
will be effected. More specifically, and as described in greater detail below, at the effective time of the Merger (the “Effective
Time”):
| ● | Merger
Sub will merge with and into SANUWAVE, with SANUWAVE being the surviving company following
the Merger and continuing in existence as a wholly owned subsidiary of SEPA; |
| ● | each
issued and outstanding share of SANUWAVE common stock, par value $0.001 per share (the
“SANUWAVE Common Stock”), will be automatically converted into shares
of Class A Common Stock of SEPA, par value $0.0001 per share (the “Class A Common
Stock”), at the Conversion Ratio (as defined in the Merger Agreement); and |
| ● | outstanding
Company Convertible Securities (as defined in the Merger Agreement) of SANUWAVE will
be assumed by SEPA and will be converted into the right to receive Class A Common Stock
of SEPA. |
Merger
Consideration
Pursuant
to the terms of the Merger Agreement, the holders of (i) SANUWAVE Common Stock, (ii) options to purchase SANUWAVE Common Stock,
(iii) warrants to purchase SANUWAVE Common Stock, and (iv) convertible promissory notes, collectively will be entitled to receive
7,793,000 shares of Class A Common Stock of SEPA (the “Merger Consideration”).
Each
SANUWAVE convertible note that is outstanding, and has not been exchanged for shares of SANUWAVE Common Stock prior to the Effective
Time will, to the extent permitted by the terms of such convertible note, automatically be assumed by SEPA and convertible into
the number of shares of Class A Common Stock of SEPA equal to the product of (i) the number of shares of SANUWAVE Common Stock
subject to such convertible note as of immediately prior to the Effective Time multiplied by (ii) the Conversion Ratio.
Each
outstanding option to purchase SANUWAVE Common Stock (whether vested or unvested, exercisable or unexercisable) that is outstanding
as of immediately prior to the Effective Time will be assumed by SEPA and automatically converted into the right to receive an
option to acquire the number of shares of Class A Common Stock of SEPA equal to the product of (i) the number of shares of SANUWAVE
Common Stock subject to such option as of immediately prior to the Effective Time multiplied by (ii) the Conversion Ratio.
Each
warrant to purchase SANUWAVE Common Stock that is outstanding and unexercised, and has not been exchanged for shares of SANUWAVE
Common Stock prior to the Effective Time will, to the extent permitted by the terms of such warrant, automatically be assumed
by SEPA and converted into a warrant to purchase the number of shares of Class A Common Stock of SEPA equal to the product of
(1) the number of shares of SANUWAVE stock subject to such warrant multiplied by (2) the Conversion Ratio.
Representations
and Warranties
The
Merger Agreement contains a number of representations and warranties made by each of SEPA and SANUWAVE as of the date of the Merger
Agreement or other specified dates. Certain of the representations and warranties are qualified by materiality or Material Adverse
Effect (as defined in the Merger Agreement), as well as information provided in the disclosure schedules to the Merger Agreement.
No
Survival
The
representations and warranties of the parties contained in the Merger Agreement terminate as of, and do not survive, the consummation
of the transactions (the “Transactions”) contemplated by the Merger Agreement (the “Closing”),
and there are no indemnification rights for another party’s breach. The covenants and agreements of the parties contained
in the Merger Agreement do not survive the Closing, except those covenants and agreements to be performed after the Closing, which
such covenants and agreements will survive until fully performed.
Covenants
of the Parties
Each
party agreed in the Merger Agreement to use its commercially reasonable efforts to effect the Closing. The Merger Agreement also
contains certain customary covenants by each of the parties during the period between the signing of the Merger Agreement and
the Closing or the earlier termination of the Merger Agreement in accordance with its terms (the “Interim Period”),
including, but not limited to those relating to: (i) the provision of access to their properties, books and personnel; (ii) the
operation of their respective businesses in the ordinary course of business; (iii) each party’s public filings; (iv) restrictions
on SANUWAVE soliciting any takeover proposals; (v) notification by SANUWAVE of any takeover proposals; (vi) notifications of certain
breaches, consent requirements or other matters; (vii) efforts to consummate the Closing; (viii) tax matters; (ix) further assurances;
(x) public announcements; (xi) confidentiality; and (xii) the composition of SEPA’s board of directors following the Closing.
During the Interim Period, SEPA and SANUWAVE will solicit PIPE Investors (as defined in the Merger Agreement) to purchase shares
of Class A Common Stock of SEPA in connection with the PIPE Investment (as defined in the Merger Agreement), which PIPE Investment
will be consummated immediately prior to the Closing. The Merger Agreement also contains certain customary post-Closing covenants
regarding (a) maintenance of books and records; (b) indemnification of directors and officers and the purchase of tail directors’
and officers’ liability insurance; and (c) use of trust account proceeds.
The
parties made customary covenants regarding the registration statement on Form S-4 to be filed by SEPA (the “Registration
Statement”) with the U.S. Securities and Exchange Commission (the “SEC”) under the Securities Act
of 1933, as amended (the “Securities Act”), to register the shares of SEPA’s Class A Common Stock to
be issued as Merger Consideration under the Merger Agreement. The Registration Statement also will contain a proxy statement to
solicit proxies from stockholders to approve the Merger Agreement and the Transactions, including the Merger.
Prior
to the Closing and upon the approval of the holders of SEPA’s Class B common stock, par value $0.0001 per share (the “Class
B Common Stock”), SEPA will file with the Delaware Secretary of State an amendment to its Certificate of Incorporation
(i) amending the conversion ratio of Class B Common Stock to Class A Common Stock on a 1:0.277 basis, such that 1 share of Class
B Common Stock is convertible to 0.277 shares of Class A Common Stock and (ii) removing the anti-dilution protection previously
held by the holders of SEPA’s Class B Common Stock (the “Class B Charter Amendment”).
Prior
to the Closing and upon the approval of all of SEPA’s stockholders, SEPA will also file with the Delaware Secretary of State
an additional amendment to its Certificate of Incorporation removing the provision requiring SEPA to have net tangible assets
in excess of $5,000,000 in order to redeem Offering Shares (as defined in the Certificate of Incorporation) in connection with
a Business Combination (as defined in the Certificate of Incorporation) (the “Net Tangible Asset Charter Amendment”
and along with the Class B Charter Amendment, collectively, the “Charter Amendments”).
Conditions
to Closing
The
Merger Agreement contains customary conditions to Closing, including the following mutual conditions of the parties (unless waived):
(i) approval of the stockholders of SEPA and SANUWAVE; (ii) approvals of any required governmental authorities; (iii) no law or
order preventing the Transactions; (iv) the filing of the Charter Amendments; (v) the appointment of SEPA’s post-closing
board of directors; (vi) the Registration Statement having been declared effective by the SEC; (vii) approval of the Class A Common
Stock of SEPA for listing on Nasdaq; (viii) holders of 80% or more of SANUWAVE’s convertible notes with a maturity date
occurring after the date of the Closing (the “Closing Date”), measured by number of shares into which such
convertible notes may be converted, agreeing to convert their convertible notes into shares of SANUWAVE Common Stock immediately
prior to the Effective Time; and (ix) holders of 80% or more of SANUWAVE’s warrants that would be outstanding on the Closing
Date, measured by number of shares subject to all such warrants in the aggregate, agreeing to convert their warrants into shares
of SANUWAVE Common Stock immediately prior to the Effective Time.
In
addition, unless waived by SANUWAVE, the obligations of SANUWAVE to consummate the Transactions are subject to the satisfaction
of the following additional Closing conditions, in addition to the delivery by SEPA of customary certificates and other Closing
deliverables: (i) the representations and warranties of SEPA being true and correct as of the date of the Closing, except to the
extent made as of a particular date and except for any failures that, individually or in the aggregate, have not had and would
not reasonably be expected to have a Material Adverse Effect; (ii) SEPA having performed in all material respects its obligations
and complied in all material respects with its covenants and agreements under the Merger Agreement required to be performed or
complied with by it on or prior to the Closing Date; (iii) SEPA having delivered a fairness opinion of the Purchaser Financial
Advisor (as defined in the Merger Agreement), in form and substance reasonably satisfactory to SANUWAVE; (iv) SEPA having, at
the Closing, at least $12,000,000 in cash and cash equivalents, including funds remaining in the trust account (after giving effect
to the completion and payment of any redemptions) and the proceeds of any PIPE Investment; (v) execution of the Registration Rights
Agreement (as defined in the Merger Agreement), (vi) evidence of the filing of the Charter Amendments with the Secretary of State
of Delaware, (vii) execution of the Letter Agreement Amendment (as described below), and (viii) delivery of the Amendment to Warrant
Agreement (as described below).
Unless
waived by SEPA, the obligations of SEPA and Merger Sub to consummate the Transactions are subject to the satisfaction of the following
additional Closing conditions, in addition to the delivery by SANUWAVE of customary certificates and other Closing deliverables:
(i) the representations and warranties of SANUWAVE being true and correct as of the date of the Closing, except to the extent
made as of a particular date and except for any failures that, individually or in the aggregate, have not had and would not reasonably
be expected to have a Material Adverse Effect; (ii) SANUWAVE having performed in all material respects its obligations and complied
in all material respects with its covenants and agreements under the Merger Agreement required to be performed or complied with
or by it on or prior to the date of the Closing; (iii) the absence of any Material Adverse Effect with respect to SANUWAVE and
its subsidiaries since the date of the Merger Agreement which is continuing and uncured; and (iv) the Lock-Up Agreements (as described
below) being in full force and effect as of the Closing.
Termination
The
Merger Agreement may be terminated under certain customary and limited circumstances at any time prior to the Closing, including:
(i) by mutual written consent of SEPA and SANUWAVE; (ii) by either SEPA or SANUWAVE if any of the conditions to Closing have not
been satisfied or waived by February 28, 2024; (iii) by either SEPA or SANUWAVE if a governmental authority of competent jurisdiction
has issued an order or taken any other action permanently restraining, enjoining or otherwise prohibiting the Transactions, and
such order or other action has become final and non-appealable; (iv) by either SEPA or SANUWAVE in the event of the other party’s
uncured breach, if such breach would result in the failure of a closing condition (and so long as the terminating party is not
also in breach under the Merger Agreement); (v) by SEPA if there has been a Material Adverse Effect on SANUWAVE and its subsidiaries
following the date of the Merger Agreement that remains uncured with 20 days written notice; (vi) by SEPA if SANUWAVE’s
board effects a Company Adverse Recommendation Change (as defined in the Merger Agreement), SANUWAVE’s board approves, endorses
or recommends a Superior Proposal (as defined in the Merger Agreement), a tender offer or exchange offer for any outstanding shares
of SANUWAVE capital stock is commenced before obtaining the required stockholder approval and the SANUWAVE board fails to recommend
against acceptance of such tender offer or exchange offer within 10 business days after commencement, or if there shall have been
a material breach of Section 5.6 of the Merger Agreement; (vii) by SANUWAVE prior to the receipt of the required stockholder approval,
if prior to or substantially concurrent with such termination, (A) SANUWAVE shall have paid the applicable termination fee (described
below) and (B) SANUWAVE substantially concurrently with such termination enters into a definitive agreement with respect to a
Superior Proposal that did not result from a material breach of Section 5.6 of the Merger Agreement; (viii) by either SEPA or
SANUWAVE if the stockholders of SEPA do not approve the Merger Agreement and the Transactions at a special stockholder meeting
held by SEPA; (ix) by either SEPA or SANUWAVE if the stockholders of SANUWAVE do not approve the Merger Agreement and the Transactions
at a special stockholder meeting held by SANUWAVE; and (x) by SANUWAVE, if (A) a Form 25 relating to the delisting of the shares
of SEPA’s Class A Common Stock from Nasdaq shall have been filed, and (B) the shares of SEPA’s Class A Common Stock
have not been approved for listing on Nasdaq after the filing of such Form 25, subject to official notice of within the earlier
of (A) 30 days after the date on which the Form 25 is filed and (B) February 28, 2024.
If
the Merger Agreement is terminated, all further obligations of the parties under the Merger Agreement (except for certain obligations
related to confidentiality, fees and expenses, trust fund waiver, no recourse, and general provisions) will terminate, and no
party to the Merger Agreement will have any further liability to any other party thereto except for liability for willful breach
of the Merger Agreement prior to termination.
Termination
Fee
In
the event that the Merger Agreement is terminated as a result of one of the below actions, SANUWAVE shall pay to SEPA by wire
transfer of immediately available funds an amount equal to $2,500,000:
| ● | the
Merger Agreement is terminated by SANUWAVE prior to the receipt of the required stockholder
approval, if prior to or substantially concurrent with such termination, SANUWAVE substantially
concurrently with such termination enters into a definitive agreement with respect to
a Superior Proposal that did not result from a material breach of Section 5.6 of the
Merger Agreement, in which case payment shall be made before or concurrently with such
termination; |
| ● | the
Merger Agreement is terminated by SEPA if SANUWAVE’s board effects a Company Adverse
Recommendation Change, SANUWAVE’s board approves, endorses or recommends a Superior
Proposal, a tender offer or exchange offer for any outstanding shares of SANUWAVE capital
stock is commenced before obtaining the required stockholder approval and the SANUWAVE
board fails to recommend against acceptance of such tender offer or exchange offer within
10 business days after commencement, or if there shall have been a material breach of
Section 5.6 of the Merger Agreement, in which case payment shall be made within two business
days following such termination; or |
| ● | after
the date of the Merger Agreement, first, a Takeover Proposal (as defined in the Merger
Agreement) is made, proposed or communicated to the SANUWAVE board or management, or
is publicly made, proposed or communicated or otherwise becomes publicly known; (B) second,
the Merger Agreement is terminated by either SANUWAVE or SEPA pursuant to Section 7.1(b)
or 7.1(i) of the Merger Agreement, or by SEPA pursuant to Section 7.1(e) of the Merger
Agreement; and (C) third, within twelve (12) months of such termination (1) any transaction
included within the definition of a Takeover Proposal with respect to SANUWAVE is consummated
or (2) SANUWAVE enters into a definitive agreement providing for the consummation of
any transaction within the definition of Takeover Proposal, in each case whether or not
involving the same Takeover Proposal or the person or group making the Takeover Proposal
referred to in clause (A); provided, that for purposes of clause (C), the term
“Takeover Proposal” shall have the meaning assigned to such term in Article
X of the Merger Agreement, except that all references to “15%” in such definition
shall be deemed references to “50%”, in which case payment shall be made
within two business days following such termination. |
Trust
Account Waiver
SANUWAVE
agreed that SANUWAVE and its affiliates will not have any right, title, interest or claim of any kind in or to any monies in SEPA’s
trust account held for its public stockholders, and agreed not to, and waived any right to, make any claim against the trust account
(including any distributions therefrom) other than in connection with the Closing.
Governing
Law
The
Merger Agreement is governed by the laws of the State of Delaware and the parties are subject to exclusive jurisdiction of federal
and state courts located in the State of Delaware (and any appellate courts thereof).
A
copy of the Merger Agreement is filed as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference,
and the foregoing description of the Merger Agreement is qualified in its entirety by reference thereto.
The
Merger Agreement contains representations, warranties and covenants that the respective parties made to each other as of the date
of such agreement or other specific dates. The assertions embodied in those representations, warranties and covenants were made
for purposes of the contract among the respective parties and are subject to important qualifications and limitations agreed to
by the parties in connection with negotiating such agreement. The Merger Agreement has been filed with this Current Report on
Form 8-K in order to provide investors with information regarding its terms. It is not intended to provide any other factual information
about SEPA, SANUWAVE, Merger Sub or any other party to the Merger Agreement. In particular, the representations, warranties, covenants
and agreements contained in the Merger Agreement, which were made only for purposes of such agreement and as of specific dates,
were solely for the benefit of the parties to the Merger Agreement, may be subject to limitations agreed upon by the contracting
parties (including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the
parties to the Merger Agreement instead of establishing these matters as facts) and may be subject to standards of materiality
applicable to the contracting parties that differ from those applicable to investors and reports and documents filed with the
SEC. Investors should not rely on the representations, warranties, covenants and agreements, or any descriptions thereof, as characterizations
of the actual state of facts or condition of any party to the Merger Agreement. In addition, the representations, warranties,
covenants and agreements and other terms of the Merger Agreement may be subject to subsequent waiver or modification. Moreover,
information concerning the subject matter of the representations and warranties and other terms may change after the date of the
Merger Agreement, which subsequent information may or may not be fully reflected in SEPA’s public disclosures.
Related
Agreements
This
section describes the material provisions of certain additional agreements entered into or to be entered into pursuant to or in
connection with the Merger Agreement (the “Ancillary Agreements”), but does not purport to describe all of the terms
thereof. The following summary is qualified in its entirety by reference to the complete text of each of the Ancillary Agreements,
copies of each of which are attached hereto as exhibits. Stockholders and other interested parties are urged to read such Ancillary
Agreements in their entirety.
Voting
Agreements
Simultaneously
with the execution and delivery of the Merger Agreement, SEPA and SANUWAVE have entered into voting agreements (collectively,
the “Voting Agreements”) with certain stockholders of SANUWAVE required to approve the Transactions. Under
the Voting Agreements, each SANUWAVE stockholder party thereto has agreed to vote all of such stockholder’s shares of SANUWAVE
in favor of the Merger Agreement and the Transactions and to otherwise take (or not take, as applicable) certain other actions
in support of the Merger Agreement and the Transactions and the other matters to be submitted to the SANUWAVE stockholders for
approval in connection with the Transactions, in the manner and subject to the conditions set forth in the Voting Agreements,
and provide a proxy to SEPA to vote such SANUWAVE shares accordingly (subject to the condition that the Registration Statement
has been declared effective by the SEC, provided that the covenants not to take certain actions to delay, impair or impede the
Transactions as set forth in the Voting Agreements shall take effect from the date such agreements are executed). The Voting Agreements
prevent transfers of the SANUWAVE shares held by the SANUWAVE stockholders party thereto between the date of the Voting Agreement
and the termination of such Voting Agreement, except for certain permitted transfers where the recipient also agrees to comply
with the Voting Agreement.
A
copy of the form of Voting Agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by
reference, and the foregoing description of the form of Voting Agreement is qualified in its entirety by reference thereto.
Sponsor
Voting Agreement
Simultaneously
with the execution and delivery of the Merger Agreement, SEPA and SANUWAVE have entered into a voting agreement (the “Sponsor
Voting Agreement”) with Mercury Sponsor Group I LLC, a Delaware limited
liability company (the “Sponsor”). Under the Sponsor Voting Agreement, the Sponsor has agreed to vote all of
the Sponsor’s shares of SEPA in favor of the Merger Agreement and the Transactions and to otherwise take (or not take, as
applicable) certain other actions in support of the Merger Agreement and the Transactions and the other matters to be submitted
to the SEPA stockholders for approval in connection with the Transactions, in the manner and subject to the conditions set forth
in the Sponsor Voting Agreement, and provide a proxy to SANUWAVE to vote such SEPA shares accordingly (subject to the condition
that the Registration Statement has been declared effective by the SEC, provided that the covenants not to take certain actions
to delay, impair or impede the Transactions as set forth in the Sponsor Voting Agreement shall take effect from the date such
agreement is executed). The Sponsor Voting Agreement prevents transfers of the SEPA shares held by the Sponsor between the date
of the Sponsor Voting Agreement and the termination of such Sponsor Voting Agreement, except for certain permitted transfers where
the recipient also agrees to comply with the Sponsor Voting Agreement.
A
copy of the Sponsor Voting Agreement is filed as Exhibit 10.2 to this Current Report on Form 8-K and is incorporated herein by
reference, and the foregoing description of the Sponsor Voting Agreement is qualified in its entirety by reference thereto.
Voting
and Non-Redemption Agreement
Simultaneously
with the execution and delivery of the Merger Agreement, SEPA has entered into voting and non-redemption agreements (collectively,
the “Voting and Non-Redemption Agreements”) with certain stockholders of SEPA required to approve the Transactions.
Under the Voting and Non-Redemption Agreements, each SEPA stockholder party thereto has agreed to vote all of such stockholder’s
shares of SEPA in favor of the Merger Agreement and the Transactions and to otherwise take (or not take, as applicable) certain
other actions in support of the Merger Agreement and the Transactions and the other matters to be submitted to the SEPA stockholders
for approval in connection with the Transactions, in the manner and subject to the conditions set forth in the Voting and Non-Redemption
Agreements, and provide a proxy to SEPA to vote such SEPA shares accordingly. Under the Voting and Non-Redemption Agreements,
each SEPA stockholder party thereto agreed to not redeem certain of such stockholder’s SEPA shares pursuant to or in connection
with the Merger. In consideration for entering into and complying with the terms of the Voting and Non-Redemption Agreements,
each SEPA stockholder will receive shares of Class A Common Stock of SEPA in accordance with the formula set forth in the Voting
and Non-Redemption Agreements. The Voting and Non-Redemption Agreements prevent transfers of the SEPA shares held by the SEPA
stockholders party thereto between the date of the Voting and Non-Redemption Agreement and the Closing Date or earlier termination
of the Merger Agreement or such Voting and Non-Redemption Agreement, except for certain permitted transfers where the recipient
also agrees to comply with the Voting and Non-Redemption Agreement. Pursuant to the Voting and Non-Redemption Agreements, certain
SEPA stockholders agreed to vote an aggregate of 865,000 shares of Class A Common Stock in favor of the Merger Agreement and Transactions
and agreed not to redeem an aggregate of 681,512 shares of Class A Common Stock (representing approximately $7.0 million (calculated
based on the funds held in the trust account as of June 30, 2023) that SEPA would have otherwise been required to pay to redeem
such shares in connection with the Merger).
A
copy of the form of Voting and Non-Redemption Agreement is filed as Exhibit 10.3 to this Current Report on Form 8-K and is incorporated
herein by reference, and the foregoing description of the form of Voting and Non-Redemption Agreement is qualified in its entirety
by reference thereto.
Lock-Up
Agreement
Simultaneously
with the execution and delivery of the Merger Agreement, certain stockholders of SANUWAVE each entered into a Lock-Up Agreement
with SEPA (collectively, the “Lock-Up Agreements”). Pursuant to the Lock-Up Agreements, each SANUWAVE stockholder
party thereto agreed not to, during the period commencing from the Closing and ending 180 days after the Closing (subject to early
release if SANUWAVE consummates a liquidation, merger, share exchange or other similar transaction that results in all of the
SEPA stockholders having the right to exchange their shares for cash, securities or other property): (i) sell, offer to sell,
contract to sell, hypothecate, pledge, grant an option to purchase or otherwise dispose of, directly or indirectly, or establish
or increase a put equivalent position or liquidation or decrease a call equivalent position, any SEPA restricted securities, (ii)
enter any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership
of any security, or (iii) publicly disclose the intention to do any of the foregoing, whether any such transaction described in
clauses (i) or (ii) above is to be settled by delivery of the SEPA restricted securities, in cash or otherwise (in each case,
subject to certain limited permitted transfers where the recipient takes the shares subject to the restrictions in the Lock-Up
Agreement).
A
copy of the form of Lock-Up Agreement is filed as Exhibit 10.4 to this Current Report on Form 8-K and is incorporated herein by
reference, and the foregoing description of the form of Lock-Up Agreement is qualified in its entirety by reference thereto.
Letter
Agreement Amendment
Upon
approval of certain of SEPA’s stockholders and immediately prior to the Closing, certain insider stockholders of SEPA and
other SEPA stockholders will enter into an amendment to that certain Letter Agreement, dated July 27, 2021 (the “Letter
Agreement”), among SEPA, the Sponsor, insider stockholders and other SEPA stockholders (the “Letter Agreement
Amendment”). Pursuant to the Letter Agreement Amendment, each SEPA stockholder party thereto will agree not to, until
180 days after the completion of SEPA’s initial Business Combination (as defined in the Letter Agreement) (subject to early
release if SEPA consummates a liquidation, merger, share exchange or other similar transaction that results in all of the SEPA
stockholders having the right to exchange their shares for cash, securities or other property): (i) sell, offer to sell, contract
to sell, hypothecate, pledge, grant an option to purchase or otherwise dispose of, directly or indirectly, or establish or increase
a put equivalent position or liquidation or decrease a call equivalent position, any SEPA restricted securities, (ii) enter any
swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of any
security, or (iii) publicly disclose the intention to do any of the foregoing, whether any such transaction described in clauses
(i) or (ii) above is to be settled by delivery of the SEPA restricted securities, in cash or otherwise (in each case, subject
to certain limited permitted transfers where the recipient takes the shares subject to the restrictions in the Letter Agreement).
A
copy of the form of Letter Agreement Amendment is filed as Exhibit 10.5 to this Current Report on Form 8-K and is incorporated
herein by reference, and the foregoing description of the form of Letter Agreement Amendment is qualified in its entirety by reference
thereto.
Warrant
Agreement Amendment
Upon
approval of SEPA’s warrant holders and immediately prior to the Closing, SEPA and Continental Stock Transfer & Trust
Company, a New York corporation, as warrant agent, will enter into an amendment (the “Warrant Agreement Amendment”)
to that certain Warrant Agreement dated as of July 21, 2021 (the “Warrant Agreement”). Pursuant to the Warrant
Agreement Amendment, (i) Public Warrants (as defined in the Warrant Agreement) are not exercisable to purchase shares of Class
A Common Stock, and instead, as of immediately prior to the Effective Time, will be automatically converted into the right to
receive 450,336 shares of Class A Common Stock of SEPA in accordance with the calculation described in the Warrant Agreement Amendment,
(ii) Private Placement Warrants (as defined in the Warrant Agreement) are not exercisable to purchase shares of Class A Common
Stock and instead, as of immediately prior to the Effective Time, will be automatically converted into the right to receive 400,000
shares of Class A Common Stock of SEPA in accordance with the calculation described in the Warrant Agreement Amendment, and (iii)
until the Closing or earlier termination of the Merger Agreement, (A) the terms of Section 3 of the Warrant Agreement regarding
any exercise of a warrant or issuance of Class A Common Stock in connection therewith will be of no force or effect and (B) the
terms of Section 6 of the Warrant Agreement will be of no force or effect.
A
copy of the form of Warrant Agreement Amendment is filed as Exhibit 10.6 to this Current Report on Form 8-K and is incorporated
herein by reference, and the foregoing description of the form of Warrant Agreement Amendment is qualified in its entirety by
reference thereto.
| Item
7.01 | Regulation
FD Disclosure. |
On
August 23, 2023, SEPA and SANUWAVE issued a press release announcing their execution of the Merger Agreement. A copy of the press
release is furnished hereto as Exhibit 99.1 and is incorporated herein by reference.
Pursuant
to the rules and regulations of the SEC, the information in this Item 7.01 disclosure, including Exhibit 99.1 and information
set forth therein, is deemed to have been furnished and shall not be deemed to be “filed” under the Securities Exchange
Act of 1934, as amended, or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference
in any filing under the Securities Act, regardless of any general incorporation language in such filing.
Forward-Looking
Statements
This
report may contain, “forward-looking statements” within the meaning of the “safe harbor” provisions of
the Private Securities Litigation Reform Act of 1995. SEPA’s and SANUWAVE’s actual results may differ from their expectations,
estimates and projections and consequently, you should not rely on these forward-looking statements as predictions of future events.
Words such as “expect,” “estimate,” “project,” “budget,” “forecast,”
“anticipate,” “intend,” “plan,” “may,” “will,” “could,”
“should,” “believes,” “predicts,” “potential,” “might” and “continues,”
and similar expressions are intended to identify such forward-looking statements. These forward-looking statements may include,
without limitation, the satisfaction of the closing conditions to the Transactions and the timing of the closing of the Transactions.
These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially
from expected results. Most of these factors are outside the control of SEPA and are difficult to predict. Factors that may cause
such differences include, but are not limited to: (1) the occurrence of any event, change or other circumstances that could give
rise to the termination of the Merger Agreement; (2) the inability to consummate the Transactions, including due to any failure
to obtain approval of the stockholders of SEPA or SANUWAVE or other conditions to the closing in the Merger Agreement, such as
the requirements that (i) SANUWAVE obtain the approval of the holders of 80% of its outstanding convertible promissory notes and
warrants to convert such securities into shares of SANUWAVE Common Stock immediately prior to the Closing and (ii) SEPA shall
have at least $12.0 million at Closing resulting from proceeds of (a) SEPA’s Class A Common Stock that has not been redeemed
and (b) a private placement; (3) delays in obtaining or the inability to obtain any necessary regulatory approvals required to
complete the Transactions; (4) the inability to obtain or maintain the listing of SEPA’s securities on Nasdaq following
the Transactions; (5) costs related to the Transactions; (6) changes in applicable laws or regulations; (7) the possibility that
SEPA or SANUWAVE may be adversely affected by other economic, business, and/or competitive factors; and (8) other risks and uncertainties
to be identified in the registration statement/proxy statement (when available) relating to the Transactions, including those
under “Risk Factors” therein, and in other filings with the SEC made by SEPA and SANUWAVE. SEPA and SANUWAVE caution
that the foregoing list of factors is not exclusive, and caution readers not to place undue reliance upon any forward-looking
statements, which speak only as of the date made. Neither SEPA nor SANUWAVE undertakes or accepts any obligation or undertaking
to release publicly any updates or revisions to any forward-looking statements to reflect any change in its expectations or any
change in events, conditions or circumstances on which any such statement is based, subject to applicable law.
Readers
are referred to the most recent reports filed with the SEC by SEPA. Readers are cautioned not to place undue reliance upon any
forward-looking statements, which speak only as of the date made, and SEPA undertakes no obligation to update or revise the forward-looking
statements, whether as a result of new information, future events or otherwise.
Important
Information About the Transactions and Where to Find It
SEPA
and SANUWAVE will file relevant materials with the SEC, including a Form S-4 registration statement to be filed by SEPA, which
will include a prospectus with respect to SEPA’s securities to be issued in connection with the proposed Merger and a proxy
statement with respect to SEPA’s and SANUWAVE’s stockholder meetings at which SEPA’s and SANUWAVE’s stockholders
will be asked to vote on the proposed Merger and related matters. SEPA’S STOCKHOLDERS AND OTHER INTERESTED PERSONS ARE ADVISED
TO READ, WHEN AVAILABLE, THE FORM S-4 AND THE AMENDMENTS THERETO AND OTHER INFORMATION FILED WITH THE SEC IN CONNECTION WITH THE
TRANSACTIONS, AS THESE MATERIALS WILL CONTAIN IMPORTANT INFORMATION ABOUT SEPA, SANUWAVE, AND THE TRANSACTIONS. When available,
the proxy statement contained in the Form S-4 and other relevant materials for the Transactions will be mailed to stockholders
of SEPA as of a record date to be established for voting on the proposed Merger and related matters. The preliminary Form S-4
registration statement and preliminary proxy statement, the final Form S-4 registration statement and definitive proxy statement
and other relevant materials in connection with the Transactions (when they become available), and any other documents filed by
SEPA with the SEC, may be obtained free of charge at the SEC’s website (www.sec.gov). SEPA’s stockholders will
also be able to obtain a copy of such documents, without charge, by directing a request to SEPA at 3737 Buffalo Speedway, Suite
1750 Houston, Texas 77098.
Participants
in Solicitations
SEPA
and SANUWAVE and their respective directors, executive officers and employees and other persons may be deemed to be participants
in the solicitation of proxies from the holders of SEPA’s Class A Common Stock in respect of the proposed business combination.
SEPA stockholders and other interested persons may obtain more detailed information regarding the names and interests in the Transactions
of SEPA’s directors and executive officers in SEPA’s and SANUWAVE’s filings with the SEC, including when filed,
the Form S-4 registration statement and proxy statement. These documents can be obtained free of charge from the sources indicated
above.
Disclaimer
This
communication shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect
of the proposed business combination. This communication shall not constitute an offer to sell or the solicitation of an offer
to buy any securities pursuant to the proposed Transactions or otherwise, nor shall there be any sale of securities in any jurisdiction
in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws
of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of
Section 10 of the Securities Act.
Item
9.01 Financial Statements and Exhibits.
(d)
Exhibits
Exhibit
No. |
|
Description
|
2.1 |
|
Agreement and Plan of Merger, dated as of August 23, 2023, by and among SEP Acquisition Corp., SEP Acquisition Holdings Inc., and SANUWAVE Health, Inc. |
10.1 |
|
Form of Voting Agreement, dated as of August 23, 2023, by and among SEP Acquisition Corp., SANUWAVE Health, Inc., and the stockholder of SANUWAVE Health, Inc. party thereto. |
10.2 |
|
Sponsor Voting Agreement, dated as of August 23, 2023, by and among Mercury Sponsor Group I LLC, SEP Acquisition Corp., and SANUWAVE Health, Inc. |
10.3 |
|
Form of Voting and Non-Redemption Agreement, dated as of August 23, 2023, by and among SEP Acquisition Corp., SANUWAVE Health, Inc., and the stockholder of SEPA party thereto. |
10.4 |
|
Form of Lock-Up Agreement, dated as of August 23, 2023, by and between SEP Acquisition Corp. and the stockholder of SANUWAVE Health, Inc. party thereto. |
10.5 |
|
Form of Amendment Number One to Letter Agreement by and among SEP Acquisition Corp., Mercury Sponsor Group I LLC, and the stockholders of SEPA party thereto. |
SIGNATURE
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date: August 23, 2023 |
By: |
/s/ R. Andrew White |
| Title:
President and Chief Executive Officer |
Exhibit
Index
Exhibit
No. |
|
Description
|
2.1 |
|
Agreement and Plan of Merger, dated as of August 23, 2023, by and among SEP Acquisition Corp., SEP Acquisition Holdings Inc., and SANUWAVE Health, Inc. |
10.1 |
|
Form of Voting Agreement, dated as of August 23, 2023, by and among SEP Acquisition Corp., SANUWAVE Health, Inc., and the stockholder of SANUWAVE Health, Inc. party thereto. |
10.2 |
|
Sponsor Voting Agreement, dated as of August 23, 2023, by and among Mercury Sponsor Group I LLC, SEP Acquisition Corp., and SANUWAVE Health, Inc. |
10.3 |
|
Form of Voting and Non-Redemption Agreement, dated as of August 23, 2023, by and among SEP Acquisition Corp., SANUWAVE Health, Inc., and the stockholder of SEPA party thereto. |
10.4 |
|
Form of Lock-Up Agreement, dated as of August 23, 2023, by and between SEP Acquisition Corp. and the stockholder of SANUWAVE Health, Inc. party thereto. |
10.5 |
|
Form of Amendment Number One to Letter Agreement by and among SEP Acquisition Corp., Mercury Sponsor Group I LLC, and the stockholders of SEPA party thereto. |
10.6 |
|
Form of Amendment Number One to Warrant Agreement by and between SEP Acquisition Corp. and Continental Stock Transfer & Trust Company. |
99.1 |
|
Press release, dated August 23, 2023. |
104 |
|
Cover
Page Interactive Data File (embedded within the Inline XBRL document). |
|
|
|
Exhibit 2.1
Execution Version
AGREEMENT AND PLAN OF MERGER
by and among
SEP ACQUISITION CORP.,
as the Purchaser,
SEP ACQUISITION HOLDINGS INC.,
as Merger Sub,
and
SANUWAVE HEALTH, INC.,
as the Company
Dated as of August 23, 2023
TABLE OF CONTENTS
Page
Article I MERGER |
3 |
1.1 |
Merger |
3 |
1.2 | Effective Time |
3 |
1.3 | Effect of the Merger |
3 |
1.4 | Tax Treatment |
3 |
1.5 | Articles of Incorporation and Bylaws |
3 |
1.6 | Directors and Officers of the Surviving Corporation |
3 |
1.7 | Company Convertible Notes |
4 |
1.8 | Merger Consideration |
4 |
1.9 | Effect of Merger on Company Securities |
4 |
1.10 | Surrender of Company Securities and Disbursement of Merger Consideration |
6 |
1.11 | Effect of Transaction on Merger Sub Stock |
8 |
1.12 | Taking of Necessary Action; Further Action |
8 |
1.13 | Appraisal Rights |
8 |
1.14 | Withholding |
9 |
| |
|
Article II CLOSING |
9 |
2.1 | Closing |
9 |
| |
|
Article III REPRESENTATIONS AND WARRANTIES OF THE PURCHASER |
9 |
3.1 | Organization and Standing |
9 |
3.2 | Authorization; Binding Agreement |
10 |
3.3 | Governmental Approvals |
11 |
3.4 | Non-Contravention |
11 |
3.5 | Capitalization |
12 |
3.6 | SEC Filings and Purchaser Financials |
13 |
3.7 | Absence of Certain Changes |
14 |
3.8 | Compliance with Laws |
14 |
3.9 | Purchaser Permits |
14 |
3.10 | Actions; Orders |
14 |
3.11 | Taxes and Returns |
15 |
3.12 | Employees and Employee Benefit Plans |
16 |
3.13 | Properties |
16 |
3.14 | Material Contracts |
16 |
3.15 | Transactions with Affiliates |
17 |
3.16 | Merger Sub Activities |
17 |
3.17 | Investment Company Act |
17 |
3.18 | Finders and Brokers |
17 |
3.19 | Ownership of Stockholder Merger Consideration |
17 |
3.20 | Certain Business Practices |
18 |
3.21 | Insurance |
18 |
3.22 | Purchaser Trust Account |
18 |
3.23 | Takeover Statutes |
19 |
3.24 | Opinion of Purchaser Financial Advisor |
19 |
3.25 | Independent Investigation |
19 |
3.26 | Information Supplied |
19 |
3.27 | No Other Representations |
20 |
| |
|
Article IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY |
20 |
4.1 | Organization and Standing |
20 |
4.2 | Authorization; Binding Agreement |
20 |
4.3 | Capitalization |
21 |
4.4 | Subsidiaries |
22 |
4.5 | Governmental Approvals |
22 |
4.6 | Non-Contravention |
23 |
4.7 | SEC Filings and Company Financial Statements |
23 |
4.8 | Absence of Certain Changes |
25 |
4.9 | Compliance with Laws |
25 |
4.10 | Company Permits |
25 |
4.11 | Actions; Orders |
26 |
4.12 | Material Contracts |
26 |
4.13 | Intellectual Property |
28 |
4.14 | Taxes and Returns |
30 |
4.15 | Real Property |
31 |
4.16 | Personal Property |
32 |
4.17 | Title to and Sufficiency of Assets |
32 |
4.18 | Employee Matters |
32 |
4.19 | Benefit Plans |
34 |
4.20 | Environmental Matters |
35 |
4.21 | Transactions with Related Persons |
36 |
4.22 | Insurance |
36 |
4.23 | Books and Records |
37 |
4.24 | Top Customers and Suppliers |
37 |
4.25 | Certain Business Practices |
37 |
4.26 | Investment Company Act |
38 |
4.27 | Finders and Brokers |
38 |
4.28 | Healthcare Industry Matters |
38 |
4.29 | Product Liability |
40 |
4.30 | Takeover Statutes |
40 |
4.31 | Independent Investigation |
40 |
4.32 | Information Supplied |
40 |
4.33 | No Other Representations |
41 |
| |
|
Article V COVENANTS |
41 |
5.1 | Access and Information |
41 |
5.2 | Conduct of Business of the Company |
42 |
5.3 | No Control of the Company’s Business |
45 |
5.4 | Conduct of Business of the Purchaser |
45 |
5.5 | Public Filings |
47 |
5.6 | No Solicitation |
47 |
5.7 | Notification of Certain Matters |
52 |
5.8 | Efforts |
52 |
5.9 | Tax Matters |
53 |
5.10 | Transfer Taxes |
53 |
5.11 | Further Assurances |
54 |
5.12 | Registration Statement |
54 |
5.13 | Public Announcements |
56 |
5.14 | Post-Closing Board of Directors and Executive Officers |
57 |
5.15 | Indemnification of Directors and Officers; Tail Insurance |
57 |
5.16 | Trust Account Proceeds |
58 |
5.17 | PIPE Investment |
58 |
5.18 | Takeover Statutes |
59 |
5.19 | Rule 16b-3 |
59 |
5.20 | Additional Agreements |
59 |
5.21 | No Trading |
60 |
5.22 | Company Convertible Notes |
60 |
| |
|
Article VI CLOSING CONDITIONS |
60 |
6.1 | Conditions to Each Party’s Obligations |
60 |
6.2 | Conditions to Obligations of the Company |
61 |
6.3 | Conditions to Obligations of the Purchaser |
62 |
6.4 | Frustration of Conditions |
63 |
| |
|
Article VII TERMINATION AND EXPENSES |
63 |
7.1 | Termination |
63 |
7.2 | Effect of Termination |
65 |
7.3 | Fees and Expenses |
65 |
| |
|
Article VIII WAIVERS AND RELEASES |
66 |
8.1 | Waiver of Claims Against Trust |
66 |
| |
|
Article IX MISCELLANEOUS |
67 |
9.1 | No Survival |
67 |
9.2 | Notices |
67 |
9.3 | Binding Effect; Assignment |
68 |
9.4 | Third Parties |
68 |
9.5 | Governing Law; Jurisdiction |
69 |
9.6 | WAIVER OF JURY TRIAL |
69 |
9.7 | Specific Performance |
69 |
9.8 | Severability |
69 |
9.9 | Amendment |
70 |
9.10 | Waiver |
70 |
9.11 | Entire Agreement |
70 |
9.12 | Interpretation |
70 |
9.13 | Disclosure Schedules |
71 |
9.14 | Counterparts |
71 |
| |
|
Article X DEFINITIONS |
71 |
10.1 | Certain Definitions |
71 |
10.2 | Section References |
82 |
INDEX OF EXHIBITS
Exhibit A |
|
Form of Company Voting Agreement |
Exhibit B |
|
Form of Sponsor Voting Agreement |
Exhibit C |
|
Form of Company Lock-Up Agreement |
Exhibit D |
|
Form of Sponsor Debt Conversion Agreement |
Exhibit E-1 |
|
Form of Class B Charter Amendment |
Exhibit E-2 |
|
Form of Net Tangible Assets Charter Amendment |
Exhibit E-3 |
|
Form of Closing Date Purchaser Charter Amendment |
Exhibit F |
|
Purchaser Equity Plan |
Exhibit G |
|
Form of Purchaser Voting and Non-Redemption Agreement |
Exhibit H |
|
Form of Purchaser Letter Agreement Amendment |
Exhibit I |
|
Form of Purchaser Amendment to Warrant Agreement |
INDEX OF ANNEXES
Annex A |
|
Company Convertible Notes |
AGREEMENT AND PLAN OF MERGER
This Agreement and
Plan of Merger (this “Agreement”) is made and entered into as of August 23, 2023 by and among (i)
SEP Acquisition Corp., a Delaware corporation (the “Purchaser”), (ii) SEP Acquisition Holdings
Inc., a Nevada corporation and a wholly-owned subsidiary of the Purchaser (“Merger Sub”), and (iii)
SANUWAVE Health, Inc., a Nevada corporation (the “Company”). The Purchaser, Merger Sub and the
Company are sometimes referred to herein individually as a “Party” and, collectively, as the “Parties”.
RECITALS:
A. The Company, directly and indirectly through its Subsidiaries, operates a medical technology company focused on the commercialization
of its patented, FDA-approved, non-invasive medical devices focused on wound healing and the repair and regeneration of skin, musculoskeletal
tissue, and vascular structures;
B. The Purchaser owns all of the issued and outstanding capital stock of Merger Sub, which was formed for the sole purpose
of the Merger (as defined below) pursuant to the applicable provisions of the Nevada Business Corporation Act (as amended, the
“BCA”);
C. The Parties intend to effect the merger of Merger Sub with and into the Company, with the Company continuing as the surviving
entity (the “Merger”), as a result of which, among other things (i) all of the issued and outstanding
capital stock of the Company immediately prior to the Effective Time shall no longer be outstanding and shall automatically be
cancelled and shall cease to exist, in exchange for conversion of the shares of capital stock of the Company into shares of Purchaser
Class A Common Stock (as defined herein) at the Conversion Ratio (as defined herein), and (ii) outstanding Company Convertible
Securities will be, prior to the Effective Time, exercised, exchanged or converted, as applicable, into shares of Company Common
Stock or assumed (with equitable adjustments to the number and exercise price of such assumed Company Convertible Securities) at
the Effective Time by Purchaser with the result that the right to obtain shares of Company Common Stock pursuant to such assumed
Company Convertible Securities shall be converted into the right to receive Purchaser Class A Common Stock, all upon the terms
and subject to the conditions set forth in this Agreement and in accordance with the applicable provisions of the BCA;
D. The board of directors of the Purchaser has unanimously (i) determined that this Agreement and the Transactions, including
the Merger, approval of the Purchaser Charter Amendments (as defined herein), the issuance of shares of Purchaser Class A Common
Stock in connection with the Merger, and the approval and adoption of the Purchaser Equity Plan, is fair, advisable and in the
best interests of Purchaser and the Purchaser Stockholders, (ii) approved the Purchaser Charter Amendments, (iii) approved this
Agreement and the Transactions, including the Merger, the issuance of shares of Purchaser Class A Common Stock in connection with
the Merger, and the approval and adoption of the Purchaser Equity Plan, upon the terms and subject to the conditions set forth
herein, (iv) directed that approval of this Agreement and adoption of the Transaction, including the Merger, the issuance of shares
of Purchaser Class A Common Stock, and the approval and adoption of the Purchaser Equity Plan, be submitted to a vote at a meeting
of Purchaser Stockholders, and (v) recommended to Purchaser Stockholders that they approve and adopt the Purchaser Charter Amendments,
this Agreement and the Transactions, including the Merger, the issuance of shares of Purchaser Class A Common Stock, and the approval
and adoption of the Purchaser Equity Plan;
E. The board of directors of the Company (the “Company Board”) has unanimously (i) determined
that this Agreement and the Transactions, including the Merger, is fair, advisable and in the best interests of the Company and
the Company Stockholders, (ii) approved this Agreement and the Transactions, including the Merger, upon the terms and subject
to the conditions set forth herein, (iii) directed that approval of this Agreement and adoption of the Transactions, including
the Merger, be submitted to a vote at a meeting of the Company Stockholders, and (iv) recommended to Company Stockholders
that they approve and adopt this Agreement and the Transactions, including the Merger (the “Company Board Recommendation”);
F. The board of directors of Merger Sub has unanimously approved and declared advisable this Agreement and the Transactions,
including the Merger, on the terms and subject to the conditions set forth in this Agreement, and Purchaser, in its capacity as
the sole stockholder of Merger Sub, has adopted and approved this Agreement and the Transactions, including the Merger;
G. The Purchaser has received voting support agreements in the form attached as Exhibit A hereto (collectively, the
“Company Voting Agreements”) signed by the Company and each of the Significant Company Holders (as defined
herein);
H. The Company has received a voting support agreement in the form attached as Exhibit B hereto signed by the Sponsor
(the “Sponsor Voting Agreement”);
I. Simultaneously with the execution and delivery of this Agreement, the Significant Company Holders have each entered into
a lock-up agreement with the Purchaser, in the form attached as Exhibit C (each, a “Company Lock-Up Agreement”),
which agreements will become effective as of the Closing;
J. After the date of this Agreement, each of the Purchaser and the Company intends for the Purchaser to enter into subscription
agreements on terms reasonably acceptable to the Purchaser and the Company (the “Subscription Agreements”)
with investors (the “PIPE Investors”) to purchase shares of Purchaser Class A Common Stock in connection
with a private equity investment in the Purchaser (the “PIPE Investment”), which PIPE Investment shall
be consummated immediately prior to the Closing on the Closing Date;
K. Simultaneously with the execution and delivery of this Agreement, the Purchaser and the Sponsor have entered into a debt
conversion agreement (the “Sponsor Debt Conversion Agreement”) in the form attached as Exhibit D
pursuant to which the Sponsor has agreed to cause the Sponsor Note to be converted into an investment in the PIPE Investment, with
such agreement being contingent and effective upon the Closing;
L. The Parties intend (i) that the Merger will qualify as a tax-free “reorganization” within the meaning of Section
368(a) of the Code (as defined herein) to which the Purchaser and the Company are parties within the meaning of Section 368(b)
of the Code and, depending on the facts at the time of the Closing, intend that the Merger and the PIPE Investment shall be considered
part of an overall plan in which the Company Stockholders exchange their shares of Company Common Stock for the Stockholder Merger
Consideration in an exchange described in Section 351 of the Code, and (ii) this Agreement be adopted as a “plan of reorganization”
for purposes of Section 368 of the Code and Treasury Regulations Sections 1.368-2(g) and 1.368-3(a) (clauses (i) and (ii),
the “Intended Tax Treatment”); and
M. Certain capitalized terms used herein are defined in Article X hereof.
AGREEMENT
NOW, THEREFORE,
in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and the
representations, warranties, covenants and agreements contained in this Agreement, and intending to be legally bound hereby, the
Parties hereto agree as follows:
Article
I
MERGER
1.1 Merger. At the Effective Time, and subject to and upon the terms and conditions of this Agreement, and in accordance
with the applicable provisions of the BCA, Merger Sub and the Company shall consummate the Merger, pursuant to which Merger Sub
shall be merged with and into the Company, following which the separate corporate existence of Merger Sub shall cease and the Company
shall continue as the surviving corporation. The Company, as the surviving corporation after the Merger, is hereinafter sometimes
referred to as the “Surviving Corporation” (provided, that references to the Company for periods after
the Effective Time shall be deemed to refer to the Surviving Corporation).
1.2 Effective Time. The Parties hereto shall cause the Merger to be consummated by filing the Articles of Merger for
the merger of Merger Sub with and into the Company (the “Articles of Merger”) with the Secretary of State
of the State of Nevada in accordance with the relevant provisions of the BCA and with the terms and conditions hereof (the time
of such filing, or such later time as may be specified in the Articles of Merger, being the “Effective Time”).
1.3 Effect of the Merger. At the Effective Time, the effect of the Merger shall be as provided in this Agreement, the
Articles of Merger and the applicable provisions of the BCA. Without limiting the generality of the foregoing, and subject thereto,
at the Effective Time, all the property, rights, privileges, agreements, powers and franchises, debts, Liabilities, duties and
obligations of Merger Sub and the Company shall become the property, rights, privileges, agreements, powers and franchises, debts,
Liabilities, duties and obligations of the Surviving Corporation, which shall include the assumption as a matter of law by the
Surviving Corporation of any and all agreements, covenants, duties and obligations of Merger Sub and the Company set forth in this
Agreement to be performed after the Effective Time.
1.4 Tax Treatment. The Parties intend that this Agreement is and the Parties hereby adopt this Agreement as a “plan
of reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the Treasury Regulations.
1.5 Articles of Incorporation and Bylaws. At the Effective Time, the Articles of Incorporation and Bylaws of the Company,
each as in effect immediately prior to the Effective Time, shall automatically be amended and restated in their entirety to read
identically to the Articles of Incorporation and Bylaws of Merger Sub as in effect immediately prior to the Effective Time, except
that the name of the Surviving Corporation in such Articles of Incorporation and Bylaws shall be amended to be “SANUWAVE
Health, Inc.”, and such amended and restated Articles of Incorporation and Bylaws shall become the respective Articles of
Incorporation and Bylaws of the Surviving Corporation.
1.6 Directors and Officers of the Surviving Corporation. At the Effective Time, the board of directors and executive
officers of the Surviving Corporation shall be the board of directors and executive officers of the Company, after giving effect
to Section 5.14, each to hold office in accordance with the Articles of Incorporation and Bylaws of the Surviving Corporation
until their respective successors are duly elected or appointed and qualified or their earlier death, resignation or removal.
1.7 Company Convertible Notes. Each Company Convertible Note that is outstanding and unexercised, and has not been exchanged
for shares of Company Common Stock, as of immediately prior to the Effective Time shall, to the extent permitted by the terms of
such Company Convertible Note, automatically, without any action on the part of the holder thereof and without the issuance of
a new convertible note with respect thereto, be assumed by the Purchaser and converted into a convertible note (each such assumed
Company Convertible Note, an “Assumed Convertible Note”) to purchase that number of shares of Purchaser
Class A Common Stock reserved for issuance from the Merger Consideration equal to the product of (i) the number of shares of Company
Stock subject to such Company Convertible Note as of immediately prior to the Effective Time multiplied by (ii) the Conversion
Ratio. Each Assumed Convertible Note shall be subject to the same terms and conditions as were applicable under the respective
Company Convertible Note immediately prior to the Effective Time, except that each Assumed Convertible Note shall have an conversion
price per share equal to the quotient obtained by dividing (x) the per share conversion price of the Company Convertible Note by
(y) the Conversion Ratio (which price per share shall be rounded up to the nearest whole cent). Upon exercise of any Assumed Convertible
Note, no evidence of book-entry shares representing fractional shares of Purchaser Class A Common Stock shall be issuable thereunder;
in lieu of the issuance of any such fractional share, the issuable shares of Purchaser Class A Common Stock shall be rounded up
to the nearest whole share of Purchaser Class A Common Stock.
1.8 Merger Consideration. As consideration for the Merger, the Company Security Holders collectively shall be entitled
to receive from the Purchaser, in the aggregate, an amount equal to 7,793,000 shares of Purchaser Class A Common Stock (the “Merger
Consideration”). The Merger Consideration shall be paid, or reserved for issuance and payable, as follows:
(a) Each Company Stockholder shall receive for each share of Company Common Stock held (excluding any Company Securities described
in Section 1.9(b)), a number of shares of Purchaser Class A Common Stock equal to the Conversion Ratio (the aggregate portion
of the Merger Consideration amount payable to all Company Stockholders in respect of shares of Company Stock (but excluding Merger
Consideration payable in respect of Company Options, Assumed Warrants and Assumed Convertible Notes) in accordance with this Agreement
is also referred to herein as the “Stockholder Merger Consideration”).
(b) The holders of Company Options shall receive, from the Merger Consideration, such number of Purchaser Options as described
in Section 1.9(d), with such terms and conditions as described in Section 1.9(d).
(c) The holders of Company Warrants that are outstanding immediately prior to the Effective Time shall have the rights described
in Section 1.9(e) with respect to such Assumed Warrants, with such terms and conditions as described in Section 1.9(e).
(d) The holders of Company Convertible Notes that are outstanding immediately prior to the Effective Time shall have the rights
set forth in Section 1.7 with respect to such Assumed Convertible Notes, with such terms and conditions as described in
Section 1.7.
1.9 Effect of Merger on Company Securities. At the Effective Time, by virtue of the Merger and without any action on
the part of any Party or the holders of any Company Securities or the holders of any shares of capital stock of the Purchaser or
Merger Sub:
(a) Company Stock. Subject to Section 1.9(b), all shares of Company Stock issued and outstanding immediately prior
to the Effective Time will automatically be cancelled and cease to exist in exchange for the right to receive the Stockholder Merger
Consideration, with each share of Company Common Stock being entitled to receive that number of shares of Purchaser Class A Common
Stock equal to the Conversion Ratio, without interest, upon delivery of the Transmittal Documents in accordance with Section 1.10(f).
As of the Effective Time, each Company Stockholder shall cease to have any other rights in and to the Company or the Surviving
Corporation (other than the rights set forth in Section 1.13 below).
(b) Treasury Stock. Notwithstanding Section 1.9(a) or any other provision of this Agreement to the contrary, at
the Effective Time, if there are any Company Securities that are owned by the Company as treasury shares or any Company Securities
owned by any direct or indirect Subsidiary of the Company immediately prior to the Effective Time, such Company Securities shall
be canceled and shall cease to exist without any conversion thereof or payment therefor.
(c) Dissenting Shares. Each of the Dissenting Shares issued and outstanding immediately prior to the Effective Time shall
be cancelled and cease to exist in accordance with Section 1.13 and shall thereafter represent only the right to receive
the applicable payments set forth in Section 1.13.
(d) Company Options.
(i)
At the Effective Time, each outstanding Company Option (whether vested or unvested, exercisable or unexercisable) that is
outstanding as of immediately prior to the Effective Time shall, without any further action on the part of the holder thereof,
be assumed by the Purchaser and automatically converted into the right to receive an option (each, a “Purchaser Option”)
to acquire shares of Purchaser Class A Common Stock reserved for issuance from the Merger Consideration, as described further below.
Subject to the subsequent sentence, each Purchaser Option that corresponds to a Company Option that was originally granted pursuant
to the Company Equity Plan will continue to be subject to the same terms and conditions set forth in the Company Equity Plan and
the applicable award agreement as in effect immediately prior to the Effective Time (including, without limitation, the vesting
and acceleration provisions therein), except any references therein to the Company or Company Common Stock will instead mean the
Purchaser and Purchaser Class A Common Stock, respectively. Each Purchaser Option shall: (i) represent the right to acquire
a number of shares of Purchaser Class A Common Stock reserved for issuance from the Merger Consideration equal to (as rounded up
to the nearest whole number) the product of (A) the number of shares of Company Common Stock that were subject to the corresponding
Company Option immediately prior to the Effective Time, multiplied by (B) the Conversion Ratio; and (ii) have an exercise
price equal to (as rounded up to the nearest whole cent) the quotient of (A) the exercise price of the corresponding Company Option,
divided by (B) the Conversion Ratio.
(ii)
The Purchaser shall take all corporate action necessary to reserve for future issuance a sufficient number of shares of
Purchaser Class A Common Stock for delivery upon the exercise of Purchaser Options, and shall maintain such reserve for so long
as any of the Purchaser Options remain outstanding. From and after the Effective Time, the Company shall not issue any new awards
under the Company Equity Plan. Within a reasonably practicable period (subject to SEC rules and guidelines for a former shell company)
after the Closing, the Purchaser shall file with the SEC a registration statement on Form S-8 (or any successor form, or, if Form
S-8 is not available, other appropriate forms as may be required under applicable Law) relating to the shares of Purchaser Class
A Common Stock issuable with respect to the Purchaser Options, and shall maintain the effectiveness of such registration statement
for as long as required to issue Purchaser Class A Common Stock pursuant to the Purchaser Options.
(e) Company Warrants. Each Company Warrant that is outstanding and unexercised, and has not been exchanged for shares
of Company Common Stock, as of immediately prior to the Effective Time shall to the extent permitted by the terms of such Company
Warrant, automatically, without any action on the part of the holder thereof and without the issuance of a new warrant with respect
thereto, be assumed by the Purchaser and converted into a warrant (each such warrant, an “Assumed Warrant”)
to purchase that number of shares of Purchaser Class A Common Stock reserved for issuance from the Merger Consideration equal to
the product of (1) the number of shares of Company Stock subject to such Company Warrant multiplied by (2) the Conversion Ratio.
Each Assumed Warrant shall be subject to the same terms and conditions (including as to vesting and exercisability) as were applicable
under the respective Company Warrant immediately prior to the Effective Time, except that each Assumed Warrant shall have an exercise
price per share equal to the quotient obtained by dividing (x) the per share exercise price of the Company Warrant by (y) the Conversion
Ratio (which price per share shall be rounded up to the nearest whole cent). Upon exercise of any Assumed Warrant, no evidence
of book-entry shares representing fractional shares of Purchaser Class A Common Stock shall be issuable thereunder; in lieu of
the issuance of any such fractional share, the issuable shares of Purchaser Class A Common Stock shall be rounded up to the nearest
whole share of Purchaser Class A Common Stock.
(f) Equitable Adjustment. If at any time during the period between the date of this Agreement and the Effective Time,
any change in the outstanding shares of capital stock of Purchaser or the Company shall occur as a result of any reclassification,
recapitalization, reorganization, stock split (including a reverse stock split) or combination, exchange or readjustment of shares,
or any stock dividend or stock distribution is declared with a record date during such period, the Merger Consideration, as applicable,
shall be equitably adjusted to reflect such change without any increase in aggregate amounts payable; provided,
that this Section 1.9(f) shall not be construed to permit Purchaser, Merger Sub, or the Company to take any action with
respect to their respective securities that is prohibited by the terms and conditions of this Agreement.
1.10
Surrender of Company Securities and Disbursement of Merger Consideration.
(a) Prior to the Effective Time, the Purchaser shall appoint its transfer agent, Continental Stock Transfer & Trust Company,
or another agent reasonably acceptable to the Company (the “Exchange Agent”), for the purpose of exchanging
the shares of Company Common Stock represented by certificates (“Company Certificates”) or book-entry
shares (the “Company Book-Entry Shares”) for Stockholder Merger Consideration. On or prior to the Effective
Time, the Purchaser shall deposit, or cause to be deposited, with the Exchange Agent, in trust for the benefit of the holders of
Company Common Stock, the Stockholder Merger Consideration. All book-entry shares representing Purchaser Class A Common Stock deposited
by Purchaser with the Exchange Agent for distribution pursuant to this Article I are referred to in this Agreement as the
“Exchange Fund”. The Exchange Fund shall be subject to the terms of this Agreement and the Exchange Agent
Agreement. The Exchange Fund will not be used for any other purpose.
(b) On or prior to the Effective Time, the Purchaser shall send, or shall cause the Exchange Agent to send, to each Company
Stockholder, a letter of transmittal for use in such exchange (a “Letter of Transmittal”) in a form to
be mutually agreed upon by the Company and the Purchaser.
(c) Subject to Section 1.10(d), at the Closing, Purchaser shall cause to be issued from the Exchange Fund to each holder
of Company Common Stock immediately prior to the Effective Time who has, at least three (3) Business Days prior to the Closing
Date, delivered a completed and duly executed Letter of Transmittal to the Exchange Agent, evidence of book-entry shares representing
the number of whole shares of the aggregate Purchaser Class A Common Stock in respect of such Company Common Stock held by such
holder.
(d) Each Company Stockholder shall be entitled to receive the number of shares of Purchaser Class A Common Stock with respect
to such shares of Company Common Stock held by such Company Stockholder (excluding any Company Securities described in Sections
1.9(b) or 1.9(c)), on or as soon as reasonably practicable after the Effective Time, but subject to the delivery by
such Company Stockholder to the Exchange Agent of the following items prior thereto (collectively, the “Transmittal
Documents”) in forms to be mutually agreed by the Purchaser and the Company prior to the Closing: (i) a properly
completed and duly executed Letter of Transmittal; and (ii) such other related documents as may be reasonably requested by the
Exchange Agent or the Purchaser. Until so surrendered, each Company Certificate or Company Book-Entry Share shall represent after
the Effective Time for all purposes only the right to receive such portion of the Stockholder Merger Consideration attributable
to such Company Certificate or Company Book-Entry Share.
(e) If any portion of the Stockholder Merger Consideration is to be delivered or issued to a Person other than the Person in
whose name the surrendered Company Certificate or Company Book-Entry Share is registered immediately prior to the Effective Time,
it shall be a condition to such delivery that (i) with respect to Company Certificates, such Company Certificate shall be properly
endorsed or shall otherwise be in proper form for transfer, (ii) the recipient of such portion of the Stockholder Merger Consideration,
or the Person in whose name such portion of the Stockholder Merger Consideration is delivered or issued, shall have already executed
and delivered such Transmittal Documents as are reasonably deemed necessary by the Exchange Agent or the Purchaser, and (iii) the
Person requesting such delivery shall pay to the Exchange Agent any transfer or other Taxes required as a result of such delivery
to a Person other than the registered holder of such Company Certificate or Company Book-Entry Share or establish to the satisfaction
of the Exchange Agent that such Tax has been paid or is not payable.
(f) After the Effective Time, there shall be no further registration of transfers of Company Stock. If, after the Effective
Time, Company Certificates or Company Book-Entry Shares are presented to the Surviving Corporation, the Purchaser or the Exchange
Agent, they shall be canceled and exchanged for the applicable portion of the Stockholder Merger Consideration provided for, and
in accordance with the procedures set forth in this Section 1.10(f). No dividends or other distributions declared or made
after the date of this Agreement with respect to Purchaser Class A Common Stock with a record date after the Effective Time will
be paid to the holders of any Company Certificates or Company Book-Entry Shares that have not yet been surrendered with respect
to Purchaser Class A Common Stock to be issued upon surrender thereof until the holders of record of such Company Certificates
or Company Book-Entry Shares shall provide the other Transmittal Documents. Subject to applicable Law, following delivery of the
other Transmittal Documents, the Purchaser shall promptly deliver to the record holders thereof, without interest, book-entry shares
representing Purchaser Class A Common Stock issued in exchange therefor and the amount of any such dividends or other distributions
with a record date after the Effective Time theretofore paid with respect to such Purchaser Class A Common Stock.
(g) All securities issued upon the surrender of Company Securities in accordance with the terms hereof shall be deemed to have
been issued in full satisfaction of all rights pertaining to such Company Securities. Any Company Stockholder who has not exchanged
its Company Stock for the applicable portion of the Merger Consideration in accordance with this Section 1.10(g) prior to
the date that is four (4) years after the Effective Time shall thereafter look only to the Purchaser for payment of the portion
of the applicable Merger Consideration in respect of such Company Securities without any interest thereon (but with any dividends
paid with respect thereto). Notwithstanding the foregoing, none of the Surviving Corporation, the Purchaser or any Party hereto
shall be liable to any Person for any amount properly paid to a public official pursuant to any applicable abandoned property,
escheat or similar Law.
(h) Notwithstanding anything to the contrary contained herein, no fraction of a share of Purchaser Class A Common Stock will
be issued by virtue of the Merger or the Transactions, and each Person who would otherwise be entitled to a fraction of a share
of Purchaser Class A Common Stock (after aggregating all fractional shares of Purchaser Class A Common Stock that otherwise would
be received by such holder) shall instead have the number of shares of Purchaser Class A Common Stock issued to such Person rounded
up in the aggregate to the nearest whole share of Purchaser Class A Common Stock.
1.11
Effect of Transaction on Merger Sub Stock. At the Effective Time, by virtue of the Merger and without any action
on the part of any Party or the holders of any Company Securities or the holders of any shares of capital stock of the Purchaser
or Merger Sub, each share of Merger Sub Common Stock outstanding immediately prior to the Effective Time shall be converted into
an equal number of shares of common stock of the Surviving Corporation, with the same rights, powers and privileges as the shares
so converted and shall constitute the only outstanding shares of capital stock of the Surviving Corporation.
1.12 Taking of Necessary Action; Further Action. If, at any time after the Effective Time, any further action is necessary
or desirable to carry out the purposes of this Agreement and to vest the Surviving Corporation with full right, title and possession
to all assets, property, rights, privileges, powers and franchises of the Company and Merger Sub, the officers and directors of
the Company and Merger Sub are fully authorized in the name of their respective corporations or otherwise to take, and will take,
all such lawful and necessary action, so long as such action is not inconsistent with this Agreement.
1.13
Appraisal Rights. No Company Stockholder who has validly exercised and perfected its appraisal rights pursuant to
NRS 92A.300 et seq. of the BCA (a “Dissenting Stockholder”) with respect to its Company Stock (such shares,
“Dissenting Shares”) shall be entitled to receive any portion of the Stockholder Merger Consideration
with respect to the Dissenting Shares owned by such Dissenting Stockholder unless and until such Dissenting Stockholder shall have
effectively withdrawn or lost its appraisal rights under the BCA. Each Dissenting Stockholder shall be entitled to receive only
the payment resulting from the procedure set forth in NRS 92A.300 et seq. of the BCA with respect to the Dissenting Shares owned
by such Dissenting Stockholder. Such Company Stockholders shall be entitled to receive payment of the appraised value of such shares
of Company Common Stock held by them in accordance with the BCA, unless and until such Company Stockholders fail to perfect or
effectively withdraw or otherwise lose their appraisal rights under the BCA. All Dissenting Shares held by Company Stockholders
who shall have failed to perfect or who effectively shall have effectively withdrawn or lost their right to appraisal of such shares
of Company Common Stock under the BCA (whether occurring before, at or after the Effective Time) shall thereupon be deemed to be
converted into and to have become exchangeable for, as of the Effective Time, the right to receive the Stockholder Merger Consideration,
without interest, attributable to such Dissenting Shares upon their surrender in the manner provided in Section 1.10.
The Company shall give the Purchaser prompt notice of any written demands for appraisal, attempted withdrawals of such demands,
and any other instruments served pursuant to applicable Laws that are received by the Company relating to any Dissenting Stockholder’s
rights of appraisal; provided that the Company shall direct all negotiations and proceedings with respect to demand for appraisal
under the BCA. The Company shall not, except with the prior written consent of the Purchaser, voluntarily make any payment with
respect to any demands for appraisal, offer to settle or settle any such demands or approve any withdrawal of any such demands.
1.14
Withholding. Each of the Purchaser, Merger Sub, the Company, the Surviving Corporation and their respective Affiliates
shall be entitled to deduct and withhold from any amounts otherwise deliverable, issuable or payable under this Agreement such
amounts that any such Persons are required to deduct and withhold with respect to any of the deliveries, issuances and payments
contemplated by this Agreement under the Code or any other applicable Law; provided that before making any deduction or withholding
pursuant to this Section 1.14 other than with respect to amounts treated as compensation for applicable Tax purposes, the
Purchaser shall use commercially reasonable efforts to give prior written notice to the Company at least five (5) days’ prior
to the applicable date of such anticipated deduction or withholding, in order to provide the Company with a reasonable opportunity
to provide any forms or other documentation from the applicable equity holders or take such other steps in order to avoid such
deduction or withholding, and the Purchaser shall reasonably consult and cooperate with the Company in good faith to attempt to
reduce or eliminate any amounts that would otherwise be deducted or withheld pursuant to this Section 1.14, in all
events, subject to the requirement of applicable Law. To the extent that the Purchaser, Merger Sub, the Company, the Surviving
Corporation or any of their respective Affiliates deducts and withholds any such amounts with respect to any Person and properly
and timely remits such deducted and withheld amounts to the applicable Governmental Authority, such deducted and withheld amounts
shall be treated as having been paid to or on behalf of such Person for all purposes.
Article
II
CLOSING
2.1 Closing. Subject to the satisfaction or waiver of the conditions set forth in Article VI, the consummation
of the Transactions (the “Closing”) shall take place remotely, through the exchange of documents via
electronic mail or facsimile, on a date and at a time to be agreed upon by the Purchaser and the Company, which date shall be no
later than the second (2nd) Business Day after all the Closing conditions to this Agreement have been satisfied or waived (other
than any conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of those
conditions), or at such other date, time or place (including remotely) as the Purchaser and the Company may agree (the date and
time at which the Closing is actually held being the “Closing Date”). All actions to be taken and all
documents to be executed or delivered at Closing will be deemed to have been taken, executed and delivered simultaneously, and
no action will be deemed taken and no document will be deemed executed or delivered until all have been taken, delivered and executed,
except in each case to the extent otherwise stated in any such document.
Article
III
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER
Except as set forth
in (i) the disclosure schedules delivered by the Purchaser to the Company on the date hereof (the “Purchaser Disclosure
Schedules”), or (ii) the Purchaser SEC Reports that are available on the SEC’s website through EDGAR at least
two (2) Business Days prior to the date hereof (it being acknowledged that nothing disclosed in such a SEC Report under the headings
“Risk Factors” or “Forward-Looking Statements” will be deemed to modify or qualify and representations
or warranties set forth in Article III), the Purchaser represents and warrants to the Company as follows:
3.1 Organization and Standing. The Purchaser is a corporation duly incorporated, validly existing and in good standing
under the Laws of the State of Delaware. The Purchaser has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted, except where the failure to have such requisite power or authority
would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect. The Purchaser is duly qualified
or licensed and in good standing in each jurisdiction in which the character of the property owned, leased or operated by it or
the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so qualified
or licensed or in good standing would not, individually or in the aggregate, reasonably be expected to have a Material Adverse
Effect. The Purchaser has heretofore made available to the Company accurate and complete copies of its Organizational Documents,
as amended to date and as currently in effect. The Purchaser is not in violation of any provision of its Organizational Documents
in any material respect.
3.2 Authorization; Binding Agreement.
(a) The Purchaser has all requisite corporate power and authority to execute and deliver this Agreement and each Ancillary Document
to which it is or is required to be a party, to perform the Purchaser’s obligations hereunder and thereunder and to consummate
the Transactions, subject to obtaining the Required Purchaser Stockholder Approval. The execution and delivery of this Agreement
and each Ancillary Document to which it is or is required to be a party and the consummation of the Transactions (i) have been
duly and validly authorized by the board of directors of the Purchaser in accordance with the Purchaser’s Organizational
Documents, the DGCL, any other applicable Law or any Contract to which the Purchaser is a party or by which it or its securities
are bound, and (ii) other than the Required Purchaser Stockholder Approval, no other corporate proceedings on the part of the Purchaser
are necessary to authorize the execution and delivery of this Agreement and each Ancillary Document to which it is a party or to
consummate the Transactions. This Agreement has been, and each Ancillary Document to which the Purchaser is or is required to be
a party shall be when delivered, duly and validly executed and delivered by the Purchaser and, assuming the due authorization,
execution and delivery of this Agreement and Ancillary Documents by the other Parties hereto and thereto, constitutes, or when
delivered shall constitute, the legal, valid and binding obligation of the Purchaser, enforceable against the Purchaser in accordance
with its terms, except to the extent that enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization
and moratorium Laws and other Laws of general application affecting the enforcement of creditors’ rights generally or by
any applicable statute of limitation or by any valid defense of set-off or counterclaim, and the fact that equitable remedies or
relief (including the remedy of specific performance) are subject to the discretion of the court from which such relief may be
sought (collectively, the “Enforceability Exceptions”).
(b) The Purchaser’s board of directors has unanimously (i) determined that this Agreement and the Transactions, including
the Merger, approval of the Purchaser Charter Amendments, the issuance of shares of Purchaser Class A Common Stock in connection
with the Merger, and the approval and adoption of the Purchaser Equity Plan, is fair, advisable and in the best interests of Purchaser
and the Purchaser Stockholders, (ii) approved the Purchaser Charter Amendments, (iii) approved this Agreement and the Transactions,
including the Merger, the issuance of shares of Purchaser Class A Common Stock in connection with the Merger, and the approval
and adoption of the Purchaser Equity Plan, upon the terms and subject to the conditions set forth herein, (iv) directed that approval
of this Agreement and adoption of the Transaction, including the Merger, the issuance of shares of Purchaser Class A Common Stock,
and the approval and adoption of the Purchaser Equity Plan, be submitted to a vote at a meeting of Purchaser Stockholders, and
(v) recommended to Purchaser Stockholders that they approve and adopt the Purchaser Charter Amendments, this Agreement and the
Transactions, including the Merger, the issuance of shares of Purchaser Class A Common Stock, and the approval and adoption of
the Purchaser Equity Plan.
(c) Merger Sub’s board of directors, by resolutions duly adopted, has approved and declared advisable, this Agreement
and the Merger and the other Transactions on the terms and subject to the conditions set forth in this Agreement, and the Purchaser,
in its capacity as the sole stockholder of Merger Sub, has adopted and approved this Agreement and the Merger and the other Transactions.
3.3 Governmental Approvals. Except as otherwise described in Schedule 3.3, no Consent of or with any Governmental
Authority on the part of the Purchaser is required to be obtained or made in connection with the execution, delivery or performance
by the Purchaser of this Agreement and any Ancillary Documents to which it is or is required to be a party or the consummation
by the Purchaser of the Transactions, other than (a) such filings as contemplated by this Agreement, (b) any filings required with
Nasdaq or the SEC with respect to the Transactions, (c) applicable requirements, if any, of the Securities Act, the Exchange Act,
and/or any state “blue sky” securities Laws, and the rules and regulations thereunder, and (d) where the failure
to obtain or make such Consents or to make such filings or notifications would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on the Purchaser.
3.4 Non-Contravention. Except as otherwise described in Schedule 3.4, the execution and delivery by the Purchaser
of this Agreement and each Ancillary Document to which it is or is required to be a party or otherwise bound, and the consummation
by the Purchaser of the Transactions, and compliance by the Purchaser with any of the provisions hereof and thereof, will not (a)
conflict with or violate any provision of the Purchaser’s Organizational Documents, (b) subject to obtaining the Consents
from Governmental Authorities referred to in Section 3.3 hereof, the waiting periods referred to therein having expired,
and any condition precedent to such Consent or waiver having been satisfied, conflict in any manner with or violate in any respect
any Law, Order or Consent applicable to the Purchaser or any of its material properties or assets, or (c) (i) violate, conflict
with or result in a breach of, (ii) constitute a default (or an event which, with notice or lapse of time or both, would constitute
a default) under, (iii) result in the termination, withdrawal, suspension, cancellation or modification of, (iv) accelerate the
performance required by the Purchaser under, (v) result in a right of termination or acceleration under, (vi) give rise to any
obligation to make payments or provide compensation under, (vii) result in the creation of any Lien upon any of the properties
or assets of the Purchaser under (other than Permitted Liens), (viii) give rise to any obligation to obtain any third party Consent
or provide any notice to any Person, or (ix) give any Person the right to declare a default, exercise any remedy, claim a rebate,
chargeback, penalty or change in delivery schedule, accelerate the maturity or performance, cancel, terminate or modify any right,
benefit, obligation or other term under, any of the terms, conditions or provisions of any Purchaser Material Contract, except
for any deviations from any of the foregoing clauses (a), (b) or (c) that would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect on the Purchaser.
3.5 Capitalization.
(a) The Purchaser is authorized to issue (i) 150,000,000 shares of Purchaser Class A Common Stock, (ii) 20,000,000 shares of
Purchaser Class B Common Stock, and (iii) 1,000,000 shares of Purchaser Preferred Stock. The issued and outstanding Purchaser Securities
as of the date of this Agreement are set forth on Schedule 3.5(a). As of the date of this Agreement, there are no issued
or outstanding shares of Purchaser Preferred Stock. There are no outstanding or authorized equity appreciation, phantom equity
or similar rights with respect to the Purchaser. All outstanding Purchaser Class A Common Stock and Purchaser Class B Common Stock
is duly authorized, validly issued, fully paid and non-assessable and is not subject to or issued in violation of any purchase
option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the DGCL, any
other applicable Law, the Purchaser’s Organizational Documents or any Contract to which the Purchaser is a party or by which
it or its securities are bound. The Purchaser holds no shares or other equity interests of the Purchaser in its treasury. None
of the outstanding Purchaser Securities has been issued in violation of any applicable securities Laws. The rights, privileges
and preferences of the Purchaser Preferred Stock are as stated in the Purchaser’s Organizational Documents and as provided
by the DGCL.
(b) Prior to giving effect to the Merger, Merger Sub is authorized to issue 1,000 shares of Merger Sub Common Stock, of which
1,000 shares are issued and outstanding, and all of which are owned by the Purchaser. Prior to giving effect to the Transactions,
other than Merger Sub, the Purchaser does not have any Subsidiaries or own any equity interests in any other Person.
(c) Except as set forth in Schedule 3.5(a) or Schedule 3.5(c), there are no (i) outstanding options, warrants,
puts, calls, convertible securities, rights of first refusal, preemptive or similar rights other than the Redemption, (ii) bonds,
debentures, notes or other Indebtedness having general voting rights or that are convertible or exchangeable into securities having
such rights, or (iii) subscriptions or other rights, agreements, arrangements, Contracts or commitments of any character (other
than this Agreement and the Ancillary Documents), (A) relating to the issued or unissued shares of the Purchaser, (B) obligating
the Purchaser to issue, transfer, deliver, offer or sell or cause to be issued, transferred, delivered, offered or sold any options
or shares or securities convertible into or exchangeable for such shares, (C) obligating the Purchaser to grant, extend or enter
into any such option, warrant, call, subscription, convertible securities, right of first refusal, preemptive right or other similar
right, agreement or arrangement or commitment for such shares, or (D) other than the Redemption or as expressly set forth in this
Agreement, obligating the Purchaser to redeem, repurchase or otherwise acquire any such shares or other equity interests, or provide
an amount of funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in the Purchaser or any
other Person. Except as set forth in Schedule 3.5(c), there is no agreement or commitment by the Purchaser relating
to the voting or registration of, or restricting any Person from purchasing, selling, pledging or otherwise disposing of (or granting
any option or similar right with respect to), any shares of the Purchaser.
(d) All Indebtedness of the Purchaser as of the date of this Agreement is disclosed on Schedule 3.5(d). No Indebtedness
of the Purchaser contains any restriction upon (i) the prepayment of any of such Indebtedness, (ii) the incurrence of Indebtedness
by the Purchaser, or (iii) the ability of the Purchaser to grant any Lien on its properties or assets.
(e) Since the date of formation of the Purchaser, and except as contemplated by this Agreement (including any redemptions that
may occur in connection with an Extension, if any) or as set forth on Schedule 3.5(e), the Purchaser has not declared or
paid any distribution or dividend in respect of its shares and has not repurchased, redeemed or otherwise acquired any of its shares,
and the Purchaser’s board of directors has not authorized any of the foregoing.
3.6 SEC Filings and Purchaser Financials.
(a) Except as set forth on Schedule 3.6(a)(i), the Purchaser, since the IPO, has filed all forms, reports, schedules,
statements, registration statements, prospectuses and other documents required to be filed or furnished by the Purchaser with the
SEC under the Securities Act and the Exchange Act, together with any amendments, restatements or supplements thereto, and will
file all such forms, reports, schedules, statements and other documents required to be filed subsequent to the date of this Agreement.
Except to the extent available on the SEC’s website through EDGAR for at least two (2) days prior to the date of this Agreement,
the Purchaser has delivered to the Company copies in the form filed with the SEC of all of the following: (i) the Purchaser’s
annual reports on Form 10-K for each fiscal year of the Purchaser beginning with the first year the Purchaser was required to file
such a form; (ii) the Purchaser’s quarterly reports on Form 10-Q for each fiscal quarter that the Purchaser filed such
reports to disclose its quarterly financial results in each of the fiscal years of the Purchaser referred to in clause (i) above;
(iii) all other forms, reports, registration statements, prospectuses and other documents (other than preliminary materials) filed
by the Purchaser with the SEC since the beginning of the first fiscal year referred to in clause (i) above (the forms, reports,
registration statements, prospectuses and other documents referred to in clauses (i), (ii) and (iii) above, whether or not available
through EDGAR, are, collectively, the “Purchaser SEC Reports”); and (iv) all certifications and statements
required by (A) Rules 13a-14 or 15d-14 under the Exchange Act, and (B) 18 U.S.C. §1350 (Section 906 of SOX) with respect to
any report referred to in clause (i) above (collectively, the “Public Certifications”). Except for any
changes (including any required restatements of the Purchaser Financials (defined below) or the Purchaser SEC Reports) to the Purchaser’s
historical accounting of the Purchaser Warrants as equity rather than as liabilities that may be required as a result of the Staff
Statement on Accounting and Reporting Considerations for Warrants Issued by Special Purpose Acquisition Companies that was issued
by the SEC on April 12, 2021, and related guidance by the SEC (the “SEC April Warrant Statement”), the
Purchaser SEC Reports (x) were prepared in all material respects in accordance with the requirements of the Securities Act and
the Exchange Act, as the case may be, and the rules and regulations thereunder and (y) did not, as of their respective effective
dates (in the case of Purchaser SEC Reports that are registration statements filed pursuant to the requirements of the Securities
Act) and at the time they were filed with the SEC (in the case of all other Purchaser SEC Reports), 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
made therein, in the light of the circumstances under which they were made, not misleading. The Public Certifications are each
true as of their respective dates of filing. As of the date of this Agreement, there are no outstanding or unresolved comments
in comment letters received from the SEC with respect to any Purchaser SEC Reports. None of the Purchaser SEC Reports filed on
or prior to the date of this Agreement is subject to ongoing SEC review or investigations as of the date of this Agreement. As
used in this Section 3.6(a), the term “file” shall be broadly construed to include any manner permitted
by SEC rules and regulations in which a document or information is furnished, supplied or otherwise made available to the SEC.
As of the date of this Agreement, except as set forth on Schedule 3.6(a)(ii), (A) the Purchaser Units, the Purchaser
Class A Common Stock and the Purchaser Warrants are listed on Nasdaq, (B) the Purchaser has not received any written deficiency
notice from Nasdaq relating to the continued listing requirements of such Purchaser Securities, (C) there are no Actions pending
or, to the Knowledge of the Purchaser, threatened against the Purchaser by the Financial Industry Regulatory Authority with respect
to any intention by such entity to suspend, prohibit or terminate the quoting of such Purchaser Securities on Nasdaq, and (D) such
Purchaser Securities are in compliance with all of the applicable corporate governance rules of Nasdaq.
(b) Except for any changes (including any required restatements of the Purchaser Financials (defined below) or the Purchaser
SEC Reports) to the Purchaser’s historical accounting of the Purchaser Warrants as equity rather than as liabilities that
may be required as a result of the SEC April Warrant Statement, the financial statements and notes of the Purchaser contained or
incorporated by reference in the Purchaser SEC Reports (the “Purchaser Financials”) are complete and
accurate in all material respects and fairly present in all material respects the financial position and the results of operations,
changes in shareholders’ equity, and cash flows as of the respective dates of, and for the periods referred to in, such Purchaser
Financials, all in accordance with (i) GAAP methodologies applied on a consistent basis throughout the periods involved, (ii) with
all applicable accounting requirements under the Securities Act and the rules and regulations of the SEC thereunder, including
Regulation S-X or Regulation S-K, as applicable (except as may be indicated in the notes thereto and for the omission of notes
and audit adjustments in the case of unaudited quarterly financial statements to the extent permitted by Regulation S-X or Regulation
S-K, as applicable), and (iii) the books and records of the Purchaser as of the times and for the periods referred to therein.
(c) Except for any changes (including any required restatements of the Purchaser Financials or the Purchaser SEC Reports) to
the Purchaser’s historical accounting of the Purchaser Warrants as equity rather than as liabilities that may be required
as a result of the SEC April Warrant Statement and except as specifically disclosed, reflected or fully reserved against in the
Purchaser Financials, the Purchaser has not incurred any Liabilities or obligations of the type required to be reflected on a balance
sheet in accordance with GAAP that are not adequately reflected or reserved against the Purchaser Financials, other than Liabilities
of the type required to be reflected on a balance sheet in accordance with GAAP that have been incurred since the most recent Purchaser
Financials.
3.7 Absence of Certain Changes. As of the date of this Agreement, except as set forth on Schedule 3.7, (a) the
Purchaser has, since its formation, conducted no business other than its formation, the public offering of its securities (and
the related private offerings), public reporting and its search for an initial Business Combination as described in the IPO Prospectus
(including the investigation of the Target Companies and the negotiation and execution of this Agreement) and related activities,
(b) since December 31, 2022, the Purchaser has not been subject to any event or occurrence, that has had or would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on the Purchaser, and (c) since December 31,
2022, the Purchaser has not taken any action or committed or agreed to take any action that would be prohibited by Section 5.4(b)
(without giving effect to Schedule 5.4) if such action were taken on or after the date hereof without the consent of the
Company.
3.8 Compliance with Laws. The Purchaser is, and has since its formation been, in compliance with all Laws applicable
to it and the conduct of its business and, to the Knowledge of the Purchaser, is not under investigation with respect to any violation
or alleged violation of any applicable Laws, except for such noncompliance or investigation that would not reasonably be expected
to have a Material Adverse Effect on the Purchaser, and the Purchaser has not received written notice alleging any violation of
applicable Law in any material respect by the Purchaser. To the Knowledge of the Purchaser, the Purchaser is not under investigation
with respect to any violation or alleged violation of any applicable Laws, except for such noncompliance or investigation that
would not reasonably be expected to have a Material Adverse Effect on the Purchaser, and the Purchaser has not received written
notice in the last three (3) years alleging any violation of applicable Law in any material respect by the Purchaser.
3.9 Purchaser Permits. The Purchaser holds all material Permits necessary to lawfully conduct its business as presently
conducted, and to own, lease and operate its assets and properties, all of which are in full force and effect, except where the
failure for such Permits to be in full force and effect would not reasonably be expected to have a Material Adverse Effect on the
Purchaser.
3.10 Actions; Orders. As of the date of this Agreement, there is (a) no Action of any nature currently pending or, to
the Knowledge of the Purchaser, threatened in writing that would, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect on the Purchaser (and no such Action has been brought in the past three (3) years, or to the Knowledge
of the Purchaser, threatened in the past three (3) years) and (b) no material Order now pending or outstanding or that was rendered
by a Governmental Authority in the past three (3) years, in either case of (a) or (b), by or against the Purchaser or any of its
business, equity securities or assets. In the past three (3) years to the date of this Agreement, none of the current or former
officers, senior management or directors of the Purchaser have been charged with, indicted for, arrested for, or convicted of any
felony or any crime involving fraud.
3.11
Taxes and Returns.
(a) The Purchaser and Merger Sub have each timely filed, or caused to be timely filed, all income Tax Returns and all other
material Tax Returns required to be filed by it (taking into account all available extensions), which such Tax Returns are true,
correct and complete in all material respects, and has timely paid, or caused to be timely paid, all income Taxes and other material
Taxes required to be paid, other than such Taxes that are not yet due and payable for which adequate reserves in the Purchaser
Financials have been established in accordance with GAAP. No written claim has been made within the last thirty-six (36) months
by any Governmental Authority in a jurisdiction where Purchaser or Merger Sub do not currently file Tax Returns that Purchaser
or Merger Sub is or may be subject to taxation by that jurisdiction, which such claim has not been resolved. There are no claims,
assessments, audits, examinations, investigations or other Actions pending against the Purchaser or Merger Sub in respect of any
material amount of Tax, and neither the Purchaser nor the Merger Sub has not been notified in writing of any proposed material
Tax claims or assessments against the Purchaser or Merger Sub (other than, in each case, claims or assessments for which adequate
reserves in the Purchaser Financials have been established in accordance with GAAP). There are no Liens with respect to any Taxes
upon any of the Purchaser’s or Merger Sub’s assets, other than Permitted Liens. Neither the Purchaser nor the Merger
Sub has any outstanding waivers, extensions, or requests for extensions of any applicable statute of limitations to assess any
material amount of Taxes. There are no outstanding requests by the Purchaser or Merger Sub for any extension of time within which
to file any material Tax Return or within which to pay any material Taxes shown to be due on any material Tax Return.
(b) Neither the Purchaser nor the Merger Sub has taken any action, or has any current plan, intention or obligation to take
any action, that would reasonably be expected to prevent the Merger from qualifying as a “reorganization” within the
meaning of Section 368(a) of the Code. To the Knowledge of the Purchaser, there are no facts or circumstances that would reasonably
be expected to prevent the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the
Code.
(c) Each of the Purchaser and the Merger Sub has collected or withheld all material Taxes currently required to be collected
or withheld by it, and all such material Taxes have been paid to or deposited with the appropriate Governmental Authorities or
set aside in appropriate accounts for future payment when due.
(d) Within the last thirty-six (36) months, neither the Purchaser nor the Merger Sub has made any changes in any Tax accounting
method (except as required by a change in Law) that would reasonably be expected to have a material impact on Purchaser or the
Merger Sub’s Taxes following Closing.
(e) Neither the Purchaser nor the Merger Sub has engaged in or entered into any “listed transaction,” as defined
in Treasury Regulations Section 1.6011-4(b)(2).
(f) Neither the Purchaser nor the Merger Sub has Liability for the material Taxes of another Person that are not adequately
reflected in the Purchaser Financials (i) under Treasury Regulations Section 1.1502-6 (or any similar provision of state, local
or foreign applicable Law), (ii) as a transferee or successor, or (iii) by contract or indemnity (excluding commercial contracts
and agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes). Neither
the Purchaser nor the Merger Sub is a party to or bound by any Tax indemnity agreement, Tax sharing agreement or Tax allocation
agreement or similar agreement (excluding commercial agreements entered into in the ordinary course of business the primary purpose
of which is not the sharing of Taxes).
(g) Neither the Purchaser nor the Merger Sub has requested, or is the subject of or bound by any private letter ruling, technical
advice memorandum, closing agreement, or similar ruling, memorandum, or agreement with any Governmental Authority with respect
to any Taxes, nor is any such request outstanding, except, in each case, to the extent that the effect of such ruling, memorandum,
or agreement would not reasonably be expected to be material to the Taxes of Purchaser or Merger Sub after Closing.
(h) Neither the Purchaser nor the Merger Sub nor any predecessor thereof: (i) has constituted either a “distributing corporation”
or a “controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of securities
qualifying for, or intended to qualify for, Tax-free treatment under Section 355 of the Code (A) within the two-year period ending
on the date hereof or (B) in a distribution which constitutes part of a “plan” or “series of related transactions”
(within the meaning of Section 355(e) of the Code) in conjunction with the Transactions; or (ii) (A) is, or has during
the applicable period specified in Section 897(c)(1)(A)(ii) of the Code been, a U.S. real property holding corporation within the
meaning of Section 897(c)(2) of the Code, or (B) is or has been a member of any consolidated, combined, unitary or affiliated group
for any Tax purposes other than a group of which the Purchaser is the common parent.
3.12
Employees and Employee Benefit Plans. The Purchaser does not (a) have any employees (including service providers
that would be considered employees under common law) or (b) maintain, sponsor, contribute to or otherwise have any Liability under,
any Benefit Plans. Neither the execution and delivery of this Agreement or the Ancillary Documents nor the consummation of the
Transactions will (i) result in any payment or benefit (including severance, unemployment compensation, golden parachute,
bonus or otherwise) from the Purchaser or its Subsidiaries becoming due to any director, officer or employee of the Purchaser or
(ii) result in the acceleration of the time of payment or vesting of any such payment or benefit. There is no arrangement
with respect to any employee of the Purchaser that would result in the payment of any amount that by operation of Sections 280G
or 162(m) of the Code would not be deductible by the Purchaser and no arrangement exists pursuant to which the Purchaser will be
required to “gross up” or otherwise compensate any person because of the imposition of any excise Tax on a payment
to such person.
3.13
Properties. The Purchaser does not own, license or otherwise have any right, title or interest in any material Intellectual
Property. The Purchaser does not own or lease any material real property or material Personal Property.
3.14
Material Contracts.
(a) Except as set forth on Schedule 3.14(a), other than this Agreement and the Ancillary Documents, there are no Contracts
to which the Purchaser is a party or by which any of its properties or assets may be bound, subject or affected, which (i) creates
or imposes a Liability greater than $200,000, (ii) may not be cancelled by the Purchaser on less than sixty (60) days’ prior
notice without payment of a material penalty or termination fee or (iii) prohibits, prevents, restricts or impairs in any material
respect any business practice of the Purchaser as its business is currently conducted, any acquisition of material property by
the Purchaser, or restricts in any material respect the ability of the Purchaser to engage in business as currently conducted by
it or compete with any other Person (each, a “Purchaser Material Contract”). All Purchaser Material Contracts
have been made available to the Company other than those that are exhibits to the Purchaser SEC Reports.
(b) With respect to each Purchaser Material Contract: (i) the Purchaser Material Contract was entered into at arms’ length
and in the ordinary course of business; (ii) the Purchaser Material Contract is legal, valid, binding and enforceable in all material
respects against the Purchaser and, to the Knowledge of the Purchaser, the other parties thereto, and is in full force and effect
(except, in each case, as such enforcement may be limited by the Enforceability Exceptions); (iii) the Purchaser is not in breach
or default in any material respect, and no event has occurred that with the passage of time or giving of notice or both would constitute
such a breach or default in any material respect by the Purchaser, or permit termination or acceleration by the other party, under
such Purchaser Material Contract; and (iv) to the Knowledge of the Purchaser, no other party to any Purchaser Material Contract
is in breach or default in any material respect, and no event has occurred that with the passage of time or giving of notice or
both would constitute such a breach or default by such other party, or permit termination or acceleration by the Purchaser under
any Purchaser Material Contract.
3.15
Transactions with Affiliates. Schedule 3.15 sets forth a true, correct and complete list of the Contracts
and arrangements that are in existence as of the date of this Agreement under which there are any existing or future Liabilities
or obligations between the Purchaser and any (a) present or former director, officer or employee or Affiliate of the Purchaser,
or any immediate family member of any of the foregoing, or (b) record or beneficial owner of more than five percent (5%) of the
Purchaser’s outstanding capital stock as of the date hereof.
3.16
Merger Sub Activities. Since its formation, Merger Sub has not engaged in any business activities other than as contemplated
by this Agreement, does not own directly or indirectly any ownership, equity, profits or voting interest in any Person and has
no assets or Liabilities except those incurred in connection with this Agreement and the Ancillary Documents to which it is a party
and the Transactions, and, other than this Agreement and the Ancillary Documents to which it is a party, Merger Sub is not party
to or bound by any Contract.
3.17
Investment Company Act. The Purchaser is not an “investment company” or a Person directly or indirectly
“controlled” by or acting on behalf of an “investment company”, or required to register as an “investment
company”, in each case within the meaning of the Investment Company Act of 1940, as amended.
3.18
Finders and Brokers. Except as set forth on Schedule 3.18, no broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission from the Purchaser, the Target Companies or any of their respective
Affiliates in connection with the Transactions based upon arrangements made by or on behalf of the Purchaser.
3.19
Ownership of Stockholder Merger Consideration. All shares of Purchaser Class A Common Stock to be issued and delivered
to the Company Stockholders as Stockholder Merger Consideration in accordance with Article I shall be, upon issuance and
delivery of such Purchaser Class A Common Stock, fully paid and non-assessable, free and clear of all Liens, other than restrictions
arising from applicable securities Laws, any applicable Company Lock-Up Agreement, and any Liens incurred by any Company Stockholder,
and the issuance and sale of such Purchaser Class A Common Stock pursuant hereto will not be subject to or issued in violation
of any purchase option, right of first refusal, preemptive right, subscription right or any similar right under any provision of
the DGCL or any other applicable Law, the Purchaser’s Organizational Documents or any Contract to which Purchaser is a party.
All of the outstanding Purchaser Securities have been granted, offered, sold and issued in compliance with all applicable securities
Laws.
3.20
Certain Business Practices.
(a) Neither the Purchaser, nor any of its Representatives acting on its behalf, has (i) used any funds for unlawful contributions,
gifts, entertainment or other unlawful expenses relating to political activity, (ii) made any unlawful payment to foreign
or domestic government officials or employees, to foreign or domestic political parties or campaigns or violated any provision
of the U.S. Foreign Corrupt Practices Act of 1977 or any other local or foreign anti-corruption or bribery Law, (iii) made
any other unlawful payment, or (iv) since the formation of the Purchaser, directly or indirectly, given or agreed to give any unlawful
gift or similar benefit in any material amount to any customer, supplier, governmental employee or other Person who is or may be
in a position to help or hinder the Purchaser or assist it in connection with any actual or proposed transaction.
(b) The operations of the Purchaser are and have been conducted at all times in material compliance with money laundering statutes
in all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines,
issued, administered or enforced by any Governmental Authority, and no Action involving the Purchaser with respect to any of the
foregoing is pending or, to the Knowledge of the Purchaser, threatened.
(c) None of the Purchaser or any of its directors or officers, or, to the Knowledge of the Purchaser, any other Representative
acting on behalf of the Purchaser is currently identified on the specially designated nationals or other blocked person list or
otherwise currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department
(“OFAC”), and the Purchaser has not, in the last three (3) fiscal years directly or knowingly indirectly,
used any funds, or loaned, contributed or otherwise made available such funds to any Subsidiary, joint venture partner or other
Person, in connection with any sales or operations in any country sanctioned by OFAC or for the purpose of financing the activities
of any Person currently subject to, or otherwise in violation of, any U.S. sanctions administered by OFAC.
3.21
Insurance. Schedule 3.21 lists all insurance policies (by policy number, insurer, coverage period, coverage
amount, annual premium and type of policy) held by the Purchaser relating to the Purchaser or its business, properties, products,
products liability, assets, directors, officers and employees, copies of which have been provided to the Company. All premiums
due and payable under all such insurance policies have been timely paid and the Purchaser is otherwise in material compliance with
the terms of such insurance policies. All such insurance policies are in full force and effect, and, to the Knowledge of the Purchaser,
there is no threatened termination of, or material premium increase with respect to, any of such insurance policies. There have
been no insurance claims made by the Purchaser. The Purchaser has each reported to its insurers all claims and pending circumstances
that would reasonably be expected to result in a claim, except where such failure to report such a claim would not be reasonably
likely to have a Material Adverse Effect on the Purchaser.
3.22
Purchaser Trust Account. As of June 30, 2023, the Trust Account has a rounded off balance of no less than $13,634,402.
Such monies are invested solely in United States “government securities” within the meaning of Section 2(a)(16) of
the Investment Company Act or money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company
Act, and held in trust by Continental Stock Transfer & Trust Company pursuant to the Trust Agreement. The Trust Agreement is
valid and in full force and effect and enforceable in accordance with its terms (subject to the Enforceability Exceptions) and
has not been amended or modified. There are no separate agreements, side letters or other agreements that would cause the description
of the Trust Agreement in the Purchaser SEC Reports to be inaccurate in any material respect and/or that would entitle any Person
(other than the underwriters of the IPO, Public Stockholders who shall have elected to redeem their Purchaser Class A Common Stock
(or in connection with an extension of the Purchaser’s deadline to consummate a Business Combination) or Governmental Authorities
for Taxes) to any portion of the proceeds in the Trust Account. Prior to the Closing, none of the funds held in the Trust Account
may be released except as described in the second sentence of Section 8.1.
3.23
Takeover Statutes. The Purchaser board of directors has taken all necessary action to ensure that the restrictions
on business combinations contained in Section 203 of the DGCL or contained in Section 78.411
through Section 78.444 of the BCA will not apply to this Agreement, the Transactions, including by approving this Agreement,
the Mergers and the other Transactions. There is no stockholder rights plan, “poison pill” anti-takeover plan or other
similar plan, device or arrangement to which the Purchaser is a party or by which it or they are bound with respect to any capital
stock of the Purchaser.
3.24
Opinion of Purchaser Financial Advisor. ValueScope, Inc. (the “Purchaser Financial Advisor”)
has delivered to the board of directors of the Purchaser as of the date hereof an opinion to the effect that, as of the date of
such opinion, and based on and subject to the assumptions, limitations, qualifications and other matters set forth therein, the
Merger is fair, from a financial point of view, to holders of Purchaser Class A Common Stock and Purchaser Class B Common Stock.
A copy of the written opinion has been provided to the Company, solely for informational purposes (it being understood and agreed
that such written opinion may not be relied upon by the Company or its Affiliates).
3.25
Independent Investigation. The Purchaser has conducted its own independent investigation, review and analysis of
the business, results of operations, prospects, condition (financial or otherwise) or assets of the Target Companies, and acknowledges
that it has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents
and data of the Target Companies for such purpose. The Purchaser acknowledges and agrees that: (a) in making its decision to enter
into this Agreement and to consummate the Transactions, it has relied solely upon its own investigation and the express representations
and warranties of the Company set forth in this Agreement (including the related portions of the Company Disclosure Schedules)
and in any certificate delivered to the Purchaser pursuant hereto, and the information provided by or on behalf of the Company
for the Registration Statement; and (b) neither the Company nor its respective Representatives have made any representation
or warranty as to the Target Companies, or this Agreement, except as expressly set forth in this Agreement (including the related
portions of the Company Disclosure Schedules) or in any certificate delivered to Purchaser pursuant hereto, or with respect to
the information provided by or on behalf of the Company for the Registration Statement.
3.26
Information Supplied. None of the information supplied or to be supplied by the Purchaser expressly for inclusion
or incorporation by reference: (a) in any current report on Form 8-K, and any exhibits thereto or any other report, form, registration
or other filing made with any Governmental Authority or stock exchange with respect to the Transactions; (b) in the Registration
Statement; or (c) in the mailings or other distributions to the Purchaser Stockholders and/or prospective investors with respect
to the consummation of the Transactions or in any amendment to any of documents identified in (a) through (c), will, when
filed, made available, mailed or distributed, as the case may be, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances
under which they are made, not misleading. None of the information supplied or to be supplied by the Purchaser expressly for inclusion
or incorporation by reference in any of the press releases or filings with the SEC relating to the Transactions will, when filed
or distributed, as applicable, contain any untrue statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not
misleading. Notwithstanding the foregoing, the Purchaser makes no representation, warranty or covenant with respect to any information
supplied by or on behalf of the Company or its Affiliates.
3.27
No Other Representations. Except for the representations and warranties expressly made by the Purchaser in this Article
III (as modified by the Purchaser Schedules) or as expressly set forth in an Ancillary Document, neither the Purchaser, nor
any other Person on its behalf makes any express or implied representation or warranty with respect to any of the Purchaser, the
Purchaser Securities, the business of the Purchaser, or the Transactions, and the Purchaser hereby expressly disclaims any other
representations or warranties, whether implied or made by the Purchaser or any of its respective Representatives. Except for the
representations and warranties expressly made by the Purchaser in this Article III (as modified by the Purchaser Disclosure
Schedules) or in an Ancillary Document, the Purchaser hereby expressly disclaims all liability and responsibility for any representation,
warranty, projection, forecast, statement or information made, communicated or furnished (orally or in writing) to the Target Companies,
the Company Security Holders or any of their respective Representatives (including any opinion, information, projection or advice
that may have been or may be provided to the Target Companies, the Company Security Holders or any of their respective Representatives
by any Representative of the Purchaser), including any representations or warranties regarding the probable success or profitability
of the businesses of the Purchaser.
Article
IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth
in (i) the disclosure schedules delivered by the Company to the Purchaser on the date hereof (the “Company Disclosure
Schedules”) or (ii) the Company SEC Reports that are available on the SEC’s website through EDGAR at least
two (2) Business Days prior to the date hereof (it being acknowledged that nothing disclosed in such a SEC Report under the headings
“Risk Factors” or “Forward-Looking Statements” will be deemed to modify or qualify and representations
or warranties set forth in Article IV), the Company hereby represents and warrants to the Purchaser as follows:
4.1 Organization and Standing. The Company is a corporation duly incorporated, validly existing and in good standing
under the BCA. The Company has all requisite corporate power and authority to own, lease and operate its properties and to carry
on its business as now being conducted, except where the failure to have such requisite power or authority would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect. Each Subsidiary of the Company is a corporation
or other entity duly formed, validly existing and in good standing under the Laws of its jurisdiction of organization and has all
requisite corporate power and authority to own, lease and operate its properties and to carry on its business as now being conducted,
except where the failure to have such requisite power or authority would not, individually or in the aggregate, reasonably be expected
to have a Material Adverse Effect. Each Target Company is duly qualified or licensed and in good standing in each jurisdiction
in which the character of the property owned, leased or operated by it or the nature of the business conducted by it makes such
qualification or licensing necessary, except where the failure to be so qualified or licensed or in good standing would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect. Schedule 4.1 lists all jurisdictions in which
any Target Company is qualified to conduct business as of the date of this Agreement and all names other than its legal name under
which any Target Company does business as of the date of this Agreement. The Company has provided to the Purchaser accurate and
complete copies of its Organizational Documents and the Organizational Documents of each of its Subsidiaries, each as amended to
date and as currently in effect. No Target Company is in violation of any provision of its Organizational Documents in any material
respect.
4.2 Authorization; Binding Agreement.
(a) The Company has all requisite corporate power and authority to execute and deliver this Agreement and each Ancillary Document
to which it is or is required to be a party, to perform the Company’s obligations hereunder and thereunder and to consummate
the Transactions, subject to obtaining the Required Company Stockholder Approval. The execution and delivery of this Agreement
and each Ancillary Document to which the Company is or is required to be a party and the consummation of the Transactions, (a)
have been duly and validly authorized by the Company’s board of directors in accordance with the Company’s Organizational
Documents, the BCA, any other applicable Law or any Contract to which the Company is a party or by which it or its securities are
bound and (b) other than the Required Company Stockholder Approval, no other corporate proceedings on the part of the Company
are necessary to authorize the execution and delivery of this Agreement and each Ancillary Document to which it is a party or to
consummate the Transactions. This Agreement has been, and each Ancillary Document to which the Company is or is required to be
a party shall be when delivered, duly and validly executed and delivered by the Company and, assuming the due authorization, execution
and delivery of this Agreement and Ancillary Documents by the other Parties hereto and thereto, constitutes, or when delivered
shall constitute, the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its
terms, subject to the Enforceability Exceptions.
(b) The Company’s board of directors, by resolutions duly adopted, has unanimously (i) determined that this Agreement
and the Transactions, including the Merger, is fair, advisable and in the best interests of the Company and the Company Stockholders,
(ii) approved this Agreement and the Transactions, including the Merger, upon the terms and subject to the conditions set
forth herein, (iii) directed that approval of this Agreement and adoption of the Transactions, including the Merger, be submitted
to a vote at a meeting of the Company Stockholders, and (iv) recommended to Company Stockholders that they approve and adopt
this Agreement and the Transactions, including the Merger.
4.3 Capitalization.
(a) The Company is authorized to issue (i) 2,500,000,000 shares of Company Common Stock, par value $0.001 per share, of which
1,026,078,464 shares as of August 18, 2023 are issued and outstanding, and (ii) 5,000,000 shares of Company Preferred Stock,
par value $0.0001 per share, of which no shares as of the date hereof are issued and outstanding. With respect to the Company Preferred
Stock, the Company has designated (A) 6,175 shares as Company Series A Preferred Stock, of which no shares are outstanding,
(B) 293 shares as Company Series B Preferred Stock, of which no shares are outstanding, (C) 90 shares as Company Series C
Preferred Stock, of which no shares are outstanding, and (D) 8 shares as Company Series D Preferred Stock, of which no shares are
outstanding. All of the outstanding shares and other equity interests of the Company have been duly authorized, are fully paid
and non-assessable and not in violation of any purchase option, right of first refusal, preemptive right, subscription right or
any similar right under any provision of the BCA, any other applicable Law, the Company Articles or any Contract to which the Company
is a party or by which it or its securities are bound. The Company holds no shares or other equity interests of the Company in
its treasury. None of the outstanding shares or other equity interests of the Company were issued in violation of any applicable
securities Laws. The rights, privileges and preferences of the Company Preferred Stock are as stated in the Company Articles and
as provided by the BCA.
(b) As of the date of this Agreement, the Company has reserved 35,000,000 shares of Company Common Stock for issuance pursuant
to the Company Equity Plan, which was duly adopted by the Company’s board of directors and approved by the Company’s
stockholders. As of the date of this Agreement, of such shares of Company Common Stock reserved for issuance under the Company
Equity Plan, (x) 19,136,150 of such shares are reserved for issuance upon exercise of Company Options that are outstanding as of
the date of this Agreement, and (y) 15,863,850 of such shares remain available for future awards permitted under the Company Equity
Plan. Except as set forth on Schedule 4.3(b), as of the date of this Agreement, there are no (i) outstanding options,
warrants, puts, calls, convertible securities, rights of first refusal, preemptive or similar rights, (ii) bonds, debentures, notes
or other Indebtedness having general voting rights or that are convertible or exchangeable into securities having such rights or
(iii) subscriptions or other rights, agreements, arrangements, Contracts or commitments of any character (other than this Agreement
and the Ancillary Documents) to which the Company is a party, (A) relating to the issued or unissued shares of the Company, (B)
obligating the Company to issue, transfer, deliver, offer or sell or cause to be issued, transferred, delivered, offered or sold
any options or shares or securities convertible into or exchangeable for such shares, (C) obligating the Company to grant, extend
or enter into any such option, warrant, call, subscription, convertible securities, right of first refusal, preemptive right or
other similar right, agreement or arrangement or commitment for such shares, (D) obligating the Company to redeem, repurchase or
otherwise acquire any such shares or other equity interests, or (E) to provide an amount of funds to, or make any investment
(in the form of a loan, capital contribution or otherwise) in the Company or any other Person. Except as set forth on Schedule
4.3(b), as of the date of this Agreement, there is no agreement or commitment by the Company relating to the voting or registration
of, or restricting any Person from purchasing, selling, pledging or otherwise disposing of (or granting any option or similar right
with respect to), any shares of the Company. As a result of the consummation of the Transactions, no equity interests of the Company
are issuable and no rights in connection with any interests, warrants, rights, options or other securities of the Company accelerate
or otherwise become triggered (whether as to vesting, exercisability, convertibility or otherwise).
(c) Except as disclosed in the Company Financials, since January 1, 2023, the Company has not declared or paid any distribution
or dividend in respect of its equity interests and has not repurchased, redeemed or otherwise acquired any equity interests of
the Company, and the board of directors of the Company has not authorized any of the foregoing.
4.4 Subsidiaries. Schedule 4.4 sets forth, as of the date of this Agreement, the name of each Subsidiary of the
Company, and with respect to each Subsidiary, (a) its jurisdiction of organization, (b) its authorized shares or other equity interests
(if applicable), and (c) the number of issued and outstanding shares or other equity interests and the record holders and beneficial
owners thereof. All of the outstanding equity securities of each Subsidiary of the Company are duly authorized and validly issued,
fully paid and non-assessable (if applicable), were offered, sold and delivered in compliance with all applicable securities Laws,
are owned by one or more of the Company or its Subsidiaries free and clear of all Liens (other than those, if any, imposed by such
Subsidiary’s Organizational Documents) and no depositary receipts have been issued for or in respect of any equity securities
issued by any Subsidiary. There are no Contracts to which the Company or any of its Affiliates is a party or bound with respect
to the voting (including voting trusts or proxies) of the equity interests of any Subsidiary of the Company other than the Organizational
Documents of any such Subsidiary. There are no outstanding or authorized options, warrants, rights, agreements, subscriptions,
convertible securities or commitments to which any Subsidiary of the Company is a party or which are binding upon any Subsidiary
of the Company providing for the issuance or redemption of any equity interests of any Subsidiary of the Company. There are no
outstanding equity appreciation, phantom equity, profit participation or similar rights granted by any Subsidiary of the Company.
No Subsidiary of the Company has any limitation, whether by Contract, Order or applicable Law, on its ability to make any distributions
or dividends to its equity holders or repay any debt owed to another Target Company. Except for the equity interests of the Subsidiaries
listed on Schedule 4.4, the Company does not own or have any rights to acquire, directly or indirectly, any equity interests
of, or otherwise Control, any Person. None of the Company or its Subsidiaries is a participant in any joint venture, partnership
or similar arrangement. There are no outstanding contractual obligations of the Company or its Subsidiaries to provide funds to,
or make any investment (in the form of a loan, capital contribution or otherwise) in, any other Person.
4.5 Governmental Approvals. Except as otherwise described in Schedule 4.5, no Consent of or with any Governmental
Authority on the part of any Target Company is required to be obtained or made in connection with the execution, delivery or performance
by the Company of this Agreement or any Ancillary Documents or the consummation by the Company of the Transactions, other than
(a) such filings as contemplated by this Agreement, (b) any filings required with OTC Market or the SEC with respect to the Transactions,
(c) applicable requirements, if any, of the Securities Act, the Exchange Act, and/or any state “blue sky”
securities Laws, and the rules and regulations thereunder, and (d) where the failure to obtain or make such Consents or to make
such filings or notifications would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.6 Non-Contravention. Except as otherwise described in Schedule 4.6, the execution and delivery by the Company
(or any other Target Company, as applicable) of this Agreement and each Ancillary Document to which any Target Company is or is
required to be a party or otherwise bound, and the consummation by any Target Company of the Transactions and compliance by any
Target Company with any of the provisions hereof and thereof, will not (a) conflict with or violate any provision of any Target
Company’s Organizational Documents, (b) subject to obtaining the Consents from Governmental Authorities referred to in Section 4.5
hereof, the waiting periods referred to therein having expired, and any condition precedent to such Consent or waiver having been
satisfied, conflict in any manner with or violate in any respect any Law, Order or Consent applicable to any Target Company or
any of its material properties or assets, or (c) (i) violate, conflict with or result in a breach of, (ii) constitute
a default (or an event which, with notice or lapse of time or both, would constitute a default) under, (iii) result in the termination,
withdrawal, suspension, cancellation or modification of, (iv) accelerate the performance required by any Target Company under,
(v) result in a right of termination or acceleration under, (vi) give rise to any obligation to make payments or provide compensation
under, (vii) result in the creation of any Lien upon any of the properties or assets of any Target Company under (other than Permitted
Liens), (viii) give rise to any obligation to obtain any Third Party Consent or provide any notice to any Person, or (ix) give
any Person the right to declare a default, exercise any remedy, claim a rebate, chargeback, penalty or change in delivery schedule,
accelerate the maturity or performance, cancel, terminate or modify any right, benefit, obligation or other term under, any of
the terms, conditions or provisions of any Company Material Contract, except for any deviations from any of the foregoing clauses
(a), (b) or (c) that would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
4.7 SEC Filings and Company Financial Statements.
(a) The Company has filed all forms, reports, schedules, statements, registration statements, prospectuses and other documents
required to be filed or furnished by the Company with the SEC under the Securities Act and/or the Exchange Act, together with any
amendments, restatements or supplements thereto, and will file all such forms, reports, schedules, statements and other documents
required to be filed subsequent to the date of this Agreement. Except to the extent available in full without redaction on the
SEC’s website through EDGAR for at least two (2) days prior to the date of this Agreement, the Company has delivered to the
Purchaser copies in the form filed with the SEC of all of the following: (i) the Company’s annual reports on Form 10-K for
the past three (3) fiscal years; (ii) the Company’s quarterly reports on Form 10-Q for each fiscal quarter from and after
January 1, 2023, that the Company filed such reports to disclose its quarterly financial results in each of the fiscal years of
the Company referred to in clause (i) above; (iii) all other forms, reports, registration statements, prospectuses and other documents
(other than preliminary materials) filed by the Company with the SEC since the beginning of the first fiscal year referred to in
clause (i) above (the forms, reports, registration statements, prospectuses and other documents referred to in clauses (i), (ii)
and (iii) above, whether or not available through EDGAR, are, collectively, the “Company SEC Reports”);
and (iv) all certifications and statements required by (A) Rules 13a-14 or 15d-14 under the Exchange Act, and (B) 18 U.S.C.
§1350 (Section 906 of SOX) with respect to any report referred to in clause (i) above (collectively, the “Company
Public Certifications”). The Company SEC Reports (x) were prepared in all material respects in accordance with the
requirements of the Securities Act and the Exchange Act, as the case may be, and the rules and regulations thereunder and (y) did
not, as of their respective effective dates (in the case of Company SEC Reports that are registration statements filed pursuant
to the requirements of the Securities Act) and at the time they were filed with the SEC (in the case of all other Company SEC Reports)
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 made therein, in the light of the circumstances under which they were made, not misleading, and the
Company Public Certifications are each true as of their respective dates of filing. Except as otherwise described in Schedule
4.7(a), as of the date of this Agreement, there are no outstanding or unresolved comments in comment letters received from
the SEC with respect to any Company SEC Reports. None of the Company SEC Reports filed on or prior to the date of this Agreement
is subject to ongoing SEC review or investigations as of the date of this Agreement. As used in this Section 4.7(a), the
term “file” shall be broadly construed to include any manner permitted by SEC rules and regulations in which
a document or information is furnished, supplied or otherwise made available to the SEC. As of the date of this Agreement, (A)
the Company Common Stock is listed on the OTCQB, (B) the Company has not received any written deficiency notice from the OTCQB
relating to the continued listing requirements of such Company Common Stock, (C) there are no Actions pending or, to the Company’s
Knowledge, threatened in writing against the Company by the Financial Industry Regulatory Authority with respect to any intention
by such entity to suspend, prohibit or terminate the quoting of such Company Common Stock on the OTCQB, and (D) such Company Common
Stock is compliance with all of the applicable corporate governance rules of the OTCQB.
(b) As used herein, the term “Company Financials” means the (i) audited consolidated financial statements
of the Target Companies (including, in each case, any related notes thereto), consisting of the consolidated balance sheets of
the Target Companies as of December 31, 2021 and December 31, 2022 and the related consolidated audited income statements, changes
in stockholder equity and statements of cash flows as of the respective dates of, and for the fiscal years then ended, each audited
by a PCAOB qualified auditor in accordance with GAAP and PCAOB standards and (ii) the unaudited consolidated financial statements
of the Target Companies, consisting of the consolidated balance sheet of the Target Companies as of June 30, 2023 (the “Interim
Balance Sheet Date”), and the related unaudited consolidated income statement, changes in shareholder equity and
statement of cash flows for the six (6) month period then ended. The Company Financials are complete and accurate in all material
respects and fairly present in all material respects the financial position and the results of operations, changes in shareholders’
equity, and cash flows as of the respective dates of, and for the periods referred to in, such Company Financials, all in accordance
with (x) GAAP methodologies applied on a consistent basis throughout the periods involved, (y) with all applicable accounting requirements
under the Securities Act and the rules and regulations of the SEC thereunder, including Regulation S-X or Regulation S-K, as applicable
(except as may be indicated in the notes thereto and for the omission of notes and audit adjustments in the case of unaudited quarterly
financial statements to the extent permitted by Regulation S-X or Regulation S-K, as applicable), and (z) the books and records
of the Target Companies as of the times and for the periods referred to therein.
(c) Each Target Company maintains accurate books and records reflecting its assets and Liabilities and maintains proper and
adequate internal accounting controls that provide reasonable assurance that (i) such Target Company does not maintain any off-the-book
accounts and that such Target Company’s assets are used only in accordance with such Target Company’s management directives,
(ii) transactions are executed with management’s authorization, (iii) transactions are recorded as necessary to permit
preparation of the financial statements of such Target Company and to maintain accountability for such Target Company’s assets,
(iv) access to such Target Company’s assets is permitted only in accordance with management’s authorization, (v) the
reporting of such Target Company’s assets is compared with existing assets at regular intervals and verified for actual amounts,
and (vi) accounts, notes and other receivables and inventory are recorded accurately, and proper and adequate procedures are implemented
to effect the collection of accounts, notes and other receivables on a current and timely basis. All of the financial books and
records of the Target Companies are complete and accurate in all material respects and have been maintained in the ordinary course
consistent with past practice and in accordance with applicable Laws. No Target Company has been subject to or involved in any
material fraud that involves management or other employees who have a significant role in the internal controls over financial
reporting of any Target Company. In the past three (3) years, no Target Company or its Representatives has received any written
complaint, allegation, assertion or claim regarding the accounting or auditing practices, procedures, methodologies or methods
of any Target Company or its internal accounting controls, including any material written complaint, allegation, assertion or claim
that any Target Company has engaged in questionable accounting or auditing practices.
(d) The Target Companies do not have any Indebtedness other than the Indebtedness set forth on Schedule 4.7(d), which
schedule sets for the amounts (including principal and any accrued but unpaid interest or other obligations) with respect to such
Indebtedness. Except as disclosed on Schedule 4.7(d), no Indebtedness of any Target Company contains any restriction
upon (i) the prepayment of any of such Indebtedness, (ii) the incurrence of Indebtedness by any Target Company, or (iii) the ability
of the Target Companies to grant any Lien on their respective properties or assets. The Company Convertible Notes set forth on
Annex A represent all of the convertible promissory notes of the Company that are convertible into shares of Company Common Stock.
(e) Except as set forth on Schedule 4.7(e), no Target Company is subject to any Liabilities or obligations required to
be reflected on a balance sheet prepared in accordance with GAAP, except for those that (i) are adequately reflected or reserved
on or provided for in the consolidated balance sheet of the Company and its Subsidiaries as of the Interim Balance Sheet Date contained
in the Company Financials, (ii) are incurred after the Interim Balance Sheet Date in the ordinary course of business (other than
Liabilities for breach of any Contract or violation of any Law), or (iii) would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect.
4.8 Absence of Certain Changes. Except as set forth on Schedule 4.8, since December 31, 2022 to the date of this
Agreement, each Target Company has (a) conducted its business only in the ordinary course of business, (b) not been subject to
any event or occurrence, that has had or would reasonably be expected to have, individually or in the aggregate, a Material Adverse
Effect on the Company, and (c) has not taken any action that would be prohibited by Sections 5.2(b)(i)-(iv), (xiii),
(xv)-(xvi), or (xviii) (without giving effect to Schedule 5.2) if such action were taken on or after
the date hereof without the consent of the Purchaser.
4.9 Compliance with Laws. During the past three (3) years, no Target Company is or has been in conflict or noncompliance
with, or in default or violation of (nor has any Target Company received, during the three (3) years prior to the date of this
Agreement, any written notice of any conflict or non-compliance with, or default or violation of) any applicable Laws by which
it or any of its properties, assets, employees, business or operations are or were bound or affected, except for such conflict,
noncompliance, default or violation that would not reasonably be expected to have a Material Adverse Effect. To the Knowledge of
the Company, no Target Company is under investigation with respect to any violation or alleged violation of any applicable Laws,
except for such noncompliance or investigation that would not reasonably be expected to have a Material Adverse Effect on such
Target Company, and no Target Company has received written notice in the last three (3) years alleging any violation of applicable
Law in any material respect by such Target Company.
4.10 Company Permits. Each Target Company (and its employees who are legally required to be licensed by a Governmental
Authority in order to perform his or her duties with respect to his or her employment with any Target Company), holds all material
Permits (including those administered by the FDA or by any Governmental Authority performing functions similar to those performed
by the FDA that governs the business of a Target Company) necessary to lawfully conduct in all material respects its business as
presently conducted, and to own, lease and operate its assets and properties (collectively, the “Company Permits”),
except where the failure to possess such Company Permit would not have, and would not reasonably be expected to have, a Material
Adverse Effect on the Target Companies. The Company has made available to the Purchaser true, correct and complete copies of all
material Company Permits as of the date of this Agreement, all of which material Company Permits are listed on Schedule 4.10.
All of the Company Permits are in full force and effect, except where the failure for such Consent to be in full force and effect
would not reasonably be expected to have a Material Adverse Effect on the Company. No suspension or cancellation of any of the
material Company Permits is pending or, to the Company’s Knowledge, threatened in writing. No Target Company is in violation
in any material respect of the terms of any material Company Permit and, as of the date of this Agreement, no Target Company has
received any written notice of any Actions relating to the revocation or material modification of any material Company Permit.
4.11 Actions; Orders. Except as described on Schedule 4.11, as of the date of this Agreement, there is no (a) Action
of any nature currently pending or, to the Company’s Knowledge, threatened in writing that would, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect on the Company (and no such Action has been brought in the
past three (3) years or, to the Company’s Knowledge, threatened in the past three (3) years), or (b) material Order now pending
or outstanding or that was rendered by a Governmental Authority in the past three (3) years to the date of this Agreement, in either
case of (a) or (b) by or against any Target Company, or any Target Company’s business, equity securities or assets. The items
listed on Schedule 4.11, if finally determined adversely to the Target Companies, will not have, either individually or
in the aggregate, a Material Adverse Effect upon any Target Company. In the past three (3) years to the date of this Agreement,
none of the current or former officers, senior management or directors of any Target Company have been charged with, indicted for,
arrested for, or convicted of any felony or any crime involving fraud.
4.12 Material Contracts.
(a) Schedule 4.12(a) sets forth a true, correct and complete list of, and the Company has made available to the Purchaser
(including written summaries of oral Contracts), true, correct and complete copies of, each Contract to which any Target Company
is a party or by which any Target Company, or any of its properties or assets are bound or affected as of the date of this Agreement
(each Contract required to be set forth on Schedule 4.12(a), other than a Company Benefit Plan, a “Company Material
Contract”) that:
(i) contains covenants that materially limit the ability of any Target Company (A) to compete in any line of business or with
any Person or in any geographic area or to sell, or provide any service or product, including any non- competition covenants, exclusivity
restrictions, rights of first refusal or most-favored pricing clauses or (B) to purchase or acquire an interest in any other Person;
(ii) involves any joint venture, profit sharing, partnership, limited liability company or other similar agreement or arrangement
relating to the formation, creation, operation, management or control of any partnership or joint venture;
(iii) involves any exchange traded, over the counter or other swap, cap, floor, collar, futures contract, forward contract, option
or other derivative financial instrument or Contract, based on any commodity, security, instrument, asset, rate or index of any
kind or nature whatsoever, whether tangible or intangible, including currencies, interest rates, foreign currency and indices;
(iv) evidences Indebtedness (whether incurred, assumed, guaranteed or secured by any asset) of any Target Company having an outstanding
principal amount in excess of $500,000;
(v) involves the acquisition or disposition, directly or indirectly (by merger or otherwise), of assets with an aggregate value
in excess of $500,000 (other than in the ordinary course of business) or shares or other equity interests of any Target Company
or another Person;
(vi) relates to any merger, consolidation or other business combination with any other Person or the acquisition or disposition
of any other entity or its business or material assets or the sale of any Target Company, its business or material assets, in each
case with ongoing or future rights or obligations on behalf of any Target Company;
(vii) by its terms, individually or with all related Contracts, calls for aggregate payments or receipts by the Target Companies
under such Contract or Contracts of at least $500,000 in the 12-month period ended December 31, 2022, or during the 12-month period
ending December 31, 2023 (on an annualized basis);
(viii)
is with any Top Customer or Top Supplier;
(ix) is between any Target Company and any Related Person of a Target Company, including all non-competition, severance and indemnification
agreements (other than at-will employment or consulting arrangements, confidentiality, non-solicitation, non-competition, or Intellectual
Property assignment agreements with employees and contractors entered into in the ordinary course of business);
(x) obligates the Target Companies to make any capital commitment or expenditure in excess of $500,000 (including pursuant to
any joint venture);
(xi) relates to a material settlement in excess of $500,000 entered into within two (2) years prior to the date of this Agreement
or under which any Target Company has outstanding obligations (other than customary confidentiality obligations);
(xii) provides another Person (other than another Target Company or any manager, director or officer of any Target Company) with
a power of attorney;
(xiii)
relates to the development, ownership, licensing or use of any material Intellectual Property by, to or from any Target
Company, other than (A) “shrink wrap,” “click wrap,” and “off the shelf” software agreements
and other agreements for Software commercially available on reasonable terms to the public generally with license, maintenance,
support and other fees of less than $20,000 per year, (B) employee or consultant invention assignment agreements entered into on
a Target Company’s standard form of such agreement, (C) confidentiality agreements entered into in the ordinary course of
business, (D) non-exclusive licenses from customers or distributors to any Target Company entered into in the ordinary course of
business, or (E) feedback and ordinary course trade name or logo rights that are not material to any Target Company (each such
scheduled Contract, a “Company IP License”); or
(xiv)
that will be required to be filed with the Registration Statement under applicable SEC requirements or would otherwise be
required to be filed by the Company as an exhibit for a Form S-1 pursuant to Items 601(b)(1), (2), (4), (9) or (10) of Regulation
S-K under the Securities Act as if the Company was the registrant.
(b) Except as disclosed in Schedule 4.12(b), with respect to each Company Material Contract, except as would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect: (i) such Company Material Contract is valid and
binding and enforceable against the Target Company party thereto and, to the Knowledge of the Company, as of the date of this Agreement
each other party thereto, and is in full force and effect (except, in each case, as such enforcement may be limited by the Enforceability
Exceptions); (ii) the consummation of the Transactions will not affect the validity or enforceability of any Company Material Contract;
(iii) no Target Company is in breach or default, and no event has occurred that with the passage of time or giving of notice or
both would constitute a breach or default by any Target Company, or permit termination or acceleration by the other party thereto,
under such Company Material Contract; (iv) to the Knowledge of the Company as of the date of this Agreement, no other party to
such Company Material Contract is in breach or default, and no event has occurred that with the passage of time or giving of notice
or both would constitute such a breach or default by such other party, or permit termination or acceleration by any Target Company,
under such Company Material Contract; (v) as of the date of this Agreement no party under any Company Material Contract has
given written notice of its intent to terminate or otherwise seek a material amendment to such Company Material Contract, other
than modifications in the ordinary course of business; and (vi) no Target Company has waived any rights under any such Company
Material Contract.
4.13
Intellectual Property.
(a) A Target Company owns, is licensed to use pursuant to valid, enforceable and binding Contracts, or otherwise has the right
to use all Intellectual Property used, held for use or necessary for the operation of the business of the Target Companies (collectively,
the “Company Intellectual Property”) free and clear of all Liens (other than Permitted Liens), except
as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target Company. Schedule 4.13(a)
sets forth a true and complete list of the following, which are owned or purported to be owned by a Target Company: (i) Patents
and Patent applications; (ii) registered Trademarks and applications therefor; (iii) registered Copyrights and applications
therefor; and (iv) domain name registrations ((i) – (iv), the “Registered IP”).
Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target Company,
the execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the Transactions
do not and will not encumber, impair or extinguish any of the Company Intellectual Property.
(b) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target
Company, (i) none of the Company Intellectual Property owned or purported to be owned by a Target Company (“Company
Owned Intellectual Property”) (A) has been adjudged invalid or unenforceable in whole or in part, or (B) is
the subject of any cancellation or reexamination proceeding or any other proceeding challenging its ownership, use, registrability,
validity and enforceability, and (ii) all Registered IP is subsisting, in full force and effect, and, to the Knowledge of the Company,
valid and enforceable, and all renewal fees and other maintenance fees have been paid. There exist no material contractual restrictions
on the disclosure, use, license or transfer of any Company Owned Intellectual Property.
(c) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target
Company, (i) the conduct of the business of the Target Companies does not infringe upon, misappropriate or otherwise violate, and
has not, since January 1, 2021, infringed upon, misappropriated, or otherwise violated, the Intellectual Property rights
of any Third Party and (ii) no Legal Action is pending, asserted in writing, or to the Knowledge of the Company, threatened against
any Target Company that the conduct of the business of any Target Company infringes upon, misappropriates or otherwise violates
the Intellectual Property rights of any Third Party. To the Knowledge of the Company, no Person is infringing upon, misappropriating
or otherwise violating, or has, since January 1, 2021, infringed upon, misappropriated, or otherwise violated, any Intellectual
Property owned or purported to be owned by a Target Company.
(d) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target
Company, each Target Company has taken reasonable steps in accordance with normal industry practice to maintain and protect the
confidentiality of all Company Intellectual Property that is material to the business of such Target Company and the value of which
is contingent upon maintaining the confidentiality thereof. Except as would not, individually or in the aggregate, reasonably be
expected to have a Material Adverse Effect on a Target Company, none of the Company Owned Intellectual Property that is material
to the business of a Target Company and the value of which is contingent upon maintaining the confidentiality thereof, has been
disclosed other than to third parties that are bound by customary, written confidentiality agreements entered into in the ordinary
course of business and that are, to the Knowledge of the Company, valid and enforceable.
(e) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target
Company, all Persons who have contributed, developed or conceived any Company Owned Intellectual Property have done so pursuant
to a valid and enforceable Contract (subject to enforceability exceptions for bankruptcy and insolvency and subject to principles
of equity) that protects the confidential information of the Target Companies and assigns to a Target Company exclusive ownership
of the Person’s contribution, development or conception, other than Intellectual Property excluded by law or non-assignable
moral rights.
(f) To the Knowledge of the Company as of the date of this Agreement, no Person has obtained unauthorized access to Third Party
information and data (including personally identifiable information) in the possession of a Target Company, nor has there been
any other material compromise of the security, confidentiality or integrity of such information or data, and no written or, to
the Knowledge of the Company, oral complaint relating to an improper use or disclosure of, or a breach in the security of, any
such information or data has been received by a Target Company. Each Target Company has complied in all material respects with
all applicable Laws and Contract requirements relating to privacy, personal data protection, and the collection, processing and
use of personal information and its own privacy policies and guidelines. The operation of the business of the Target Companies
as currently conducted does not violate any right to privacy or publicity of any third person, or constitute unfair competition
or trade practices under applicable Law.
(g) Except as may be set forth in Schedule 4.13(g) or as contained in license, distribution and service Contracts entered
into in the ordinary course of business by the Target Companies, (i) no Target Company is bound by any Contract to indemnify,
defend, hold harmless, or reimburse any other Person with respect to any Intellectual Property infringement, misappropriation,
or similar claim which is material to the Target Company taken as a whole, and (ii) no Target Company has assumed, or agreed
to discharge or otherwise take responsibility for, any existing or potential Liability of another Person for infringement, misappropriation,
or violation of any Intellectual Property right, which assumption, agreement or responsibility remains in force as of the date
of this Agreement.
(h) Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect on a Target
Company, (i) to the Knowledge of the Company, there have been no unauthorized intrusions or breaches of the security of the information
technology systems currently used to provide material products to customers in the conduct of a Target Company as it is currently
conducted (the “IT Systems”) during the two (2) year period preceding and up to the date of this Agreement,
(ii) the Target Companies have in place adequate security controls and disaster recovery plans and procedures for the IT Systems,
and (iii) to the Knowledge of the Company, there have been no unauthorized intrusions or breaches of the security of the IT Systems
in the two (2) year period preceding and up to the date of this Agreement that, pursuant to any legal requirement, would require
a Target Company to notify customers or employees of such breach or intrusion.
(i) The consummation of any of the Transactions will not result in the material breach, material modification, cancellation,
termination, suspension of, or acceleration of any payments with respect to, or release of source code because of any Contract
providing for the license or other use of Intellectual Property to or from a Target Company. Following the Closing, the Surviving
Corporation shall be permitted to exercise, directly or indirectly through its Subsidiaries, all of the Target Companies’
rights under such Contracts or Company IP Licenses to the same extent that the Target Companies would have been able to exercise
had the Transactions not occurred, without the payment of any additional amounts or consideration other than ongoing fees, royalties
or payments which the Target Companies would otherwise be required to pay in the absence of such transactions.
4.14
Taxes and Returns.
(a) Each Target Company has timely filed, or caused to be timely filed, all income Tax Returns and all other material Tax Returns
required to be filed by it (taking into account all available extensions), which Tax Returns are true, correct, and complete in
all material respects, and has timely paid, or caused to be timely paid, all income Taxes and other material Taxes required to
be paid, other than such Taxes that are not yet due and payable and for which adequate reserves in the Company Financials have
been established in accordance with GAAP.
(b) No written claim has been made within the last thirty-six (36) months by any Governmental Authority in any jurisdiction
in which a Target Company does not currently file a Tax Return that such Target Company is or may be subject to taxation in that
jurisdiction, which claim has not been resolved.
(c) There are no claims, assessments, audits, examinations, investigations, or other Actions pending against the Target Companies
in respect of any material amount of Tax, and no Target Company has been notified in writing of any proposed material Tax claims
or assessments against such Target Company (other than, in each case, claims or assessments for which adequate reserves in the
Company Financials have been established in accordance with GAAP).
(d) There are no Liens with respect to any Taxes upon any Target Company’s assets, other than Permitted Liens.
(e) Each Target Company has collected or withheld all material Taxes currently required to be collected or withheld by it, and
all such material Taxes have been paid to or deposited with the appropriate Governmental Authorities or set aside in appropriate
accounts for future payment when due.
(f) No Target Company has any outstanding waivers, extensions, or requests for extensions of any applicable statute of limitations
to assess any material amount of Taxes. There are no outstanding requests by a Target Company for any extension of time within
which to file any material Tax Return or within which to pay any material Taxes shown to be due on any material Tax Return.
(g) Within the last thirty-six (36) months, no Target Company has made any changes in any Tax accounting method (except as required
by a change in Law) that would reasonably be expected to have a material impact on such Target Company’s Taxes following
Closing.
(h) No Target Company has engaged in or entered into any “listed transaction,” as defined in Treasury Regulations
Section 1.6011-4(b)(2).
(i) No Target Company has any Liability for the material Taxes of another Person (other than another Target Company) that are
not adequately reflected in the Company Financials (i) under Treasury Regulations Section 1.1502-6 (or any similar provision of
state, local or foreign applicable Law), (ii) as a transferee or successor, or (iii) by contract or indemnity (excluding commercial
contracts and agreements entered into in the ordinary course of business the primary purpose of which is not the sharing of Taxes).
No Target Company is a party to or bound by any Tax indemnity agreement, Tax sharing agreement or Tax allocation agreement or similar
agreement (excluding commercial agreements entered into in the ordinary course of business the primary purpose of which is not
the sharing of Taxes).
(j) No Target Company has requested, or is the subject of or bound by any private letter ruling, technical advice memorandum,
closing agreement, or similar ruling, memorandum, or agreement with any Governmental Authority with respect to any Taxes, nor is
any such request outstanding, except, in each case, to the extent that the effect of such ruling, memorandum, or agreement would
not reasonably be expected to be material to the Taxes of such Target Company after Closing.
(k) No Target Company: (i) has constituted either a “distributing corporation” or a “controlled corporation”
(within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of securities qualifying for, or intended to qualify
for, Tax-free treatment under Section 355 of the Code (A) within the two (2) year period ending on the date hereof or (B)
in a distribution which constitutes part of a “plan” or “series of related transactions” (within the meaning
of Section 355(e) of the Code) in conjunction with the Transactions; or (ii) (A) is, or has during the applicable period specified
in Section 897(c)(1)(A)(ii) of the Code been, a U.S. real property holding corporation within the meaning of Section
897(c)(2) of the Code, or (B) is or has been a member of any consolidated, combined, unitary or affiliated group for any Tax purposes
other than a group of which the Company is the common parent.
(l) No Target Company has taken any action, or has any current plan, intention or obligation to take any action, that could
reasonably be expected to prevent the Merger from qualifying as a “reorganization” within the meaning of Section 368(a)
of the Code. To the Knowledge of the Company, there are no facts or circumstances that would reasonably be expected to prevent
the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code.
4.15
Real Property. Schedule 4.15 contains a complete and accurate list of all premises leased or subleased or
otherwise used or occupied by a Target Company for the operation of the business of a Target Company as of the date of this Agreement
(collectively, the “Leased Real Property”), as well as the current annual rent and term under each Company
Real Property Lease. The Company has made available to the Purchaser a true and complete copy of all leases, lease guarantees,
agreements and documents related thereto, including all amendments, terminations and modifications thereof or waivers thereto in
effect as of the date of this Agreement for the Leased Real Property (collectively, the “Company Real Property Leases”),
and in the case of any oral Company Real Property Lease, a written summary of the material terms of such Company Real Property
Lease. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the Company
Real Property Leases are valid, binding and enforceable in accordance with their terms and are in full force and effect, subject
to Enforceability Exceptions. To the Knowledge of the Company, (i) no event has occurred which (whether with or without notice,
lapse of time or both or the happening or occurrence of any other event) would constitute a default on the part of a Target Company
or, as of the date of this Agreement, any other party under any of the Company Real Property Leases, and, (ii) as of the date of
this Agreement, no Target Company has received notice of any such condition. No Target Company owns or has ever owned any real
property or any interest in real property (other than the leasehold interests in the Company Real Property Leases).
4.16
Personal Property. Each item of Personal Property which is owned, used or leased by a Target Company as of the date
of this Agreement with a book value or fair market value of greater than $100,000 is set forth on Schedule 4.16, along with,
to the extent applicable, a list of lease agreements, lease guarantees, security agreements and other agreements related thereto,
including all amendments, terminations and modifications thereof or waivers thereto (“Company Personal Property Leases”).
Except as set forth in Schedule 4.16, as of the date of this Agreement all such items of Personal Property are in good operating
condition and repair (reasonable wear and tear excepted consistent with the age of such items), and are suitable for their intended
use in the business of the Target Companies. The operation of each Target Company’s business as it is now conducted is not
in any material respect dependent upon the right to use the Personal Property of Persons other than a Target Company, except for
such Personal Property that is owned, leased or licensed by or otherwise contracted to a Target Company. The Company has provided
to the Purchaser a true and complete copy of each of the Company Personal Property Leases, and in the case of any oral Company
Personal Property Lease, a written summary of the material terms of such Company Personal Property Lease. The Company Personal
Property Leases are valid, binding and enforceable in accordance with their terms and are in full force and effect. To the Knowledge
of the Company, no event has occurred which (whether with or without notice, lapse of time or both or the happening or occurrence
of any other event) would constitute a default on the part of a Target Company or, as of the date of this Agreement, any other
party under any of the Company Personal Property Leases, and as of the date of this Agreement, no Target Company has received notice
of any such condition.
4.17
Title to and Sufficiency of Assets. Each Target Company has good and marketable title to, or a valid leasehold interest
in or right to use, all of its tangible assets, free and clear of all Liens other than, (a) Permitted Liens, (b) the rights of
lessors under leasehold interests, (c) Liens specifically identified on the balance sheet as of the Interim Balance Sheet Date
included in the Company Financials, and (d) Liens set forth on Schedule 4.17. The material assets (including Intellectual
Property rights and contractual rights) of the Target Companies constitute all of the material assets, rights and properties that
are used in the operation of the businesses of the Target Companies as it is now conducted or that are used or held by the Target
Companies for use in the operation of the businesses of the Target Companies, and taken together, are adequate and sufficient for
the operation of the businesses of the Target Companies as currently conducted.
4.18
Employee Matters.
(a) Except as set forth in Schedule 4.18(a), no Target Company is a party to any collective bargaining agreement or other
Contract covering any group of employees, labor organization or other representative of any of the employees of any Target Company,
and the Company has no Knowledge of any activities or proceedings of any labor union or other party to organize or represent such
employees. There has not occurred or, to the Knowledge of the Company, been threatened any strike, slow-down, picketing, work-stoppage,
or other similar labor activity with respect to any such employees. As of the date hereof, no current officer of a Target Company
has provided any Target Company written notice of his or her plan to terminate his or her employment with any Target Company.
(b) Except as set forth in Schedule 4.18(b), and except as would not, individually or in the aggregate, have or reasonably
be expected to have a Material Adverse Effect on, or with respect to, the Purchaser, each Target Company since January 1, 2020,
(i) is and has been in compliance in all material respects with all applicable Laws respecting employment and employment practices,
terms and conditions of employment, health and safety and wages and hours, and other Laws relating to discrimination, disability,
labor relations, hours of work, payment of wages and overtime wages, pay equity, immigration, workers compensation, working conditions,
employee scheduling, occupational safety and health, family and medical leave, and employee terminations, (collectively, “Employment
Laws”), (ii) has not incurred any Liability that remains unsatisfied as of the date of this Agreement for any material
past due arrears of wages or any material penalty for failure to comply with any Employment Law, and (iii) has not incurred any
Liability that remains unsatisfied as of the date of this Agreement for any material past due arrears of wages or any material
penalty for failure to comply with payment of wages. As of the date of this Agreement, there are no Actions pending or, to the
Knowledge of the Company, threatened against a Target Company brought by or on behalf of any applicant for employment, any current
or former employee, any Person alleging to be a current or former employee, or any Governmental Authority, relating to any Employment
Law, or alleging breach of any express or implied contract of employment, wrongful termination of employment, or alleging any other
discriminatory, wrongful or tortious conduct in connection with the employment relationship.
(c) Schedule 4.18(c) sets forth a complete and accurate list as of the date hereof of all employees of the Target Companies
showing for each as of such date the employee’s name, job title, employer, location, salary level (including any bonus, commission,
deferred compensation or other remuneration eligible (other than any such arrangements under which payments are at the discretion
of the Target Companies)). Except as set forth on Schedule 4.18(c), no employee is a party to a written employment Contract
with a Target Company and each is employed “at will”. Except as set forth in Schedule 4.18(c), each Target
Company employee has entered into the Company’s standard form of employee non-disclosure, inventions and restrictive covenants
agreement with a Target Company (whether pursuant to a separate agreement or incorporated as part of such employee’s overall
employment agreement), a copy of which has been made available to the Purchaser by the Company.
(d) Schedule 4.18(d) sets forth a list of all individual independent contractors (including consultants) currently engaged
by any Target Company as of the date hereof, along with a high-level description of the services provided, the entity engaging
such Person, date of retention and rate of remuneration for each such Person. Except as set forth on Schedule 4.18(d), all
of such independent contractors are a party to a written Contract with a Target Company. Except as set forth on Schedule 4.18(d),
and to the extent permissible under applicable Laws, each such independent contractor has entered into customary covenants regarding
confidentiality, restrictive covenants and assignment of Intellectual Property rights in inventions developed in connection with
such contractor’s work for any Target Company in such Person’s agreement with a Target Company, a copy of which has
been provided to the Purchaser by the Company. Each such independent contractor is terminable on thirty (30) days’ notice
or less, without any obligation of any Target Company to pay severance or a termination fee.
4.19
Benefit Plans.
(a) Set forth on Schedule 4.19(a) is a true and complete list of each material Benefit Plan of a Target Company as of
the date hereof (each, a “Company Benefit Plan”). With respect to each Company Benefit Plan, there are
no funded benefit obligations for which contributions have not been made or properly accrued and there are no unfunded benefit
obligations that have not been accounted for by reserves, or otherwise properly footnoted in accordance with GAAP on the Company
Financials, except to the extent that such amount would not, individually or in the aggregate, have or reasonably be expected to
have a Material Adverse Effect on, or with respect to, the Purchaser. No Target Company is or has in the past been a member of
a “controlled group” for purposes of Section 414(b), (c), (m) or (o) of the Code with respect to any person or entity
other than another Target Company, nor does any Target Company have any Liability with respect to any collectively-bargained for
benefit plans, whether or not subject to the provisions of ERISA.
(b) Each Company Benefit Plan is and has been operated in compliance with all applicable Laws, including ERISA and the Code,
except for any noncompliance that, individually or in the aggregate, have not had and would not reasonably be expected to have
a Material Adverse Effect on, or with respect to, the Purchaser. Each Company Benefit Plan which is intended to be “qualified”
within the meaning of Section 401(a) of the Code has received a determination letter from the IRS and its related trust has been
determined to be exempt from taxation under Section 501(a) of the Code (or is based on a pre-approved plan for which the pre-approved
plan sponsor has received a favorable opinion letter). To the Company’s Knowledge, no fact exists that would reasonably be
expected to adversely affect the qualified status of such Company Benefit Plans or the exempt status of such trusts.
(c) With respect to each Company Benefit Plan that covers any current or former officer, director, consultant or employee (or
beneficiary thereof) of a Target Company, the Company has made available to Purchaser accurate and complete copies, if applicable,
of: (i) the current plan documents and related trust agreements or annuity Contracts (including any amendments, modifications or
supplements thereto); (ii) the current summary plan descriptions and material modifications thereto; (iii) the three (3) most
recent Forms 5500, if applicable, and annual report, including all schedules thereto; (iv) the most recent annual accounting of
plan assets; (v) the three (3) most recent nondiscrimination testing reports; (vi) the most recent determination or opinion letter
received from the IRS, if any; (vii) the most recent actuarial valuation, if any; and (viii) all material communications with any
Governmental Authority within the last three (3) years.
(d) With respect to each Company Benefit Plan: (i) to the Knowledge of the Company, no breach of fiduciary duty that could reasonably
be expected to result in a Material Adverse Effect to any Target Company has occurred; (ii) no Action is pending, or to the Company’s
Knowledge, threatened (other than routine claims for benefits arising in the ordinary course of administration); and (iii) no prohibited
transaction, as defined in Section 406 of ERISA or Section 4975 of the Code, has occurred that would reasonably be likely to result
in a Material Adverse Effect to any Target Company, excluding transactions effected pursuant to a statutory or administration exemption.
(e) During the six (6) year period preceding the Effective Time, no Target Company or any of their ERISA Affiliates has maintained,
contributed to, or had an obligation to contribute to (i) a “defined benefit plan” (as defined in Section 414(j) of
the Code), (ii) a “multiemployer plan” (as defined in Section 3(37) of ERISA), or (iii) a “multiple employer
plan” (as described in Section 413(c) of the Code). No Company Benefit Plan is subject to Title IV of ERISA or Section 412
of the Code, and neither the Target Company nor any ERISA Affiliate has incurred any Liability, contingent or otherwise, under
Title IV of ERISA and, to the Company’s Knowledge, no condition presently exists that is expected to cause such Liability
to be incurred. No Company Benefit Plan will become a multiple employer plan with respect to any Target Company immediately after
the Closing Date. No Target Company currently maintains or has ever maintained, or is required currently or has ever been required
to contribute to or otherwise participate in, a multiple employer welfare arrangement or voluntary employees’ beneficiary
association as defined in Section 501(c)(9) of the Code.
(f) With respect to each Company Benefit Plan that is a “welfare plan” (as described in Section 3(1) of ERISA):
(i) no such plan provides medical or death benefits with respect to current or former employees of a Target Company beyond their
termination of employment (other than coverage mandated by Law); and (ii) each Target Company has complied in all material respects
with the provisions of Section 601 et seq. of ERISA and Section 4980B of the Code.
(g) The consummation of the Transactions will not, by itself: (i) entitle any individual to severance pay, unemployment compensation
or other benefits or compensation or (ii) accelerate the time of payment or vesting, or increase the amount of any compensation
due, or in respect of, any individual. No Target Company has incurred any Liability for any Tax imposed under Chapter 43 of the
Code or civil liability under Section 502(i) or (l) of ERISA.
(h) Each Company Benefit Plan that is subject to Section 409A of the Code has been administered in compliance, and is in documentary
compliance, in each case in all material respects, with the applicable provisions of Section 409A of the Code, the regulations
thereunder and other official guidance issued thereunder. There is no Contract or plan to which any Target Company is a party or
by which it is bound to compensate any employee, consultant or director for any Taxes or interest imposed pursuant to Section 409A
of the Code.
(i) Each Company Option intended to qualify as an “incentive stock option” under the Code so qualifies. Each grant
of a Company Option was duly authorized no later than the date on which the grant of such Company Option was by its terms to be
effective by all necessary corporate action, and: (i) the stock option agreement governing such grant was duly executed and
delivered by each party thereto (including electronic execution and delivery); (ii) each such grant was made in accordance with
the terms of the Company Equity Plan and all other applicable Laws; (iii) the per share exercise price of each Company Option was
equal or greater than the fair market value (within the meaning of Section 409A of the Code) of a share of Company Common Stock
on the applicable grant date; and (iv) each such grant was properly accounted for in accordance with GAAP in the financial statements
(including the related notes) of the Company.
4.20
Environmental Matters. Except as set forth in Schedule 4.20 and except as would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect:
(a)
Each Target Company is and has been since January 1, 2020, in compliance in all material respects with all applicable Environmental
Laws, including obtaining, maintaining in good standing, and complying in all material respects with all Permits required for its
business and operations by Environmental Laws (“Environmental Permits”), no Action is pending or, to
the Company’s Knowledge, threatened to revoke, modify, or terminate any such Environmental Permit.
(b)
No Target Company is the subject of any outstanding Order with any Governmental Authority or other Person in respect of
any (i) Environmental Laws, (ii) Remedial Action, or (iii) Release or threatened Release of a Hazardous Material. Except for any
Company Real Property Lease, no Target Company has assumed, contractually or by operation of Law, any Liabilities or obligations
under any Environmental Laws.
(c) No Action has been commenced or is pending, or to the Company’s Knowledge, threatened against any Target Company or
any assets of a Target Company alleging either or both that a Target Company may be in material violation of any Environmental
Law or Environmental Permit or may have any material Liability under any Environmental Law.
(d) No Target Company has manufactured, treated, stored, disposed of, arranged for or permitted the disposal of, generated,
handled or released any Hazardous Material, or owned or operated any property or facility, in a manner that has given or would
reasonably be expected to give rise to any material Liability or obligation under applicable Environmental Laws. To the Company’s
Knowledge, no fact, circumstance, or condition exists in respect of any Target Company or any property currently or formerly operated
or leased by any Target Company or any property to which a Target Company arranged for the disposal or treatment of Hazardous Materials
that could reasonably be expected to result in a Target Company incurring any material Environmental Liabilities.
(e) To the Knowledge of the Company, there is no investigation of the business, operations, or currently operated or leased
property of a Target Company or previously owned, operated, or leased property of a Target Company pending or, to the Company’s
Knowledge, threatened that could lead to the imposition of any Liens under any Environmental Law or material Environmental Liabilities.
(f) The Company has made available to the Purchaser all environmentally related site assessments, audits, studies, reports,
analysis and results of investigations that have been performed in respect of the currently or previously owned, leased, or operated
properties of any Target Company, in each case that are in the Company’s possession.
4.21
Transactions with Related Persons. Except as set forth on Schedule 4.21, no Target Company nor any of its
Affiliates, nor any officer, director, manager, employee, trustee or beneficiary of a Target Company or any of its Affiliates,
nor any immediate family member of any of the foregoing (whether directly or indirectly through an Affiliate of such Person) (each
of the foregoing, a “Related Person”) is presently, or in the past two (2) years, has been, a party to
any transaction with a Target Company, including any Contract or other arrangement (a) providing for the furnishing of services
by (other than as officers, directors, managers, employees or trustees of the Target Company), (b) providing for the rental of
real property or Personal Property from, or (c) otherwise requiring payments to (other than for services or expenses as officers,
directors, managers, employees or trustees of the Target Company in the ordinary course of business) any Related Person or any
Person in which any Related Person has an interest as an owner, officer, manager, director, trustee or partner or in which any
Related Person has any direct or indirect interest (other than the ownership of securities representing no more than two percent
(2%) of the outstanding voting power or economic interest of a publicly traded company). Except as set forth on Schedule 4.21,
no Related Person owns any real property, Personal Property, or right, tangible or intangible (including Intellectual Property)
that is used in the business of any Target Company and no Related Person has a right to any of the foregoing property. The assets
of the Target Companies do not include any material receivable or other obligation from a Related Person, and the liabilities of
the Target Companies do not include any material payable or other obligation or commitment to any Related Person.
4.22
Insurance.
(a) Schedule 4.22(a) lists all insurance policies (by policy number, insurer, coverage period, coverage amount, annual
premium and type of policy) held by a Target Company as of the date hereof relating to a Target Company or its business, products,
properties, assets, liabilities, directors, officers and employees (other than insurance policies associated with Company Benefit
Plan), copies of which have been provided to the Purchaser. All premiums due and payable under all such insurance policies have
been timely paid and the Target Companies are otherwise in material compliance with the terms of such insurance policies. Each
such insurance policy (i) is legal, valid, binding, enforceable and in full force and effect and (ii) will continue to be legal,
valid, binding, enforceable, and in full force and effect on identical terms following the Closing. No Target Company has any self-insurance
or co-insurance programs. To the Knowledge of the Company, there is no threatened termination of, or material premium increase
with respect to, any of such insurance policies. In the two (2) years preceding the date of this Agreement, no Target Company has
received any notice from, or on behalf of, any insurance carrier relating to or involving any adverse change or any change other
than in the ordinary course of business, in the conditions of insurance, any refusal to issue an insurance policy or non-renewal
of a policy.
(b)
Schedule 4.22(b) identifies each individual insurance claim in excess of $200,000 made by a Target Company in the
past three (3) years. Each Target Company has reported to its insurers all claims and pending circumstances that would reasonably
be expected to result in a claim, except where such failure to report such a claim would not be reasonably likely to be material
to a Target Company. No event has occurred, and, to the Knowledge of the Company, no condition or circumstance exists, that would
reasonably be expected to (with or without notice or lapse of time) give rise to or serve as a basis for the denial of any such
insurance claim. In the three (3) years, no Target Company has made any claim against an insurance policy as to which the insurer
has denied coverage.
4.23
Books and Records. All of the financial books and records of the Target Companies are complete and accurate in all
material respects and have been maintained in the ordinary course of business consistent with past practice and in accordance with
applicable Laws.
4.24
Top Customers and Suppliers. Schedule 4.24 lists, by dollar volume received or paid, as applicable, for each
of (a) the twelve (12) months ended on December 31, 2022, and (b) the period from January 1, 2023 through the Interim Balance Sheet
Date, the ten (10) largest customers of the Target Companies on a consolidated basis (the “Top Customers”)
and the ten (10) largest suppliers of goods or services to the Target Companies on a consolidated basis (the “Top Suppliers”)
along with the amounts of such dollar volumes. As of the date of this Agreement, (i) no Top Supplier or Top Customer within the
last twelve (12) months has cancelled or otherwise terminated, or, to the Company’s Knowledge, intends to cancel or otherwise
terminate, any material relationships of such Person with a Target Company, (ii) no Top Supplier or Top Customer has during the
last twelve (12) months decreased materially or, to the Company’s Knowledge, threatened to stop, decrease or limit materially,
or intends to modify materially its material relationships with a Target Company, (iii) to the Company’s Knowledge,
no Top Supplier or Top Customer intends to refuse to pay any amount due to any Target Company or seek to exercise any remedy against
any Target Company, (iv) no Target Company has within the past two (2) years been engaged in any material dispute with any Top
Supplier or Top Customer, and (v) to the Company’s Knowledge, the consummation of the Transactions will not adversely affect
the relationship of any Target Company with any Top Supplier or Top Customer in any material respect.
4.25
Certain Business Practices.
(a)
No Target Company, nor any of their respective Representatives acting on their behalf has (i) used any funds for unlawful
contributions, gifts, entertainment or other unlawful expenses relating to political activity, (ii) made any unlawful payment to
foreign or domestic government officials or employees, to foreign or domestic political parties or campaigns or violated any provision
of the U.S. Foreign Corrupt Practices Act of 1977 or any other local or foreign anti-corruption or bribery Law, or (iii) made
any other unlawful payment. No Target Company, nor any of their respective Representatives acting on their behalf, has directly
or indirectly given or agreed to give any unlawful gift or similar benefit in any material amount to any customer, supplier, governmental
employee or other Person who is or may be in a position to help or hinder any Target Company or assist any Target Company in connection
with any actual or proposed transaction.
(b)
The operations of each Target Company are and have been conducted at all times in compliance with money laundering statutes
in all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines,
issued, administered or enforced by any Governmental Authority, and no Action involving a Target Company with respect to any of
the foregoing is pending or, to the Knowledge of the Company, threatened.
(c)
No Target Company or any of their respective directors or officers, or, to the Knowledge of the Company, any other Representative
acting on behalf of a Target Company is currently identified on the specially designated nationals or other blocked person list
or otherwise currently subject to any U.S. sanctions administered by the OFAC, and no Target Company has in the last three (3)
fiscal years, directly or knowingly indirectly, used any funds, or loaned, contributed or otherwise made available such funds to
any Subsidiary, joint venture partner or other Person, in connection with any sales or operations in Cuba, Iran, Syria, Sudan,
Myanmar or any other country sanctioned by OFAC or for the purpose of financing the activities of any Person currently subject
to, or otherwise in violation of, any U.S. sanctions administered by OFAC.
4.26
Investment Company Act. No Target Company is an “investment company” or a Person directly or indirectly
“controlled” by or acting on behalf of an “investment company”, or required to register as an “investment
company”, in each case within the meaning of the Investment Company Act of 1940, as amended.
4.27
Finders and Brokers. Except as set forth in Schedule 4.27, no broker, finder or investment banker is entitled
to any brokerage, finder’s or other fee or commission from the Purchaser, any Target Company or any of their respective Affiliates
in connection with the Transactions based upon arrangements made by or on behalf of any Target Company.
4.28
Healthcare Industry Matters.
(a)
Each Target Company is, and has been since January 1, 2021, in compliance in all material respects with all applicable healthcare
Laws, including: (i) the Federal Food, Drug, and Cosmetic Act; (ii) all federal or state criminal or civil fraud and abuse Laws
(including the federal Anti-Kickback Statute (42 U.S.C. §1320a-7(b)), the Civil Monetary Penalties Law (42 U.S.C. §1320a-7(a)),
the Sunshine Act (42 U.S.C. §1320a-7(h)), the Exclusion Law (42 U.S.C. §1320a-7), the Criminal False Statements Law (42
U.S.C. §1320a-7b(a)), Stark Law (42 U.S.C. §1395nn), the False Claims Act (31 U.S.C. §§3729 et seq., 42
U.S.C. §1320a-7b(a)), the Health Insurance Portability and Accountability Act of 1996 and all amendments thereto (“HIPAA”),
laws governing billing and submission of a claim for reimbursement to any federal health care program as defined in 42 U.S.C. §
1320a-7b(f) including Medicare, Medicaid, TRICARE, worker’s compensation, and all other government contracting agencies,
and any comparable state or local Laws) and; (iii) any applicable state licensing, disclosure and reporting requirements (all of
the foregoing, collectively, “Healthcare Laws”). No Target Company has received written notification
of any pending Action from the FDA or any other similar regulatory authority alleging that any operation or activity of any Target
Company is in material violation of any applicable Healthcare Law.
(b)
All material preclinical and clinical investigations conducted or sponsored by any Target Company and intended to be submitted
to a regulatory authority to support a regulatory approval are being conducted in compliance in all material respects with all
applicable Healthcare Laws administered or issued by the applicable Governmental Authority, including, as applicable, (i) the FDA
regulations for conducting non-clinical laboratory studies contained in Title 21 part 58 of the Code of Federal Regulations, (ii)
applicable FDA requirements for the design, conduct, performance, monitoring, auditing, recording, analysis and reporting of clinical
trials contained in Title 21 parts 50, 54, 56 and 312 of the Code of Federal Regulations, and (iii) applicable federal, state and
foreign Healthcare Laws restricting the use and disclosure of individually identifiable health information, including HIPAA.
(c)
All material reports, documents, claims, Permits and notices required to be filed, maintained or furnished to the FDA or
any other regulatory authority by each Target Company have been so filed, maintained or furnished. To the Knowledge of the Company,
all such reports, documents, claims, Permits and notices were materially complete and accurate on the date filed (or were corrected
in or supplemented by a subsequent filing). Neither any Target Company nor, to the Knowledge of the Company, any officer, employee
or agent of any Target Company has (i) made an untrue statement of a material fact or any fraudulent statement to the FDA or any
other regulatory authority, (ii) failed to disclose a material fact required to be disclosed to the FDA or any other regulatory
authority, or (iii) committed an act, made a statement, or failed to make a statement that, at the time such disclosure was made,
would reasonably be expected to provide a reasonable basis for the FDA or any other regulatory authority to invoke its policy respecting
“Fraud, Untrue Statements of Material Facts, Bribery, and Illegal Gratuities”, set forth in 56 Fed. Reg. 46191 (September
10, 1991) or any similar policy. Neither any Target Company nor, to the Knowledge of the Company, any officer, employee or agent
of any Target Company has been convicted of any crime or engaged in any conduct for which debarment is mandated by 21 U.S.C. §335a(a)
or any similar Healthcare Law or authorized by 21 U.S.C. §335a(b) or any similar Healthcare Law. Neither any Target Company
nor, to the Knowledge of the Company, any officer, employee or agent of any Target Company has been convicted of any crime or engaged
in any conduct for which such person could be excluded from participating in the federal health care programs under Section 1128
of the Social Security Act of 1935 or any Healthcare Law. As of the date of this Agreement, no Actions that would reasonably be
expected to result in material debarment or exclusion are pending or threatened in writing against any Target Company or, to the
Company’s Knowledge, any officer, employee, contractor, supplier (in their capacities as such) or other entities or individuals
performing research or work on behalf of any Target Company. No Target Company is a party to any corporate integrity agreements,
monitoring agreements, consent decrees, settlement orders, or similar agreements with or imposed by any Governmental Authority.
(d)
No Target Company has received any written notice, correspondence or other communication from the FDA or any other regulatory
authority or from any institutional review board requiring the termination, suspension or material modification of any ongoing
or planned clinical trials conducted by, or on behalf of, any Target Company.
(e)
As of the date of this Agreement, no data generated by any Target Company with respect to its products is the subject of
any written regulatory Action, either pending or threatened in writing, by any Governmental Authority relating to the truthfulness
or scientific integrity of such data.
(f)
To the Company’s Knowledge, no product manufactured or distributed by any Target Company is (i) adulterated within
the meaning of 21 U.S.C. §351 (or any similar Healthcare Law), or (ii) misbranded within the meaning of 21 U.S.C. §352
(or any similar Healthcare Law). Since January 1, 2021, neither any Target Company nor, to the Company’s Knowledge,
any of their respective contract manufacturers has received any FDA Form 483, warning letter, untitled letter, or other similar
written correspondence or written notice from the FDA or any other regulatory authority alleging or asserting material noncompliance
with any applicable Healthcare Laws or Permits issued to the Company by the FDA or any other regulatory authority. No manufacturing
site owned by any Target Company or, to the Company’s Knowledge, any of their respective contract manufacturers, is or has
been since January 1, 2019, subject to a shutdown or import or export prohibition imposed by the FDA or another regulatory
authority.
4.29
Product Liability.
(a)
Each product manufactured, sold or delivered by any Target Company in conducting its business has been in all material respects
in conformity with all product specifications all express and implied warranties and all applicable Laws. To the Company’s
Knowledge, no Target Company has any material Liability for replacement or repair of any such products or other damages in connection
therewith or any other customer or product obligations not reserved against in the Company Financials. No Target Company has sold
any products or delivered any services that included a warranty for a period of longer than one year.
(b)
To the Company’s Knowledge, except as would not, individually or in the aggregate, reasonably be expected to have
a Material Adverse Effect on a Target Company, no Target Company has any Liability arising out of any injury to individuals or
property as a result of the ownership, possession, or use of any product designed, manufactured, assembled, repaired, maintained,
delivered, sold or installed, or services rendered, by or on behalf of a Target Company. Except as would not, individually or in
the aggregate, reasonably be expected to have a Material Adverse Effect on a Target Company, no Target Company has committed any
act or omission which would reasonably be expected to result in, and there has been no occurrence which would reasonably be expected
to give rise to or form the basis of, any product Liability or Liability for breach of warranty (whether covered by insurance or
not) on the part of a Target Company with respect to products designed, manufactured, assembled, repaired, maintained, delivered,
sold or installed or services rendered by or on behalf of a Target Company.
4.30
Takeover Statutes. The Company Board has taken all necessary action to ensure that the restrictions on business combinations
that are contained in Section 78.411 through Section 78.444 of the BCA and Section 203 of the DGCL will not apply to this
Agreement, the Transactions, including by approving this Agreement, the Merger and the other Transactions. There is no stockholder
rights plan, “poison pill” anti-takeover plan or other similar plan, device or arrangement to which the Company or
any of its Subsidiaries is a party or by which it or they are bound with respect to any capital stock of the Company or any of
its Subsidiaries.
4.31
Independent Investigation. The Company has conducted its own independent investigation, review and analysis of the
business, results of operations, prospects, condition (financial or otherwise) or assets of the Purchaser, and acknowledges that
it has been provided adequate access to the personnel, properties, assets, premises, books and records, and other documents and
data of the Purchaser for such purpose. The Company acknowledges and agrees that: (a) in making its decision to enter into this
Agreement and to consummate the Transactions, it has relied solely upon its own investigation and the express representations and
warranties of the Purchaser set forth in this Agreement (including the related portions of the Purchaser Disclosure Schedules)
and in any certificate delivered to the Company pursuant hereto; and (b) neither the Purchaser nor any of its Representatives have
made any representation or warranty as to the Purchaser or this Agreement, except as expressly set forth in this Agreement (including
the related portions of the Purchaser Disclosure Schedules) or in any certificate delivered to the Company pursuant hereto.
4.32
Information Supplied. None of the information supplied or to be supplied by the Company expressly for inclusion or
incorporation by reference: (a) in any current report on Form 8-K, and any exhibits thereto or any other report, form, registration
or other filing made with any Governmental Authority or stock exchange with respect to the Transactions; (b) in the Registration
Statement; or (c) in the mailings or other distributions to the Purchaser Stockholders and/or prospective investors with respect
to the consummation of the Transactions or in any amendment to any of documents identified in (a) through (c), will, when
filed, made available, mailed or distributed, as the case may be, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances
under which they are made, not misleading. None of the information supplied or to be supplied by the Company expressly for inclusion
or incorporation by reference in any of the press releases or filings with the SEC relating to the Transactions will, when filed
or distributed, as applicable, contain any untrue statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not
misleading. Notwithstanding the foregoing, the Company makes no representation, warranty or covenant with respect to any information
supplied by or on behalf of the Purchaser or its Affiliates.
4.33
No Other Representations. Except for the representations and warranties expressly made by the Company in this Article
IV (as modified by the Company Disclosure Schedules) or as expressly set forth in an Ancillary Document, no Target Company
nor any other Person on its behalf makes any express or implied representation or warranty with respect to any of the Target Companies,
the Company Security Holders, the Company Securities, the business of the Target Companies, or the Transactions, and the Company
hereby expressly disclaims any other representations or warranties, whether implied or made by any Target Company or any of its
Representatives. Except for the representations and warranties expressly made by the Company in this Article IV (as modified
by the Company Disclosure Schedules) or in an Ancillary Document, the Company hereby expressly disclaims all liability and responsibility
for any representation, warranty, projection, forecast, statement or information made, communicated or furnished (orally or in
writing) to the Purchaser or any of its Representatives (including any opinion, information, projection or advice that may have
been or may be provided to the Purchaser or any of its Representatives by any Representative of the Company), including any representations
or warranties regarding the probable success or profitability of the businesses of the Target Companies.
Article
V
COVENANTS
5.1 Access and Information.
(a)
During the period from the date of this Agreement and continuing until the earlier of the termination of this Agreement
in accordance with Section 7.1 or the Closing (the “Interim Period”), the Company shall give,
and shall cause its Representatives to give, the Purchaser and its Representatives, at reasonable times during normal business
hours and upon reasonable intervals and notice, reasonable access to all offices and other facilities and to all employees, properties,
Contracts, agreements, commitments, books and records, financial and operating data and other information (including Tax Returns,
internal working papers, client files, client Contracts and director service agreements), of or pertaining to the Target Companies,
as the Purchaser or its Representatives may reasonably request regarding the Target Companies and their respective businesses,
assets, Liabilities, financial condition, prospects, operations, management, employees and other aspects (including unaudited quarterly
financial statements, including a consolidated quarterly balance sheet and income statement, a copy of each material report, schedule
and other document filed with or received by a Governmental Authority pursuant to the requirements of applicable securities Laws,
and independent public accountants’ work papers (subject to the consent or any other conditions required by such accountants,
if any)) and cause each of the Company’s Representatives to reasonably cooperate with the Purchaser and its Representatives
in their investigation; provided, however, that the Purchaser and its Representatives shall conduct any such activities in such
a manner as not to unreasonably interfere with the business or operations of the Target Companies.
(b)
During the Interim Period, the Purchaser shall give, and shall cause its Representatives to give, the Company and its Representatives,
at reasonable times during normal business hours and upon reasonable intervals and notice, reasonable access to all offices and
other facilities and to all employees, properties, Contracts, agreements, commitments, books and records, financial and operating
data and other information (including Tax Returns, internal working papers, client files, client Contracts and director service
agreements), of or pertaining to the Purchaser or its Subsidiaries, as the Company or its Representatives may reasonably request
regarding the Purchaser, its Subsidiaries and their respective businesses, assets, Liabilities, financial condition, prospects,
operations, management, employees and other aspects (including unaudited quarterly financial statements, including a consolidated
quarterly balance sheet and income statement, a copy of each material report, schedule and other document filed with or received
by a Governmental Authority pursuant to the requirements of applicable securities Laws, and independent public accountants’
work papers (subject to the consent or any other conditions required by such accountants, if any)) and cause each of the Purchaser’s
Representatives to reasonably cooperate with the Company and its Representatives in their investigation; provided, however, that
the Company and its Representatives shall conduct any such activities in such a manner as not to unreasonably interfere with the
business or operations of the Purchaser or any of its Subsidiaries.
(c)
Notwithstanding the foregoing, neither Purchaser nor the Company shall be required to provide such access if it reasonably
determines that it would (i) cause a violation of any Contract, as applicable, (ii) constitute a violation of any applicable
Law, or (iii) cause a material risk of disclosure of any information that in the reasonable judgment of Purchaser or the Company,
as applicable, would result in the disclosure of any Trade Secrets of Third Parties. Nothing herein shall require the Company
or its Subsidiaries or Purchaser to disclose information to the extent such information would result in a waiver of attorney-client
privilege, work product doctrine or similar privilege or violate any confidentiality obligation of such Person existing as of the
date of this Agreement (provided that such party shall use reasonable best efforts to permit such disclosure to be made in a manner
consistent with the protection of such privilege or to obtain any consent required to permit such disclosure to be made without
violation of such confidentiality obligations, as applicable).
(d)
Parent and the Company shall comply with, and shall use their reasonable best efforts to cause their respective Representatives
to comply with, all of their respective obligations under the Confidentiality Agreement.
5.2 Conduct of Business of the Company.
(a)
Unless the Purchaser shall otherwise consent in writing (such consent not to be unreasonably withheld, conditioned or delayed),
during the Interim Period, except as expressly contemplated by this Agreement or the Ancillary Documents or as set forth on Schedule
5.2, the Company shall, and shall cause its Subsidiaries to, (i) conduct their respective businesses, in all material respects,
in the ordinary course of business consistent with past practice, (ii) comply in all material respects with all Laws applicable
to the Target Companies and their respective businesses, assets and employees, and (iii) take commercially reasonable measures
to preserve intact, in all material respects, their respective business organizations, to keep available the services of their
respective managers, directors, officers, employees and consultants, and to preserve the possession, control and condition of their
respective material assets, all as consistent with past practice.
(b)
Without limiting the generality of Section 5.2(a) and except as contemplated by the terms of this Agreement or the
Ancillary Documents or as set forth on Schedule 5.2, during the Interim Period, without the prior written consent of the
Purchaser (such consent not to be unreasonably withheld, conditioned or delayed), the Company shall not, and shall cause its Subsidiaries
not to:
(i)
amend, waive or otherwise change, in any respect, its Organizational Documents, except as required by applicable Law;
(ii)
authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any
of its equity securities or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any of its
equity securities, or other securities, including any securities convertible into or exchangeable for any of its shares or other
equity securities or securities of any class and any other equity-based awards, other than (A) any issuance of Company Securities
that does not increase the Merger Consideration and (B) the issuance of Company Common Stock upon the exercise of Company Options,
Company Warrants and Company Convertible Notes outstanding as of the date hereof in accordance with their existing terms, or engage
in any hedging transaction with a third Person with respect to such securities;
(iii) split, combine, recapitalize or reclassify any of its shares or other equity interests or issue any other securities in
respect thereof or pay or set aside any dividend or other distribution (whether in cash, equity or property or any combination
thereof) in respect of its equity interests, or directly or indirectly redeem, purchase or otherwise acquire or offer to acquire
any of its securities;
(iv) incur, create, assume, prepay or otherwise become liable for any Indebtedness (directly, contingently or otherwise) in excess
of $500,000 individually or $1,000,000 in the aggregate, make a loan or advance to or investment in any Third Party (other than
advancement of expenses to employees in the ordinary course of business), or guarantee or endorse any Indebtedness, Liability or
obligation of any Person in excess of $500,000 individually or $1,000,000 in the aggregate;
(v)
other than as required by applicable Law or pursuant to the terms of any Company Benefit Plans (A) increase the wages, salaries
or compensation of its Senior Vice Presidents and above other than in the ordinary course of business, consistent with past practice,
(B) make or commit to make any bonus payment (whether in cash, property or securities) other than in the ordinary course of business
consistent with past practice, (C) materially increase other benefits of employees generally other than in the ordinary course
of business, or (D) enter into, establish, materially amend or terminate any Company Benefit Plan with, for or in respect of any
current consultant, officer, manager director or other employee, other than in the ordinary course of business consistent with
past practice;
(vi)
make or rescind any material election relating to Taxes, settle any claim, action, suit, litigation, proceeding, arbitration,
investigation, audit or controversy relating to material Taxes, file any amended Tax Return or claim for refund, or make any material
change in its method of Tax accounting, in each case except as required by applicable Law or in compliance with GAAP;
(vii)
(A) take any action, or knowingly fail to take any action, which action or failure to act would reasonably be expected to
prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code
(and the Treasury Regulations) or (B) except as contemplated by this Agreement, take any action, which action would reasonably
be expected to prevent or impede any other aspect of the Intended Tax Treatment;
(viii)
transfer or license to any Person or otherwise extend, materially amend or modify, permit to lapse or fail to preserve any
material Company Owned Intellectual Property (excluding lapses or terminations of Contracts pursuant to the terms thereof), or
disclose to any Person who has not entered into a confidentiality agreement any Trade Secrets;
(ix)
terminate, or waive or assign any material right under, any Company Material Contract or enter into any Contract that would
be a Company Material Contract, in any case outside of the ordinary course of business consistent with past practice;
(x)
fail to maintain its books, accounts and records in all material respects in the ordinary course of business consistent
with past practice;
(xi)
establish any Subsidiary or enter into any new line of business;
(xii)
fail to use commercially reasonable efforts to keep in force material insurance policies or replacement or revised policies
providing insurance coverage with respect to its assets, operations and activities in such amount and scope of coverage substantially
similar to that which is currently in effect;
(xiii)
revalue any of its material assets or make any material change in accounting methods, principles or practices, except to
the extent required to comply with GAAP and after consulting with the Company’s outside auditors;
(xiv)
waive, release, assign, settle or compromise any claim, action or proceeding (including any suit, action, claim, proceeding
or investigation relating to this Agreement or the Transactions), other than waivers, releases, assignments, settlements or compromises
that involve only the payment of monetary damages (and not the imposition of equitable relief on, or the admission of wrongdoing
by, a Target Company or its Affiliates) not in excess of $500,000 individually or $1,000,000 in the aggregate;
(xv)
close or materially reduce its activities, or effect any layoff or other personnel reduction or change, at any of its facilities;
(xvi)
acquire, including by merger, consolidation, acquisition of equity interests or assets, or any other form of business combination,
any corporation, partnership, limited liability company, other business organization or any division thereof, or any material amount
of assets outside the ordinary course of business consistent with past practice;
(xvii)
make capital expenditures in excess of $500,000 (individually for any project (or set of related projects) or $1,000,000
in the aggregate);
(xviii)
voluntarily incur any Liability or obligation (whether absolute, accrued, contingent or otherwise) in excess of $1,000,000
individually or $2,000,000 in the aggregate (excluding the incurrence of any Expenses) other than pursuant to the terms of a Company
Material Contract or Company Benefit Plan in existence as of the date of this Agreement or entered into in the ordinary course
of business or in accordance with the terms of this Section 5.2;
(xix)
adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or
other reorganization;
(xx)
enter into any agreement, understanding or arrangement with respect to the voting of equity securities of the Company;
(xxi)
take any action that would reasonably be expected to significantly delay or impair the obtaining of any Consents of any
Governmental Authority to be obtained in connection with this Agreement;
(xxii)
except as required by this Agreement, enter into, amend, waive or terminate (other than terminations in accordance with
their terms) any transaction with any Related Person (other than compensation and benefits and advancement of expenses, in each
case, provided in the ordinary course of business consistent with past practice); or
(xxiii)
authorize or agree to do any of the foregoing actions.
5.3
No Control of the Company’s Business. Purchaser acknowledges and agrees that: (a) nothing contained
in this Agreement shall give Purchaser, directly or indirectly, the right to control or direct the Company’s operations prior
to the Closing; (b) prior to the Closing, the Company shall exercise, consistent with the terms and conditions of this Agreement,
complete control and supervision over its and its Subsidiaries’ operations; and (c) notwithstanding anything to the contrary
set forth in this Agreement, no consent of Purchaser shall be required with respect to any matter set forth in Section 5.1,
Section 5.2, or elsewhere in this Agreement to the extent that the requirement of such consent could violate any applicable
Law.
5.4
Conduct of Business of the Purchaser.
(a)
Unless the Company shall otherwise consent in writing (such consent not to be unreasonably withheld, conditioned or delayed),
during the Interim Period, except as expressly contemplated by this Agreement or the Ancillary Documents or as set forth on Schedule
5.4(a), the Purchaser shall, and shall cause its Subsidiaries to, (i) conduct their respective businesses, in all material
respects, in the ordinary course of business, (ii) comply in all material respects with all Laws applicable to the Purchaser and
its Subsidiaries and their respective businesses, assets and employees, and (iii) take commercially reasonable measures to preserve
intact, in all material respects, their respective business organizations, to keep available the services of their respective managers,
directors, officers, employees and consultants, and to preserve the possession, control and condition of their respective material
assets, all as consistent with past practice. Notwithstanding anything to the contrary in this Section 5.4(a), nothing in
this Agreement shall prohibit or restrict the Purchaser from extending, in accordance with the Purchaser’s Organizational
Documents and the IPO Prospectus, the deadline by which it must complete its Business Combination (an “Extension”),
and no consent of any other Party shall be required in connection therewith.
(b)
Without limiting the generality of Section 5.4(a) and except as contemplated by the terms of this Agreement or the
Ancillary Documents (including as contemplated by any PIPE Investment consented to by the Company in accordance with Section
5.17) or as set forth on Schedule 5.4(a), during the Interim Period, without the prior written consent of the Company
(such consent not to be unreasonably withheld, conditioned or delayed), the Purchaser shall not, and shall cause its Subsidiaries
to not:
(i)
amend, waive or otherwise change, in any respect, its Organizational Documents except as required by applicable Law;
(ii)
authorize for issuance, issue, grant, sell, pledge, dispose of or propose to issue, grant, sell, pledge or dispose of any
of its equity securities or any options, warrants, commitments, subscriptions or rights of any kind to acquire or sell any of its
equity securities, or other securities, including any securities convertible into or exchangeable for any of its equity securities
or other security interests of any class and any other equity-based awards, other than the issuance of Purchaser Securities issuable
upon conversion or exchange of outstanding Purchaser Securities in accordance with their terms, the issuance of securities in connection
with any PIPE Investment (or any other action or transaction by the Purchaser undertaken with the consent of the Company in accordance
with Section 5.16) existing terms, or engage in any hedging transaction with a third Person with respect to such securities;
(iii)
split, combine, recapitalize or reclassify any of its shares or other equity interests or issue any other securities in
respect thereof or pay or set aside any dividend or other distribution (whether in cash, equity or property or any combination
thereof) in respect of its shares or other equity interests, or directly or indirectly redeem, purchase or otherwise acquire or
offer to acquire any of its securities;
(iv)
incur, create, assume, prepay or otherwise become liable for any Indebtedness (directly, contingently or otherwise) in excess
of $500,000 individually or $1,000,000 in the aggregate, make a loan or advance to or investment in any Third Party, or guarantee
or endorse any Indebtedness, Liability or obligation of any Person;
(v)
make or rescind any material election relating to material Taxes, settle any claim, action, suit, litigation, proceeding,
arbitration, investigation, audit or controversy relating to Taxes, file any amended Tax Return or claim for refund, or make any
material change in its method of Tax accounting, in each case except as required by applicable Law or in compliance with GAAP;
(vi)
(A) take any action, or knowingly fail to take any action, which action or failure to act would reasonably be expected to
prevent or impede the Merger from qualifying as a “reorganization” within the meaning of Section 368(a) of the Code
(and the Treasury Regulations) or (B) except as contemplated by this Agreement, take any action, which action would reasonably
be expected to prevent or impede any other aspect of the Intended Tax Treatment;
(vii)
amend, waive or otherwise change the Trust Agreement in any manner adverse to the Purchaser;
(viii)
terminate, waive or assign any material right under any Purchaser Material Contract;
(ix)
fail to maintain its books, accounts and records in all material respects in the ordinary course of business consistent
with past practice;
(x)
establish any Subsidiary or enter into any new line of business;
(xi)
fail to use commercially reasonable efforts to keep in force material insurance policies or replacement or revised policies
providing insurance coverage with respect to its assets, operations and activities in such amount and scope of coverage substantially
similar to that which is currently in effect;
(xii)
revalue any of its material assets or make any material change in accounting methods, principles or practices, except to
the extent required to comply with GAAP and after consulting the Purchaser’s outside auditors;
(xiii)
waive, release, assign, settle or compromise any claim, action or proceeding (including any suit, action, claim, proceeding
or investigation relating to this Agreement or the Transactions), other than waivers, releases, assignments, settlements or compromises
that involve only the payment of monetary damages (and not the imposition of equitable relief on, or the admission of wrongdoing
by, the Purchaser or its Subsidiary) not in excess of $500,000 individually or $1,000,000 in the aggregate;
(xiv)
acquire, including by merger, consolidation, acquisition of equity interests or assets, or any other form of business combination,
any corporation, partnership, limited liability company, other business organization or any division thereof, or any material amount
of assets outside the ordinary course of business;
(xv)
make capital expenditures in excess of $500,000 individually for any project (or set of related projects) or $1,000,000
in the aggregate (excluding for the avoidance of doubt, incurring any Expenses);
(xvi)
adopt a plan of complete or partial liquidation, dissolution, merger, consolidation, restructuring, recapitalization or
other reorganization (other than with respect to the Merger);
(xvii)
voluntarily incur any Liability or obligation (whether absolute, accrued, contingent or otherwise) in excess of $500,000
individually or $1,000,000 in the aggregate (excluding the incurrence of any Expenses) other than pursuant to the terms of a Contract
in existence as of the date of this Agreement or entered into in the ordinary course of business or in accordance with the terms
of this Section 5.4 during the Interim Period;
(xviii)
enter into any agreement, understanding or arrangement with respect to the voting of Purchaser Securities;
(xix)
take any action that would reasonably be expected to significantly delay or impair the obtaining of any Consents of any
Governmental Authority to be obtained in connection with this Agreement; or
(xx)
authorize or agree to do any of the foregoing actions.
5.5 Public Filings. During the Interim Period, each of the Purchaser and the Company will keep current and timely file
all of their respective public filings with the SEC and otherwise comply in all material respects with applicable securities Laws
and shall use their respective reasonable best efforts prior to the Closing (a) with respect to Purchaser, to maintain the listing
of the Purchaser Units, the Purchaser Class A Common Stock and the Purchaser Warrants on Nasdaq, and (b) with respect to the Company,
to maintain the listing of the Company Common Stock on the OTC Markets; provided, that the Parties acknowledge and agree
that from and after the Closing, the Parties intend to list on Nasdaq only the Purchaser Class A Common Stock and the Purchaser
Warrants.
5.6 No Solicitation.
(a)
No Solicitation or Facilitation of Proposals. Except as set forth in this Section 5.6, until the Specified
Time, neither the Company, any of its Subsidiaries, nor any of its or their respective directors, officers and employees shall,
and the Company shall direct its other Representatives not to, and shall not authorize or knowingly permit any of its Representatives
to, directly or indirectly:
(i)
solicit, initiate or propose the making, submission or announcement of, or knowingly encourage, facilitate or assist, any
proposal or offer that constitutes, or would reasonably be expected to lead to, any Takeover Proposal; or
(ii)
other than informing Persons of the existence of the provisions of this Section 5.6, enter into, continue or otherwise
participate in any discussions or negotiations regarding, conduct, engage in, or furnish to any Person any non-public information
for the purpose of encouraging or facilitating, any Takeover Proposal or any proposal or inquiry that is reasonably expected to
lead to a Takeover Proposal.
The Company acknowledges and agrees that
any violation of the restrictions set forth in this Section 5.6 by any Representative of the Company or any of its Affiliates shall
be deemed a breach of the Company’s obligations set forth in this Section 5.6. Notwithstanding the foregoing or anything
to the contrary set forth in this Agreement, the Company may in response to an unsolicited bona fide written Takeover Proposal
(A) furnish non-public information with respect to the Company and its Subsidiaries to any Qualified Person (and the Representatives
of such Qualified Person), pursuant to a confidentiality agreement not materially less restrictive with respect to the confidentiality
obligations of the Qualified Person than the Confidentiality Agreement, provided that such confidentiality agreement shall not
(x) grant any exclusive right to negotiate with such counterparty, or (y) prohibit the Company from satisfying its obligations
hereunder, and (B) engage in discussions or negotiations (including solicitation of revised Takeover Proposals) with
any Qualified Person (and the Representatives of such Qualified Person) regarding any Takeover Proposal; provided, however,
that the Company Board has determined that the failure to take the actions contemplated by this sentence would be more likely than
not to violate its fiduciary obligations under applicable Law.
(b)
Notice to Purchaser. The Company shall promptly (and in any event within three (3) Business Days) advise Purchaser
orally, with written confirmation to follow, of: (i) the Company’s receipt of any written Takeover Proposal; (ii) a summary
of the material terms and conditions of any such Takeover Proposal; (iii) a copy of the Alternative Acquisition Agreement and other
material written proposals or offers delivered with, or in connection with, such Takeover Proposal, including any financing terms;
and (iv) the identity of the Person making any such Takeover Proposal. The Company will keep Purchaser reasonably informed in all
material respects of any material developments with respect to any Takeover Proposal (and any subsequent amendments or modifications
thereto), in each case, as soon as is reasonably practicable and in any event within twenty-four (24) hours of receipt, provision
or occurrence thereof. The Company shall, as soon as is reasonably practicable and in any event within twenty-four (24) hours following
a determination by the Company Board that a Takeover Proposal is a Superior Proposal, notify Purchaser of such determination.
(c)
No Change in Recommendation or Alternative Acquisition Agreement. Prior to the Specified Time:
(i)
the Company Board shall not, except as set forth in this Section 5.6, withhold, withdraw, qualify or modify, in a
manner adverse to Purchaser, the Company Board Recommendation;
(ii)
the Company Board shall not fail to include the Company Board Recommendation in the Joint Proxy Statement;
(iii)
the Company Board (or any committee thereof) shall not make or fail to make any recommendation or public statement in connection
with a tender or exchange offer, other than a recommendation against such tender or exchange offer or a “stop, look and listen”
communication by the Company Board (or a committee thereof) to the stockholders of the Company pursuant to Rule 14d-9(f) promulgated
under the Exchange Act (or any substantially similar communication) (it being understood that the Company Board (or a committee
thereof) may refrain from taking a position with respect to a Takeover Proposal until the close of business on the tenth (10th) Business
Day after the commencement of a tender or exchange offer in connection with such Takeover Proposal without such action being considered
a violation of this Section 5.6(c) or a Company Adverse Recommendation Change);
(iv) the Company Board shall not, except as set forth in this Section 5.6, adopt, approve, endorse or recommend, or publicly
announce an intention to adopt, approve, endorse or recommend, any Takeover Proposal or any proposal that is reasonably expected
to lead to a Takeover Proposal;
(v)
following the date of receipt of any Takeover Proposal or the date any material modification thereto is first made public,
the Company Board shall not have failed to issue a press release that expressly reaffirms the Company Board Recommendation within
five (5) Business Days following the Company’s receipt of Purchaser’s written request to do so (any action described
in clauses (i) through (v), a “Company Adverse Recommendation Change”); and
(vi) the Company shall not enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition
agreement, merger agreement or similar Contract (an “Alternative Acquisition Agreement”) providing for
the consummation of a transaction contemplated by any Takeover Proposal.
(vii)
Notwithstanding anything to the contrary contained in this Agreement, at any time prior
to the Specified Time, the Company Board may make a Company Adverse Recommendation Change in response to an Intervening Event if
the Company Board determines in good faith, after consultation with its outside legal counsel and financial advisors, and giving
due consideration to the revisions to the terms of this Agreement to which Purchaser has committed in writing, that the failure
to do so would more likely than not violate the Company Board’s fiduciary duties under applicable Law, only if the following
conditions are satisfied:
(1)
the Company shall have first provided Purchaser an Intervening Event Notice at least five (5) Business Days in advance
advising Purchaser that the Company intends to make a Company Adverse Recommendation Change (it being understood and hereby agreed
that the delivery and receipt of any such Intervening Event Notice shall not, in and of itself, be deemed to be a Company Adverse
Recommendation Change) and specifying, in reasonable detail, the Intervening Event;
(2)
during the applicable Intervening Event Notice Period (or any mutually agreed extension or continuation thereof), the Company
and its Representatives shall negotiate in good faith with Purchaser and its officers, directors and Representatives regarding
any changes to the terms of this Agreement and any other proposals made by Purchaser so that a failure to effect a Company Adverse
Recommendation Change in response to such Intervening Event would no longer be inconsistent with the Company Board’s fiduciary
duties under applicable Law;
(3)
Purchaser does not make, within the applicable Intervening Event Notice Period (or any extension or continuation thereof)
after the receipt of such notice, a proposal that would, in the good faith judgment of the Company Board (after consultation with
outside legal counsel and financial advisors), cause the failure to effect a Company Adverse Recommendation Change in response
to such Intervening Event to no longer be inconsistent with the Company Board’s fiduciary duties under applicable Law (it
being understood and agreed that any material change in any event, occurrence or facts relating to such Intervening Event shall
require a new Intervening Event Notice with a new Intervening Event Notice Period ending on the day that is three (3) Business
Days after such material change); and
(4)
following the Intervening Event Notice Period, the Company Board shall have determined in good faith (after consultation
with its outside legal counsel and financial advisors) that the failure to effect a Company Adverse Recommendation Change in response
to such Intervening Event continues to be inconsistent with the Company Board’s fiduciary duties under applicable Law.
(viii)
Notwithstanding anything to the contrary contained in this Agreement, at any time prior to the Specified Time if, in response
to a bona fide unsolicited written Takeover Proposal made by a Third Party after the date of this Agreement that does not
arise from a material breach of this Section 5.6 and has not been withdrawn, the Company Board determines in good faith
(1) after consultation with outside legal counsel and its financial advisor, that such Takeover Proposal constitutes a Superior
Proposal and (2) after consultation with outside legal counsel, that the failure to make a Company Adverse Recommendation
Change would be more likely than not to violate the Company Board’s fiduciary duties under applicable Law, then the
Company Board may make a Company Adverse Recommendation Change, only if, in either such case, the following conditions are satisfied:
(1)
the Company shall have first provided to Purchaser a Superior Proposal Notice at least five (5) Business Days in advance
advising Purchaser that the Company Board is prepared to effect a Company Adverse Recommendation Change in response to a Superior
Proposal (and specifying, in reasonable detail, the material terms and conditions of any such Superior Proposal, including the
identity of the Third Party making any such Superior Proposal) (it being understood and hereby agreed that the delivery and receipt
of any such Superior Proposal Notice shall not, in and of itself, be deemed to be a Company Adverse Recommendation Change) and
providing Purchaser with a complete copy of any written request, proposal or offer, including any proposed Alternative Acquisition
Agreement (and all schedules, appendices, exhibits and other attachments relating thereto), and any other documents containing
the material terms of such Superior Proposal;
(2)
during the applicable Superior Proposal Notice Period (or any extension or continuation thereof), prior to its effecting
a Company Adverse Recommendation Change, the Company and its Representatives shall negotiate in good faith with Purchaser and its
officers, directors and Representatives regarding changes to the terms of this Agreement and any other proposals made by Purchaser
intended by Purchaser to cause such Takeover Proposal to no longer constitute a Superior Proposal;
(3)
Purchaser does not make, within the applicable Superior Proposal Notice Period (or any mutually agreed extension or continuation
thereof) after the receipt of such notice, a proposal that would, in the good faith judgment of the Company Board (after consultation
with outside legal counsel and financial advisors), cause the offer previously constituting a Superior Proposal to no longer constitute
a Superior Proposal (it being understood and agreed that any amendment or modification of such Superior Proposal shall require
a new Superior Proposal Notice with a new Superior Proposal Notice Period of three (3) Business Days); and
(4)
following the Superior Proposal Notice Period, the Company Board shall have determined in good faith, in light of such Superior
Proposal and taking into account any revised terms proposed by Purchaser, (x) after consultation with outside legal counsel
and its financial advisor, that such Takeover Proposal continues to constitute a Superior Proposal, and (y) after consultation
with outside legal counsel and financial advisors, that the failure to make a Company Adverse Recommendation Change would continue
to be inconsistent with the Company Board’s fiduciary duties under applicable Law.
(d)
Certain Permitted Disclosures. Notwithstanding anything to the contrary in this Agreement, nothing contained in this
Agreement shall prohibit the Company, any of its Subsidiaries or the Company Board from (i) taking and disclosing to its stockholders
a position with respect to a tender offer contemplated by Rule 14d-9 or Rule 14e-2 promulgated under the Exchange Act, or
from issuing a “stop, look and listen” statement pending disclosure of its position thereunder (none of which, in and
of itself, shall be deemed to constitute a Company Adverse Recommendation Change), or (ii) making any disclosure to the Company’s
stockholders if, in the good faith judgment of the Company Board, after consultation with outside counsel, failure to so disclose
would reasonably be likely to be inconsistent with its fiduciary duties under applicable Law, it being understood that nothing
in the foregoing will be deemed to permit the Company or the Company Board (or a committee thereof) to effect a Company Adverse
Recommendation Change other than in accordance with Section 5.6(c).
(e)
Cessation of Ongoing Discussions. The Company shall, and shall direct its Representatives to: (i) cease immediately
all discussions, communications and negotiations that commenced prior to the date of this Agreement regarding any proposal that
would constitute (if made after the date of this Agreement), or would reasonably be expected to lead to, a Takeover Proposal, (ii)
within three (3) Business Days of the date of this Agreement, request the prompt return or destruction of all non-public information
concerning the Company or its Subsidiaries theretofore furnished to any Person with whom a confidentiality agreement in contemplation
of an acquisition transaction was entered into at any time within the three (3) month period immediately preceding the date hereof
and (iii) immediately terminate all access granted to any such Persons or their respective Representatives referenced in clauses
(i) and (ii) to any physical or electronic data room; provided, however, that the foregoing shall not in any way
limit or modify any of the Company’s rights under the other provisions of this Section 5.6.
(f)
Purchaser Non-Solicitation. During the Interim Period, in order to induce the Company to continue to commit to expend
management time and financial resources in furtherance of the Transactions, Purchaser shall not, and shall cause its Representatives
not to, without the prior written consent of the Company, directly or indirectly, (i) solicit, assist, initiate or facilitate the
making, submission or announcement of, or intentionally encourage, any Business Combination, (ii) furnish any non-public information
regarding Purchaser or its Affiliates or their respective businesses, operations, assets, Liabilities, financial condition, prospects
or employees to any Person or group (other than the Company or its Representatives) in connection with or in response to a Business
Combination, (iii) engage or participate in discussions or negotiations with any Person or group with respect to, or that would
reasonably be expected to lead to, a Business Combination, (iv) approve, endorse or recommend, or publicly propose to approve,
endorse or recommend, any Business Combination, (v) negotiate or enter into any letter of intent, agreement in principle, acquisition
agreement or other similar agreement related to a Business Combination, or (vi) release any third Person from, or waive any provision
of, any confidentiality agreement to which Purchaser is a party.
(g)
Purchaser Notice. Purchaser shall notify the Company as promptly as practicable (and in any event within three (3)
Business Days) in writing of the receipt by Purchaser or any of its Representatives of (i) any bona fide inquiries, proposals or
offers, requests for information or requests for discussions or negotiations regarding or constituting any Business Combination
or any bona fide inquiries, proposals or offers, requests for information or requests for discussions or negotiations that could
be expected to result in a Business Combination, and (ii) any request for non-public information relating to Purchaser or its Affiliates
in connection with any Business Combination, specifying in each case, the material terms and conditions thereof (including a copy
thereof if in writing or a written summary thereof if oral) and the identity of the party making such inquiry, proposal, offer
or request for information. Purchaser shall keep the Company promptly informed of the status of any such inquiries, proposals,
offers or requests for information. During the Interim Period, Purchaser shall, and shall cause its Representatives to, immediately
cease and cause to be terminated any solicitations, discussions or negotiations with any Person with respect to any Business Combination
and shall, and shall direct its Representatives to, cease and terminate any such solicitations, discussions or negotiations.
5.7 Notification of Certain Matters. During the Interim Period, each Party shall give prompt notice to the other Parties
if such Party or its Affiliates: (a) fails to comply with or satisfy any covenant, condition or agreement to be complied with or
satisfied by it or its Affiliates hereunder in any material respect; (b) receives any notice or other communication in writing
from any Third Party (including any Governmental Authority) alleging (i) that the Consent of such Third Party is or may be required
in connection with the Transactions or (ii) any non-compliance with any Law by such Party or its Affiliates; (c) receives any notice
or other communication from any Governmental Authority in connection with the Transactions; (d) discovers any fact or circumstance
that, or becomes aware of the occurrence or non-occurrence of any event the occurrence or non- occurrence of which, would reasonably
be expected to cause or result in any of the conditions to the Closing set forth in Article VI not being satisfied at the
Closing or the satisfaction of those conditions being delayed past the Outside Date; or (e) becomes aware of the commencement or
threat, in writing, of any Action against such Party or any of its Affiliates, or any of their respective properties or assets,
or, to the Knowledge of such Party, any officer, director, partner, member or manager, in his, her or its capacity as such, of
such Party or of its Affiliates with respect to the consummation of the Transactions. No such notice shall constitute an acknowledgement
or admission by the Party providing the notice regarding whether or not any of the conditions to the Closing have been satisfied
or in determining whether or not any of the representations, warranties or covenants contained in this Agreement have been breached.
5.8 Efforts.
(a)
Subject to the terms and conditions of this Agreement, each Party shall use its commercially reasonable efforts, and shall
cooperate fully with the other Parties, to take, or cause to be taken, all actions and to do, or cause to be done, all things reasonably
necessary, proper or advisable under applicable Laws and regulations to consummate the Transactions (including the receipt of all
applicable Consents of Governmental Authorities) and to comply as promptly as practicable with all requirements of Governmental
Authorities applicable to the Transactions.
(b)
As soon as reasonably practicable following the date of this Agreement, the Parties shall reasonably cooperate with each
other and use (and shall cause their respective Affiliates to use) their respective reasonable best efforts to prepare and file
with Governmental Authorities requests for approval of the Transactions and shall use commercially reasonable efforts to have such
Governmental Authorities approve the Transactions. Each Party shall give prompt written notice to the other Parties if such Party
or any of its Representatives receives any notice from such Governmental Authorities in connection with the Transactions and shall
promptly furnish the other Parties with a copy of such Governmental Authority notice. If any Governmental Authority requires that
a hearing or meeting be held in connection with its approval of the Transactions, whether prior to the Closing or after the Closing,
each Party shall arrange for Representatives of such Party to be present for such hearing or meeting. If any objections are asserted
with respect to the Transactions under any applicable Law or if any Action is instituted (or threatened to be instituted) by any
applicable Governmental Authority or any private Person challenging any of the Transactions as violative of any applicable Law
or which would otherwise prevent, materially impede or materially delay the consummation of the Transactions, the Parties shall
use their commercially reasonable efforts to resolve any such objections or Actions so as to timely permit consummation of the
Transactions, including in order to resolve such objections or Actions which, in any case if not resolved, could reasonably be
expected to prevent, materially impede or materially delay the consummation of the Transactions. In the event any Action is instituted
(or threatened to be instituted) by a Governmental Authority or private Person challenging the Transactions, the Parties shall,
and shall cause their respective Representatives to, reasonably cooperate with each other and use their respective commercially
reasonable efforts to contest and resist any such Action and to have vacated, lifted, reversed or overturned any Order, whether
temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts consummation of the Transactions.
(c)
Prior to the Closing, each Party shall use its reasonable best efforts to obtain any Consents of Governmental Authorities
or other third Persons as may be necessary for the consummation by such Party or its Affiliates of the Transactions or required
as a result of the execution or performance of, or consummation of the Transactions by such Party or its Affiliates, and the other
Parties shall provide reasonable cooperation in connection with such efforts.
5.9 Tax Matters.
(a)
Each of the Parties shall use its reasonable best efforts to cause the Merger to qualify as a “reorganization”
within the meaning of Section 368(a) of the Code (and the Treasury Regulations) to which the Purchaser and the Company are parties
within the meaning of Section 368(b) of the Code (and the Treasury Regulations). None of the Parties shall (and each of the Parties
shall cause their respective Subsidiaries and Affiliates not to) take any action, or fail to take any action, that causes, or could
reasonably be expected to cause, the Merger to fail to qualify as a “reorganization” within the meaning of Section
368(a) of the Code (and the Treasury Regulations) to which the Purchaser and the Company are parties within the meaning of Section
368(b) of the Code (and the Treasury Regulations). The Parties intend to report and shall report, for federal income tax purposes,
and shall not take any position inconsistent with (whether in audits, Tax Returns or otherwise), the Intended Tax Treatment, unless
otherwise required by a change in Law or by a Tax authority as a result of a “determination” within the meaning of
Section 1313(a) of the Code. Each of the Parties agrees to use reasonable best efforts to promptly notify all other Parties of
any challenge to the Intended Tax Treatment by any Governmental Authority.
(b)
If, in connection with the preparation and filing of the Registration Statement (as defined below), the Joint Proxy Statement
(as defined below) or other similar filing, the SEC requires that tax opinions be prepared and submitted, the Purchaser and the
Company shall deliver, and shall cause each of their respective Subsidiaries to deliver, to Baker Donelson, Bearman, Caldwell &
Berkowitz, PC and Faegre Drinker Biddle & Reath LLP (or, in each case, other nationally recognized tax counsel), respectively,
customary Tax representation letters satisfactory to its tax counsel, dated and executed as of the date the Registration Statement,
the Joint Proxy Statement or similar filing shall have been declared effective by the SEC and such other date(s) as determined
reasonably necessary by such tax counsel in connection with the preparation and filing of the Registration Statement, the Joint
Proxy Statement or other similar filing.
5.10
Transfer Taxes. The Purchaser shall pay for and bear any sales, use, real property transfer, stamp, stock transfer,
or other similar transfer Taxes imposed on Purchaser, Merger Sub or any Target Company in connection with the Merger or other Transactions.
5.11
Further Assurances. The Parties hereto shall further cooperate with each other and use their respective commercially
reasonable efforts to take or cause to be taken all actions, and do or cause to be done all things, necessary, proper or advisable
on their part under this Agreement and applicable Laws to consummate the Transactions as soon as reasonably practicable, including
preparing and filing as soon as practicable all documentation to effect all necessary notices, reports and other filings.
5.12
Registration Statement.
(a)
As promptly as practicable after the date hereof, the Purchaser shall prepare with the reasonable assistance of the Company,
and file with the SEC a registration statement on Form S-4 (as amended or supplemented from time to time, and including the Joint
Proxy Statement contained therein, the “Registration Statement”) in connection with the registration
under the Securities Act of the Purchaser Class A Common Stock to be issued under this Agreement as the Merger Consideration, which
Registration Statement will also contain a joint proxy statement (as amended, the “Joint Proxy Statement”)
for the purpose of (x) soliciting proxies from the Purchaser Stockholders for the matters to be voted upon at the Purchaser Special
Meeting and providing the Purchaser Stockholders an opportunity in accordance with the Purchaser’s Organizational Documents
and the IPO Prospectus to have their Purchaser Class A Common Stock redeemed (the “Redemption”) in conjunction
with the stockholder vote on the Purchaser Stockholder Approval Matters (as defined below), and (y) soliciting proxies from the
Company Stockholders for the matters to be acted upon at the Company Special Meeting. The Joint Proxy Statement shall include proxy
materials for the purpose of:
(i)
soliciting proxies from Purchaser Stockholders to vote, at a special meeting of Purchaser Stockholders to be called and
held for such purpose (the “Purchaser Special Meeting”), in favor of resolutions approving (1) the Purchaser
Charter Amendments, (2) this Agreement and the Transactions, including the Merger (and, to the extent required, the issuance of
any shares in connection with the PIPE Investment), by the holders of Purchaser Class A Common Stock in accordance with the Purchaser’s
Organizational Documents, the DCGL and the rules and regulations of the SEC and Nasdaq, (3) the change of name of the Purchaser,
(4) the Purchaser Equity Plan, (5) the appointment of the members of the Post-Closing Purchaser Board in accordance with Section
5.14 hereof, (6) such other matters as the Company and Purchaser shall hereafter mutually determine to be necessary or appropriate
in order to effect the Merger and the other Transactions (the approvals described in foregoing clauses (1) through (6), collectively,
the “Purchaser Stockholder Approval Matters”), and (7) the adjournment of the Purchaser Special Meeting,
if necessary or desirable in the reasonable determination of Purchaser; and
(ii)
soliciting proxies from Company Stockholders to vote, at a special meeting of Company Stockholders to be called and held
for such purpose (the “Company Special Meeting”), in favor of resolutions approving (1) this Agreement
and the Transactions, including the Merger, by the Company Stockholders in accordance with the Company’s Organizational Documents,
the BCA and the rules and regulations of the SEC and OTC Markets, and (2) such other matters as the Company and Purchaser
shall hereafter mutually determine to be necessary or appropriate in order to effect the Merger and the other Transactions (the
approvals described in foregoing clauses (1) through (2), collectively, the “Company Stockholder Approval Matters”),
and (3) the adjournment of the Company Special Meeting, if necessary or desirable in the reasonable determination of Company.
(b)
If on the date for which the Purchaser Special Meeting or the Company Special Meeting is scheduled, Purchaser or the Company,
as applicable, has not received proxies representing a sufficient number of shares to obtain the Required Purchaser Stockholder
Approval or the Required Company Stockholder Approval, as applicable, whether or not a quorum is present, Purchaser or Company,
as applicable, may make one or more successive postponements or adjournments of the Purchaser Special Meeting and Company Special
Meeting, as applicable.
(c)
In connection with the Registration Statement, Purchaser and Company will file with the SEC financial and other information
about the Transactions in accordance with applicable Law and applicable proxy solicitation and registration statement rules set
forth in the Purchaser’s Organizational Documents, the Company’s Organizational Documents, the DGCL, the BCA and the
rules and regulations of the SEC, Nasdaq and OTC Market.
(d)
Purchaser shall cooperate and provide the Company (and its counsel) with a reasonable opportunity to review and comment
on the Registration Statement and any amendment or supplement thereto prior to filing the same with the SEC, and Purchaser shall
incorporate any comments made by the Company (and its counsel) with respect to the Target Companies, the Company Special Meeting
and the Company Stockholder Approvals Matters and consider any such comments relating to other matters that are timely made in
good faith. The Company shall provide Purchaser with such information concerning the Target Companies and their stockholders, officers,
directors, employees, assets, Liabilities, condition (financial or otherwise), business and operations that may be required or
appropriate for inclusion in the Registration Statement, or in any amendments or supplements thereto, which information provided
by the Company shall be true and correct in all material respects and not contain any untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made,
not materially misleading.
(e)
The Purchaser shall cause any information concerning the Purchaser or its stockholders, officers, directors, assets, Liabilities,
condition (financial or otherwise), business and operations included in the Registration Statement, or in any amendments or supplements
thereto, to be true and correct in all material respects and to not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements made, in light of the circumstances under which they were made,
not materially misleading. Each of Purchaser and Company shall take any and all reasonable and necessary actions required to satisfy
the requirements of the Securities Act, the Exchange Act and other applicable Laws in connection with the Registration Statement,
the Purchaser Special Meeting, the Company Special Meeting and the Redemption, as applicable. Each of the Purchaser and the Company
shall, and shall cause each of its Subsidiaries to, make their respective directors, officers and employees, upon reasonable advance
notice, available to the Company and the Purchaser, and their respective Representatives in connection with the drafting of the
public filings with respect to the Transactions, including the Registration Statement, and responding in a timely manner to comments
from the SEC. Each Party shall promptly correct any information provided by it for use in the Registration Statement (and other
related materials) if and to the extent that such information is determined to have become false or misleading in any material
respect or as otherwise required by applicable Laws. The Purchaser shall amend or supplement the Registration Statement and cause
the Registration Statement, as so amended or supplemented, to be filed with the SEC and to be disseminated to the Purchaser Stockholders,
in each case as and to the extent required by applicable Laws and subject to the terms and conditions of this Agreement and the
Purchaser’s Organizational Documents; provided, however, that the Purchaser shall not amend or supplement the Registration
Statement without prior review of such amendment or supplement by the Company.
(f)
Each of the Purchaser and Company, with the reasonable and timely assistance of the other Parties, shall promptly respond
to any SEC comments on the Registration Statement, including the Joint Proxy Statement, and shall otherwise use its commercially
reasonable efforts to cause the Registration Statement, including the Joint Proxy Statement, to become effective. Each of the Purchaser
and the Company shall provide the other Party with copies of any written comments, and shall inform the other Party of any material
oral comments, that the Purchaser, the Company or any of their respective Representatives receive from the SEC or its staff with
respect to the Registration Statement, including the Joint Proxy Statement, the Purchaser Special Meeting, the Company Special
Meeting and the Redemption promptly after the receipt of such comments and shall give such other Party(and its counsel) a reasonable
opportunity under the circumstances to review and timely comment on any proposed written or material oral responses to such comments,
and the Purchaser and the Company, as applicable, shall consider any such comments timely made in good faith under the circumstances.
(g)
As soon as practicable after the SEC confirms that it has no further comments on the Registration Statement and the Registration
Statement becomes effective, (i) Purchaser shall distribute the Registration Statement to the Purchaser Stockholders and the Company
shall distribute the Registration Statement to the Company Stockholders, and (ii) Purchaser and Company shall call the Purchaser
Special Meeting and the Company Special Meeting, respectively in accordance with the DGCL and BCA, as applicable, for a date as
soon as reasonably practicable following the effectiveness of the Registration Statement. Each of Purchaser and the Company shall
use its reasonable best efforts to solicit from the Purchaser Stockholders and the Company Stockholders, as applicable, proxies
in favor of the Required Purchaser Stockholder Approval prior to the Purchaser Special Meeting and the Required Company Stockholder
Approval prior to such Company Special Meeting, and to take all other actions necessary or advisable to secure the Required Purchaser
Stockholder Approval and the Required Company Stockholder Approval, including enforcing the Sponsor Voting Agreement and the Company
Voting Agreements.
(h)
The Purchaser shall comply with all applicable Laws, any applicable rules and regulations of Nasdaq, Purchaser’s Organizational
Documents and this Agreement in the preparation, filing and distribution of the Registration Statement, any solicitation of proxies
thereunder, the calling and holding of the Purchaser Special Meeting and the Redemption. The Purchaser shall apply for, and shall
take commercially reasonable actions to cause, the Purchaser Class A Common Stock to be issued in connection with the Merger to
be approved for listing on the Nasdaq as of the Closing.
(i)
The Company shall comply with all applicable Laws, any applicable rules and regulations of OTC Markets, the Company’s
Organizational Documents and this Agreement in the preparation, filing and distribution of the Joint Proxy Statement, any solicitation
of proxies thereunder, the calling and holding of the Company Special Meeting.
5.13
Public Announcements. The Purchaser and the Company shall consult with each other before issuing any press release
or otherwise making any public statements about this Agreement or any of the Transactions. Neither the Purchaser nor the Company
shall issue any such press release or make any such public statement prior to such consultation, except to the extent required
by applicable Law or Nasdaq or OTC Market rules, in which case that Party shall use its reasonable best efforts to consult with
the other Party before issuing any such release or making any such public statement; provided, however, that such
consent shall not be required, and neither the Company nor Purchaser shall be required to consult with the other in connection
with, or provide the other an opportunity to review or comment upon, any press release or other public statement or comment to
be issued or made with respect to any Takeover Proposal. Notwithstanding the foregoing, without the prior consent of the other
Parties, the Company or the Purchaser may (a) communicate with its respective customers, vendors, suppliers, financial analysts,
investors and media representatives in a manner consistent with its past practice in compliance with applicable Law to the extent
such communications consist of information included in a press release or other document previously approved for external distribution
by the other and (b) issue public statements or disseminate information to the extent solely related to the operation of the business
of such Person. Each of Purchaser and the Company will issue a joint press release announcing the execution of this Agreement promptly
after the date hereof.
5.14
Post-Closing Board of Directors and Executive Officers.
(a)
The Parties shall take all necessary action, including causing the directors of the Purchaser to resign, so that effective
as of the Closing, the Purchaser’s board of directors (the “Post-Closing Purchaser Board”) will
consist of the individuals set forth on Schedule 5.14(a). At or prior to the Closing, the Purchaser will provide each member
of the Post-Closing Purchaser Board with a customary director indemnification agreement, in form and substance reasonably acceptable
to such director, to be effective upon the Closing (or if later, upon such director’s appointment).
(b)
The Parties shall take all action necessary, including causing the executive officers of Purchaser to resign, so that the
individuals serving as the chief executive officer and chief financial officer, respectively, of Purchaser immediately after the
Closing will be the same individuals (in the same office) as that of the Company immediately prior to the Closing (unless, at its
sole discretion, the Company desires to appoint another qualified person to either such role, in which case, such other person
identified by the Company shall serve in such role).
5.15
Indemnification of Directors and Officers; Tail Insurance.
(a)
The Parties agree that all rights to exculpation, indemnification and advancement of expenses existing in favor of the current
or former directors and officers of the Purchaser, Merger Sub and the Company or any of the Company’s Subsidiaries, and each
Person who served as a director, officer, member, trustee or fiduciary of another corporation, partnership, joint venture, trust,
pension or other employee benefit plan or enterprise at the request of the Purchaser, Merger Sub, Company or any of the Company’s
Subsidiaries (the “D&O Indemnified Persons”) as provided in their respective Organizational Documents
or under any indemnification, employment or other similar agreements between any D&O Indemnified Person and the Purchaser,
Merger Sub, Company or any of the Company’s Subsidiaries, in each case as in effect on the date of this Agreement, shall
survive the Closing and continue in full force and effect in accordance with their respective terms to the extent permitted by
applicable Law. For a period of six (6) years after the Effective Time, the Purchaser shall cause the Organizational Documents
of the Purchaser and the Surviving Corporation to contain provisions no less favorable with respect to exculpation and indemnification
of and advancement of expenses to D&O Indemnified Persons than are set forth as of the date of this Agreement in the Organizational
Documents of the Purchaser, Merger Sub, Company or any of the Company’s Subsidiaries, to the extent permitted by applicable
Law. The provisions of this Section 5.15 shall survive the consummation of the Merger and are intended to be for the
benefit of, and shall be enforceable by, each of the D&O Indemnified Persons and their respective heirs and Representatives.
(b)
For the benefit of the directors and officers of the Purchaser and Merger Sub, the Purchaser shall, at or prior to the Effective
Time, obtain and fully pay the premium for a “tail” insurance policy that provides coverage for up to a six-year period
from and after the Effective Time for events occurring prior to the Effective Time (the “Purchaser D&O Tail Insurance”)
that is substantially equivalent to and in any event not less favorable in the aggregate than the existing policies of the Purchaser
or, if substantially equivalent insurance coverage is unavailable, the best available coverage. The Purchaser shall maintain the
Purchaser D&O Tail Insurance in full force and effect, and continue to honor the obligations thereunder, and the Purchaser
shall timely pay or caused to be paid all premiums with respect to the Purchaser D&O Tail Insurance. For the benefit of the
directors and officers of the Company or any of the Company’s Subsidiaries, the Company shall, at or prior to the Effective
Time, obtain and fully pay the premium for a “tail” insurance policy that provides coverage for up to a six-year period
from and after the Effective Time for events occurring prior to the Effective Time (the “Company D&O Tail Insurance”)
that is substantially equivalent to and in any event not less favorable in the aggregate than the existing policies of the Company
or, if substantially equivalent insurance coverage is unavailable, the best available coverage. The Company shall, and after Closing
Purchaser shall cause the Company to, maintain the Company D&O Tail Insurance in full force and effect, and continue to honor
the obligations thereunder, and the Company shall timely pay or caused to be paid all premiums with respect to the Company D&O
Tail Insurance.
(c)
The obligations of the Purchaser and the Company under this Section 5.15 shall survive the Closing and shall not
be terminated or modified in such a manner as to affect adversely any D&O Indemnified Person to whom this Section 5.15
applies without the written consent of such affected D&O Indemnified Person. The covenants contained in this Section 5.15
are intended to be for the benefit of, and shall be enforceable by, each of the D&O Indemnified Persons and their respective
heirs and legal Representatives and shall not be deemed exclusive of any other rights to which a D&O Indemnified Person is
entitled, whether pursuant to Law, Contract or otherwise. For the avoidance of the doubt, the Indemnified Parties and their respective
heirs and legal Representatives shall be third-party beneficiaries with respect to the covenants contained in this Section 5.15.
Purchaser shall pay all expenses, including reasonable attorneys’ fees, that may be incurred by any D&O Indemnified Person
in enforcing the indemnity and other obligations provided in this Section 5.15, except to the extent that it is ultimately
determined by a Governmental Authority with valid jurisdiction that such D&O Indemnified Person is not entitled to be indemnified
pursuant to this Agreement.
5.16
Trust Account Proceeds. The Parties agree that after the Closing, the funds in the Trust Account, after taking into
account payments for the Redemption, and any proceeds received by the Purchaser from any PIPE Investment shall first be used to
pay (a) the Purchaser’s accrued Expenses, (b) the Purchaser’s deferred Expenses (including cash amounts, if any,
payable to the IPO Underwriter and any legal fees) of the IPO, (c) any loans owed by the Purchaser to the Sponsor for any Expenses
(including deferred Expenses), other administrative costs and expenses incurred by or on behalf of the Purchaser and (d) any other
Liabilities of the Purchaser as of the Closing. Such Expenses, as well as any Expenses that are required to be paid by delivery
of the Purchaser’s securities, will be paid at the Closing. Any remaining cash, together with any other cash of Purchaser
or the Company, will be used, first to pay any then-remaining Expenses of the Parties and, thereafter, be used for working capital
and general corporate purposes of the Purchaser and the Surviving Corporation.
5.17
PIPE Investment.
(a)
During the Interim Period, each of the Purchaser and the Company shall solicit mutually acceptable PIPE Investors to enter
into Subscription Agreements with the Purchaser on the terms set forth on Schedule 5.17(a) or on such other terms as
may be mutually acceptable to the Purchaser and the Company; provided that the Purchaser shall enter into Subscription Agreements
with the PIPE Investors that offer the best terms to the Purchaser (as long as such terms are at least as favorable to the Purchaser
as the terms set forth on Schedule 5.17(a) or are otherwise mutually agreed by Purchaser and the Company) regardless of
whether the Purchaser or the Company has identified such PIPE Investors. If either Party identifies PIPE Investors, the Purchaser
and the Company shall, and shall cause their respective Representatives to, cooperate with each other and their respective Representatives
in connection with entering into Subscription Agreements with such PIPE Investors and use their respective reasonable efforts to
cause such Subscription Agreements to be executed and the transactions contemplated thereby to occur (including having the Company’s
senior management participate in any investor meetings and roadshows as reasonably requested by the Purchaser). The Purchaser will
deliver to the Company true, correct and complete copies of each Subscription Agreement entered into by the Purchaser. During the
Interim Period, neither the Purchaser nor the Company shall enter into any Contract with a PIPE Investor without the prior written
consent of the other Party, as applicable, with such consent not to be unreasonably withheld, delayed or conditioned.
(b)
After any Subscription Agreements are executed by the parties thereto, the Purchaser shall use its commercially reasonable
efforts to satisfy the conditions of the PIPE Investors’ closing obligations contained in the Subscription Agreements and
consummate the transactions contemplated thereby. The Purchaser shall not terminate, or amend or waive in any material respect
any Subscription Agreement without the Company’s prior written consent (not to be unreasonably withheld, delayed or conditioned),
other than (i) as expressly provided for by the terms of the Subscription Agreements or (ii) to reflect any permitted assignments
or transfers of the Subscription Agreements by the applicable PIPE Investors pursuant to the Subscription Agreements (it being
understood, but without limiting the foregoing, that it shall be deemed material if any amendment, modification or waiver (x) reduces
the PIPE Investment from any PIPE Investor or (y) imposes new or additional conditions or otherwise expands, or adversely
amends or modifies any of the conditions to the receipt of the PIPE Investment). Each of the Purchaser and, as applicable, the
Company, shall, and shall cause its Affiliates to, use commercially reasonable efforts to avoid being in breach or default under
the Subscription Agreements.
(c)
The Purchaser shall give the Company prompt (and, in any event, within two (2) Business Days) written notice: (i) of
any request from a PIPE Investor for any amendment to its Subscription Agreement (other than as a result of any assignments or
transfers contemplated therein or otherwise permitted thereby); (ii) of any actual, threatened or anticipated breach or default
(or any event or circumstance that, with or without notice, lapse of time or both, would reasonably be expected to give rise to
any breach or default) by any PIPE Investor under its Subscription Agreement, to the extent known by such Party; and (iii) of
the receipt of any written notice or other written communication from any party to any Subscription Agreement with respect to any
actual, potential, threatened or claimed expiration, lapse, withdrawal, breach, default, termination or repudiation by any PIPE
Investor under its Subscription Agreement or any related agreement. The Purchaser shall deliver all notices it is required to deliver
under the Subscription Agreements on a timely basis in order to cause the PIPE Investors to consummate the PIPE Investment immediately
prior to the Effective Time.
5.18
Takeover Statutes. Unless the Company Board has made a Company Adverse Recommendation Change in accordance with this
Agreement, if any takeover statute is or becomes applicable to this Agreement or any Transaction, each of Purchaser, the Company
and their respective boards of directors shall use reasonable best efforts (a) to ensure that such Transactions may be consummated
as promptly as practicable upon the terms and subject to the conditions set forth in this Agreement and (b) to otherwise act
to eliminate or minimize the effects of such takeover statute.
5.19
Rule 16b-3. Prior to the Effective Time, the Company may take such further actions, if any, as may be necessary or
appropriate to ensure that the dispositions of equity securities of the Company (including derivative securities) pursuant to the
Transactions by any officer or director of the Company who is subject to Section 16 of the Exchange Act are exempt under Rule
16b-3 promulgated under the Exchange Act.
5.20
Additional Agreements.
(a)
Prior to the Closing, the Purchaser shall file with the Delaware Secretary of State an amendment to its Certificate of Incorporation
in the form attached as (i) Exhibit E-1 hereto (the “Class B Charter Amendment”), which amendment
shall be filed prior to the Closing Date upon approval by the holders of the Purchaser Class B Common Stock; (ii) Exhibit E-2
hereto (the “Net Tangible Assets Charter Amendment”), which amendment shall be filed prior to the Closing
Date upon approval by the Purchaser Stockholders following approval at the Purchaser Special Meeting; and (iii) Exhibit E-3
hereto (the “Purchaser Closing Date Charter Amendment” and, together with the Class B Charter Amendment
and the Net Tangible Assets Charter Amendment, the “Purchaser Charter Amendments”), which amendment shall
be filed with the Delaware Secretary of State immediately after the filing of the Articles of Merger with the Secretary of State
of the State of Nevada pursuant to Section 1.2.
(b)
Prior to the Closing, the Purchaser and certain Company Stockholders who will be Affiliates of the Purchaser immediately
after the Closing shall enter into a registration rights agreement in a form to be reasonably acceptable to the Purchaser and the
Company (the “Registration Rights Agreement”) to provide such Company Stockholders with registration
rights that are substantially similar in all material respects to, and pari passu with, the registration rights of the Sponsor
pursuant that that certain Registration Rights Agreement, dated as of July 27, 2021, by and among the Purchaser, the Sponsor and
certain securityholders named therein.
(c)
Prior to the Closing, the Purchaser shall use its commercially reasonable efforts to enter into voting and non-redemption
agreements, substantially in the form attached as Exhibit G hereto, with such Purchaser Stockholders as mutually agreed
by Purchaser and the Company.
(d)
The Purchaser shall use its commercially reasonable efforts to obtain the approval of the Amendment to Warrant Agreement
from the requisite holders of the Purchaser Public Warrants.
(e)
Prior to the Closing, the Company shall use its commercially reasonable efforts to negotiate with the holders of the Company
Warrants and the Company Convertible Notes to cause such Company Warrants and Company Convertible Notes to be amended, exercised,
converted or exchanged, as applicable, into shares of Company Common Stock.
5.21
No Trading. Each of the Company and the Purchaser acknowledges and agrees that it is aware, and that its respective
Affiliates are aware (and each of their respective Representatives is aware or, upon receipt of any material nonpublic information
of the Purchaser or the Company, will be advised) of the restrictions imposed by U.S. federal securities Laws and the rules and
regulations of the SEC and Nasdaq promulgated thereunder or otherwise and other applicable foreign and domestic Laws on a Person
possessing material nonpublic information about a publicly traded company.
5.22
Company Convertible Notes. The Company shall, at or promptly following the Closing,
pay in full the outstanding balance, including any interest thereon, owed under the Company Convertible Notes set forth on Schedule
6.1(i)(A).
Article
VI
CLOSING CONDITIONS
6.1
Conditions to Each Party’s Obligations. The obligations of each Party to consummate the Merger and the other
transactions described herein shall be subject to the satisfaction or written waiver (where permissible) by the Company and the
Purchaser of the following conditions:
(a)
Required Purchaser Stockholder Approval. The Purchaser Stockholder Approval Matters set forth in Section 5.12(a)(i)
that are submitted to the vote of the shareholders of the Purchaser at the Purchaser Special Meeting in accordance with the Joint
Proxy Statement and the Purchaser Organizational Documents shall have been approved by the requisite vote of the shareholders of
the Purchaser at the Purchaser Special Meeting in accordance with the Purchaser Organizational Documents, applicable Law and the
Joint Proxy Statement (the “Required Purchaser Stockholder Approval”).
(b)
Required Company Stockholder Approval. The Company Stockholder Approval Matter set forth in Section 5.12(a)(ii)(1)
that is submitted to the vote of the Company Stockholders at the Company Special Meeting in accordance with the Joint Proxy
Statement and the Company’s Organizational Documents shall have been approved by the requisite vote of the Company Stockholders
at the Company Special Meeting in accordance with the Company’s Organizational Documents, applicable Law and the Joint Proxy
Statement (the “Required Company Stockholder Approval”).
(c)
Requisite Consents. The Consents required to be obtained from or made with any third Person (other than a Governmental
Authority) in order to consummate the Transactions that are set forth in Schedule 6.1(c) shall have each been obtained or
made.
(d)
No Adverse Law or Order. No Governmental Authority shall have enacted, issued, promulgated, enforced or entered any
Law (whether temporary, preliminary or permanent) or Order that is then in effect and which has the effect of making the transactions
or agreements contemplated by this Agreement illegal or which otherwise prevents or prohibits consummation of the Transactions.
(e)
Purchaser Charter Amendments. The Purchaser Charter Amendments shall have been filed with the Secretary of State
of the State of Delaware, and evidence of such filings shall have been provided to Purchaser and the Company.
(f)
Appointment to the Board. The members of the Post-Closing Purchaser Board shall have been elected or appointed as
of the Closing consistent with the requirements of Section 5.14.
(g)
Registration Statement. The Registration Statement shall have been declared effective by the SEC and shall remain
effective as of the Closing, and no stop order or similar order shall be in effect with respect to the Registration Statement.
(h)
Nasdaq Listing. The shares of Purchaser Class A Common Stock shall have been approved for listing on Nasdaq, subject
to official notice of issuance, for the period after the Closing Date.
(i)
Company Convertible Notes. Holders of 80% or more of the Company Convertible Notes with a maturity date occurring
after the Closing Date (not including the Company Convertible Notes set forth on Schedule 6.1(i)(A)), measured by number
of shares of Company Common Stock into which such Company Convertible Notes may be converted, shall have agreed to convert their
Company Convertible Notes into shares of Company Common Stock immediately prior to the Effective Time.
(j)
Company Warrants. Holders of 80% or more of the Company Warrants that would be outstanding on the Closing Date, measured
by number of shares of Company Common Stock issuable upon exercise in respect of such Company Warrants in the aggregate, shall
have agreed to convert their Company Warrants into shares of Company Common Stock immediately prior to the Effective Time.
6.2 Conditions to Obligations of the Company. In addition to the conditions specified in Section 6.1, the obligations
of the Company to consummate the Merger and the other Transactions are subject to the satisfaction or written waiver (by the Company)
of the following conditions:
(a)
Representations and Warranties. All of the representations and warranties of the Purchaser and Merger Sub set forth
in this Agreement and in any certificate delivered by or on behalf of the Purchaser pursuant hereto shall be true and correct on
and as of the Closing Date as if made on the Closing Date, except for (i) those representations and warranties that address matters
only as of a particular date (which representations and warranties shall have been accurate as of such date), and (ii) any failures
to be true and correct that (without giving effect to any qualifications or limitations as to materiality or Material Adverse Effect),
individually or in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on, or with
respect to, the Purchaser.
(b)
Agreements and Covenants. The Purchaser shall have performed in all material respects all of the Purchaser’s
obligations and complied in all material respects with all of the Purchaser’s agreements and covenants under this Agreement
to be performed or complied with by it on or prior to the Closing Date.
(c)
No Purchaser Material Adverse Effect. No Material Adverse Effect shall have occurred with respect to the Purchaser
since the date of this Agreement.
(d)
Fairness Opinion. The Purchaser shall have delivered a fairness opinion of the Purchaser Financial Advisor, in form
and substance reasonably satisfactory to the Company.
(e)
PIPE Investment and Purchaser Non-Redemption. Upon the Closing, the Purchaser shall have at least $12,000,000 resulting
from (i) proceeds from Purchaser Class A Common Stock that has not been redeemed in the Redemption and (ii) proceeds of the PIPE
Investment, on terms mutually acceptable to the Purchaser and the Company.
(f)
Closing Deliveries.
(i)
Officer Certificate. The Purchaser shall have delivered to the Company a certificate, dated the Closing Date, signed
by an officer of the Purchaser in such capacity, certifying as to the satisfaction of the conditions specified in Sections 6.2(a),
6.2(b) and 6.2(c).
(ii)
Registration Rights Agreement. The Company shall have received a copy of a Registration Rights Agreement duly executed
by the Purchaser.
(iii)
Purchaser Charter Amendments. The Company shall have received evidence of the filing of the Purchaser Charter Amendments
with the Secretary of State of Delaware.
(iv)
Amendment to Lock-Up Agreement. The Company shall have received a copy of an amendment to the Letter Agreement in
the form attached as Exhibit H, duly executed by the Purchaser, the Sponsor and the other parties identified therein (the
“Purchaser Letter Agreement Amendment”), and such Purchaser Letter Agreement Amendment shall be in full
force and effect as of the Closing Date.
(v)
Amendment to Warrant Agreement. The Company shall have received a copy of the amendment to that certain Warrant Agreement,
dated as of July 27, 2021, between the Purchaser and the Exchange Agent (the “Purchaser Amendment to Warrant Agreement”)
in the form attached as Exhibit I, pursuant to which Sponsor has agreed to exchange all of its Purchaser Private Warrants
for 400,000 shares of Purchaser Class A Common Stock and holders of at least fifty percent (50%) of the Purchaser Public Warrants
have agreed to exchange all of the Purchaser Public Warrants for 450,336 shares of Purchaser Class A Common Stock.
6.3
Conditions to Obligations of the Purchaser. In addition to the conditions specified in Section 6.1, the obligations
of the Purchaser and Merger Sub to consummate the Merger and the other Transactions are subject to the satisfaction or written
waiver (by the Purchaser) of the following conditions:
(a)
Representations and Warranties. All of the representations and warranties of the Company set forth in this Agreement
and in any certificate delivered by or on behalf of the Company pursuant hereto shall be true and correct on and as of the Closing
Date as if made on the Closing Date, except for (i) those representations and warranties that address matters only as of a particular
date (which representations and warranties shall have been accurate as of such date), and (ii) any failures to be true and correct
that (without giving effect to any qualifications or limitations as to materiality or Material Adverse Effect), individually or
in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect on, or with respect to, the
Target Companies, taken as a whole.
(b)
Agreements and Covenants. The Company shall have performed in all material respects all of its obligations and complied
in all material respects with all of its agreements and covenants under this Agreement to be performed or complied with by it on
or prior to the Closing Date.
(c)
No Material Adverse Effect. No Material Adverse Effect shall have occurred with respect to the Target Companies taken
as a whole since the date of this Agreement.
(d)
Certain Ancillary Documents. Each Company Lock-Up Agreement shall be in full force and effect in accordance with
the terms thereof as of the Closing.
(e)
Closing Deliveries.
(i)
Officer Certificate. The Purchaser shall have received a certificate from the Company, dated as the Closing Date,
signed by an executive officer of the Company in such capacity, certifying as to the satisfaction of the conditions specified in
Sections 6.3(a), 6.3(b) and 6.3(c).
(ii)
Waiver of Underwriter Liability. The Purchaser shall have received a waiver from the IPO Underwriter in a form acceptable
to Purchaser providing for the IPO Underwriter’s waiver of any liability of the Purchaser.
6.4 Frustration of Conditions. Notwithstanding anything contained herein to the contrary, no Party may rely on the failure
of any condition set forth in this Article VI to be satisfied if such failure was caused by the failure of such Party or
its Affiliates (or with respect to the Company, any Target Company or Company Stockholder) failure to comply with or perform any
of its covenants or obligations set forth in this Agreement.
Article
VII
TERMINATION AND EXPENSES
7.1 Termination. This Agreement may be terminated and the Transactions may be abandoned at any time prior to the Effective
Time as follows:
(a)
by mutual written consent of the Purchaser and the Company;
(b)
by written notice by either the Purchaser or the Company if any of the conditions of the other Party to the Closing set
forth in Article VI have not been satisfied or waived by February 28, 2024 (the “Outside Date”);
(c)
by written notice by either the Purchaser or the Company if a Governmental Authority of competent jurisdiction shall have
issued an Order or taken any other action permanently restraining, enjoining or otherwise prohibiting the Transactions, and such
Order or other action has become final and non-appealable; provided, however, that the right to terminate this Agreement pursuant
to this Section 7.1(c) shall not be available to a Party if the failure by such Party or its Affiliates to comply with any
provision of this Agreement has been a substantial cause of, or substantially resulted in, such action by such Governmental Authority;
(d)
by written notice by the Company to the Purchaser, if (i) there has been a breach by the Purchaser of any of its representations,
warranties, covenants or agreements contained in this Agreement, or if any representation or warranty of the Purchaser shall have
become untrue or inaccurate, in any case, which would result in a failure of a condition set forth in Section 6.2(a) or
Section 6.2(b) to be satisfied (treating the Closing Date for such purposes as the date of this Agreement or, if later,
the date of such breach), and (ii) the breach or inaccuracy is incapable of being cured or is not cured within the earlier of (A)
twenty (20) days after written notice of such breach or inaccuracy is provided to the Purchaser or (B) the Outside Date; provided,
that the Company shall not have the right to terminate this Agreement pursuant to this Section 7.1(d) if at such time the
Company is in material uncured breach of this Agreement;
(e)
by written notice by the Purchaser to the Company, if (i) there has been a breach by the Company of any of its representations,
warranties, covenants or agreements contained in this Agreement, or if any representation or warranty of such Parties shall have
become untrue or inaccurate, in any case, which would result in a failure of a condition set forth in Section 6.3(a) or
Section 6.3(b) to be satisfied (treating the Closing Date for such purposes as the date of this Agreement or, if later,
the date of such breach), and (ii) the breach or inaccuracy is incapable of being cured or is not cured within the earlier of (A)
twenty (20) days after written notice of such breach or inaccuracy is provided to the Company or (B) the Outside Date; provided,
that the Purchaser shall not have the right to terminate this Agreement pursuant to this Section 7.1(e) if at such time
the Purchaser is in material uncured breach of this Agreement;
(f)
by written notice by Purchaser to the Company if: (i) the Company Board effects a Company Adverse Recommendation Change;
(ii) (A) the Company Board approves, endorses or recommends to the Company’s Stockholders a Superior Proposal or (B) a tender
offer or exchange offer for any outstanding shares of Company capital stock is commenced before obtaining the Required Company
Stockholder Approval and the Company Board fails to recommend against acceptance of such tender offer or exchange offer by the
Company’s Stockholders within ten (10) Business Days after commencement; or (iii) if there shall have been a material breach
of Section 5.6;
(g)
by written notice by the Company to Purchaser prior to the receipt of the Required Company Stockholder Approval, if prior
to or substantially concurrent with such termination, (i) the Company shall have paid the applicable Termination Fee pursuant to
Section 7.3 and (ii) the Company substantially concurrently with such termination enters into a definitive agreement with
respect to the Superior Proposal that did not result from a material breach of Section 5.6 and that remained a Superior
Proposal following the Company’s compliance with the provisions set forth in Section 5.6;
(h)
by written notice by either the Purchaser or the Company to the other, if the Purchaser Special Meeting is held (including
any adjournment or postponement thereof) and has concluded, the Purchaser Stockholders have duly voted, and the Required Purchaser
Stockholder Approval was not obtained;
(i)
by written notice by either the Purchaser or the Company to the other, if the Company Special Meeting is held (including
any adjournment or postponement thereof) and has concluded, the Company Stockholders have duly voted, and the Required Company
Stockholder Approval was not obtained; or
(j)
by written notice by the Company to the Purchaser, if (i) a Form 25 relating to the delisting of the shares of Purchaser
Class A Common Stock from Nasdaq shall have been filed, and (ii) the shares of Purchaser Class A Common Stock shall not have
been approved for listing on Nasdaq after the filing of such Form 25, subject to official notice of issuance, within the earlier
of (A) thirty (30) days after the date on which the Form 25 is filed or (B) the Outside Date.
7.2 Effect of Termination. This Agreement may only be terminated in the circumstances described in Section 7.1
and pursuant to a written notice delivered by the applicable Party to the other applicable Parties, which sets forth the basis
for such termination, including the provision of Section 7.1 under which such termination is made. In the event of the valid
termination of this Agreement pursuant to Section 7.1, this Agreement shall forthwith become void, and there shall be no
Liability on the part of any Party or any of their respective Representatives, and all rights and obligations of each Party shall
cease, except: (a) Sections 5.1(d), 7.3, 8.1, Article IX and this Section 7.2 shall survive
the termination of this Agreement, and (b) nothing herein other than Section 7.3(b) shall relieve any Party from Liability
for any willful breach of any representation, warranty, covenant or obligation under this Agreement, in either case, prior to the
termination of this Agreement (in each case of clauses (a) and (b) above, subject to Section 8.1). Without limiting the
foregoing, and except as provided in Sections 7.3 and this Section 7.2 (but subject to Section 8.1) and subject
to the right to seek injunctions, specific performance or other equitable relief in accordance with Section 9.7, the Parties’
sole right prior to the Closing with respect to any breach of any representation, warranty, covenant or other agreement contained
in this Agreement by another Party or with respect to the Transactions shall be the right, if applicable, to terminate this Agreement
pursuant to Section 7.1 or to receive payment of a Termination Fee pursuant to Section 7.3.
7.3 Fees and Expenses.
(a)
Subject to Section 8.1 and except as otherwise set forth in this Section 7.3, all Expenses incurred in connection
with this Agreement and the Transactions shall be paid by the Party incurring such expenses. As used in this Agreement, “Expenses”
shall include all out-of-pocket expenses (including all fees and expenses of counsel, accountants, investment bankers, financial
advisors, financing sources, experts and consultants to a Party hereto or any of its Affiliates) incurred by a Party or on its
behalf in connection with or related to the authorization, preparation, negotiation, execution or performance of this Agreement
or any Ancillary Document related hereto and all other matters related to the consummation of this Agreement. With respect to the
Purchaser, Expenses shall include any and all deferred expenses (including fees or commissions payable to the underwriters and
any legal fees) of the IPO upon consummation of a Business Combination, any costs and expenses relating to the PIPE Investment.
(b)
The Company shall pay, or cause to be paid, to Purchaser (or its designee(s)) by wire transfer of immediately available
funds an amount equal to $2,500,000 (the “Termination Fee”), if:
(i)
this Agreement is terminated by the Company pursuant to Section 7.1(g), in which case payment shall be made before
or concurrently with such termination;
(ii)
the Agreement is terminated by Purchaser pursuant to Section 7.1(f), in which case payment shall be made within two
(2) Business Days following such termination; or
(iii)
(A) after the date of this Agreement, first, a Takeover Proposal with respect to the Company is made, proposed or communicated
to the Company Board or management, or is publicly made, proposed or communicated or otherwise becomes publicly known; (B) second,
this Agreement is terminated by either the Company or Purchaser pursuant to Section 7.1(b) or 7.1(i), or by
Purchaser pursuant to Section 7.1(e); and (C) third, within twelve (12) months of such termination (1) any transaction included
within the definition of a Takeover Proposal with respect to the Company is consummated or (2) the Company enters into a definitive
agreement providing for the consummation of any transaction within the definition of Takeover Proposal, in each case whether or
not involving the same Takeover Proposal or the Person or group making the Takeover Proposal referred to in clause (A); provided,
that for purposes of clause (C), the term “Takeover Proposal” shall have the meaning assigned to such term in Article
X, except that all references to “15%” in such definition shall be deemed references to “50%”, in which
case payment shall be made within two (2) Business Days following such termination.
(c)
The Company acknowledges that the fees and the other provisions of this Section 7.3 are an integral part of
the Transactions and that, without these agreements, Purchaser would not enter into this Agreement. Notwithstanding anything to
the contrary in this Agreement, if the Termination Fee is required to be paid as a result of a termination of this Agreement, then,
Purchaser’s right to receive payment of the Termination Fee pursuant to Section 7.3(b) shall be the sole and exclusive
remedy (whether at law, in equity, in contract, tort or otherwise) of Purchaser and its Affiliates for (i) the damages suffered
as a result of the failure of the Transactions to be consummated and (ii) any other damages suffered as a result of or in
connection with this Agreement and the Transactions, and upon payment of the Termination Fee in accordance with this Section
7.3, none of the Company or any of its Affiliates, respective current or former stockholders, directors, officers, employees,
agents, advisors or other Representatives shall have any further Liability relating to or arising out of this Agreement or the
Transactions; provided, that the foregoing shall not impair the rights of Purchaser, if any, to obtain an order of specific
performance prior to any valid termination of this Agreement. The Parties acknowledge and agree that in no event will (A) the
Company be required to pay the Termination Fee on more than one (1) occasion or (B) the Company have Liability for monetary damages
(including monetary damages in lieu of specific performance) in the aggregate in excess of the Termination Fee for breaches of
this Agreement (whether willfully, intentionally, unintentionally or otherwise) or failure to perform hereunder (whether willfully,
intentionally, unintentionally or otherwise). Under no circumstances shall Purchaser (or any of its equityholders or other Person)
be permitted or entitled to receive both a grant of specific performance and any monetary damages, including any monetary damages
in lieu of specific performance and the Termination Fee.
Article
VIII
WAIVERS AND RELEASES
8.1 Waiver of Claims Against Trust. Reference is made to the IPO Prospectus. The Company, Merger Sub and the Purchaser
each hereby represents and warrants that it has read the IPO Prospectus and understands that the Purchaser has established the
Trust Account containing the proceeds of the IPO and the overallotment shares acquired by Purchaser’s underwriters and from
certain private placements occurring simultaneously with the IPO (including interest accrued from time to time thereon) for the
benefit of the Purchaser’s Public Stockholders (including overallotment shares acquired by the Purchaser’s underwriters)
(the “Public Stockholders”) and that, except as otherwise described in the IPO Prospectus, the Purchaser
may disburse monies from the Trust Account only: (a) to the Public Stockholders in the event they elect to redeem their Purchaser
Class A Common Stock in connection with the consummation of the Purchaser’s initial business combination (as such term is
used in the IPO Prospectus) (the “Business Combination”) or in connection with an amendment to the Purchaser’s
Organizational Documents to extend the deadline to consummate a Business Combination, (b) to the Public Stockholders if the Purchaser
fails to consummate a Business Combination within thirty-six (36) months after the closing of the IPO, (c) with respect to any
interest earned on the amounts held in the Trust Account, amounts necessary to pay for any Taxes or (d) to the Purchaser after
or concurrently with the consummation of a Business Combination. For and in consideration of the Purchaser entering into this Agreement
and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of the Company
hereby agrees on behalf of itself and its Affiliates that, notwithstanding anything to the contrary in this Agreement, none of
the Company nor any of its Affiliates do now or shall at any time hereafter have any right, title, interest or claim of any kind
in or to any monies in the Trust Account or distributions therefrom, or make any claim against the Trust Account (including any
distributions therefrom), regardless of whether such claim arises as a result of, in connection with or relating in any way to,
this Agreement or any proposed or actual business relationship between Purchaser or any of its Representatives, on the one hand,
and the Company or any of its Representatives, on the other hand, or any other matter, and regardless of whether such claim arises
based on contract, tort, equity or any other theory of legal liability (collectively, the “Released Claims”).
The Company on behalf of itself and its Affiliates hereby irrevocably waives any Released Claims that any such Party or any of
its Affiliates may have against the Trust Account (including any distributions therefrom) now or in the future as a result of,
or arising out of, any negotiations, contracts or agreements with Purchaser or its Representatives and will not seek recourse against
the Trust Account (including any distributions therefrom) for any reason whatsoever (including for an alleged breach of this Agreement
or any other agreement with Purchaser or its Affiliates). The Company agrees and acknowledges that such irrevocable waiver is material
to this Agreement and specifically relied upon by Purchaser and its Affiliates to induce Purchaser to enter in this Agreement,
and the Company further intends and understands such waiver to be valid, binding and enforceable against such Party and each of
its Affiliates under applicable Law. To the extent that the Company or any of its Affiliates commences any Action based upon, in
connection with, relating to or arising out of any matter relating to Purchaser or its Representatives, which proceeding seeks,
in whole or in part, monetary relief against Purchaser or its Representatives, the Company hereby acknowledges and agrees that
its and its Affiliates’ sole remedy shall be against funds held outside of the Trust Account and that such claim shall not
permit such Party or any of its Affiliates (or any Person claiming on behalf of any of them, or in lieu of them) to have any claim
against the Trust Account (including any distributions therefrom) or any amounts contained therein. In the event that the Company
or any its Affiliates commences Action based upon, in connection with, relating to or arising out of any matter relating to Purchaser
or its Representatives which proceeding seeks, in whole or in part, relief against the Trust Account (including any distributions
therefrom) or the Public Stockholders, whether in the form of money damages or injunctive relief, Purchaser and its Representatives,
as applicable, shall be entitled to recover from the Company (on behalf of the Company Stockholders) and their respective Affiliates,
as applicable, the associated legal fees and costs in connection with any such Action, in the event Purchaser or its Representatives,
as applicable, prevails in such Action. This Section 8.1 shall survive termination of this Agreement for any reason and
continue indefinitely.
Article
IX
MISCELLANEOUS
9.1 No Survival. Representations and warranties of the Company and the Purchaser contained in this Agreement or in any
certificate or instrument delivered by or on behalf of the Company or the Purchaser pursuant to this Agreement shall not survive
the Closing, and from and after the Closing, the Company and the Purchaser and their respective Representatives shall not have
any further obligations, nor shall any claim be asserted or action be brought against the Company or the Purchaser or their respective
Representatives with respect thereto. The covenants and agreements made by the Company and the Purchaser in this Agreement or in
any certificate or instrument delivered pursuant to this Agreement, including any rights arising out of any breach of such covenants
or agreements, shall not survive the Closing, except for those covenants and agreements contained herein and therein that by their
terms apply or are to be performed in whole or in part after the Closing (which such covenants shall survive the Closing and continue
until fully performed in accordance with their terms).
9.2 Notices. All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed
to have been duly given when delivered (a) in person, (b) by email, with affirmative confirmation of receipt, (iii) one (1) Business
Day after being sent, if sent by a reputable, nationally recognized overnight courier service or (iv) three (3) Business Days after
being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in each case to the applicable Party
at the following addresses (or at such other address for a Party as shall be specified by like notice):
If to the Purchaser or Merger Sub at or prior to the Closing,
to:
SEP Acquisition Corp.
3737 Buffalo Speedway
Suite 1750
Houston, TX 77098
Attn: Andrew White
Telephone No.: 713-715-6820
Email: info@seplp.com
|
|
with a copy (which will not constitute notice) to:
Baker Donelson, Bearman, Caldwell & Berkowitz,
PC
1600 West End Avenue
Suite 2000
Nashville, TN 37203
Attn: Tonya Mitchem Grindon
Attn: Nathan Kibler
Attn: Andrew Yonchak
Telephone No.: 615-726-5600
Email: tgrindon@bakerdonelson.com
Email: nkibler@bakerdonelson.com
Email: dyonchak@bakerdonelson.com
|
If to the Company, to:
SANUWAVE Health, Inc.
11495 Valley View Road
Eden Prairie, Minnesota 55344
Attn: Morgan C. Frank, Chief Executive Officer
Email:
|
|
with a copy (which will not constitute notice) to:
Faegre Drinker Biddle & Reath LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, Minnesota 55402
Attn: Ben A. Stacke
Attn: Jonathan Nygren
Email: ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com
|
If to the Purchaser after the Closing, to:
SANUWAVE Health, Inc.
11495 Valley View Road
Eden Prairie, Minnesota 55344
Attn: Morgan C. Frank, Chief Executive Officer
Email:
|
|
with a copy (which will not constitute notice) to:
Faegre Drinker Biddle & Reath LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, Minnesota 55402
Attn: Ben A. Stacke
Attn: Jonathan Nygren
Email: ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com
|
9.3 Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the
benefit of the Parties hereto and their respective successors and permitted assigns. This Agreement shall not be assigned by operation
of Law or otherwise without the prior written consent of the Purchaser and the Company, and any assignment without such consent
shall be null and void; provided that no such assignment shall relieve the assigning Party of its obligations hereunder.
9.4 Third Parties. Except (a) as provided in Section 5.15 (Indemnification of Directors and Officers; Tail
Insurance), and (b) for the provision of Section 1.10, (which, only from and after the Effective Time, shall be for
the benefit of holders of Company Securities), which the Parties acknowledge and agree are express third party beneficiaries of
this Agreement, nothing contained in this Agreement or in any instrument or document executed by any party in connection with the
Transactions shall create any rights in, or be deemed to have been executed for the benefit of, any Person that is not a Party
hereto or thereto or a successor or permitted assign of such a Party.
9.5 Governing Law; Jurisdiction. This Agreement shall be governed by, construed and enforced in accordance with the Laws
of the State of Delaware without regard to the conflict of laws principles thereof. All Actions arising out of or relating to this
Agreement shall be heard and determined exclusively in any state or federal court located in the Chancery Court of the State of
Delaware (or, if the Chancery Court of the State of Delaware declines to accept jurisdiction over a particular matter, any U.S.
state or federal court located in the State of Delaware (or in any appellate court thereof)) (the “Specified Courts”).
Each Party hereto hereby (a) submits to the exclusive jurisdiction of any Specified Court for the purpose of any Action arising
out of or relating to this Agreement brought by any Party hereto and (b) irrevocably waives, and agrees not to assert by way
of motion, defense or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction of the above-named
courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an inconvenient forum,
that the venue of the Action is improper, or that this Agreement or the Transactions may not be enforced in or by any Specified
Court. Each Party agrees that a final judgment in any Action shall be conclusive and may be enforced in other jurisdictions by
suit on the judgment or in any other manner provided by Law. Each Party irrevocably consents to the service of the summons and
complaint and any other process in any other Action relating to the Transactions, on behalf of itself, or its property, by personal
delivery of copies of such process to such Party at the applicable address set forth in Section 9.2. Nothing in this Section
9.5 shall affect the right of any Party to serve legal process in any other manner permitted by Law.
9.6 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS
AGREEMENT OR THE TRANSACTIONS. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND (B) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION 9.6.
9.7 Specific Performance. Each Party acknowledges that the rights of each Party to consummate the Transactions are unique,
recognizes and affirms that in the event of a breach of this Agreement by any Party, money damages may be inadequate and the non-breaching
Parties may have not adequate remedy at law, and agree that irreparable damage would occur in the event that any of the provisions
of this Agreement were not performed by an applicable Party in accordance with their specific terms or were otherwise breached.
Accordingly, each Party shall be entitled to seek an injunction or restraining order to prevent breaches of this Agreement and
to seek to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or
to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such Party may be
entitled under this Agreement, at law or in equity. Notwithstanding the foregoing, the Purchaser agrees that its rights under this
Section 9.7 shall terminate upon its acceptance of the Termination Fee.
9.8 Severability. In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction,
such provision shall be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid,
legal and enforceable, and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be
affected or impaired thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other
jurisdiction. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the
Parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out,
so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
9.9 Amendment. This Agreement may be amended, supplemented or modified only by execution of a written instrument signed
by the Purchaser and the Company.
9.10 Waiver. The Purchaser, on behalf of itself and its Affiliates, and the Company, on behalf of itself and its Affiliates,
may in its sole discretion (a) extend the time for the performance of any obligation or other act of any other non-Affiliated Party
hereto, (b) waive any inaccuracy in the representations and warranties by such other non-Affiliated Party contained herein or in
any document delivered pursuant hereto and (c) waive compliance by such other non-Affiliated Party with any covenant or condition
contained herein. Any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the Party
or Parties to be bound thereby. Notwithstanding the foregoing, no failure or delay by a Party in exercising any right hereunder
shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any
other right hereunder.
9.11 Entire Agreement. This Agreement and the documents or instruments referred to herein, including any exhibits and
schedules attached hereto, which exhibits and schedules are incorporated herein by reference, together with the Ancillary Documents,
embody the entire agreement and understanding of the Parties hereto in respect of the subject matter contained herein. There are
no restrictions, promises, representations, warranties, covenants or undertakings, other than those expressly set forth or referred
to herein or the documents or instruments referred to herein, which collectively supersede all prior agreements and the understandings
among the Parties with respect to the subject matter contained herein.
9.12 Interpretation. The table of contents and the Article and Section headings contained in this Agreement are solely
for the purpose of reference, are not part of the agreement of the Parties and shall not in any way affect the meaning or interpretation
of this Agreement. In this Agreement, unless the context otherwise requires: (a) any pronoun used shall include the corresponding
masculine, feminine or neuter forms, and words in the singular, including any defined terms, include the plural and vice versa;
(b) reference to any Person includes such Person’s successors and assigns but, if applicable, only if such successors
and assigns are permitted by this Agreement, and reference to a Person in a particular capacity excludes such Person in any other
capacity; (c) any accounting term used and not otherwise defined in this Agreement or any Ancillary Document has the meaning assigned
to such term in accordance with GAAP; (d) “including” (and with correlative meaning “include”) means including
without limiting the generality of any description preceding or succeeding such term and shall be deemed in each case to be followed
by the words “without limitation”; (e) the words “herein,” “hereto,” and “hereby”
and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and not to any particular
Section or other subdivision of this Agreement; (f) the word “if” and other words of similar import when used herein
shall be deemed in each case to be followed by the phrase “and only if”; (g) the term “or” means “and/or”;
(h) any reference to the term “ordinary course” or “ordinary course of business” shall be deemed in each
case to be followed by the words “consistent with past practice”; (i) any agreement, instrument, insurance policy,
Law or Order defined or referred to herein or in any agreement or instrument that is referred to herein means such agreement, instrument,
insurance policy, Law or Order as from time to time amended, modified or supplemented, including (in the case of agreements or
instruments) by waiver or consent and (in the case of statutes, regulations, rules or orders) by succession of comparable successor
statutes, regulations, rules or orders and references to all attachments thereto and instruments incorporated therein; (j) except
as otherwise indicated, all references in this Agreement to the words “Section,” “Article”, “Schedule”
and “Exhibit” are intended to refer to Sections, Articles, Schedules and Exhibits to this Agreement; and (k) the term
“Dollars” or “$” means United States dollars. Any reference in this Agreement to a Person’s directors
shall include any member of such Person’s governing body and any reference in this Agreement to a Person’s officers
shall include any Person filling a substantially similar position for such Person. Any reference in this Agreement or any Ancillary
Document to a Person’s shareholders or stockholders shall include any applicable owners of the equity interests of such Person,
in whatever form. The Parties have participated jointly in the negotiation and drafting of this Agreement. Consequently, in the
event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the
Parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any Party by virtue of the authorship
of any provision of this Agreement. To the extent that any Contract, document, certificate or instrument is represented and warranted
to by the Company to be given, delivered, provided or made available by the Company, in order for such Contract, document, certificate
or instrument to have been deemed to have been given, delivered, provided and made available to the Purchaser or its Representatives,
such Contract, document, certificate or instrument shall have been posted to the electronic data site maintained on behalf of the
Company for the benefit of the Purchaser and its Representatives and the Purchaser and its Representatives have been given access
to the electronic folders containing such information.
9.13 Disclosure Schedules. It is specifically acknowledged that the Purchaser Disclosure Schedules and the Company Disclosure
Schedules may expressly provide exceptions to a particular Section of Article III or Article IV notwithstanding that
the Section does not state “except as set forth on Schedule ‘__’” or words of similar effect. Notwithstanding
anything to the contrary contained in the Purchaser Disclosure Schedules, the Company Disclosure Schedules or in this Agreement,
the information and disclosures set forth in the Purchaser Disclosure Schedules and the Company Disclosure Schedules shall be deemed
to be an exception or qualification with respect to the correspondingly numbered or lettered representation, warranty or covenant
in this Agreement to which they refer and any other applicable representations, warranties and covenants contained in this Agreement
only to the extent such disclosures have sufficient detail that it is reasonably apparent from the face of such disclosure (without
investigation or the need to examine any referenced documents) that such disclosure is applicable thereto.
9.14 Counterparts. This Agreement and each Ancillary Document may be executed and delivered (including by facsimile or
other electronic transmission) in one or more counterparts, and by the different Parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement.
Article
X
DEFINITIONS
10.1 Certain Definitions. For purpose of this Agreement, the following capitalized terms have the following meanings:
“Action”
means any notice of noncompliance or violation, or any claim, demand, charge, action, suit, litigation, audit, settlement, complaint,
stipulation, assessment or arbitration, or hearing, proceeding or investigation, by or before any Governmental Authority.
“Affiliate”
means, with respect to any Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control
with such Person. For the avoidance of doubt, the Sponsor shall be deemed to be an Affiliate of the Purchaser prior to the Closing.
“Ancillary
Documents” means each agreement, instrument or document attached hereto as an Exhibit, and the other agreements,
certificates and instruments to be executed or delivered by any of the Parties hereto in connection with or pursuant to this Agreement.
“Benefit
Plans” of any Person means any and all deferred compensation, executive compensation, incentive compensation, equity
purchase or other equity-based compensation plan, employment or consulting, severance or termination pay, holiday, vacation or
other bonus plan or practice, hospitalization or other medical, life or other insurance, supplemental unemployment benefits, profit
sharing, pension, or retirement plan, program, agreement, commitment or arrangement, and each other employee benefit plan, program,
agreement or arrangement, including each “employee benefit plan” as such term is defined under Section 3(3) of ERISA,
maintained or contributed to or required to be contributed to by a Person for the benefit of any employee or terminated employee
of such Person, or with respect to which such Person has any Liability, whether direct or indirect, actual or contingent, whether
formal or informal, and whether legally binding or not.
“Business
Day” means any day other than a Saturday, Sunday or a legal holiday on which commercial banking institutions in Houston,
Texas are authorized to close for business.
“Code”
means the Internal Revenue Code of 1986, as amended.
“Company
Articles” means the Articles of Incorporation of the Company, as amended and effective under the BCA, prior to the
Effective Time.
“Company
Common Stock” means the common stock, par value $0.001 per share, of the Company.
“Company
Convertible Notes” means the convertible promissory notes of the Company that, by their terms, contemplate the conversion
of such convertible promissory notes into shares of Company Stock, including the convertible promissory notes identified on Annex
A attached hereto.
“Company
Convertible Securities” means, collectively, the Company Options, the Company Warrants, the Company Convertible Notes
and any other options, warrants or rights to subscribe for or purchase any capital stock of the Company or securities convertible
into or exchangeable for, or that otherwise confer on the holder any right to acquire any capital stock of the Company.
“Company
Equity Plan” means the Company’s Amended and Restated 2006 Stock Incentive Plan, as amended from time to time.
“Company
Option” means an option to purchase Company Common Stock granted pursuant to the Company Equity Plan.
“Company
Preferred Stock” means the Company Series A Preferred Stock, the Company Series B Preferred Stock, the Company Series
C Preferred Stock and the Company Series D Preferred Stock.
“Company
Securities” means, collectively, the Company Stock, the Company Options, the Company Warrants, the Company Convertible
Notes and any other Company Convertible Securities outstanding immediately prior to the Effective Time.
“Company
Security Holders” means, collectively, the holders of Company Securities.
“Company
Series A Preferred Stock” means the Series A preferred stock, par value $0.001 per share, of the Company.
“Company
Series B Preferred Stock” means the Series B preferred stock, par value $0.001 per share, of the Company.
“Company
Series C Preferred Stock” means the Series C preferred stock, par value $0.001 per share, of the Company.
“Company
Series D Preferred Stock” means the Series D preferred stock, par value $0.001 per share, of the Company.
“Company
Stock” means any shares of the Company Common Stock and the Company Preferred Stock.
“Company
Stockholders” means, collectively, the holders of Company Stock.
“Company
Warrants” means any warrants to purchase Company Common Stock.
“Confidentiality
Agreement” means that certain Mutual Non-Disclosure Agreement by and between the Company and Purchaser, dated as
of April 28, 2023.
“Consent”
means any consent, approval, waiver, authorization or Permit of, or notice to or declaration or filing with any Governmental Authority
or any other Person.
“Contracts”
means all contracts, agreements, arrangements, bonds, notes, indentures, mortgages, debt instruments, purchase order, licenses
(and all other contracts, agreements or binding arrangements concerning Intellectual Property), franchises, leases and other instruments
or obligations of any kind, written or oral (including any amendments and other modifications thereto), in each case only if legally
binding.
“Control”
of a Person means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies
of such Person, whether through the ownership of voting securities, by contract, or otherwise. “Controlled”, “Controlling”
and “under common Control with” have correlative meanings. Without limiting the foregoing a Person (the “Controlled
Person”) shall be deemed Controlled by (a) any other Person (i) owning beneficially, as meant in Rule 13d-3 under
the Exchange Act, securities entitling such Person to cast ten percent (10%) or more of the votes for election of directors or
equivalent governing authority of the Controlled Person or (ii) entitled to be allocated or receive ten percent (10%) or more of
the profits, losses, or distributions of the Controlled Person; (b) an officer, director, general partner, partner (other than
a limited partner), manager, or member (other than a member having no management authority that is not a Person described in clause
(a) above) of the Controlled Person; or (c) a spouse, parent, lineal descendant, sibling, aunt, uncle, niece, nephew, mother-in-law,
father-in-law, sister-in-law, or brother-in-law of an Affiliate of the Controlled Person or a trust for the benefit of an Affiliate
of the Controlled Person or of which an Affiliate of the Controlled Person is a trustee.
“Conversion
Ratio” means, subject to Section 1.9(f), the following ratio (rounded to four decimal places): the quotient
obtained by dividing (a) (i) the Merger Consideration plus (ii) (A) the Aggregate Exercise Price, divided by (B) 10, by (b) the
Company Fully Diluted Shares, in which:
(1) “Aggregate
Exercise Price” means the sum of (a) the sum of the exercise prices of all in-the-money Company Options; and (b)
the sum of the exercise prices of all in-the-money Company Warrants, in each case outstanding as of immediately prior to the Effective
Time.
(2) “Company
Fully Diluted Shares” means the sum of (i) the number of shares of Company Stock that are issued and outstanding
(other than any Company Securities cancelled pursuant to Section 1.09); (ii) the number of shares of Company Stock issuable
upon the exercise of in-the-money Company Options outstanding (whether or not then vested or exercisable); (iii) the number of
shares of Company Stock issuable upon the exercise of in-the-money Assumed Warrants outstanding; and (iv) the number of shares
of Company Stock issuable upon conversion of the Assumed Convertible Notes, in each case as of immediately prior to the Effective
Time.
“Copyrights”
means any works of authorship, mask works, designs and other equivalent rights in any of the foregoing, and all copyrights therein,
including all renewals and extensions, copyright registrations and applications for registration and renewal, and non-registered
copyrights.
“DGCL”
means the Delaware General Corporation Law.
“Environmental
Law” means any Law in any way relating to (a) the protection of human health and safety (with respect to exposure
to Hazardous Substances), (b) the protection, preservation or restoration of the environment and natural resources (including air,
water vapor, surface water, groundwater, drinking water supply, surface land, subsurface land, plant and animal life or any other
natural resource), or (c) the exposure to, or the use, storage, recycling, treatment, generation, transportation, processing, handling,
labeling, production, release or disposal of Hazardous Materials, including the Comprehensive Environmental Response, Compensation
and Liability Act, 42 USC. Section 9601 et. seq., the Resource Conservation and Recovery Act, 42 USC. Section 6901 et. seq., the
Toxic Substances Control Act, 15 USC. Section 2601 et. seq., the Federal Water Pollution Control Act, 33 USC. Section 1151 et seq.,
the Clean Air Act, 42 USC. Section 7401 et seq., the Federal Insecticide, Fungicide and Rodenticide Act, 7 USC. Section 111 et.
seq., Occupational Safety and Health Act, 29 USC. Section 651 et. seq. (to the extent it relates to exposure to Hazardous Substances),
the Asbestos Hazard Emergency Response Act, 15 USC. Section 2601 et. seq., the Safe Drinking Water Act, 42 USC. Section 300f et.
seq., the Oil Pollution Act of 1990 and analogous state acts.
“Environmental
Liabilities” means, in respect of any Person, all Liabilities, obligations, responsibilities, Remedial Actions, losses,
damages, costs, and expenses (including all reasonable fees, disbursements, and expenses of counsel, experts, and consultants and
costs of investigation and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or
demand by any other Person or in response to any violation of Environmental Law, whether known or unknown, accrued or contingent,
whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute, to the extent based
upon, related to, or arising under or pursuant to any Environmental Law, Environmental Permit, Order, or Contract with any Governmental
Authority or other Person, that relates to any environmental, health or safety condition, violation of Environmental Law, or a
Release or threatened Release of Hazardous Materials.
“ERISA”
means the U.S. Employee Retirement Income Security Act of 1974, as amended. References to a specific provision of ERISA shall include
such section and any valid regulation promulgated thereunder.
“ERISA Affiliate”
means each person (as defined in Section 3(9) of ERISA) which together with any Target Company or any of its Subsidiaries would
be deemed to be a “single employer” within the meaning of Section 414(b), (c), (m) or (o) of the Code.
“Exchange
Act” means the U.S. Securities Exchange Act of 1934, as amended.
“Exchange
Agent Agreement” means the agreement entered into between the Purchaser and the Exchange Agent for the purpose of
exchanging the shares of Company Common Stock for Stockholder Merger Consideration pursuant to this Agreement.
“FDA”
means the U.S. Food and Drug Administration, or any successor agency thereto.
“GAAP”
means generally accepted accounting principles as in effect in the United States of America.
“Governmental
Authority” means any federal, state, local, foreign or other governmental, quasi-governmental or administrative body,
instrumentality, department or agency or any court, tribunal, administrative hearing body, arbitration panel, commission, or other
similar dispute-resolving panel or body.
“Hazardous
Material” means any waste, gas, liquid or other substance or material that is defined, listed or designated as a
“hazardous substance”, “pollutant”, “contaminant”, “hazardous waste”, “regulated
substance”, “hazardous chemical”, or “toxic chemical” (or by any similar term) under any Environmental
Law, or any other material regulated, or that could result in the imposition of Liability or responsibility, under any Environmental
Law, including petroleum and its by-products, asbestos, polychlorinated biphenyls, radon, mold, and urea formaldehyde insulation.
“Indebtedness”
of any Person means, without duplication, (a) all indebtedness of such Person for borrowed money (including the outstanding principal
and accrued but unpaid interest), (b) all obligations for the deferred purchase price of property or services (other than trade
payables incurred in the ordinary course of business), (c) any other indebtedness of such Person that is evidenced by a note, bond,
debenture, credit agreement or similar instrument, (d) all obligations of such Person under leases that are required to be classified
as capital leases in accordance with GAAP, (e) all obligations of such Person for the reimbursement of any obligor on any line
or letter of credit, banker’s acceptance, guarantee or similar credit transaction, in each case, that has been drawn or claimed
against, (f) all obligations of such Person in respect of acceptances issued or created, (g) all interest rate and currency swaps,
caps, collars and similar agreements or hedging devices under which payments are obligated to be made by such Person, whether periodically
or upon the happening of a contingency, (h) any premiums, prepayment fees or other penalties, fees, costs or expenses associated
with payment of any Indebtedness of such Person and (i) all obligation described in clauses (a) through (h) above of any other
Person which is directly or indirectly guaranteed by such Person or which such Person has agreed (contingently or otherwise) to
purchase or otherwise acquire or in respect of which it has otherwise assured a creditor against loss.
“Intellectual
Property” means all of the following as they exist in any jurisdiction throughout the world: Patents, Trademarks,
Copyrights, Trade Secrets, Internet Assets, Software and other intellectual property, and all licenses, sublicenses and other agreements
or permissions related to the preceding property.
“Internet
Assets” means any and all domain name registrations, web sites and web addresses and related rights, items and documentation
related thereto, and applications for registration therefor.
“Intervening
Event” means any material event, change, effect, development or occurrence occurring or arising after the date of
this Agreement that (i) was not known by nor was reasonably foreseeable to the Company Board as of or prior to the date of this
Agreement (or, if known, the consequences or timing of which were not known or reasonably foreseeable to the Company Board as of
the date of this Agreement) and results in the standalone financial condition of Company and its Subsidiaries, taken as a whole,
being materially more favorable to the stockholders of the Company than this Agreement and the Transactions and (ii) does not relate
to or involve (A) a Takeover Proposal or (B) any changes in the market price, or change in trading volume, of the Company
Common Stock, or the Company exceeding any projections, forecasts, budgets, operational metrics or estimates (it being understood
that the underlying causes of any such changes or developments may, if they are not otherwise excluded from the definition of Intervening
Event, be taken into account in determining whether an Intervening Event has occurred).
“Intervening
Event Notice” means a prior written notice of an Intervening Event delivered by the Company to Purchaser in accordance
with Section 5.6(c)(vii).
“Intervening
Event Notice Period” means five (5) Business Days (as modified, extended or continued in accordance with Section
5.6(c)(vii)).
“IPO”
means the initial public offering of Purchaser Units pursuant to the IPO Prospectus.
“IPO Prospectus”
means the final prospectus of the Purchaser, dated as of July 27, 2021, and filed with the SEC on July 29, 2021 (File No. 33-254726).
“IPO Underwriter”
means Needham & Company, LLC, the lead underwriter in the IPO.
“IRS”
means the U.S. Internal Revenue Service (or any successor Governmental Authority).
“Knowledge”
means, with respect to (a) the Company, the actual knowledge of Morgan Frank and Toni Rinow, after reasonable inquiry of personnel
and review of internal documents or (b) the Purchaser, the actual knowledge of Andrew White, after reasonable inquiry of personnel
and review of internal documents.
“Law”
means any federal, state, local, municipal, foreign or other law, statute, legislation, principle of common law, ordinance, code,
edict, decree, proclamation, treaty, convention, rule, regulation, directive, requirement, writ, injunction, settlement, Order
or Consent that is or has been issued, enacted, adopted, passed, approved, promulgated, made, implemented or otherwise put into
effect by or under the authority of any Governmental Authority.
“Letter Agreement”
means that certain Letter Agreement, dated July 27, 2021, by and among the Purchaser, Sponsor and the other parties identified
therein.
“Liabilities”
means any and all liabilities, Indebtedness, Actions or obligations of any nature (whether absolute, accrued, contingent or otherwise,
whether known or unknown, whether direct or indirect, whether matured or unmatured, whether due or to become due and whether or
not required to be recorded or reflected on a balance sheet under GAAP or other applicable accounting standards), including Tax
liabilities.
“Lien”
means any mortgage, pledge, security interest, attachment, right of first refusal, option, proxy, voting trust, encumbrance, lien
or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof), restriction
(whether on voting, sale, transfer, disposition or otherwise), any subordination arrangement in favor of another Person, or any
filing or agreement to file a financing statement as debtor under the Uniform Commercial Code or any similar Law.
“Material
Adverse Effect” means, with respect to any specified Person, any fact, event, occurrence, change or effect that has
had, or would reasonably be expected to have, individually or in the aggregate, a material adverse effect upon (a) the business,
assets, Liabilities, results of operations or condition (financial or otherwise) of such Person and its Subsidiaries, taken as
a whole, or (b) the ability of such Person or any of its Subsidiaries on a timely basis to consummate the Transactions or to perform
its obligations hereunder or thereunder; provided, however, that for purposes of clause (a) above, any changes or effects directly
or indirectly attributable to, resulting from, relating to or arising out of the following (by themselves or when aggregated with
any other, changes or effects) shall not be deemed to be, constitute, or be taken into account when determining whether there has
or may, would or could have occurred a Material Adverse Effect: (i) general changes in the financial or securities markets or general
economic or political conditions in the country or region in which such Person or any of its Subsidiaries do business; (ii) changes,
conditions or effects that generally affect the industries in which such Person or any of its Subsidiaries principally operate;
(iii) changes in GAAP or other applicable accounting principles or mandatory changes in the regulatory accounting requirements
applicable to any industry in which such Person and its Subsidiaries principally operate; (iv) conditions caused by acts of God,
terrorism, war (whether or not declared), natural disaster or any outbreak or continuation of an epidemic or pandemic (including
COVID-19), including the effects of any Governmental Authority or other third-party responses thereto; (v) changes in Law or other
legal or regulatory conditions, or the interpretation thereof; (vi) any failure in and of itself by such Person and its Subsidiaries
to meet any internal or published budgets, projections, forecasts or predictions of financial performance for any period (provided
that the underlying cause of any such failure may be considered in determining whether a Material Adverse Effect has occurred or
would reasonably be expected to occur to the extent not excluded by another exception herein); (vii) the announcement of this Agreement
or the pendency or consummation of the Transactions, including, in any such case, the impact thereof on relationships, contractual
or otherwise, with customers, suppliers, vendors, lenders, investors, licensors, licensees, venture partners or employees; (viii)
any actions taken or failure to take action, in each case, to which Purchaser has expressly requested or consented to (with respect
to a Material Adverse Effect on the Company and its Subsidiaries, taken as a whole) or to which the Company has expressly requested
or consented to (with respect to a Material Adverse Effect on the Purchaser), or compliance with the terms of, or the taking of
any action required or contemplated by, this Agreement, or the failure to take any action prohibited by this Agreement; or (ix)
any breach of this Agreement by Parent or Merger Sub with respect to a Material Adverse Effect on the Company and its Subsidiaries,
taken as a whole, or by the Company or its Subsidiaries with respect to a Material Adverse Effect on the Purchaser; provided
further, however, that (x) any event, occurrence, fact, condition, or change referred to in clauses (i)-(v) immediately above
shall be taken into account in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur
to the extent that such event, occurrence, fact, condition, or change has a disproportionate effect on such Person or any of its
Subsidiaries compared to other participants in the industries in which such Person or any of its Subsidiaries primarily conducts
its businesses and (y) any event, occurrence, fact, condition, or change referred to in clause (iv) immediately above shall be
taken into account in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur to the
extent that such event, occurrence, fact, condition, or change has a disproportionate effect on such Person or any of its Subsidiaries
compared to other participants in the same impacted geographic region. Notwithstanding the foregoing, with respect to the Purchaser,
the amount of the Redemption (or any redemption in connection with the Extension, if any) or the failure to obtain the Required
Purchaser Stockholder Approval shall not be deemed to be a Material Adverse Effect on or with respect to the Purchaser.
“Merger Sub
Common Stock” means the shares of common stock, par value $0.001 per share, of Merger Sub.
“Nasdaq”
means the Nasdaq Capital Market.
“Order”
means any order, decree, ruling, judgment, injunction, writ, determination, decision, verdict, judicial award or other action that
is or has been made, entered, rendered, or otherwise put into effect by or under the authority of any Governmental Authority, in
each case only if legally-binding.
“Organizational
Documents” means, with respect to any Person that is an entity, its certificate or memorandum of incorporation or
formation, bylaws, operating agreement, memorandum and articles of association or similar organizational documents, in each case,
as amended.
“OTC Markets”
means over-the-counter markets of OTCQX, OTCQB and the Pink Open Market.
“OTCQB”
means the OTCQB marketplace trading system as part of the OTC Markets.
“Patents”
means any patents, patent applications and the inventions, designs and improvements described and claimed therein, and other patent
rights (including any divisionals, provisionals, non-provisionals, continuations, continuations-in-part, substitutions, or reissues
thereof, whether or not patents are issued on any such applications and whether or not any such applications are amended, modified,
withdrawn, or refiled).
“PCAOB”
means the U.S. Public Company Accounting Oversight Board (or any successor thereto).
“Permits”
means all federal, state, local or foreign or other third-party permits, grants, easements, consents, approvals, authorizations,
exemptions, licenses, franchises, concessions, ratifications, permissions, clearances, confirmations, endorsements, waivers, certifications,
designations, ratings, registrations, qualifications or orders of any Governmental Authority or any other Person.
“Permitted
Liens” means (a) Liens for Taxes, which either are (i) not delinquent or (ii) being contested in good faith
and by appropriate proceedings, and adequate reserves have been established with respect thereto in accordance with GAAP, (b) other
Liens imposed by operation of Law arising in the ordinary course of business for amounts which are not due and payable and as would
not in the aggregate materially adversely affect the value of, or materially adversely interfere with the use of, the property
subject thereto, (c) Liens incurred or deposits made in the ordinary course of business in connection with social security, (d)
Liens on goods in transit incurred pursuant to documentary letters of credit, in each case arising in the ordinary course of business,
(e) Liens arising under this Agreement or any Ancillary Document, (f) Liens on real property (including recorded or unrecorded
easements, rights of way, covenants, conditions, licenses and reservations, and any matters that would be disclosed by a current,
accurate survey or physical inspection of such real property) that do not materially interfere with the present uses of such
real property, or (g) zoning, building codes and other land-use Laws regulating the use or occupancy of any real property or the
activities conducted thereon and which are not violated by the current use or occupancy of any such real property.
“Person”
means an individual, corporation, partnership (including a general partnership, limited partnership or limited liability partnership),
limited liability company, association, trust or other entity or organization, including a government, domestic or foreign, or
political subdivision thereof, or an agency or instrumentality thereof.
“Personal
Property” means any machinery, equipment, tools, vehicles, furniture, leasehold improvements, office equipment, plant,
parts and other tangible personal property.
“Purchaser
Class A Common Stock” means the shares of Class A common stock, par value $0.0001 per share, of the Purchaser.
“Purchaser
Class B Common Stock” means the shares of Class B common stock, par value $0.0001 per share, of the Purchaser.
“Purchaser
Equity Plan” means the Purchaser’s incentive plan in the form attached hereto as Exhibit F.
“Purchaser
Organizational Documents” means the organizational documents of Purchaser, including, but not limited to the Purchaser’s
Certificate of Incorporation and Bylaws.
“Purchaser
Preferred Stock” means the shares of preferred stock, par value $0.0001 per share, of the Purchaser.
“Purchaser
Private Warrants” means the 7,850,000 warrants sold by the Purchaser at the time of the IPO to the Sponsor.
“Purchaser
Public Warrants” means one-half of one (1) whole warrant that was included as part of each Purchaser Unit, entitling
the holder thereof to purchase one (1) share of Purchaser Class A Common Stock at a purchase price of $11.50 per share.
“Purchaser
Securities” means the Purchaser Units, the Purchaser Class A Common Stock, the Purchaser Preferred Stock, the Purchaser
Private Warrants and the Purchaser Public Warrants, collectively.
“Purchaser
Stockholders” means, collectively, the holders of Purchaser Securities.
“Purchaser
Units” means the units issued in the IPO consisting of one (1) share of Purchaser Class A Common Stock and one (1)
Purchaser Public Warrant.
“Purchaser
Warrants” means Purchaser Private Warrants and Purchaser Public Warrants.
“Qualified
Person” means any Person making a bona fide Takeover Proposal, that did not result from a material breach
of Section 5.6, that the Company Board determines in good faith (after consultation with outside counsel and its financial
advisor) is, or would reasonably be expected to lead to, a Superior Proposal.
“Release”
means any release, spill, emission, leaking, pumping, injection, deposit, disposal, discharge, dispersal, or leaching into the
indoor or outdoor environment, or into or out of any property.
“Remedial
Action” means all actions to (a) clean up, remove, treat, or in any other way address any Hazardous Material, (b)
prevent the Release of any Hazardous Material so it does not endanger or threaten to endanger public health or welfare or the indoor
or outdoor environment, (c) perform pre-remedial studies and investigations or post-remedial monitoring and care, or (d) correct
a condition of noncompliance with Environmental Laws.
“Representatives”
means, as to any Person, such Person’s Affiliates and the respective managers, directors, officers, employees, independent
contractors, consultants, advisors (including financial advisors, counsel and accountants) acting on such person’s behalf,
agents and other legal representatives of such Person or its Affiliates.
“SEC”
means the U.S. Securities and Exchange Commission (or any successor Governmental Authority).
“Securities
Act” means the Securities Act of 1933, as amended.
“Significant
Company Holder” means any Company Stockholder who (a) is an executive officer or director of the Company, (b) is
an Affiliate of any Company Stockholder who is an executive officer or director of the Company, as listed on Schedule 10.01.
“Software”
means any computer software programs, including all source code, object code, and documentation related thereto and all software
modules, tools and databases.
“SOX”
means the U.S. Sarbanes-Oxley Act of 2002, as amended.
“Specified
Time” means the earlier of (i) the time that this Agreement is terminated in accordance with the terms hereof and
(ii) receipt of the Required Company Stockholder Approval.
“Sponsor”
means Mercury Sponsor Group I LLC.
“Sponsor
Note” means that certain Revolving Promissory Note, dated as of October 11, 2022, issued by the Purchaser in favor
of the Sponsor in the original principal amount of up to $1,000,000.
“Subsidiary”
means, with respect to any Person, any corporation, partnership, association or other business entity of which (a) if a corporation,
a majority of the total voting power of shares of stock entitled (without regard to the occurrence of any contingency) to vote
in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that
Person or one or more of the other Subsidiaries of that Person or a combination thereof, or (b) if a partnership, association or
other business entity, a majority of the partnership or other similar ownership interests thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination thereof. For purposes hereof,
a Person or Persons will be deemed to have a majority ownership interest in a partnership, association or other business entity
if such Person or Persons will be allocated a majority of partnership, association or other business entity gains or losses or
will be or control the managing director, managing member, general partner or other managing Person of such partnership, association
or other business entity. A Subsidiary of a Person will also include any variable interest entity which is consolidated with such
Person under applicable accounting rules.
“Superior
Proposal” means a bona fide written Takeover Proposal (but substituting “more than 50%” for “15%”
in each instance in the definition of Takeover Proposal), made by any Third Party or group (as defined in Section 13 of the Exchange
Act), which did not result from a material breach of Section 5.6 and that the Company Board determines in good faith,
in consultation with outside legal counsel and financial advisors and taking into account (with such weight and proportion as determined
by the Company Board in its sole discretion) all the terms and conditions and the financial, legal, regulatory, timing, financing,
conditionality and other aspects and risks of such Takeover Proposal and this Agreement (after taking into account any revisions
to the terms and conditions to this Agreement made or proposed in writing by Purchaser prior to the time of determination that
would be immediately binding on Purchaser upon acceptance by the Company and execution of definitive documents), (i) are more favorable
to the Company and its stockholders (solely in their capacities as such), from a financial point of view, than the Transactions,
and (ii) the Company Board believes is reasonably likely to be consummated in accordance with its terms taking into account
all the factors described above and other aspects and terms of such proposal and the identity of the Person or group making the
proposal.
“Superior
Proposal Notice” means a prior written notice of a Superior Proposal delivered by the Company to Purchaser in accordance
with Section 5.6(c)(viii).
“Superior
Proposal Notice Period” means five (5) Business Days (as modified, extended or continued in accordance with Section
5.6(c)(viii)).
“Takeover
Proposal” means any proposal, offer, inquiry or indication of interest from a Third Party or “group”
(as defined in Section 13 of the Exchange Act) of Third Parties, whether involving a single or a series of related transactions,
relating to (i) a merger, consolidation, share exchange or business combination involving the Company or any of its Subsidiaries
representing 15% or more of the Company’s assets, revenues, or earnings, (ii) a sale, lease, exchange, mortgage, transfer
or other disposition of 15% or more of the Company’s assets, revenues or earnings, (iii) a direct or indirect purchase
or sale of shares of capital stock or other securities (including the Company Common Stock) representing 15% or more of the voting
power of the capital stock of the Company or any successor or parent company thereto, including by way of a merger, business combination,
share exchange, tender offer or exchange offer, other than, for the avoidance of doubt, any PIPE Investment, (iv) a reorganization,
recapitalization, liquidation or dissolution of the Company or (v) any other transaction having a similar effect to those described
in clauses (i) through (iv), or any combination of the transactions in (i) through (iv) in each case other than the Transactions.
“Target Company”
means each of the Company and its direct and indirect Subsidiaries.
“Tax”
or “Taxes” means all federal, state, local, foreign and other net income, gross income, gross receipts,
sales, use, value-added, ad valorem, transfer, franchise, profits, production, license, lease, service, service use, withholding,
payroll, employment, social security and related contributions due in relation to the payment of compensation to employees, excise,
severance, stamp, occupation, premium, property, windfall profits, alternative minimum, estimated, customs, duties or other taxes,
fees, assessments or charges in the nature of tax, together with any interest and any penalties, additions to tax or additional
amounts with respect thereto.
“Tax Return”
means any return, declaration, report, claim for refund, information return or other documents (including any related or supporting
schedules, statements or information) filed or required to be filed in connection with the determination, assessment or collection
of any Taxes or the administration of any Laws or administrative requirements relating to any Taxes.
“Third Party”
means any Person or group other than the Parties and their Affiliates.
“Trade Secrets”
means information that derives independent economic from not being generally known and is the subject of reasonable efforts to
maintain its secrecy.
“Trademarks”
means any trademarks, service marks, trade dress, trade names, brand names, internet domain names, designs, logos, or corporate
names (including, in each case, the goodwill associated therewith), whether registered or unregistered, and all registrations and
applications for registration and renewal thereof.
“Transactions”
means, collectively, the Merger and the other transactions expressly contemplated by this Agreement or any of the Ancillary Documents.
“Treasury
Regulations” means the regulations promulgated under the Code.
“Trust Account”
means the trust account established by the Purchaser with the proceeds from the IPO pursuant to the Trust Agreement in accordance
with the IPO Prospectus.
“Trust Agreement”
means that certain Investment Management Trust Agreement, dated as of July 27, 2021, as it may be amended, by and between the Purchaser
and the Trustee, as well as any other agreements entered into related to or governing the Trust Account.
“Trustee”
means Continental Stock Transfer & Trust Company, in its capacity as trustee under the Trust Agreement.
10.2
Section References. The following capitalized terms, as used in this Agreement, have the respective meanings given
to them in the Section as set forth below adjacent to such terms:
Term |
|
Section |
Agreement |
|
Preamble |
Alternative Acquisition Agreement |
|
5.6(c)(vi) |
Articles of Merger |
|
1.2 |
Assumed Convertible Note |
|
1.7 |
Assumed Warrant |
|
1.9(e) |
BCA |
|
Recitals |
Business Combination |
|
8.1 |
Closing Date |
|
2.1 |
Closing |
|
2.1 |
Class B Charter Amendment |
|
5.20(a) |
Company |
|
Preamble |
Company Adverse Recommendation Change |
|
5.6(c)(v) |
Company Benefit Plan |
|
4.19(a) |
Company Board |
|
Recitals |
Company Board Recommendation |
|
Recitals |
Company Book-Entry Shares |
|
1.10(a) |
Company Certificates |
|
1.10(a) |
Company D&O Tail Insurance |
|
5.15(b) |
Company Disclosure Schedules |
|
Article IV |
Company Financials |
|
4.7(b) |
Company Intellectual Property |
|
4.13(a) |
Company IP License |
|
4.12(a)(xiii) |
Company Lock-Up Agreement |
|
Recitals |
Company Material Contracts |
|
4.12(a) |
Company Owned Intellectual Property |
|
4.13(b) |
Company Permits |
|
4.10 |
Company Personal Property Leases |
|
4.16 |
Company Public Certifications |
|
4.7(a) |
Company Real Property Leases |
|
4.15 |
Company SEC Reports |
|
4.7(a) |
Company Special Meeting |
|
5.12(a) |
Company Stockholder Approval Matters |
|
5.12(a)(ii) |
Company Voting Agreements |
|
Recitals |
D&O Indemnified Persons |
|
5.15(a) |
Dissenting Shares |
|
1.13 |
Dissenting Stockholders |
|
1.13 |
Effective Time |
|
1.2 |
Employment Laws |
|
4.18(b) |
Enforceability Exceptions |
|
3.2(a) |
Environmental Permits |
|
4.20(a) |
Exchange Agent |
|
1.10(a) |
Exchange Fund |
|
1.10(a) |
Expenses |
|
7.3(a) |
Extension |
|
5.4(a) |
Healthcare Laws |
|
4.28(a) |
HIPAA |
|
4.28(a) |
Intended Tax Treatment |
|
Recitals |
Interim Balance Sheet Date |
|
4.7(b) |
Interim Period |
|
5.1(a) |
IT Systems |
|
4.13(h) |
Joint Proxy Statement |
|
5.12(a) |
Leased Real Property |
|
4.15 |
Letter of Transmittal |
|
1.10(b) |
Merger Consideration |
|
1.8 |
Merger Sub |
|
Preamble |
Merger |
|
Recitals |
Net Tangible Assets Charter Amendment |
|
5.20(a) |
OFAC |
|
3.20(c) |
Outside Date |
|
7.1(b) |
Party(ies) |
|
Preamble |
PIPE Investment |
|
Recitals |
PIPE Investors |
|
Recitals |
Post-Closing Purchaser Board |
|
5.14(a) |
Public Certifications |
|
3.6(a) |
Public Stockholders |
|
8.1 |
Purchaser Amendment to Warrant Agreement |
|
6.2(f)(v) |
Purchaser Charter Amendments |
|
5.20(a) |
Purchaser Closing Date Charter Amendment |
|
5.20(a) |
Purchaser D&O Tail Insurance |
|
5.15(b) |
Purchaser Disclosure Schedules |
|
Article III |
Purchaser Financial Advisor |
|
3.24 |
Purchaser Financials |
|
3.6(b) |
Purchaser Letter Agreement Amendment |
|
6.2(f)(iv) |
Purchaser Material Contract |
|
3.14(a) |
Purchaser Option |
|
1.9(d)(i) |
Purchaser SEC Reports |
|
3.6(a) |
Purchaser Special Meeting |
|
5.12(a)(i) |
Purchaser Stockholder Approval Matters |
|
5.12(a)(i) |
Purchaser |
|
Preamble |
Redemption |
|
5.12(a) |
Registered IP |
|
4.13(a) |
Registration Rights Agreement |
|
5.20(b) |
Registration Statement |
|
5.12(a) |
Related Person |
|
4.21 |
Released Claims |
|
8.1 |
Required Company Stockholder Approval |
|
6.1(b) |
Required Purchaser Shareholder Approval |
|
6.1(a) |
SEC April Warrant Statement |
|
3.6(a) |
Specified Courts |
|
9.5 |
Sponsor Debt Conversion Agreement |
|
Recitals |
Sponsor Voting Agreement |
|
Recitals |
Stockholder Merger Consideration |
|
1.8 |
Subscription Agreements |
|
Recitals |
Termination Fee |
|
7.3(b) |
Surviving Corporation |
|
1.1 |
Top Customers |
|
4.24 |
Top Suppliers |
|
4.24 |
Transmittal Documents |
|
1.10(d) |
{REMAINDER OF PAGE INTENTIONALLY LEFT
BLANK; SIGNATURE PAGE FOLLOWS}
IN WITNESS WHEREOF,
each Party hereto has caused this Agreement and Plan of Merger to be signed and delivered as of the date first written above.
|
The Purchaser: |
|
|
|
SEP ACQUISITION CORP. |
|
|
|
By: |
/s/ R. Andrew White |
|
|
Name: R. Andrew White
Title: Chief
Executive Officer |
|
Merger Sub: |
|
|
|
SEP ACQUISITION HOLDINGS INC. |
|
|
|
By: |
/s/ R. Andrew White |
|
|
Name: R. Andrew White
Title: Chief
Executive Officer |
[Signature Page
to Merger Agreement]
|
The Company: |
|
|
|
SANUWAVE HEALTH, INC. |
|
|
|
By: |
/s/ Morgan Frank |
|
Name: Morgan Frank Title: Chairman, Chief Executive
Officer |
[Signature Page
to Merger Agreement]
Exhibit
10.1
FORM
OF VOTING AGREEMENT
This
Voting Agreement (this “Agreement”) is made as of August 23, 2023, by and among (i) SEP Acquisition
Corp., a Delaware corporation (the “Purchaser”), (ii) SANUWAVE Health, Inc., a Nevada corporation
(the “Company”), and (iii) the undersigned holder (“Holder”) of capital stock
and/or securities convertible into capital stock of the Company. Any capitalized term used but not defined in this Agreement will
have the meaning ascribed to such term in the Merger Agreement.
WHEREAS,
on the date hereof, the Purchaser, the Company, and SEP Acquisition Holdings Inc., a Delaware corporation and a wholly-owned subsidiary
of the Purchaser (“Merger Sub”), entered into an Agreement and Plan of Merger (as amended from time
to time in accordance with the terms thereof, the “Merger Agreement”), pursuant to which Merger Sub
will merge with and into the Company, with the Company continuing as the surviving entity (the “Merger”),
and as a result of which, among other matters, all of the issued and outstanding capital stock of the Company immediately prior
to the Effective Time shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, in exchange
for the right for each stockholder of the Company to receive its Stockholder Merger Consideration, all upon the terms and subject
to the conditions set forth in the Merger Agreement and in accordance with the applicable provisions of the BCA;
WHEREAS,
the Board of Directors of the Company has (a) determined that the Merger Agreement and the Transactions, including the Merger,
is fair, advisable and in the best interests of the Company and the Company Stockholders, (b) approved this Agreement and the
Transactions, including the Merger, upon the terms and subject to the conditions set forth herein, (c) directed that approval
of this Agreement and adoption of the Transactions, including the Merger, be submitted to a vote at a meeting of the Company Stockholders,
and (d) recommended to Company Stockholders that they approve and adopt this Agreement and the Transactions, including the Merger,
(the “Company Board Recommendation”); and
WHEREAS,
as a condition to the willingness of the Purchaser to enter into the Merger Agreement, and as an inducement and in consideration
therefor, and in view of the valuable consideration to be received by Holder thereunder, and the expenses and efforts to be undertaken
by the Purchaser and the Company to consummate the Transactions, the Purchaser, the Company and Holder desire to enter into this
Agreement in order for Holder to provide certain assurances to the Purchaser regarding the manner in which Holder is bound hereunder
to vote any shares of capital stock of the Company which Holder beneficially owns, holds or otherwise has voting power [in his
individual capacity] (the “Shares”) [and not, for the avoidance of doubt, any shares over which he may
act as a fiduciary or have voting power on behalf of any other Person], during the period from and including the date hereof through
and including the date on which this Agreement is terminated in accordance with its terms (the “Voting Period”)
with respect to the Merger Agreement, the Merger, the Ancillary Documents and the Transactions.
NOW,
THEREFORE, in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth
below, and intending to be legally bound hereby, the parties hereby agree as follows:
| 1. | Covenant
to Vote. Holder agrees, with respect to all of the Shares: |
(a) during
the Voting Period, at each meeting of the Company Stockholders of any class or series thereof, and in each written consent or
resolutions of any of the Company Stockholders in which Holder is entitled to vote or consent, Holder hereby unconditionally and
irrevocably agrees to be present for such meeting and vote (in person or by proxy), or consent to any action by written consent
or resolution with respect to, as applicable, the Shares (i) at any time after the later of (x) the registration statement on
Form S-4 to be filed by the Purchaser in connection with the Transactions having been declared effective by the Securities and
Exchange Commission (“SEC”) or (y) the board of directors of the Company having solicited the vote or
consent of the Company Stockholders in connection with the Transactions, in each case to the extent in accordance with the Company
Board Recommendation (A) in favor of, and adopt, the Merger, the Merger Agreement, the Ancillary Documents, and all of the other
Transactions (and any actions required in furtherance thereof); and (B) in favor of the other matters set forth in the Merger
Agreement, and (ii), to the extent in accordance with the Company Board Recommendation, to vote the Shares in opposition to: (A)
any Takeover Proposal or Alternative Acquisition Agreement and any and all other proposals (x) for the acquisition of the Company,
(y) that could reasonably be expected to delay or impair the ability of the Company to consummate the Merger, the Merger Agreement
or any of the Transactions, or (z) which are in competition with or materially inconsistent with the Merger Agreement or the Ancillary
Documents; (B) any amendment of the Company’s Organizational Documents or any material change in the Company’s corporate
structure or business which is inconsistent with the Merger Agreement or any of the Transactions; or (C) any other action or proposal
involving any Target Company that is intended, or would reasonably be expected, to prevent, impede, interfere with, delay, postpone
or adversely affect in any material respect the Transactions or would reasonably be expected to result in any of the conditions
to the Closing under the Merger Agreement not being fulfilled; provided, that, nothing in this Agreement shall preclude Holder
from exercising full power and authority to vote the Shares in Holder’s sole discretion for or against, and the proxy granted
pursuant to this Agreement shall not cover, any proposal submitted to a vote of the Company Stockholders (1) that materially decreases
the amount or materially changes the form of consideration payable to Holder, or (2) that imposes any material restrictions on
the payment to Holder of its share of the Stockholder Merger Consideration, in the case of either clause (1) or (2), (X) not contemplated
by the Merger Agreement or the Ancillary Documents, (Y) in a manner that is not substantially the same as applied to all other
Company Stockholders, and (Z) with respect to clause (2) only, or pursuant to applicable securities Laws;
(b) except
for transfers as permitted by, and in accordance with Section 2(b), not to deposit, and to cause their Affiliates not to deposit,
except as provided in this Agreement, any Shares owned by Holder or his/her/its Affiliates in a voting trust or subject any Shares
to any arrangement or agreement with respect to the voting of such Shares, unless specifically requested to do so by the Company
and the Purchaser in connection with the Merger Agreement, the Ancillary Documents and any of the Transactions;
(c) except
as contemplated by the Merger Agreement or the Ancillary Documents, make, or in any manner participate in, directly or indirectly,
a “solicitation” of “proxies” or consents (as such terms are used in the rules of the SEC) or powers of
attorney or similar rights to vote, or seek to advise or influence any Person with respect to the voting of, any Shares in connection
with any vote or other action with respect to the Transactions, other than to recommend that stockholders of the Company vote
in favor of adoption of the Merger Agreement and the Transactions and any other proposal the approval of which is a condition
to the obligations of the parties under the Merger Agreement (and any actions required in furtherance thereof and otherwise as
expressly provided by Section 1 of this Agreement); and
(d) to
refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to the
Merger, the Merger Agreement, the Ancillary Documents and any of the Transactions, including pursuant to the BCA.
2. [Grant
of Proxy. During the Voting Period, Holder, with respect to all of Holder’s, hereby irrevocably grants to, and appoints,
the Purchaser and any designee of the Purchaser (determined in the Purchaser’s sole discretion) as Holder’s attorney-in-fact
and proxy, with full power of substitution and resubstitution, for and in Holder’s name, to vote, or cause to be voted (including
by proxy or written consent, if applicable) any Shares owned of record by Holder, solely on the matters and in the manner specified
in Section 1 above. The proxy granted by Holder pursuant to this Section 2 is irrevocable and is granted in consideration
of the Purchaser entering into this Agreement and the Merger Agreement and incurring certain related fees and expenses. Holder
hereby affirms that such irrevocable proxy is coupled with an interest by reason of the Merger Agreement and, except upon the
termination of this Agreement in accordance with Section 5(a), is intended to be irrevocable. Holder agrees, until this
Agreement is terminated in accordance with Section 5(a), to vote its Shares in accordance with Section 1 above.]
(a) No
Transfers. Holder agrees that during the period from and including the date hereof through the end of the Voting Period it
shall not, and shall cause its Affiliates not to, without the Purchaser’s prior written consent, (A) offer for sale, sell
(including short sales), transfer, tender, pledge, encumber, assign or otherwise dispose of (including by gift) (collectively,
a “Transfer”), or enter into any contract, option, derivative, hedging or other agreement or arrangement
or understanding (including any profit-sharing arrangement) with respect to, or consent to, a Transfer of, any or all of the Shares
(as defined below); (B) grant any proxies or powers of attorney with respect to any or all of the Shares; or (C) permit to exist
any lien of any nature whatsoever (other than those imposed by this Agreement, applicable securities Laws or the Company’s
Organizational Documents, as in effect on the date hereof) with respect to any or all of the Shares or (D) take any action that
would have the effect of preventing, impeding, interfering with or adversely affecting Holder’s ability to perform its obligations
under this Agreement. The Company hereby agrees that it shall not permit any Transfer of the Shares in violation of this Agreement.
Holder agrees with, and covenants to, the Purchaser that Holder shall not request that the Company register the Transfer (book-entry
or otherwise) of any certificate or uncertificated interest representing any Shares during the term of this Agreement without
the prior written consent of the Purchaser, and the Company hereby agrees that it shall not effect any such Transfer.
(b) Permitted
Transfers. Section 3(a) shall not prohibit a Transfer of Shares by Holder (i) by gift, will or intestate succession upon the
death of Holder, (ii) to any Permitted Transferee (as defined below) or (iii) pursuant to a court order or settlement agreement
related to the distribution of assets in connection with the dissolution of marriage or civil union; provided, however, that in
any of cases (i), (ii) or (iii) it shall be a condition to such Transfer that the transferee agrees to be bound by the terms of
this Agreement and executes and delivers to the parties hereto a written consent and joinder memorializing such agreement. As
used in this Agreement, the term “Permitted Transferee” shall mean: (A) the members of Holder’s
immediate family (for purposes of this Agreement, “immediate family” shall mean with respect to any natural person,
any of the following: such person’s spouse, the siblings of such person and his or her spouse, and the direct descendants
and ascendants (including adopted and step children and parents) of such person and his or her spouses and siblings), (B) any
trust for the direct or indirect benefit of Holder or the immediate family of Holder, (C) if Holder is a trust, the trustor or
beneficiary of such trust or to the estate of a beneficiary of such trust, (D) if Holder is an entity, as a distribution to limited
partners, shareholders, members of, or owners of similar equity interests in Holder, including, for the avoidance of doubt, where
Holder is a partnership, to its general partner or a successor partnership or fund, or any other funds managed by such partnership
and (E) any affiliate of Holder. During the term of this Agreement, the Company will not register or otherwise recognize the transfer
(book-entry or otherwise) of any Shares or any certificate or uncertificated interest representing any of Holder’s Shares,
except as permitted by, and in accordance with, this Section 3(b).
(c) Changes
to Shares. In the event of a stock dividend or distribution, or any change in the Shares by reason of any stock dividend or
distribution, stock split, recapitalization, combination, conversion, domestication, exchange of shares or the like, the term
“Shares” shall be deemed to refer to and include the Shares as well as all such stock dividends and
distributions and any securities into which or for which any or all of the Shares may be changed or exchanged or which are received
in such transaction. Holder agrees during the period from and including the date hereof through the end of the Voting Period to
notify the Purchaser and the Company promptly in writing of the number and type of any changes to Holder’s ownership of
Shares, if any, after the date hereof.
(d) Compliance.
Holder agrees during the period from and including the date hereof through the end of the Voting Period not to take or agree or
commit to take any action that would make any representation and warranty of Holder contained in this Agreement inaccurate in
any material respect.
(e) Registration
Statement. During the period from and including the date hereof through the end of the Voting Period, Holder agrees to provide
to the Purchaser, the Company and their respective Representatives any information regarding Holder or the Shares that is reasonably
requested by the Purchaser, the Company or their respective Representatives for inclusion in the Registration Statement.
(f) Publicity.
Holder shall not issue any press release or otherwise make any public statements with respect to the Transactions or the transactions
contemplated herein without providing prior notice to the Company and the Purchaser, after which the Company and the Purchaser
shall be provided reasonable time to consult with Holder before any such public statements are made, unless such information was
already made available publicly in reports filed with the SEC or is otherwise required by applicable Law. Nothing herein shall
restrict Holder’s right to furnish or disclose any information with respect to the Transactions or the transactions contemplated
herein (i) to its limited partners, members or shareholders, (ii) as required by applicable Law, regulation, SEC or stock exchange
requirement or legal process, or (iii) as permitted by the Merger Agreement. Holder hereby authorizes the Company and the Purchaser
to publish and disclose in any announcement or disclosure required by the SEC, NYSE or the Registration Statement (including all
documents and schedules filed with the SEC in connection with the foregoing), Holder’s identity and ownership of the Shares
and the nature of Holder’s commitments and agreements under this Agreement, the Merger Agreement, the Letter of Transmittal,
the Transmittal Documents and any other Ancillary Documents.
4. Representations
and Warranties of Holder. Holder hereby represents and warrants to the Purchaser and the Company as follows:
(a) Binding
Agreement. Holder (i) if a natural person, is of legal age to execute this Agreement and is legally competent to do so and
(ii) if not a natural person, is (A) a corporation, limited liability company, company or partnership duly organized and validly
existing under the laws of the jurisdiction of its organization and (B) has all necessary power and authority to execute and deliver
this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. If Holder is not
a natural person, the execution and delivery of this Agreement, the performance of its obligations hereunder and the consummation
of the transactions contemplated hereby by Holder has been duly authorized by all necessary corporate, limited liability or partnership
action on the part of Holder, as applicable. This Agreement, assuming due authorization, execution and delivery hereof by the
other parties hereto, constitutes a legal, valid and binding obligation of Holder, enforceable against Holder in accordance with
its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
and other similar laws of general applicability relating to or affecting creditor’s rights, and to general equitable principles).
Holder understands and acknowledges that the Purchaser is entering into the Merger Agreement in reliance upon the execution and
delivery of this Agreement by Holder.
(b) Ownership
of Shares. As of the date hereof, Holder has beneficial ownership over the type and number of the Shares set forth under Holder’s
name on the signature page hereto, is the lawful owner of such Shares, has the sole power to vote or cause to be voted such Shares
(to the extent the Shares have associated voting rights), and has good and valid title to such Shares, free and clear of any and
all pledges, mortgages, encumbrances, charges, proxies, voting agreements, liens, adverse claims, options, security interests
and demands of any nature or kind whatsoever, other than those imposed by this Agreement, applicable securities Laws or the Company’s
Organizational Documents. There are no claims for finder’s fees or brokerage commission or other like payments in connection
with this Agreement or the transactions contemplated hereby payable by Holder pursuant to arrangements made by Holder. The Shares
identified herein do not include shares over which Holder exercises control in a fiduciary capacity for any other person or entity
that is not an Affiliate of Holder. Except for the Shares, as of the date of this Agreement, Holder is not a beneficial owner
or record holder of any shares of common stock of the Company.
(c) No
Conflicts. No filing with, or notification to, any Governmental Authority, and no consent, approval, authorization or permit
of any other person is necessary for the execution of this Agreement by Holder, the performance of its obligations hereunder or
the consummation by it of the transactions contemplated hereby. None of the execution and delivery of this Agreement by Holder,
the performance of its obligations hereunder or the consummation by it of the transactions contemplated hereby shall (i) conflict
with or result in any breach of the certificate of incorporation, bylaws or other comparable organizational documents of Holder,
if applicable, (ii) result in, or give rise to, a violation or breach of or a default under any of the terms of any Contract or
obligation to which Holder is a party or by which Holder or any of the Shares or its other assets may be bound, or (iii) violate
any applicable Law or Order, except for any of the foregoing in clauses (i) through (iii) as would not reasonably be expected
to impair Holder’s ability to perform its obligations under this Agreement in any material respect.
(d) No
Inconsistent Agreements. Holder hereby covenants and agrees that, except for this Agreement, which will be terminated at the
Closing, Holder (i) has not entered into, nor will enter into at any time while this Agreement remains in effect, any voting agreement
or voting trust with respect to the Shares inconsistent with Holder’s obligations pursuant to this Agreement, (ii) has not
granted, nor will grant at any time while this Agreement remains in effect, a proxy, a consent or power of attorney with respect
to the Shares and (iii) has not entered into any agreement or knowingly taken any action (nor will enter into any agreement or
knowingly take any action) that would make any representation or warranty of Holder contained herein untrue or incorrect in any
material respect or have the effect of preventing Holder from performing any of its material obligations under this Agreement.
(a) Termination.
Notwithstanding anything to the contrary contained herein, this Agreement shall automatically terminate, and none of the Purchaser,
the Company or Holder shall have any rights or obligations hereunder, upon the earliest to occur of (i) the mutual written consent
of the Purchaser, the Company and Holder, (ii) the Closing Date (following the performance of the obligations of the parties hereunder
required to be performed at or prior to the Closing Date), (iii) the date of termination of the Merger Agreement in accordance
with its terms, and (iv) the date on which any Company Adverse Recommendation Change occurs. The termination of this Agreement
shall not relieve such party from liability for such party’s breach of any terms of this Agreement prior to the date of
termination. Notwithstanding anything to the contrary herein, the provisions of this Section 5 shall survive the termination of
this Agreement.
(b) Capacity.
Notwithstanding anything in this Agreement to the contrary, (i) Holder makes no agreement or understanding herein in any capacity
other than in such Holder’s capacity as a record holder and beneficial owner of the Shares, and not in such Holder’s
capacity as a director, officer or employee of the Company or any of its Affiliates, as applicable, and (b) nothing herein will
be construed to limit or affect any action or inaction by such Holder or any representative of such Holder serving as a member
of the board of directors of the Company or its Affiliates or as an officer, employee or fiduciary of the Company or its Affiliates,
in each case, acting in such person’s capacity as a director, officer, employee or fiduciary of the Company or such Affiliate.
(c) Binding
Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the
parties hereto and their respective permitted successors and assigns. This Agreement and all of its obligations are personal to
the parties hereto and may not be assigned, transferred or delegated at any time without the prior written consent of the other
parties, and any purported assignment, transfer or delegation without such consent shall be null and void ab initio.
(d) Third
Parties. Nothing contained in this Agreement or in any instrument or document executed by any party in connection with the
transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any person
that is not a party hereto or thereto or a successor or permitted assign of such a party.
(e) Governing
Law; Jurisdiction. This Agreement and any dispute or controversy arising out of or relating to this Agreement shall be governed
by and construed in accordance with the laws of the State of Delaware, without regard to the conflict of law principles thereof.
All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in the Chancery Court of the
State of Delaware (or, if the Chancery Court of the State of Delaware declines to accept jurisdiction over a particular matter,
any state or U.S. federal court located in the State of Delaware (or in any appellate court thereof)) (the “Specified
Courts”). Each party hereto hereby (i) submits to the exclusive jurisdiction of any Specified Court for the purpose
of any Action arising out of or relating to this Agreement brought by any party hereto and (ii) irrevocably waives, and agrees
not to assert by way of motion, defense or otherwise, in any such Action, any claim that it is not subject personally to the jurisdiction
of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action is brought in an
inconvenient forum, that the venue of the Action is improper, or that this Agreement or the transactions contemplated hereby may
not be enforced in or by any Specified Court. Each party agrees that a final judgment in any Action shall be conclusive and may
be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each party irrevocably consents
to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions
contemplated by this Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such party
at the applicable address set forth or referred to in Section 5(h). Nothing in this Section 5(e) shall affect the right of any
party to serve legal process in any other manner permitted by applicable law.
(f) WAIVER
OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW ANY RIGHT IT MAY
HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT
OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED,
EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND
(ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5(f).
(g) Interpretation.
The titles and subtitles used in this Agreement are for convenience only and are not to be considered in construing or interpreting
this Agreement. In this Agreement, unless the context otherwise requires: (i) any pronoun used shall include the corresponding
masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include the plural and vice versa;
(ii) the term “including” (and with correlative meaning “include”) shall be deemed in each case to be
followed by the words “without limitation”; (iii) the words “herein,” “hereto,” and “hereby”
and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and not to any particular
section or other subdivision of this Agreement; and (iv) the term “or” means “and/or”. The parties have
participated jointly in the negotiation and drafting of this Agreement. Consequently, in the event an ambiguity or question of
intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto, and no presumption
or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision of this Agreement.
(h) Notices.
All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given
when delivered (i) in person, (ii) by facsimile or other electronic means (including email), with affirmative confirmation of
receipt, (iii) one Business Day after being sent, if sent by reputable, nationally recognized overnight courier service or (iv)
three (3) Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in
each case to the applicable party at the following addresses (or at such other address for a party as shall be specified by like
notice):
If
to Holder, to the address set forth on Holder’s signature page hereto.
If
to the Purchaser or Merger Sub at or prior to
the Closing,
to:
SEP
Acquisition Corp.
3737
Buffalo Speedway
Suite
1750
Houston,
TX 77098
Attn:
Andrew White
Telephone
No.: 713-715-6820
Email:
info@seplp.com |
|
with
a copy (which will not constitute notice) to:
Baker
Donelson, Bearman, Caldwell & Berkowitz, PC
1600
West End Avenue
Suite
2000
Nashville,
TN 37203
Attn:
Tonya Mitchem Grindon
Attn:
Nathan Kibler
Attn:
Andrew Yonchak
Telephone
No.: 615-726-5600
Email:
tgrindon@bakerdonelson.com
Email:
nkibler@bakerdonelson.com
Email:
dyonchak@bakerdonelson.com |
|
|
|
If
to the Company, to:
Sanuwave
Health, Inc.
11495
Valley View Road
Eden
Prairie, Minnesota 55344
Attn:
Morgan C. Frank, Chief Executive Officer
Email: |
|
with
a copy (which will not constitute notice) to:
Faegre
Drinker Biddle & Reath LLP
2200
Wells Fargo Center
90
South Seventh Street
Minneapolis,
Minnesota 55402
Attn:
Ben A. Stacke
Attn:
Jonathan Nygren
Email:
ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com |
|
|
|
|
|
|
If
to the Purchaser after the Closing, to:
Sanuwave
Health, Inc.
11495
Valley View Road
Eden
Prairie, Minnesota 55344
Attn:
Morgan C. Frank, Chief Executive Officer
Email:
|
|
with
a copy (which will not constitute notice) to:
Faegre
Drinker Biddle & Reath LLP
2200
Wells Fargo Center
90
South Seventh Street
Minneapolis,
Minnesota 55402
Attn:
Ben A. Stacke
Attn:
Jonathan Nygren
Email:
ben.stacke@faegredrinker.com
Email:
jon.nygren@faegredrinker.com |
|
|
|
(e) Amendments
and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either
generally or in a particular instance, and either retroactively or prospectively) only with the written consent of the Purchaser,
the Company and the Holder. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof.
No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed
to be or construed as a further or continuing waiver of any such term, condition, or provision.
(f) Severability.
In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction, such provision shall
be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid, legal and enforceable,
and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be affected or impaired
thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other jurisdiction. Upon
such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties will substitute
for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out, so far as may be valid,
legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
(g) Specific
Performance. Holder acknowledges that its obligations under this Agreement are unique, recognizes and affirms that in the
event of a breach of this Agreement by Holder, money damages may be inadequate and the Company and the Purchaser may not have
an adequate remedy at law, and agree that irreparable damage may occur in the event that any of the provisions of this Agreement
were not performed by Holder in accordance with their specific terms or were otherwise breached. Accordingly, the Company and
the Purchaser shall be entitled to seek an injunction or restraining order to prevent breaches of this Agreement by Holder and
to seek to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or
to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such party may be
entitled under this Agreement, at law or in equity. Notwithstanding the foregoing, the Purchaser agrees that its rights under
this subsection (g) shall terminate upon its acceptance of the Termination Fee under the Merger Agreement.
(h) Expenses.
Each party shall be responsible for its own fees and expenses (including the fees and expenses of investment bankers, accountants
and counsel) in connection with the entering into of this Agreement, the performance of its obligations hereunder and the consummation
of the transactions contemplated hereby; provided, that in the event of any Action arising out of or relating to this Agreement,
the non-prevailing party in any such Action will pay its own expenses and the reasonable documented out-of-pocket expenses, including
reasonable attorneys’ fees and costs, reasonably incurred by the prevailing party.
(i) No
Partnership, Agency or Joint Venture. This Agreement is intended to create a contractual relationship among Holder, the Company
and the Purchaser, and is not intended to create, and does not create, any agency, partnership, joint venture or any like relationship
among the parties hereto or among any other Company shareholders entering into voting agreements with the Company or the Purchaser.
Nothing contained in this Agreement shall be deemed to vest in the Company or the Purchaser any direct or indirect ownership or
incidence of ownership of or with respect to any Shares.
(j) Further
Assurances. From time to time, at another party’s request and without further consideration, each party shall execute
and deliver such additional documents and take all such further action as may be reasonably necessary or desirable to consummate
the transactions contemplated by this Agreement.
(k) Entire
Agreement. This Agreement (together with the Merger Agreement to the extent referred to herein) constitutes the full and entire
understanding and agreement among the parties with respect to the subject matter hereof, and any other written or oral agreement
relating to the subject matter hereof existing between the parties is expressly canceled; provided, that, for the avoidance of
doubt, the foregoing shall not affect the rights and obligations of the parties under the Merger Agreement or any Ancillary Document.
Notwithstanding the foregoing, nothing in this Agreement shall limit any of the rights or remedies of the Purchaser or any of
the obligations of Holder under any other agreement between Holder and the Purchaser or any certificate or instrument executed
by Holder in favor of the Purchaser, and nothing in any other agreement, certificate or instrument shall limit any of the rights
or remedies of the Purchaser or any of the obligations of Holder under this Agreement.
(l) Counterparts;
Facsimile. This Agreement may also be executed and delivered by facsimile or electronic signature or by email in portable
document format in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
[Remainder
of Page Intentionally Left Blank; Signature Page Follows]
IN WITNESS
WHEREOF, the parties have executed this Voting Agreement as of the date first written above.
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The Purchaser: |
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SEP ACQUISITION CORP. |
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By: |
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Name: R. Andrew White |
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Title: Chief Executive Officer |
[Signature Page to Company Voting Agreement]
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The Company: |
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SANUWAVE HEALTH, INC. |
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By: |
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Name: Morgan Frank |
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Title: Chairman, Chief Executive Officer |
[Signature Page to Company Voting Agreement]
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Number
and Type of Shares: |
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Shares
of Company Common Stock: |
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[Signature
Page to Company Voting Agreement]
Exhibit 10.2
SPONSOR VOTING AGREEMENT
This Voting Agreement
(this “Agreement”) is made as of August 23, 2023, by and among (i) Mercury
Sponsor Group I LLC, a Delaware limited liability company (the “Sponsor”), (ii) SEP Acquisition
Corp., a Delaware corporation (the “Purchaser”), and (iii) SANUWAVE Health, Inc., a Nevada
corporation (the “Company”). Any capitalized term used but not defined in this Agreement will have the
meaning ascribed to such term in the Merger Agreement.
WHEREAS, on
date hereof, the Company, the Purchaser, SEP Acquisition Holdings Inc., a Delaware corporation and a wholly-owned subsidiary
of the Purchaser (“Merger Sub”), entered into an Agreement and Plan of Merger (as amended from time to
time in accordance with the terms thereof, the “Merger Agreement”), pursuant to which Merger Sub will
merge with and into the Company, with the Company continuing as the surviving entity (the “Merger”),
and as a result of which, among other matters, all of the issued and outstanding capital stock of the Company immediately prior
to the Effective Time shall no longer be outstanding and shall automatically be cancelled and shall cease to exist, in exchange
for the right for each stockholder of the Company to receive its Stockholder Merger Consideration, all upon the terms and subject
to the conditions set forth in the Merger Agreement and in accordance with the applicable provisions of the BCA;
WHEREAS, the
managers of Sponsor have (a) determined that the Merger Agreement and the Transactions, including the Merger, are fair to,
advisable and in the best interests of the Purchaser and its stockholders, including Sponsor (the “Purchaser Stockholders”),
and (b) approved this Agreement and the Transactions, including the Merger, upon the terms and subject to the conditions set
forth herein;
WHEREAS, in
view of the valuable consideration to be received by Sponsor as a result of the Transactions, and the expenses and efforts to be
undertaken by the Company to consummate the Transactions, the Sponsor and the Company desire to enter into this Agreement in order
for Sponsor to provide certain assurances to the Company regarding the manner in which Sponsor is bound hereunder to vote any shares
of capital stock of the Purchaser which Sponsor beneficially owns, holds or otherwise has voting power (the “Shares”)
during the period from and including the date hereof through and including the date on which this Agreement is terminated in accordance
with its terms (the “Voting Period”) with respect to the Merger Agreement, the Merger, the Ancillary
Documents and the Transactions.
NOW, THEREFORE,
in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and intending
to be legally bound hereby, the parties hereby agree as follows:
1. Covenant to Vote in Favor of Transactions. Sponsor agrees, with respect to all of the Shares:
(a) during the Voting Period, at each meeting of the Purchaser Stockholders of any class or series thereof, and in each written
consent or resolutions of any of the Purchaser Stockholders in which Sponsor is entitled to vote or consent, Sponsor hereby unconditionally
and irrevocably agrees to be present for such meeting and vote (in person or by proxy), or consent to any action by written consent
or resolution with respect to, as applicable, the Shares (i) at any time after the later of (x) the registration statement on Form
S-4 to be filed by the Purchaser in connection with the Transactions having been declared effective by the Securities and Exchange
Commission (“SEC”) and (y) the board of directors of the Purchaser having solicited the vote or consent
of the Purchaser Stockholders in connection with the Transactions, (A) in favor of, and adopt, the Merger, the Merger Agreement,
the Ancillary Documents (including the Amendment to Warrant Agreement), any amendments to the Purchaser’s Organizational
Documents, and all of the other Transactions (and any actions required in furtherance thereof) and (B) in favor of the other matters
set forth in the Merger Agreement, and (ii) to vote the Shares in opposition to: (A) any and all proposals (x) that could reasonably
be expected to delay or impair the ability of the Purchaser to consummate the Merger, the Merger Agreement or any of the Transactions,
or (y) which are in competition with or materially inconsistent with the Merger Agreement or the Ancillary Documents; (B) any material
change in (y) the present capitalization of the Purchaser or any amendment of the Purchaser’s Organizational Documents or
(z) the Purchaser’s corporate structure or business which is inconsistent with the Merger Agreement or any of the Transactions;
or (C) any other action or proposal that is intended, or would reasonably be expected, to prevent, impede, interfere with, delay,
postpone or adversely affect in any material respect the Transactions or would reasonably be expected to result in any of the conditions
to the Closing under the Merger Agreement not being fulfilled, including any proposal to rescind or amend in any manner any prior
vote or written consent, as a stockholder of the Purchaser, to approve or adopt the Merger Agreement, the Merger or the Transactions,
unless this Agreement shall have been terminated in accordance with its terms;
(b) to execute and deliver all related documentation and take such other action in support of the Merger, the Merger Agreement,
any Ancillary Documents and any of the Transactions as shall reasonably be requested by the Purchaser or the Company in order to
carry out the terms and provision of this Section 1;
(c) except for transfers as permitted by, and in accordance with Section 3(b), not to deposit, and to cause its Affiliates not
to deposit, except as provided in this Agreement, any Shares owned by Sponsor or its Affiliates in a voting trust or subject any
Shares to any arrangement or agreement with respect to the voting of such Shares, unless specifically requested to do so by the
Purchaser and the Company in connection with the Merger Agreement, the Ancillary Documents and any of the Transactions;
(d) except as contemplated by the Merger Agreement or the Ancillary Documents, make, or in any manner participate in, directly
or indirectly, a “solicitation” of “proxies” or consents (as such terms are used in the rules of the SEC)
or powers of attorney or similar rights to vote, or seek to advise or influence any Person with respect to the voting of, any shares
of capital stock of the Purchaser in connection with any vote or other action with respect to the Transactions, other than to recommend
that stockholders of the Purchaser vote in favor of adoption of the Merger Agreement and the Transactions and any other proposal
the approval of which is a condition to the obligations of the parties under the Merger Agreement (and any actions required in
furtherance thereof and otherwise as expressly provided by Section 1 of this Agreement); and
(e) to refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect
to the Merger, the Merger Agreement, the Ancillary Documents and any of the Transactions, including pursuant to the DGCL.
2. Grant of Proxy. During the Voting Period, Sponsor, with respect to all of Sponsor’s Shares, hereby irrevocably
grants to, and appoints, the Company and any designee of the Company (determined in the Company’s sole discretion) as Sponsor’s
attorney-in-fact and proxy, with full power of substitution and resubstitution, for and in Sponsor’s name, to vote, or cause
to be voted (including by proxy or written consent, if applicable) any Shares owned (whether beneficially or of record) by Sponsor,
solely on the matters and in the manner specified in Section 1 above. The proxy granted by Sponsor pursuant to this Section
2 is irrevocable and is granted in consideration of the Company entering into this Agreement and the Merger Agreement and incurring
certain related fees and expenses. Sponsor hereby affirms that such irrevocable proxy is coupled with an interest by reason of
the Merger Agreement and, except upon the termination of this Agreement in accordance with Section 5(a), is intended to
be irrevocable. Sponsor agrees, until this Agreement is terminated in accordance with Section 5(a), to vote its Shares in
accordance with Section 1 above.
3. Other Covenants.
(a) No Transfers. Sponsor agrees that during the period from and including the date hereof through the end of the Voting
Period it shall not, and shall cause its Affiliates not to, without the Company’s prior written consent, (A) offer for sale,
sell (including short sales), transfer, tender, pledge, encumber, assign or otherwise dispose of (including by gift) (collectively,
a “Transfer”), or enter into any contract, option, derivative, hedging or other agreement or arrangement
or understanding (including any profit-sharing arrangement) with respect to, or consent to, a Transfer of, any or all of the Shares;
(B) grant any proxies or powers of attorney with respect to any or all of the Shares; (C) permit to exist any lien of any nature
whatsoever (other than those imposed by this Agreement, applicable securities Laws or the Purchaser’s Organizational Documents,
as in effect on the date hereof) with respect to any or all of the Shares; or (D) take any action that would have the effect of
preventing, impeding, interfering with or adversely affecting Sponsor’s ability to perform its obligations under this Agreement.
The Purchaser hereby agrees that it shall not permit any Transfer of the Shares in violation of this Agreement. Sponsor agrees
with, and covenants to, the Company that Sponsor shall not request that the Purchaser register the Transfer (book-entry or otherwise)
of any certificate or uncertificated interest representing any Shares during the term of this Agreement without the prior written
consent of the Company, and the Purchaser hereby agrees that it shall not effect any such Transfer.
(b) Permitted Transfers. Section 2(a) shall not prohibit a Transfer of Shares by Sponsor to any Permitted Transferee
(as defined below); provided, however, that it shall be a condition to such Transfer that the transferee agrees to be bound by
the terms of this Agreement and executes and delivers to the parties hereto a written consent and joinder memorializing such agreement.
As used in this Agreement, the term “Permitted Transferee” shall mean a distribution to Sponsor’s
members and any Affiliate of Sponsor. During the term of this Agreement, the Purchaser will not register or otherwise recognize
the transfer (book-entry or otherwise) of any Shares or any certificate or uncertificated interest representing any of Sponsor’s
Shares, except as permitted by, and in accordance with, this Section 2(b).
(c) Changes to Shares. In the event of a stock dividend or distribution, or any change in the Shares by reason of any
stock dividend or distribution, stock split, recapitalization, combination, conversion, domestication, exchange of shares or the
like, the term “Shares” shall be deemed to refer to and include the Shares as well as all such stock
dividends and distributions and any securities into which or for which any or all of the Shares may be changed or exchanged or
which are received in such transaction. Sponsor agrees during the period from and including the date hereof through the end of
the Voting Period to notify the Company and the Purchaser promptly in writing of the number and type of any changes to Sponsor’s
ownership of Shares, if any, after the date hereof.
(d) Compliance with Merger Agreement. Sponsor agrees during the period from and including the date hereof through the
end of the Voting Period not to take or agree or commit to take any action that would make any representation and warranty of Sponsor
contained in this Agreement inaccurate in any material respect. Sponsor further agrees that it shall use its commercially reasonable
efforts to cooperate with the Company to effect the Merger, all other Transactions, the Merger Agreement, the Ancillary Documents
and the provisions of this Agreement.
(e) Registration Statement. During the period from and including the date hereof through the end of the Voting Period,
Sponsor agrees to provide to the Company, the Purchaser and their respective Representatives any information regarding Sponsor
or the Shares that is reasonably requested by the Company, the Purchaser or their respective Representatives for inclusion in the
Registration Statement.
(f) Publicity. Sponsor shall not issue any press release or otherwise make any public statements with respect to the
Transactions or the transactions contemplated herein without providing prior notice to the Company and the Purchaser, after which
the Company and the Purchaser shall be provided reasonable time to consult with Sponsor before any such public statements are made,
unless such information was already made available publicly in reports filed with the SEC or is otherwise required by applicable
Law. Nothing herein shall restrict Sponsor’s right to furnish or disclose any information with respect to the Transactions
or the transactions contemplated herein (i) to its members, (ii) as required by applicable law, regulation, Securities and Exchange
Commission (“SEC”) or stock exchange requirement or legal process or (iii) as permitted by the Merger
Agreement. Sponsor hereby authorizes the Company and the Purchaser to publish and disclose in any announcement or disclosure required
by the SEC, Nasdaq or the Registration Statement (including all documents and schedules filed with the SEC in connection with the
foregoing), Sponsor’s identity and ownership of the Shares and the nature of Sponsor’s commitments and agreements under
this Agreement, the Merger Agreement, and any other Ancillary Documents.
4. Representations and Warranties of Sponsor. Sponsor hereby represents and warrants to the Company and the Purchaser
as follows:
(a) Binding Agreement. Sponsor is a limited liability company duly organized and validly existing under the laws of the
jurisdiction of its organization and has all necessary power and authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement, the
performance of its obligations hereunder and the consummation of the transactions contemplated hereby by Sponsor has been duly
authorized by all necessary limited liability company action on the part of Sponsor. This Agreement, assuming due authorization,
execution and delivery hereof by the other parties hereto, constitutes a legal, valid and binding obligation of Sponsor, enforceable
against Sponsor in accordance with its terms (except as such enforceability may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws of general applicability relating to or affecting creditor’s
rights, and to general equitable principles). Sponsor understands and acknowledges that the Company is entering into the Merger
Agreement in reliance upon the execution and delivery of this Agreement by Sponsor.
(b) Ownership of Shares. As of the date hereof, Sponsor has beneficial ownership over the type and number of the Shares
set forth under Sponsor’s name on the signature page hereto, is the lawful owner of such Shares, has the sole power to vote
or cause to be voted such Shares (to the extent the Shares have associated voting rights), and has good and valid title to such
Shares, free and clear of any and all pledges, mortgages, encumbrances, charges, proxies, voting agreements, liens, adverse claims,
options, security interests and demands of any nature or kind whatsoever, other than those imposed by this Agreement, applicable
securities Laws or the Purchaser’s Organizational Documents, as in effect on the date hereof. There are no claims for finder’s
fees or brokerage commission or other like payments in connection with this Agreement or the transactions contemplated hereby payable
by Sponsor pursuant to arrangements made by Sponsor. Except for the Shares, as of the date of this Agreement, Sponsor is not a
beneficial owner or record holder of any shares of common stock of the Purchaser.
(c) No Conflicts. No filing with, or notification to, any Governmental Authority, and no consent, approval, authorization
or permit of any other person is necessary for the execution of this Agreement by Sponsor, the performance of its obligations hereunder
or the consummation by it of the transactions contemplated hereby. None of the execution and delivery of this Agreement by Sponsor,
the performance of its obligations hereunder or the consummation by it of the transactions contemplated hereby shall (i) conflict
with or result in any breach of the certificate of formation, limited liability company agreement or other comparable organizational
documents of Sponsor, if applicable, (ii) result in, or give rise to, a violation or breach of or a default under any of the terms
of any Contract or obligation to which Sponsor is a party or by which Sponsor or any of the Shares or its other assets may be bound,
or (iii) violate any applicable Law or Order, except for any of the foregoing in clauses (i) through (iii) as would not reasonably
be expected to impair Sponsor’s ability to perform its obligations under this Agreement in any material respect.
(d) No Inconsistent Agreements. Sponsor hereby covenants and agrees that, except for this Agreement, which will be terminated
at the Closing, Sponsor (i) has not entered into, nor will enter into at any time while this Agreement remains in effect, any voting
agreement or voting trust with respect to the Shares inconsistent with Sponsor’s obligations pursuant to this Agreement,
(ii) has not granted, nor will grant at any time while this Agreement remains in effect, a proxy, a consent or power of attorney
with respect to the Shares and (iii) has not entered into any agreement or knowingly taken any action (nor will enter into any
agreement or knowingly take any action) that would make any representation or warranty of Sponsor contained herein untrue or incorrect
in any material respect or have the effect of preventing Sponsor from performing any of its material obligations under this Agreement.
5. Miscellaneous.
(a) Termination. Notwithstanding anything to the contrary contained herein, this Agreement shall automatically terminate,
and none of the Company, the Purchaser or Sponsor shall have any rights or obligations hereunder, upon the earliest to occur of
(i) the mutual written consent of the Company, the Purchaser and Sponsor, (ii) the Closing Date (following the performance of the
obligations of the parties hereunder required to be performed at or prior to the Closing Date), and (iii) the date of termination
of the Merger Agreement in accordance with its terms. The termination of this Agreement shall not prevent any party hereunder from
seeking any remedies (at law or in equity) against another party hereto or relieve such party from liability for such party’s
breach of any terms of this Agreement. Notwithstanding anything to the contrary herein, the provisions of this Section 5 shall
survive the termination of this Agreement.
(b) Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and assigns. This Agreement and all of its obligations
are personal to the parties hereto and may not be assigned, transferred or delegated at any time without the prior written consent
of the other parties, and any purported assignment, transfer or delegation without such consent shall be null and void ab initio.
(c) Third Parties. Nothing contained in this Agreement or in any instrument or document executed by any party in connection
with the transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any
person that is not a party hereto or thereto or a successor or permitted assign of such a party.
(d) Governing Law; Jurisdiction. This Agreement and any dispute or controversy arising out of or relating to this Agreement
shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflict of law
principles thereof. All Actions arising out of or relating to this Agreement shall be heard and determined exclusively in the Chancery
Court of the State of Delaware (or, if the Chancery Court of the State of Delaware declines to accept jurisdiction over a particular
matter, any state or U.S. federal court located in the State of Delaware) (or in any appellate courts thereof)) (the “Specified
Courts”). Each party hereto hereby (i) submits to the exclusive jurisdiction of any Specified Court for the
purpose of any Action arising out of or relating to this Agreement brought by any party hereto and (ii) irrevocably waives, and
agrees not to assert by way of motion, defense or otherwise, in any such Action, any claim that it is not subject personally to
the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action
is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the transactions contemplated
hereby may not be enforced in or by any Specified Court. Each party agrees that a final judgment in any Action shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each party irrevocably
consents to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions
contemplated by this Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such party
at the applicable address set forth or referred to in Section 5(g). Nothing in this Section 5(d) shall affect the right of any
party to serve legal process in any other manner permitted by applicable law.
(e) WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW
ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER
PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT
FOREGOING WAIVER AND (ii) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY,
AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 5(e).
(f) Interpretation. The titles and subtitles used in this Agreement are for convenience only and are not to be considered
in construing or interpreting this Agreement. In this Agreement, unless the context otherwise requires: (i) any pronoun used shall
include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and verbs shall include
the plural and vice versa; (ii) the term “including” (and with correlative meaning “include”) shall be
deemed in each case to be followed by the words “without limitation”; (iii) the words “herein,” “hereto,”
and “hereby” and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and
not to any particular section or other subdivision of this Agreement; and (iv) the term “or” means “and/or”.
The parties have participated jointly in the negotiation and drafting of this Agreement. Consequently, in the event an ambiguity
or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the parties hereto,
and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provision
of this Agreement.
(g) Notices. All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed
to have been duly given when delivered (i) in person, (ii) by facsimile or other electronic means (including email), with affirmative
confirmation of receipt, (iii) one Business Day after being sent, if sent by reputable, nationally recognized overnight courier
service or (iv) three (3) Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt
requested, in each case to the applicable party at the following addresses (or at such other address for a party as shall be specified
by like notice):
If to the Purchaser prior to the Closing or to Sponsor, to:
SEP Acquisition Corp.
3737 Buffalo Speedway
Suite 1750
Houston, TX 77098
Attn: Andrew White
Telephone No.: 713-715-6820
Email: info@seplp.com
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with a copy (which will not constitute notice) to:
Baker Donelson, Bearman, Caldwell & Berkowitz, PC
1600 West End Avenue
Suite 2000
Nashville, TN 37203
Attn: Tonya Mitchem Grindon
Attn: Nathan Kibler
Attn: Andrew Yonchak
Telephone No.: 615-726-5600
Email: tgrindon@bakerdonelson.com
Email: nkibler@bakerdonelson.com
Email: dyonchak@bakerdonelson.com
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If to the Purchaser after the Closing or to the Company,
to:
SANUWAVE Health, Inc.
11495 Valley View Road
Eden Prairie, Minnesota 55344
Attn: Morgan C. Frank, Chief Executive Officer
Email:
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with a copy (which will not constitute notice) to:
Faegre Drinker Biddle & Reath LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, Minnesota 55402
Attn: Ben A. Stacke
Attn: Jonathan Nygren
Email: ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com
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(h) Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance, and either retroactively or prospectively) only with the written consent
of the Company, the Purchaser and the Sponsor. No failure or delay by a party in exercising any right hereunder shall operate as
a waiver thereof. No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances,
shall be deemed to be or construed as a further or continuing waiver of any such term, condition, or provision.
(i) Severability. In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction,
such provision shall be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid,
legal and enforceable, and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be
affected or impaired thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other
jurisdiction. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the
parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out,
so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
(j) Specific Performance. Sponsor acknowledges that its obligations under this Agreement are unique, recognizes and affirms
that in the event of a breach of this Agreement by Sponsor, money damages may be inadequate and the Purchaser and the Company may
not have an adequate remedy at law, and agree that irreparable damage may occur in the event that any of the provisions of this
Agreement were not performed by Sponsor in accordance with their specific terms or were otherwise breached. Accordingly, the Purchaser
and the Company shall be entitled to seek an injunction or restraining order to prevent breaches of this Agreement by Sponsor and
to seek to enforce specifically the terms and provisions hereof, without the requirement to post any bond or other security or
to prove that money damages would be inadequate, this being in addition to any other right or remedy to which such party may be
entitled under this Agreement, at law or in equity.
(k) Expenses. Each party shall be responsible for its own fees and expenses (including the fees and expenses of investment
bankers, accountants and counsel) in connection with the entering into of this Agreement, the performance of its obligations hereunder
and the consummation of the transactions contemplated hereby; provided, that in the event of any Action arising out of or relating
to this Agreement, the non-prevailing party in any such Action will pay its own expenses and the reasonable documented out-of-pocket
expenses, including reasonable attorneys’ fees and costs, reasonably incurred by the prevailing party.
(l) No Partnership, Agency or Joint Venture. This Agreement is intended to create a contractual relationship among Sponsor,
the Purchaser and the Company, and is not intended to create, and does not create, any agency, partnership, joint venture or any
like relationship among the parties hereto or among any other Purchaser shareholders entering into voting agreements with the Purchaser
or the Company. Sponsor has acted independently regarding its decision to enter into this Agreement. Nothing contained in this
Agreement shall be deemed to vest in the Purchaser or the Company any direct or indirect ownership or incidence of ownership of
or with respect to any Shares.
(m) Further Assurances. From time to time, at another party’s request and without further consideration, each party
shall execute and deliver such additional documents and take all such further action as may be reasonably necessary or desirable
to consummate the transactions contemplated by this Agreement.
(n) Entire Agreement. This Agreement (together with the Merger Agreement to the extent referred to herein) constitutes
the full and entire understanding and agreement among the parties with respect to the subject matter hereof, and any other written
or oral agreement relating to the subject matter hereof existing between the parties is expressly canceled; provided, that, for
the avoidance of doubt, the foregoing shall not affect the rights and obligations of the parties under the Merger Agreement or
any Ancillary Document. Notwithstanding the foregoing, nothing in this Agreement shall limit any of the rights or remedies of the
Company or any of the obligations of Sponsor under any other agreement between Sponsor and the Company or any certificate or instrument
executed by Sponsor in favor of the Company, and nothing in any other agreement, certificate or instrument shall limit any of the
rights or remedies of the Company or any of the obligations of Sponsor under this Agreement.
(o) Counterparts; Facsimile. This Agreement may also be executed and delivered by facsimile or electronic signature or
by email in portable document format in two or more counterparts, each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
[Remainder of Page Intentionally Left
Blank; Signature Page Follows]
IN WITNESS WHEREOF, the parties have
executed this Sponsor Voting Agreement as of the date first written above.
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The Sponsor: |
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MERCURY SPONSOR GROUP I LLC |
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By: |
/s/ R. Andrew
White |
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Name: |
R. Andrew White |
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Title: |
Chief Executive Officer |
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Shares of Class A Purchaser Stock: 0 |
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Shares of Class B Purchaser Stock: 3,465,375 |
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The Purchaser: |
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SEP ACQUISITION CORP. |
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By: |
/s/ R. Andrew
White |
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Name: |
R. Andrew White |
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Title: |
Chief Executive Officer |
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The Company: |
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SANUWAVE HEALTH, INC. |
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By: |
/s/ Morgan Frank |
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Name: |
Morgan Frank |
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Title: |
Chairman, Chief Executive Officer |
Exhibit 10.3
VOTING AND NON-REDEMPTION AGREEMENT
This VOTING AND NON-REDEMPTION
AGREEMENT (this “Agreement”) is entered into as of August 23, 2023 (the “Agreement Date”)
by and among SEP Acquisition Corp., a Delaware corporation (the “SPAC”), Sanuwave Health, Inc., a Nevada corporation
(the “Company”), and the undersigned stockholder of SPAC (“Stockholder”). The Stockholder,
the SPAC and the Company are collectively referred to herein as the “Parties” and individually as a “Party”.
WHEREAS, the Stockholder
is the record and “beneficial owner” (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as
amended (the “Exchange Act”)) of the number of shares of the Class A common stock, par value $0.0001 per share
(“Class A Stock”), of the SPAC set forth on Exhibit A attached hereto (such shares, the “Owned
Securities”, and together with any other shares of capital stock of the SPAC acquired by Stockholder after the date hereof
and prior to the earlier of the Closing and the termination of all of Stockholder’s obligations under this Agreement being
collectively referred to herein as the “Securities”);
WHEREAS, on the date
hereof, the SPAC, SEP Acquisition Holdings Inc., a Nevada corporation and a wholly-owned subsidiary of the SPAC (the “Merger
Sub”), and the Company entered into an Agreement and Plan of Merger (the “Merger Agreement”), pursuant
to which, subject to the terms and conditions set forth in the Merger Agreement, the Merger Sub will merge with and into the Company,
with the Company surviving the Merger as a wholly-owned subsidiary of the SPAC (the “Merger”);
WHEREAS, in connection
with the Merger, the SPAC intends to enter into subscription agreements on terms reasonably acceptable to the SPAC and the Company
with investors to purchase shares of Class A Stock at a certain price per share (the “PIPE Price”) in connection
with a private equity investment in the SPAC;
WHEREAS, it is a condition
precedent to the consummation of the Merger that the stockholders of the SPAC approve the Merger, certain amendments to the SPAC’s
certificate of incorporation, and the conversion of the SPAC’s warrants into shares of Class A Stock;
WHEREAS, the amended
and restated certificate of incorporation of SPAC, as amended on December 20, 2022 (the “Charter”), provides
the Stockholder with certain rights to redeem its shares of Class A Stock in connection with the Merger (the “Redemption
Rights”);
WHEREAS, as a condition
to the willingness of the Company and the SPAC to enter into the Merger Agreement and as an inducement and in consideration therefor,
and in view of the valuable consideration to be received thereunder, and the expenses and efforts to be undertaken by the Company
and the SPAC to consummate the Merger, the Stockholder has agreed to enter into this Agreement; and
WHEREAS, all capitalized
terms used but not defined herein shall have the respective meanings specified in the Merger Agreement.
NOW, THEREFORE, in
consideration of the premises, covenants and agreements set forth herein, and other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the Parties hereby agree as follows:
1. Agreement not to Redeem. The Stockholder irrevocably and unconditionally hereby (a) agrees that the Stockholder shall
not, and shall cause its Affiliates not to, elect to redeem or otherwise tender or submit for redemption or repurchase __ shares
of Class A Stock held by the Stockholder (the “Non-Redeemed Securities”) pursuant to or in connection with the
Merger, and (b) waives, on behalf of itself and its Affiliates, the Redemption Rights, including any notice rights in connection
therewith, with respect to the Non-Redeemed Securities. In the event of a breach of this Section 1, the Stockholder irrevocably
and unconditionally agrees to, or to cause one or more of its Affiliates to, subscribe for and purchase from the SPAC a number
of shares of Class A Stock equal to the number of shares of Class A Stock redeemed pursuant to the Redemption Rights, for a per
share purchase price equal to the amount to be received by public stockholders of the SPAC exercising their Redemption Rights under
the Charter in connection with the Merger.
2.
Agreement to Vote. From and after the date hereof until the Expiration Date, the Stockholder (in such capacity and
in its capacity as a holder of Public Warrants, if applicable and not in any other capacity) irrevocably and unconditionally hereby
agrees that, at any meeting (whether annual or special and each adjourned or postponed meeting) of the SPAC’s stockholders,
however called, or in connection with any other written consent or resolutions of the SPAC’s stockholders, in which the Stockholder
is entitled to vote or consent the Stockholder will (x) appear at such meeting or otherwise cause all of the Securities to be counted
as present thereat for purposes of calculating a quorum and (y) vote or cause to be voted (including by proxy or written consent
or resolution, if applicable) all of the Securities:
(a) (i) in favor of, and adopt, the Merger, the Merger Agreement, the Ancillary Documents, any amendments to the SPAC’s
Organizational Documents, any amendment of the Warrant Agreement, dated as of July 27, 2021, between SPAC and Continental
Stock Transfer & Trust Company, as warrant agent (including the Amendment to Warrant Agreement), and all of the other
Transactions (and any actions required in furtherance thereof) and (ii) in favor of the other matters set forth in the Merger Agreement,
(b) for any proposal to adjourn or postpone the applicable stockholder meeting to a later date if (and only if) there are not
sufficient votes for approval of the Merger Agreement and any other proposals related thereto as set forth in the Registration
Statement/Proxy Statement on the dates on which such meetings are held;
(c) in opposition to: (i) any and all proposals (x) that could reasonably be expected to delay or impair the ability of the
SPAC to consummate the Merger, the Merger Agreement or any of the Transactions, or (y) which are in competition with or materially
inconsistent with the Merger Agreement or the Ancillary Documents; (ii) any material change in (x) the present capitalization of
the SPAC or any amendment of the SPAC’s Organizational Documents other than as contemplated by the Merger Agreement or (y)
the SPAC’s corporate structure or business which is inconsistent with the Merger Agreement or any of the Transactions; or
(z) any other action or proposal that is intended, or would reasonably be expected, to prevent, impede, interfere with, delay,
postpone or adversely affect in any material respect the Transactions or would reasonably be expected to result in any of the conditions
to the Closing under the Merger Agreement not being fulfilled, including any proposal to rescind or amend in any manner any prior
vote or written consent, as a stockholder of the SPAC, to approve or adopt the Merger Agreement, the Merger or the Transactions,
unless this Agreement shall have been terminated in accordance with its terms;
(d) to execute and deliver all related documentation and take such other action in support of the Merger, the Merger Agreement,
any Ancillary Documents and any of the Transactions as shall reasonably be requested by the SPAC or the Company in order to carry
out the terms and provision of this Section 2;
(e) against any action, proposal, transaction or agreement that would reasonably be expected to result in a breach in any respect
of any covenant, representation or warranty or any other obligation or agreement of the SPAC contained in the Merger Agreement,
or of the Stockholder contained in this Agreement; and
(f) in favor of any other matter necessary or desirable to the consummation of the transactions contemplated by the Merger Agreement,
including the Merger (clauses (a) through (f) of this Section 2, the “Required Voting Matters”).
The obligations of the Stockholder specified
in this Section 2 shall apply whether or not the Merger, any of the Transactions, or any action described above is recommended
by the board of directors of the SPAC.
3.
Issuance of Class A Stock.
(a) In consideration of the agreement set forth in Sections 1 and 2, conditioned upon, immediately prior to, and
substantially concurrently with the closing of the Merger (the “Closing”):
(i) provided the Stockholder remains in compliance with Sections 1 and 2, the SPAC shall issue (the “Share
Issuance”) to the Stockholder (or to a designee elected by the Stockholder by notice to the SPAC and approved by the
SPAC (the “Designee”), pursuant to Section 9) shares of Class A Stock (the “Issued Class
A Common Stock”) in accordance with the following formula, rounded down to the nearest whole number:
($10
– PIPE Price) x Number of Non-Redeemed Securities
PIPE Price
(ii) The Issued Class A Common Stock shall be issued directly to the Stockholder (or its Designee) in book-entry form on the
books and records of the SPAC’s transfer agent electronically via the Direct Registration System of the Depository Trust
Company or in such other manner as the SPAC and the Stockholder shall agree upon Closing; and
(iii) as further consideration for the issuance of the Issued Class A Common Stock to the Stockholder (or its Designee) pursuant
to the Share Issuance, the Stockholder hereby agrees to pay to the SPAC, at least one (1) business day prior to the Closing, an
amount equal to $0.0001 per share of Issued Class A Common Stock issued to the Stockholder (or its Designee) pursuant to the Share
Issuance by wire transfer of immediately available funds, to accounts designated by the SPAC at a financial institution to be chosen
by the SPAC.
(b) If at any time prior to the Merger the number of outstanding shares of common stock of the SPAC is increased or decreased
by a consolidation, combination, split or reclassification of the common stock or other similar event, then, as of the effective
date of such consolidation, combination, split, reclassification or similar event, all share numbers referenced in this Agreement
shall be adjusted in proportion to such increase or decrease in outstanding common stock of the SPAC.
(c) The Stockholder shall, on or prior to the Closing, execute and deliver to the SPAC a completed IRS Form W-9 or Form W-8,
as applicable.
(d) Notwithstanding any other provision of this Agreement, the SPAC and any of its agents and representatives, as applicable,
shall be entitled to deduct and withhold from any amount payable pursuant to this Agreement any such taxes as may be required to
be deducted and withheld from such amounts (and any other amounts treated as paid for applicable tax law) under the Internal Revenue
Code of 1986, as amended, or any other applicable tax law (as determined in good faith by the party so deducting or withholding
in its sole discretion). To the extent that any amounts are so deducted and withheld, such deducted and withheld amounts shall
be treated for all purposes of this Agreement as having been paid to the person in respect of which such deduction and withholding
was made.
4.
Grant of Irrevocable Proxy and Power of Attorney; Appointment of Proxy.
(a) From and after the date hereof until the Expiration Date, the Stockholder hereby irrevocably and unconditionally grants
to, and appoints, the SPAC, and any of its respective designees as Stockholder’s proxy and attorney-in-fact (with full power
of substitution), for and in the name, place and stead of Stockholder, to (i) vote or cause to be voted (including by proxy or
written consent, if applicable) the Securities in accordance with the Required Voting Matters, in each case, in the event that
the Stockholder fails to perform or otherwise comply with the covenants, agreements or obligations set forth in Section 2,
it being understood that the proxy holder may not exercise the proxy granted pursuant to this Section 4(a) on any matter
except for those matters described in Section 2, and (ii) revoke any redemption election made by Stockholder in contravention
of Section 1 with respect to any of Stockholder’s shares of Class A Stock and cause SPAC’s transfer agent to
fail to redeem such shares in connection with the Business Combination.
(b) The Stockholder hereby represents that any proxies and powers of attorney heretofore given in respect of the Securities,
if any, are revocable, and hereby revokes such proxies and powers of attorney.
(c) The Stockholder hereby affirms that the irrevocable proxy and power of attorney set forth in this Section 4 are given
in connection with the execution of the Merger Agreement, and that such irrevocable proxy and power of attorney are given to secure
the performance of the duties of the Stockholder under this Agreement. The Stockholder hereby further affirms that the irrevocable
proxy and power of attorney are coupled with an interest and, except as set forth in this Section 4, are intended to be
irrevocable. If for any reason the proxy or power of attorney granted herein is not irrevocable, then the Stockholder agrees, until
the Expiration Date, to vote the Securities in accordance with Section 2(a) through Section 2(e) above as instructed
by the SPAC in writing.
5.
Restrictions on Transfer.
(a) Except as contemplated by this Agreement, the Merger Agreement, and the Transactions, from the date hereof until the Expiration
Date, the Stockholder shall not, and shall cause its Affiliates not to, directly or indirectly, without the Company’s prior
written consent, which shall not be unreasonable withheld, conditioned or delayed, (i) offer for sale, sell (including short
sales), transfer, tender, pledge, convert, encumber, contract, assign or otherwise dispose of (including by gift, merger, tendering
into any tender offer or exchange offer or otherwise) (collectively, a “Transfer”), or enter into any contract,
option, derivative, hedging or other agreement or arrangement or understanding (including any profit-sharing arrangement) with
respect to, or consent to, a Transfer of, any or all of the Securities, (ii) grant any proxies or powers of attorney with
respect to any or all of the Securities (except in connection with voting by proxy at a meeting of stockholders of the SPAC as
contemplated by Section 2), (iii) permit to exist any lien or encumbrance with respect to any or all of the Securities
other than those created by this Agreement or (iv) take any action that would have the effect of preventing, impeding, interfering
with or adversely affecting Stockholder’s ability to perform its obligations under this Agreement. The SPAC hereby agrees
that it shall not permit any Transfer of the Shares in violation of this Agreement. Stockholder agrees with, and covenants to,
the Company that Stockholder shall not request that the SPAC register the Transfer (book-entry or otherwise) of any certificate
or uncertificated interest representing any Securities during the term of this Agreement without the prior written consent of the
Company, and the SPAC hereby agrees that it shall not effect any such Transfer.
(b) Notwithstanding subsection (a), this Section 5 shall not prohibit a Transfer of Securities by the Stockholder
to (i) one of its Affiliates, (ii) in the case of an individual, by gift to a member of the individual’s immediate family
(for purposes of this Agreement, “immediate family” shall mean with respect to any natural person, any of the following:
such person’s spouse, the siblings of such person and his or her spouse, and the direct descendants and ascendants (including
adopted and step children and parents) of such person and his or her spouses and siblings), to a trust, the beneficiary of which
is a member of the individual’s immediate family, or an Affiliate of such person; (iii) in the case of an individual, by
virtue of laws of descent and distribution upon death of the individual; [(iv) in the case of an individual, pursuant to a qualified
domestic relations order; (v) in the case of an individual, pursuant to a charitable gift or contribution, and (vi) by virtue of
the Stockholder’s organizational documents upon liquidation or dissolution of the Stockholder;] provided that in case
of clauses (i)-(vi), such transferee agrees in a writing, reasonably satisfactory in form and substance to the SPAC, to assume
all of the obligations of the Stockholder hereunder and to be bound by the terms of this Agreement; provided, in the case
of clauses (iii), (iv), and (vi), the transferee will not be required to assume the voting obligations under Section 2 if
the transferee’s assumption of such obligations would violate any applicable Laws, including any securities Laws, or would
reasonably be expected to materially delay or impede the Registration Statement / Proxy Statement being declared effective under
the Securities Act. Any transfer in violation of this Section 5 shall be null and void ab initio. During the
term of this Agreement, the SPAC will not register or otherwise recognize the transfer (book-entry or otherwise) of any Shares
or any certificate or uncertificated interest representing any of Holder’s Shares, except as permitted by, and in accordance
with, this Section 5(b).
6.
Inconsistent Agreements. The Stockholder hereby covenants and agrees that, except for this Agreement, it (a) shall
not enter into at any time while this Agreement remains in effect, any voting agreement or voting trust with respect to the Securities
and (b) shall not grant at any time while this Agreement remains in effect a proxy, consent or power of attorney with respect to
the Securities.
7.
Representations and Warranties of the Stockholder. The Stockholder represents and warrants to the SPAC and the Company
as follows:
(a) If the Stockholder is a natural person, the Stockholder is of legal age to execute this Agreement, is legally competent
to execute this Agreement and has full legal right and capacity to execute and deliver this Agreement, to perform the Stockholder’s
obligations hereunder and to consummate the transactions contemplated hereby. If the Stockholder is not a natural person, the Stockholder
is duly organized, validly existing and in good standing under the Laws of its jurisdiction of organization and has all requisite
power and authority to execute and deliver this Agreement and perform its respective obligations hereunder.
(b) The Stockholder, in making the decisions to enter into this Agreement and receive the Issued Class A Common Stock from the
SPAC, has not relied upon any oral or written representations or assurances from the SPAC, the Company or any of their respective
officers, directors, partners, or employees or any other representatives or agents. The Stockholder further understands that no
federal or state agency has passed upon or made any recommendation or endorsement of the acquisition of the Issued Class A Common
Stock.
(c) The Stockholder acknowledges that it has had the opportunity to review this Agreement and the transactions contemplated
by this Agreement with the Stockholder’s own legal counsel and investment and tax advisors, has sought such accounting, legal
and tax advice as the Stockholder has considered necessary to make an informed decision with respect to the transactions contemplated
by this Agreement, and has not received and is not relying on any statement, representation or warranty made by any person, firm
or corporation (including without limitation the SPAC or its Affiliates), other than as expressly set forth in Section 8,
in connection with the transactions contemplated by this Agreement.
(d) The Stockholder is an “accredited investor” as such term is defined in Rule 501(a) of Regulation D under
the Securities Act of 1933, as amended (the “Securities Act”), and acknowledges that the issuance of the Issued
Class A Common Stock contemplated hereby will be made in reliance, among other things, on a private placement exemption to “accredited
investors” under the Securities Act and similar exemptions under state law.
(e) The Stockholder is acquiring the Issued Class A Common Stock solely for investment purposes, for such Stockholder’s
own account, and not with a view to the distribution thereof in violation of the Securities Act and the Stockholder has no present
arrangement to sell the Issued Class A Common Stock to or through any person or entity except as may be permitted hereunder.
(f) The Stockholder is sophisticated in financial matters and able to evaluate the risks and benefits of the investment in the
Issued Class A Common Stock. The Stockholder is aware that an investment in the Issued Class A Common Stock is highly speculative
and subject to substantial risks. The Stockholder is cognizant of and understands the risks related to the acquisition of the Class
A Common Stock and the restrictions relating to the Securities described or provided for in this Agreement. The Stockholder is
able to bear the economic risk of its investment in the SPAC for an indefinite period of time and able to sustain a complete loss
of such investment.
(g) The Stockholder understands that the Issued Class A Common Stock are being offered and sold to the Stockholder in reliance
on exemptions from the registration requirements under the Securities Act, and analogous provisions in the laws and regulations
of various states, and that the SPAC is relying upon the truth and accuracy of the representations, warranties, agreements, acknowledgments
and understandings of the Stockholder set forth in this Agreement in order to determine the applicability of such provisions.
(h) The Stockholder is cognizant of and understands the risks related to the transfer restrictions and voting obligations with
respect to the Securities provided for in Sections 1 and 2 of this Agreement.
(i) The execution, delivery and performance of this Agreement by the Stockholder and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on the part of Stockholder and no other actions or proceedings on the
part of the Stockholder are necessary to authorize this Agreement or to consummate the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by the Stockholder and constitutes the legal, valid and binding obligations of
the Stockholder, enforceable against the Stockholder in accordance with its terms.
(j) The execution, delivery and performance by the Stockholder of this Agreement and the consummation of the transactions contemplated
herein do not and will not (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute
a default under, or result in the creation or imposition of any lien, charge or encumbrance upon the Owned Securities pursuant
to the terms of any indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which
the Stockholder is a party or by which the Stockholder or to which the Securities are subject, other than those which would not
reasonably be expected to have a material adverse effect on the legal authority of Stockholder to enter into and timely perform
its obligations under this Agreement (a “Stockholder Material Adverse Effect”), (ii) if the Stockholder is not
an individual, result in any violation of the provisions of the organizational documents of the Stockholder, other than those that
would not reasonably be expected to have a Stockholder Material Adverse Effect, or (iii) result in any violation of any statute
or any judgment, order, rule or regulation of any Governmental Authority having jurisdiction over the Stockholder or any of its
properties, other than those that would not reasonably be expected to have a Stockholder Material Adverse Effect.
(k) The Stockholder owns, beneficially and of record, as of the date hereof, the shares of Class A Stock set forth on Exhibit
A attached hereto free and clear of any proxy, voting restriction, adverse claim or other lien (other than any restrictions
created by this Agreement, the Organizational Documents of the SPAC and applicable securities Laws). The Stockholder has the sole
power to vote or cause to be voted such shares. Except for shares of Class A Stock set forth on Exhibit A attached hereto
and any public warrants and/or private warrants held by the Stockholder, as of the date of this Agreement, the Stockholder is not
a record holder of any (i) equity securities of the SPAC, (ii) securities of the SPAC having the right to vote on any matters on
which the stockholders of the SPAC may vote or which are convertible into or exchangeable for, at any time, equity securities of
the SPAC, or (iii) options or other rights to acquire from the SPAC any equity securities or securities convertible into or exchangeable
for equity securities of the SPAC, except as contemplated by, or in connection with, the Merger Agreement.
(l) Other than the filings, notices and reports pursuant to, in compliance with or required to be made under the Exchange Act
and those set forth as conditions to closing in the Merger Agreement, no filings, notices, reports, consents, registrations, approvals,
permits, waivers, expirations of waiting periods or authorizations are required to be obtained by Stockholder from, or to be given
by Stockholder to, or be made by Stockholder with, any Governmental Authority in connection with the execution, delivery and performance
by Stockholder of this Agreement or the consummation of the transactions contemplated hereby.
(m) There is no Action pending or, to the knowledge of the Stockholder, threatened, against the Stockholder that challenges
the Stockholder’s beneficial or record ownership of the Securities, the validity of this Agreement or the performance by
the Stockholder of its obligations under this Agreement.
(n) Except as expressly disclosed in a Schedule 13D or Schedule 13G (or amendments thereto) filed by the Stockholder with the
SEC with respect to the beneficial ownership of the SPAC’s common stock, the Stockholder is not currently (and at all times
through Closing will refrain from being or becoming) a member of a “group” (within the meaning of Section 13(d)(3)
or Section 14(d)(2) of the Exchange Act), including any group acting for the purpose of acquiring, holding or disposing of equity
securities of the SPAC (within the meaning of Rule 13d-5(b)(1) under the Exchange Act).
(o) The Stockholder (i) has not entered into any voting agreement or voting trust with respect to the Securities inconsistent
with the Stockholder’s obligations pursuant to this Agreement, (ii) has not granted a consent or power of attorney with respect
to the Securities and (iii) has not entered into any agreement or knowingly taken any action that would make any representation
or warranty of the Stockholder contained herein untrue or incorrect in any material respect or have the effect of preventing the
Stockholder from performing any of its material obligations under this Agreement.
(p) The Stockholder understands and acknowledges that the SPAC is entering into the Merger Agreement in reliance upon the Stockholder’s
execution and delivery of this Agreement and the representations, warranties, covenants and other agreements of the Stockholder
contained herein.
(q) No investment banker, broker, finder or other intermediary is entitled to any broker’s, finder’s, financial
advisor’s or other similar fee or commission for which the SPAC is or will be liable in connection with the transactions
contemplated hereby based upon arrangements made by or, to the knowledge of the Stockholder, on behalf of the Stockholder.
8.
Representations and Warranties of the SPAC. The SPAC hereby represents and warrants to the Stockholder that:
(a) This Agreement has been validly authorized, executed and delivered by it and, assuming the due authorization, execution
and delivery thereof by the other Parties, is a valid and binding agreement enforceable in accordance with its terms, subject to
the general principles of equity and to bankruptcy or other laws affecting the enforcement of creditors’ rights generally.
The execution, delivery and performance of this Agreement by the SPAC does not and will not conflict with, violate or cause a breach
of, constitute a default under, or result in a violation of (i) any agreement, contract or instrument to which the SPAC is
a party which would prevent the SPAC from performing its obligations hereunder or (ii) any law, statute, rule or regulation to
which the SPAC is subject.
(b) The Issued Class A Common Stock to be issued by the Stockholder pursuant to this Agreement shall be free and clear of any
liens, claims, security interests, options charges or any other encumbrance whatsoever, except for restrictions imposed by federal
and state securities laws and the transfer restrictions referred to in Section 5.
9.
Joinder by Designee. The SPAC and the Stockholder acknowledge and agree that the Stockholder may elect a Designee
to be issued the Issued Class A Common Stock pursuant to the Share Issuance in place of the Stockholder, provided that:
(a) the Stockholder provides the SPAC written notice of the proposed Designee at least ten (10) Business Days prior to the Closing;
(b) the SPAC consents to the election of the Designee, which shall not be unreasonably withheld or delayed; and
(c) at least five (5) Business Days prior to the Closing, the Designee validly executes a Joinder to this Agreement in substantially
the form attached hereto as Exhibit B (the “Joinder”), pursuant to which the Designee shall represent
and warrant to the SPAC the matters set out in Section 7.
10. Conditions to Share Issuances. Notwithstanding any provision in this Agreement to the contrary, the SPAC’s
obligation to issue the Issued Class A Common Stock to the Stockholder (or its Designee) pursuant to the Share Issuance shall be
conditioned upon: (i) the Stockholder complying with Sections 1 and 2 hereof until termination of this Agreement
(including, for the avoidance of doubt, the Stockholder holding the Securities until the Business Day following the meeting of
the stockholders of the SPAC at which the stockholders vote on and approve the consummation of Merger, other than as permitted
pursuant to Section 2); and (ii) the Closing occurring, and, in any case, the Share Issuance will only take place immediately
prior to, and substantially concurrently with, the Closing.
11. Trust Account Waiver. The Stockholder acknowledges that the SPAC has established a trust account (the “Trust
Account”) containing the proceeds of the IPO and certain proceeds of the private placement consummated simultaneously
with the IPO (including interest accrued from time to time thereon) for the benefit of its public shareholders. For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Stockholder hereby agrees (on its own behalf and
on behalf of its related parties) that it does not now and shall not at any time hereafter have any right, title, interest or claim
of any kind in or to any assets held in the Trust Account (other than those that it may have as a shareholder of the SPAC), and
it shall not make any claim against the Trust Account, regardless of whether such claim arises as a result of, in connection with
or relating in any way to this Agreement or any other matter, and regardless of whether such claim arises based on contract, tort,
equity or any other theory of legal liability (any and all such claims are collectively referred to hereafter as the “Released
Claims”); provided, that the Released Claims shall not include any rights or claims of the Stockholder or any of
its related parties as a shareholder of the SPAC to the extent related to or arising from any shares of the SPAC.
12. Covenants of the Stockholder. The Stockholder hereby: (a) agrees to promptly notify the SPAC of the number of any
new Securities acquired by the Stockholder after the date hereof and prior to the Expiration Date (any such Securities being subject
to the terms of this Agreement as though owned by the Stockholder on the date hereof), and any other changes to the number or type
of Securities owned by Stockholder; (b) agrees to permit the SPAC to publish and disclose the Stockholder’s identity, ownership
of the Securities and the nature of the Stockholder’s commitments, arrangements and understandings under this Agreement,
and, if deemed appropriate by the SPAC, a copy of this Agreement, in (i) the Registration Statement/Proxy Statement, (ii) any Form
8-K filed by the SPAC with the SEC in connection with the execution and delivery of the Merger Agreement and the Registration Statement/Proxy
Statement, and (iii) any other documents or communications provided by the SPAC to any Governmental Authority or to securityholders
of SPAC, in each case, to the extent required by the federal securities Laws or the SEC or any other securities authorities; (c)
shall and does authorize the SPAC, and any of their respective counsels, to notify SPAC’s transfer agent that there is a
stop transfer order with respect to all of the Securities (and that this Agreement places limits on the voting and transfer of
such shares); provided that the SPAC, or such counsel, as applicable, further notifies the SPAC’s transfer agent to
lift and vacate the stop transfer order with respect to the Securities following the Expiration Date; (d) agrees not to take
or agree or commit to take any action that would make any representation and warranty of the Stockholder contained in this Agreement
inaccurate in any material respect; (e) agrees to provide to the SPAC, the Company and their respective Representatives any information
regarding Stockholder or the Securities that is reasonably requested by the SPAC, the Company or their respective Representatives
for inclusion in the Registration Statement; and (f) shall not issue any press release or otherwise make any public statements
with respect to the Transactions or the transactions contemplated herein without providing prior notice to the Company and the
SPAC, after which the Company and the SPAC shall be provided reasonable time to consult with the Stockholder before any such public
statements are made, unless such information was already made available publicly in reports filed with the SEC or is otherwise
required by applicable Law; provided, nothing herein shall restrict the Stockholder’s right to furnish or disclose
any information with respect to the Transactions or the transactions contemplated herein (i) to its limited partners, members or
shareholders, (ii) as required by applicable Law, regulation, SEC or stock exchange requirement or legal process, or (iii) as
permitted by the Merger Agreement. The Stockholder agrees that it shall not, and shall cause its Affiliates not to, indirectly
accomplish or attempt to accomplish that which it is not permitted to accomplish directly under this Agreement.
13. Termination. This Agreement shall terminate and be of no further force or effect upon the earliest to occur of (a)
the consummation of the Merger, (b) the termination of the Merger Agreement pursuant to and in compliance with the terms therein,
and (c) the mutual written agreement of each of the Parties to terminate this Agreement (such earliest date, the “Expiration
Date”). Upon such termination, no Party shall have any further obligations hereunder; provided that (a) this Section 13,
Section 15 and Section 17 shall survive any termination of this Agreement and (b) the termination of this
Agreement shall not prevent any Party hereunder from seeking any remedies (at law or in equity) against another Party or relieve
such Party from liability for such Party’s breach of any terms of this Agreement.
14. Fiduciary Duties. Notwithstanding anything in this Agreement to the contrary, (a) the Stockholder makes no agreement
or understanding herein in any capacity other than in such Stockholder’s capacity as a record holder and beneficial owner
of the Securities, and not in such Stockholder’s capacity as a director, officer or employee of SPAC or any of its Affiliates,
as applicable and (b) nothing herein will be construed to limit or affect any action or inaction by such Stockholder or any representative
of such Stockholder serving as a member of the board of directors of the SPAC or its Affiliates or as an officer, employee or fiduciary
of the SPAC or its Affiliates, in each case, acting in such person’s capacity as a director, officer, employee or fiduciary
of the SPAC or such Affiliate.
15. Non-Recourse. This Agreement may only be enforced against, and any claim or cause of action based upon, arising out
of, or related to this Agreement or the transactions contemplated hereby may only be brought against, the Persons that are expressly
named as Parties and then only with respect to the specific obligations set forth herein with respect to such Party. Notwithstanding
the foregoing, nothing in this Section 15 shall limit, amend or waive any rights or obligations of any party to this
Agreement, the Merger Agreement, or any Ancillary Documents.
16. No Ownership Interest. Nothing contained in this Agreement will be deemed to vest in the SPAC any direct or indirect
ownership or incidents of ownership of or with respect to the Securities. All rights, ownership and economic benefits of and relating
to the Securities shall remain vested in and belong to Stockholder, and the SPAC shall have no authority to manage, direct, superintend,
restrict, regulate, govern or administer any of the policies or operations of the SPAC or exercise any power or authority to direct
the Stockholder in the voting of any of the Securities, except as otherwise provided herein with respect to the Securities. Except
as otherwise set forth in Section 2, the Stockholder shall not be restricted from voting in favor of, against or abstaining
with respect to any other matters presented to the stockholders of the SPAC.
17. Miscellaneous.
(a) The Parties shall execute and deliver such additional documents and take such additional actions as the Parties reasonably
may deem to be practical and necessary in order to consummate the transactions contemplated by this Agreement.
(b) Except as otherwise provided herein, each Party shall bear its own expenses incurred in connection with this Agreement,
regardless of whether the Transactions shall be consummated, including all fees of its legal counsel, financial advisers and accountants.
(c) All notices and other communications among the Parties shall be in writing and shall be deemed to have been duly given when
delivered (i) in person, (ii) by facsimile or other electronic means (including email), with affirmative confirmation of receipt,
(iii) one Business Day after being sent, if sent by reputable, nationally recognized overnight courier service or (iv) three (3)
Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in each case
to the applicable Party at the following addresses (or at such other address for a Party as shall be specified by like notice):
if to the SPAC prior to the Closing:
SEP Acquisition Corp.
3737 Buffalo Speedway
Suite 1750
Houston, TX 77098
Attn: Andrew White
Telephone No.: 713-715-6820
Email: info@seplp.com
with a copy to:
Baker Donelson, Bearman, Caldwell & Berkowitz,
PC
1600 West End Avenue
Suite 2000
Nashville, TN 37203
Attn: Tonya Mitchem Grindon
Attn: Nathan Kibler
Attn: Andrew Yonchak
Telephone No.: 615-726-5600
Email: tgrindon@bakerdonelson.com
Email: nkibler@bakerdonelson.com
Email: dyonchak@bakerdonelson.com
If to the Purchaser after the Closing
or to the Company, to:
Sanuwave Health, Inc.
11495 Valley View Road
Eden Prairie, Minnesota 55344
Attn: Morgan C. Frank, Chief Executive
Officer
Email:
with a copy (which will not constitute notice) to:
Faegre Drinker Biddle & Reath LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, Minnesota 55402
Attn: Ben A. Stacke
Attn: Jonathan Nygren
Email: ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com
if to Stockholder, to the address
or email of Stockholder set forth on the signature page hereto.
(d) Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally
or in a particular instance, and either retroactively or prospectively) only with the written consent of the Company, the Purchaser
and the Sponsor. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof. No waivers
of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed to be or
construed as a further or continuing waiver of any such term, condition, or provision.
(e) Nothing expressed or implied in this Agreement is intended or shall be construed to confer upon or give any Person, other
than the Parties, any right or remedies under or by reason of this Agreement; provided, however, that the past, present
and future directors, officers, employees, incorporators, members, partners, stockholders, Affiliates, agents, attorneys, advisors
and representatives of the Parties, and any Affiliate of any of the foregoing (and their successors, heirs and representatives),
are intended third-party beneficiaries of, and may enforce, Section 15.
(f) This Agreement is intended to create, and creates, a contractual relationship and is not intended to create, and does not
create, any agency, partnership, joint venture or any like relationship between or among the Parties.
(g) This Agreement, and the other agreements referred to in this Agreement, the Merger Agreement, and the Transaction Agreements,
constitute the entire agreement among the Parties relating to the transactions contemplated hereby and supersede any other agreements,
whether written or oral, that may have been made or entered into by or among any of the Parties or any of their respective Subsidiaries
relating to the transactions contemplated hereby. No representations, warranties, covenants, understandings, agreements, oral or
otherwise, relating to the transactions contemplated by this Agreement exist between the Parties except as expressly set forth
or referenced in this Agreement, the Merger Agreement, and the Transaction Agreements. The captions in this Agreement are for convenience
only and shall not be considered a part of or affect the construction or interpretation of any provision of this Agreement. This
Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
(h) This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the Parties and their
respective permitted successors and assigns. This Agreement and all of its obligations are personal to the Parties and may not
be assigned, transferred or delegated at any time without the prior written consent of the other Parties, and any purported assignment,
transfer or delegation without such consent shall be null and void ab initio.
(i) This Agreement, and all claims or causes of action based upon, arising out of, or related to this Agreement or the transactions
contemplated hereby, shall be governed by, and construed in accordance with, the Laws of the State of Delaware, without giving
effect to principles or rules of conflict of laws to the extent such principles or rules would require or permit the application
of Laws of another jurisdiction. Each of the Parties hereby irrevocably and unconditionally submits, for itself and its property,
to the exclusive jurisdiction of the Court of Chancery of the State of Delaware or, if such court shall not have or declines jurisdiction,
any state or federal court of the United States of America sitting in Delaware, and any appellate court from any appeal thereof,
in any Action arising out of or relating to this Agreement or the transactions contemplated hereby, and each of the Parties hereby
irrevocably and unconditionally (i) agrees not to commence any such Action except in such courts, (ii) agrees that any claim in
respect of any such Action may be heard and determined in the Court of Chancery of the State of Delaware or, to the extent permitted
by Law, in such state or federal court, (iii) waives, to the fullest extent it may legally and effectively do so, any objection
which it may now or hereafter have to the laying of venue of any such Action in the Court of Chancery of the State of Delaware
or such state or federal court and (iv) waives, to the fullest extent permitted by Law, the defense of an inconvenient forum to
the maintenance of such Action in the Court of Chancery of the State of Delaware or such state or federal court. Each of the Parties
agrees that a final judgment in any such Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by Law. Each Party irrevocably consents to service of process in the manner provided for notices
in Section 17(c). Nothing in this Agreement will affect the right of any Party to serve process in any other manner
permitted by Law. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY DISPUTE OR CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY
TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE
TO A TRIAL BY JURY IN RESPECT OF ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT (I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE EITHER OF SUCH
WAIVERS, (II) IT UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF SUCH WAIVERS, (III) IT MAKES SUCH WAIVERS VOLUNTARILY AND (IV)
IT HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 17(i).
(j) The Parties agree that irreparable damage for which monetary damages, even if available, may not be an adequate remedy,
may occur in the event that the Parties do not perform their obligations under the provisions of this Agreement (including failing
to take such actions as are required of them hereunder to consummate this Agreement) in accordance with its specified terms or
otherwise breach such provisions. The Parties acknowledge and agree that (i) the Parties shall be entitled to seek an injunction,
specific performance, or other equitable relief, to prevent breaches of this Agreement and to enforce specifically the terms and
provisions hereof, without proof of damages or the requirement to post any bond or other security, prior to the Expiration Date,
this being in addition to any other remedy to which they are entitled under this Agreement, and (ii) the right of specific enforcement
is an integral part of the transactions contemplated by this Agreement and without that right, none of the Parties would have entered
into this Agreement.
(k) In the event of a stock split, stock dividend or distribution, or any change in SPAC’s capital stock by reason of
any split-up, reverse stock split, recapitalization, combination, reclassification, exchange of shares or the like, the term “Securities”
shall be deemed to refer to and include all such stock dividends and distributions and any securities into which or for which any
or all of such shares may be changed or exchanged or which are received in such transaction.
(l) For purposes of this Agreement, whenever the context requires the singular number shall include the plural, and vice versa,
the masculine gender shall include the feminine and neuter genders, the feminine gender shall include the masculine and neuter
genders, and the neuter gender shall include masculine and feminine genders. The Parties agree that any rule of construction to
the effect that ambiguities are to be resolved against the drafting Party shall not be applied in the construction or interpretation
of this Agreement. As used in this Agreement, the words “include” and “including,” and variations thereof,
shall not be deemed to be terms of limitation, but rather shall be deemed to be followed by the words “without limitation.”
Except as otherwise indicated, all references in this Agreement to “Sections” are intended to refer to Sections of
this Agreement. The headings and captions contained in this Agreement are for convenience of reference only, shall not be deemed
to be a part of this Agreement, and shall not be referred to in connection with the construction or interpretation of this Agreement.
The words, “hereby,” “herewith,” “herein,” “hereto,” “hereof” and words
of similar import shall refer to this Agreement as a whole and not to any particular Section or paragraph hereof. Derivative forms
of defined terms shall have correlative means.
(m) If any provision of this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions
of this Agreement shall remain in full force and effect. The Parties further agree that if any provision contained herein is, to
any extent, held invalid or unenforceable in any respect under the Laws governing this Agreement, they shall take any actions necessary
to render the remaining provisions of this Agreement valid and enforceable to the fullest extent permitted by Law and, to the extent
necessary, shall amend or otherwise modify this Agreement to replace any provision contained herein that is held invalid or unenforceable
with a valid and enforceable provision giving effect to the intent of the Parties.
[Signature Page Follows]
IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be executed as of the date first above written.
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SPAC: |
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SEP ACQUISITION CORP. |
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By: |
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Name:
Title: |
[Signature
page to Voting and Non-Redemption Agreement]
IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be executed as of the date first above written.
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STOCKHOLDER: |
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[NAME] |
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By: |
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Name:
Title: |
[Signature
page to Voting and Non-Redemption Agreement]
Exhibit A
SPAC Shares
Class A Common Stock |
__________ |
Exhibit B
FORM OF JOINDER TO VOTING AND NON-REDEMPTION
AGREEMENT
_____________, 2023
1.
Reference is made to that certain Voting and Non-Redemption Agreement, dated August 23, 2023 (as may be amended from
time to time, the “Agreement”), by and among [NAME] (the “Stockholder”) and SEP Acquisition
Corp., a Delaware corporation (the “Company” or “SPAC”). Capitalized terms used and not otherwise
defined herein shall have the meanings given to such terms in the Agreement.
2.
Pursuant to Sections 3(a)(i) and 9 of the Agreement, the Stockholder has designated [Designee Name] (the “Designee”)
as its designee to be issued the Issued Class A Common Stock pursuant to the Share Issuance on the terms set out in the Agreement,
and the Company has consented to the election of the Designee by the Stockholder.
3.
By executing this joinder (the “Joinder”), the Designee and each party hereto hereby agrees, as of the
date first set forth above, that:
| a. | the Designee shall become a party to the Agreement (as it exists on the date of this Joinder solely
with respect to the issuance of the Issued Class A Common Stock pursuant to the Share Issuance); and |
| b. | the Designee shall be bound by the terms and provisions of the Agreement as if it were the Stockholder,
and will be deemed to have given the representations and warranties as set out in Section 7 of the Agreement for the
benefit of the Company, and shall entitled to the rights of the Stockholder under the Agreement, each only to the extent applicable
with respect to the issuance of the Issued Class A Common Stock to the Designee pursuant to the Share Issuance. |
4.
For the avoidance of doubt, the following provisions of the Agreement will not be applicable with respect to the Designee:
Section 1 and Section 2.
5.
This Joinder may be executed in one or more counterparts, and by the different parties hereto in separate counterparts,
each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same
agreement. This Joinder shall become binding when one or more counterparts hereof, individually or taken together, shall bear the
signatures of all parties reflected hereon as signatories. The delivery by facsimile or by electronic delivery (including any electronic
signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records
Act or other applicable law, e.g., www.docusign.com) of this Joinder with all executed signature pages (in counterparts or otherwise)
shall be sufficient to bind the parties hereto to the terms and conditions set forth herein.
[Signature Page Follows]
IN WITNESS WHEREOF,
the undersigned have executed this Joinder as of the date first set forth above.
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COMPANY: |
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SEP ACQUISITION CORP. |
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By: |
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Name:
Title: |
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STOCKHOLDER: |
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[NAME] |
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By: |
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Name:
Title: |
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DESIGNEE: |
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[NAME] |
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By: |
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Name:
Title: |
[Signature
Page to Joinder to Voting and Non-Redemption Agreement]
Exhibit 10.4
LOCK-UP AGREEMENT
(Company)
This Lock-Up Agreement
(this “Agreement”) is made and entered into as of August 23, 2023 by and among (i) SEP Acquisition
Corp., a Delaware corporation (the “Purchaser”), and (ii) the undersigned (“Holder”).
Any capitalized term used but not defined in this Agreement will have the meaning ascribed to such term in the Merger Agreement.
WHEREAS, on
the date hereof, (i) the Purchaser, (ii) SEP Acquisition Holdings Inc., a Nevada corporation and a wholly-owned subsidiary of the
Purchaser (“Merger Sub”), and (iii) SANUWAVE Health, Inc., a Nevada corporation (the “Company”),
entered into an Agreement and Plan of Merger (as amended from time to time in accordance with the terms thereof, the “Merger
Agreement”), pursuant to which, among other matters Merger Sub will merge with and into the Company, with the Company
continuing as the surviving entity (the “Merger”), as a result of which all of the issued and outstanding
capital stock of the Company immediately prior to the Effective Time shall no longer be outstanding and shall automatically be
cancelled and shall cease to exist, in exchange for the right to receive the Stockholder Merger Consideration, all upon the terms
and subject to the conditions set forth in the Merger Agreement and in accordance with the applicable provisions of the BCA;
WHEREAS, as
of the date hereof, Holder is a holder of the Company Stock in such amounts and classes or series as set forth underneath Holder’s
name on the signature page hereto; and
WHEREAS, pursuant
to the Merger Agreement, and in view of the valuable consideration to be received by Holder thereunder, the parties desire to enter
into this Agreement, pursuant to which the Stockholder Merger Consideration received by Holder in the Merger, including its right
to any Purchaser Securities (all such securities, together with any securities paid as dividends or distributions with respect
to such securities or into which such securities are exchanged or converted, the “Restricted Securities”),
shall become subject to limitations on disposition as set forth herein.
NOW, THEREFORE,
in consideration of the premises set forth above, which are incorporated in this Agreement as if fully set forth below, and intending
to be legally bound hereby, the parties hereby agree as follows:
(a)
Holder hereby agrees that [it] / [he] / [she] shall not Transfer any Restricted Securities until the earlier of (i) 180
days after the completion of the Merger or (ii) subsequent to the Merger, the date on which the Purchaser completes a liquidation,
merger, capital stock exchange, reorganization or other similar transaction that results in all of the Purchaser Stockholders having
the right to exchange their shares of Purchaser Class A Common Stock for cash, securities or other property (the “Lock-up
Period”).
(b)
Notwithstanding the provisions set forth in Section 1(a), Transfers of the Restricted Securities that are held by Holder
or any of their permitted transferees (that have complied with this Section 1(b)), are permitted (i) to the Purchaser’s officers,
directors, any affiliates or family members of any of the Purchaser’s officers, directors[, any members of the Holder] or
any affiliates of the Holder; (ii) in the case of an individual, transfers by gift to a member of the individual’s immediate
family, to a trust, the beneficiary of which is a member of the individual’s immediate family or an affiliate of such person,
or to a charitable organization; (iii) in the case of an individual, transfers by virtue of laws of descent and distribution upon
death of the individual; (iv) in the case of an individual, transfers pursuant to a qualified domestic relations order; (v) transfers
by private sales or transfers made in connection with the consummation of a Business Combination at prices no greater than the
price at which the securities were originally purchased; (vi) transfers by virtue of the laws of the State of Delaware or the Holder’s
organizational documents upon dissolution of the Holder; and (vii) in the event of the Purchaser’s liquidation, merger, capital
stock exchange, reorganization or other similar transaction which results in all of the Purchaser Stockholders having the right
to exchange their shares of Purchaser Class A Common Stock for cash, securities or other property subsequent to the completion
of the Merger; provided, however, that in the case of clauses (i) through (vii), these permitted transferees must enter into a
written agreement agreeing to be bound by the restrictions herein.
(c)
As used herein, (i) “Business Combination” shall mean a merger, capital stock exchange, asset
acquisition, stock purchase, reorganization or similar business combination, involving the Purchaser and one or more businesses;
and (ii) “Transfer” shall mean the (1) sale of, offer to sell, contract or agreement to sell, hypothecate,
pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment
or increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position within the meaning
of Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Securities and Exchange
Commission promulgated thereunder with respect to, any security, (2) entry into any swap or other arrangement that transfers to
another, in whole or in part, any of the economic consequences of ownership of any security, whether any such transaction is to
be settled by delivery of such securities, in cash or otherwise, or (3) public announcement of any intention to effect any
transaction specified in clause (1) or (2).
(a)
Termination of Merger Agreement. This Agreement shall be binding upon Holder upon Holder’s execution and delivery
of this Agreement, but this Agreement shall only become effective upon the Closing. Notwithstanding anything to the contrary contained
herein, in the event that the Merger Agreement is terminated in accordance with its terms prior to the Closing, this Agreement
and all rights and obligations of the parties hereunder shall automatically terminate and be of no further force or effect.
(b)
Binding Effect; Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the
benefit of the parties hereto and their respective permitted successors and assigns. This Agreement and all obligations of the
parties are personal to the parties and, except as expressly set forth in this Agreement, may not be transferred or delegated by
any party at any time.
(c)
Third Parties. Nothing contained in this Agreement or in any instrument or document executed by any party in connection
with the transactions contemplated hereby shall create any rights in, or be deemed to have been executed for the benefit of, any
person or entity that is not a party hereto or thereto or a successor or permitted assign of such a party.
(d)
Governing Law; Jurisdiction. This Agreement and any dispute or controversy arising out of or relating to this Agreement
or the actions of any party hereto in the negotiation, administration, performance or enforcement hereof shall be governed by and
construed in accordance with the laws of the State of Delaware, without regard to the conflict of law principles thereof. All actions,
claims, suits or other legal proceedings arising out of or relating to this Agreement, including counterclaims (whether based in
contract, tort or otherwise) (“Actions”) shall be heard and determined exclusively in the Chancery Court
of the State of Delaware (or, if the Chancery Court of the State of Delaware declines to accept jurisdiction over a particular
matter, any state or U.S. federal court located in the State of Delaware (or in any appellate court thereof)) (the “Specified
Courts”). Each party hereto hereby (i) submits to the exclusive jurisdiction of any Specified Court for the
purpose of any Action arising out of or relating to this Agreement brought by any party hereto and (ii) irrevocably waives,
and agrees not to assert by way of motion, defense or otherwise, in any such Action, any claim that it is not subject personally
to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the Action
is brought in an inconvenient forum, that the venue of the Action is improper, or that this Agreement or the transactions contemplated
hereby may not be enforced in or by any Specified Court. Each party agrees that a final judgment in any Action shall be conclusive
and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each party irrevocably
consents to the service of the summons and complaint and any other process in any other action or proceeding relating to the transactions
contemplated by this Agreement, on behalf of itself, or its property, by personal delivery of copies of such process to such party
at the applicable address set forth in Section 2(g). Nothing in this Section 2(d) shall affect
the right of any party to serve legal process in any other manner permitted by applicable law.
(e)
WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTION DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION
WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF SUCH PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE
OR ENFORCEMENT HEREOF. EACH PARTY HERETO (i) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR
OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SEEK TO ENFORCE THAT FOREGOING WAIVER AND (ii) ACKNOWLEDGES
THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION 2(e).
(f)
Interpretation. The titles and subtitles used in this Agreement are for convenience only and are not to be considered
in construing or interpreting this Agreement. In this Agreement, unless the context otherwise requires: (i) any pronoun used in
this Agreement shall include the corresponding masculine, feminine or neuter forms, and the singular form of nouns, pronouns and
verbs shall include the plural and vice versa; (ii) “including” (and with correlative meaning “include”)
means including without limiting the generality of any description preceding or succeeding such term and shall be deemed in each
case to be followed by the words “without limitation”; (iii) the words “herein,” “hereto,”
and “hereby” and other words of similar import shall be deemed in each case to refer to this Agreement as a whole and
not to any particular section or other subdivision of this Agreement; (iv) the term “or” means “and/or”
and (v) “affiliate” shall mean, with respect to any specified person, any other person or group of persons acting
together that, directly or indirectly, through one or more intermediaries controls, is controlled by or is under common control
with such specified person (where the term “control” (and any correlative terms) means the possession, direct or indirect,
of the power to direct or cause the direction of the management and policies of such person, whether through the ownership of voting
securities, by contract or otherwise). The parties have participated jointly in the negotiation and drafting of this Agreement.
Consequently, in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if
drafted jointly by the parties hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue
of the authorship of any provision of this Agreement.
(g)
Notices. All notices, consents, waivers and other communications hereunder shall be in writing and shall be deemed
to have been duly given when delivered (i) in person, (ii) by facsimile or other electronic means, with affirmative confirmation
of receipt, (iii) one Business Day after being sent, if sent by reputable, nationally recognized overnight courier service or (iv)
three (3) Business Days after being mailed, if sent by registered or certified mail, pre-paid and return receipt requested, in
each case to the applicable party at the following addresses (or at such other address for a party as shall be specified by like
notice):
If to the Holder, to the address set forth on the signature
page hereto.
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If to the Purchaser at or prior to the Closing, to:
SEP Acquisition Corp.
3737 Buffalo Speedway
Suite 1750
Houston, TX 77098
Attn: Andrew White
Telephone No.: 713-715-6820
Email: info@seplp.com
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with a copy (which will not constitute notice) to:
Baker Donelson, Bearman, Caldwell & Berkowitz, PC
1600 West End Avenue
Suite 2000
Nashville, TN 37203
Attn: Tonya Mitchem Grindon
Attn: Nathan Kibler
Attn: Andrew Yonchak
Telephone No.: 615-726-5600
Email: tgrindon@bakerdonelson.com
Email: nkibler@bakerdonelson.com
Email: dyonchak@bakerdonelson.com
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If to the Company, to:
Sanuwave Health, Inc.
11495 Valley View Road
Eden Prairie, Minnesota 55344
Attn: Morgan C. Frank, Chief Executive Officer
Email:
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with a copy (which will not constitute notice) to:
Faegre Drinker Biddle & Reath LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, Minnesota 55402
Attn: Ben A. Stacke
Attn: Jonathan Nygren
Email: ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com
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If to the Purchaser after the Closing, to:
Sanuwave Health, Inc.
11495 Valley View Road
Eden Prairie, Minnesota 55344
Attn: Morgan C. Frank, Chief Executive Officer
Email:
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with a copy (which will not constitute notice) to:
Faegre Drinker Biddle & Reath LLP
2200 Wells Fargo Center
90 South Seventh Street
Minneapolis, Minnesota 55402
Attn: Ben A. Stacke
Attn: Jonathan Nygren
Email: ben.stacke@faegredrinker.com
Email: jon.nygren@faegredrinker.com
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(h)
Amendments and Waivers. Any term of this Agreement may be amended and the observance of any term of this Agreement
may be waived (either generally or in a particular instance, and either retroactively or prospectively) only with the written consent
of the Purchaser and Holder. No failure or delay by a party in exercising any right hereunder shall operate as a waiver thereof.
No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed
to be or construed as a further or continuing waiver of any such term, condition, or provision.
(i) Severability. In case any provision in this Agreement shall be held invalid, illegal or unenforceable in a jurisdiction,
such provision shall be modified or deleted, as to the jurisdiction involved, only to the extent necessary to render the same valid,
legal and enforceable, and the validity, legality and enforceability of the remaining provisions hereof shall not in any way be
affected or impaired thereby nor shall the validity, legality or enforceability of such provision be affected thereby in any other
jurisdiction. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the
parties will substitute for any invalid, illegal or unenforceable provision a suitable and equitable provision that carries out,
so far as may be valid, legal and enforceable, the intent and purpose of such invalid, illegal or unenforceable provision.
(j) Specific Performance. Holder acknowledges that its obligations under this Agreement are unique, recognizes and affirms
that in the event of a breach of this Agreement by Holder, money damages may be inadequate and Purchaser may have no adequate remedy
at law, and agrees that irreparable damage may occur in the event that any of the provisions of this Agreement were not performed
by Holder in accordance with their specific terms or were otherwise breached. Accordingly, the Purchaser shall be entitled to seek
an injunction or restraining order to prevent breaches of this Agreement by Holder and to seek to enforce specifically the terms
and provisions hereof, without the requirement to post any bond or other security or to prove that money damages would be inadequate,
this being in addition to any other right or remedy to which such party may be entitled under this Agreement, at law or in equity.
(k) Entire Agreement. This Agreement constitutes the full and entire understanding and agreement among the parties with
respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing between
the parties is expressly canceled; provided, that, for the avoidance of doubt, the foregoing shall not affect the rights
and obligations of the parties under the Merger Agreement or any Ancillary Document. Notwithstanding the foregoing, nothing in
this Agreement shall limit any of the rights or remedies of the Purchaser or any of the obligations of Holder under any other agreement
between Holder and the Purchaser or any certificate or instrument executed by Holder in favor of the Purchaser, and nothing in
any other agreement, certificate or instrument shall limit any of the rights or remedies of the Purchaser or any of the obligations
of Holder under this Agreement.
(l) Further Assurances. From time to time, at another party’s request and without further consideration (but at
the requesting party’s reasonable cost and expense), each party shall execute and deliver such additional documents and take
all such further action as may be reasonably necessary to consummate the transactions contemplated by this Agreement.
(m) Counterparts; Facsimile. This Agreement may also be executed and delivered by facsimile signature or by email
in portable document format in two or more counterparts, each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.
{Remainder of Page Intentionally Left
Blank; Signature Pages Follow}
IN WITNESS WHEREOF, the parties have executed
this Lock-Up Agreement as of the date first written above.
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Title: Chief
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{Additional Signature on the Following Page}
[Signature Page to Lock-Up Agreement (Company)]
IN WITNESS WHEREOF, the parties have executed
this Lock-Up Agreement as of the date first written above.
Holder:
Name of Holder: [ ]
Name:
Title:
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[Signature Page to Lock-Up Agreement (Company)]
Exhibit 10.5
AMENDMENT NUMBER ONE TO LETTER AGREEMENT
THIS AMENDMENT NUMBER
ONE TO LETTER AGREEMENT (this “Amendment”), dated as of _____________, 2023, is by and between SEP Acquisition
Corp., a Delaware corporation formerly known as “Mercury Ecommerce Acquisition Corp.” (the “Company”),
Mercury Sponsor Group I LLC, a Delaware limited liability company (“Sponsor”) and each of the undersigned
individuals, each of whom is a member of the Company’s board of directors, management team and/or advisory board (each, an
“Insider” and collectively, the “Insiders”), and the other persons party hereto
(the “Other Investors” and, together with Sponsor and each Insider, the “Holders”
and each, a “Holder”). Defined terms used herein but not otherwise defined herein shall have the meanings
assigned to them in that certain Letter Agreement, dated July 27, 2021, among the Company, Sponsor, the Insiders and the Other
Investors (the “Original Letter Agreement”).
RECITALS
WHEREAS, the undersigned
are parties to the Original Letter Agreement;
WHEREAS, the Company,
SEP Acquisition Holdings Inc., a Nevada corporation and wholly owned subsidiary of the Company (“Merger Sub”)
and SANUWAVE Health, Inc., a Nevada corporation (“Target”), have entered into that certain Agreement
and Plan of Merger, dated as of August 23, 2023 (the “Merger Agreement”), pursuant to which Target will
merge with and into Merger Sub (the “Merger”), with Target being the surviving entity in the Merger (the
date of such Merger, the “Closing Date”);
WHEREAS, in connection
with the transactions contemplated by the Merger Agreement, the parties to the Original Letter Agreement have agreed to amend the
Original Letter Agreement on the terms set forth herein.
NOW, THEREFORE, in
consideration of the mutual covenants and promises set forth herein, the parties hereto, intending to be legally bound hereby,
agree as of the date hereof, as follows:
AGREEMENTS
1. Amendments to Original Letter Agreement. The Original Letter Agreement is hereby amended as follows:
(a) Section 7 is hereby deleted in its entirety and replaced with the following:
7. (a) The Sponsor,
each Insider and each Other Investor agrees that it, he or she shall not Transfer any Founder Shares (or shares of Common Stock
issuable upon conversion thereof) or other shares of the Company’s Common Stock (collectively, the “Restricted
Securities”) until the earlier of (i) 180 days after the completion of the Company’s initial Business Combination
or (ii) subsequent to the Business Combination, the date on which the Company completes a liquidation, merger, capital stock exchange,
reorganization or other similar transaction that results in all of the Company’s stockholders having the right to exchange
their shares of Common Stock for cash, securities or other property (the “Lock-up Period”).
(b) [Reserved].
(c) Notwithstanding
the provisions set forth in paragraph 7(a), Transfers of the Restricted Securities that are held by the Sponsor, an Insider, an
Other Investor or any of their permitted transferees (that have complied with this paragraph 7(c)), are permitted (a) to the Company’s
officers, directors, any affiliates or family members of any of the Company’s officers, directors, any members of the Sponsor
or any affiliates of the Sponsor or of an Other Investor; (b) in the case of an individual, transfers by gift to a member of the
individual’s immediate family, to a trust, the beneficiary of which is a member of the individual’s immediate family
or an affiliate of such person, or to a charitable organization; (c) in the case of an individual, transfers by virtue of laws
of descent and distribution upon death of the individual; (d) in the case of an individual, transfers pursuant to a qualified domestic
relations order; (e) transfers by private sales or transfers made in connection with the consummation of a Business Combination
at prices no greater than the price at which the securities were originally purchased; (f) transfers in the event of the Company’s
liquidation prior to the completion of an initial Business Combination; (g) transfers by virtue of the laws of the State of Delaware
or the Sponsor’s limited liability company agreement upon dissolution of the Sponsor; and (h) in the event of the Company’s
liquidation, merger, capital stock exchange, reorganization or other similar transaction which results in all of the Company’s
stockholders having the right to exchange their shares of Common Stock for cash, securities or other property subsequent to the
completion of the Company’s initial Business Combination; provided, however, that in the case of clauses (a) through (h),
these permitted transferees must enter into a written agreement agreeing to be bound by the restrictions herein.
2. Effect of Amendment. The undersigned agree and acknowledge that, except as provided in this Amendment, the Letter
Agreement shall remain in full force and effect and has not been modified or amended in any respect, it being the intention of
the undersigned that this Amendment and the Letter Agreement be read, construed and interpreted as one and the same instrument.
Notwithstanding the foregoing, this Amendment shall only become effective upon the Closing and, in the event that the Merger Agreement
is terminated in accordance with its terms prior to the Closing, this Amendment and all rights and obligations of the parties hereunder
shall automatically terminate and be of no further force or effect.
3. Headings. The headings used in this Amendment are for convenience of reference only and shall not, for any purpose,
be deemed part of this Amendment.
4. Counterparts. This Amendment may be executed in any number of original or facsimile counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and
the same instrument. Counterparts may be delivered via facsimile, electronic mail (including any electronic signature covered by
the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records Act or other applicable
law, e.g., www.docusign.com) or other transmission method and any counterpart so delivered shall be deemed to have been
duly and validly delivered and be valid and effective for all purposes.
5. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New
York, without giving effect to any conflict of law provision or rule that would cause the application of the laws of any jurisdiction
other than the State of New York.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed as of the date first above written.
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SEP Acquisition Corp. |
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Name: R. Andrew White |
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Title: President and Chief Executive Officer |
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Mercury Sponsor Group I LLC |
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[Signature Page
to Amendment No. One to Letter Agreement]
Exhibit 10.6
AMENDMENT NUMBER ONE
to
WARRANT AGREEMENT
between
SEP ACQUISITION CORP.
and
CONTINENTAL STOCK TRANSFER & TRUST
COMPANY
THIS AMENDMENT NUMBER
ONE TO WARRANT AGREEMENT (this “Amendment”), dated as of _____________, 2023, is by and between SEP Acquisition
Corp., a Delaware corporation formerly known as “Mercury Ecommerce Acquisition Corp.” (the “Company”),
and Continental Stock Transfer & Trust Company, a New York corporation, as warrant agent (the “Warrant Agent”,
also referred to herein as the “Transfer Agent”). Defined terms used herein but not otherwise defined
herein shall have the meanings assigned to them in the Original Warrant Agreement (defined below).
RECITALS
WHEREAS, the Company
and Warrant Agent are parties to that certain Warrant Agreement dated as of July 21, 2021 (the “Original Warrant Agreement”);
WHEREAS, the Company,
SEP Acquisition Holdings Inc., a Nevada corporation and wholly owned subsidiary of the Company (“Merger Sub”),
and SANUWAVE Health, Inc., a Nevada corporation (“Target”), have entered into that certain Agreement
and Plan of Merger (the “Merger Agreement”), dated August 23, 2023 (the “Effective Date”),
pursuant to which Target will merge with and into Merger Sub (the “Merger”), with Target being the surviving
entity in the Merger (the date of such Merger, the “Closing Date”);
WHEREAS, pursuant to
Section 9.8 of the Original Warrant Agreement, this Amendment has been approved by vote or written consent of the Registered Holders
of more than 50% of the outstanding Public Warrants, and each of the Registered Holders of the Private Placement Warrants; and
WHEREAS, the Company
and the Registered Holders have agreed to amend the Original Warrant Agreement on the terms set forth herein.
NOW, THEREFORE, in
consideration of the mutual covenants and promises set forth herein, the parties hereto, intending to be legally bound hereby,
agree as of the date hereof, as follows:
AGREEMENTS
| 1. | Amendments to Original Warrant Agreement. The Original Warrant Agreement is hereby amended
as follows: |
(a)
A new Section 10 shall be added to the Original Warrant Agreement that reads as follows:
10. Merger
Transaction Matters.
(a) Reference
is made to that certain Agreement and Plan of Merger (the “Merger Agreement”) dated as of August 23,
2023 (the “Effective Date”), by and among the Company, SEP Acquisition Holdings Inc., a Nevada corporation
and wholly owned subsidiary of the Company (“Merger Sub”), and SANUWAVE Health, Inc., a Nevada corporation
(“Target”), pursuant to which Target will merge with and into Merger Sub (the “Merger”),
with Target being the surviving entity in the Merger (the date of such Merger, the “Closing Date” and
the consummation of such Merger, the “Closing”).
(b) Notwithstanding
anything to the contrary set forth in this Agreement or any Warrant issued thereunder, at all times between the date hereof and
the earlier of Closing or the termination of the Merger Agreement (the “Merger Period”), the:
(1) Public
Warrants are not exercisable to purchase shares of Class A Common Stock, and instead, effective as of immediately prior to
the effective time of the Merger (the “Effective Time”) shall be automatically converted solely into
the right to receive 450,336 shares of Class A Common Stock of the Company, calculated in respect of each Registered Holder
of Public Warrants, as follows: each Public Warrant shall be converted into the right to receive, effective as of immediately prior
to the Effective Time, that number of shares of Class A Common Stock equal to: (1) (i) the number of shares of Class A Common
Stock issuable to such Registered Holder if such Registered Holder’s Public Warrants had been exercised under the terms of
Section 3 of this Agreement divided by (ii) the number of shares of Class A Common Stock issuable if all the Public Warrants
had been exercised under the terms of Section 3 of this Agreement, multiplied by (2) 450,336.
(2) Private
Placement Warrants are not exercisable to purchase shares of Class A Common Stock and instead, effective as of immediately
prior to the Effective Time, shall be automatically converted solely into the right to receive 400,000 shares of Class A Common
Stock of the Company, calculated in respect of each Registered Holder of Private Placement Warrants, as follows: each Private Placement
Warrant shall be converted into the right to receive, effective as of immediately prior to the Effective Time, that number of shares
of Class A Common Stock equal to: (1) (i) the number of shares of Class A Common Stock issuable to such Registered Holder
if such Registered Holder’s Private Placement Warrants had been exercised under the terms of Section 3 of this Agreement
divided by (ii) the number of shares of Class A Common Stock issuable if all of the Private Placement Warrants had been exercised
under the terms of Section 3 of this Agreement, multiplied by (2) 400,000.
(c) During
the Merger Period, the (i) terms of Section 3 of this Agreement regarding any exercise of a Warrant or issuance of Class A
Common Stock in connection therewith shall be of no force or effect and (ii) the terms of Section 6 of this Agreement shall
be of no force or effect.
(d) If,
by reason of any exchange of Warrants contemplated by this Section 10, the Registered Holder of any Warrant would be entitled,
upon such exchange, to receive a fractional interest in a share of Class A Common Stock, the Company shall round down to the nearest
whole number the number of shares of Class A Common Stock to be issued to such Registered Holder.
(e) Subject
to the terms of subsection (f) below, all provisions set forth in this Agreement relating to the issuance of shares of Class A
Common Stock to a Registered Holder of Warrants upon an exercise of the Warrants shall apply, mutatis mutandis, to the issuance
of shares of Class A Common Stock to a Registered Holder of Warrants in exchange for such Registered Holder’s Warrants.
In the event of any conflict between the terms of subsection (f) and any other term of this Agreement, subsection (f) shall
control.
(f) Each
Registered Holder shall be entitled to receive the number of shares of Class A Common Stock to which it is entitled under
subsection (b) above, on or as soon as reasonably practicable after the Closing Date, but subject to the delivery by such holder
to the Transfer Agent of the following items prior thereto (collectively, the “Transmittal Documents”)
in forms mutually agreed by the Company and Target prior to the Closing: (i) a properly completed and duly executed Letter of Transmittal;
and (ii) such other related documents as may be reasonably requested by the Transfer Agent or the Company. Until so surrendered,
each Warrant shall represent after the Closing Date for all purposes only the right to receive the shares of Class A Common Stock
attributable to such Warrant. If any portion of the shares of Class A Common Stock are to be issued to a Person other than the
Person in whose name the Warrant is registered immediately prior to the Closing Date, it shall be a condition to such issuance
that (i) the Person in whose name such portion of the shares are to be issued shall have executed and delivered such Transmittal
Documents as are reasonably deemed necessary by the Transfer Agent or the Company, and (ii) the Person requesting such delivery
shall pay to the Transfer Agent any transfer or other taxes required as a result of such issuance to a Person other than the Registered
Holder or establish to the satisfaction of the Transfer Agent that such tax has been paid or is not payable. Subject to applicable
Law, following delivery of the Transmittal Documents, the Company shall promptly deliver to the Registered Holder, without interest,
book-entry shares representing Class A Common Stock issued in exchange therefor and the amount of any such dividends or other distributions
with a record date after the Closing Date theretofore paid with respect to such Class A Common Stock.
(g) All
Class A Common Stock issued in exchange for and upon surrender of the Warrant(s) in accordance with the terms hereof shall be deemed
to have been issued in full satisfaction of all rights pertaining to such Warrant(s). Any Registered Holder who has not exchanged
its Warrant(s) for shares of Class A Common Stock in accordance with this Section 10 prior to the date that is four (4)
years after the Effective Time shall thereafter look only to the Company for payment of the shares of Class A Common Stock attributable
to such Warrant(s) without any interest thereon (but with any dividends paid with respect thereto). Notwithstanding the foregoing,
none of the Company, Target or any party hereto shall be liable to any person for any amount properly paid to a public official
pursuant to any applicable abandoned property, escheat or similar law.
(h) Notwithstanding
the foregoing, this Section 10 shall terminate, and have no further force and effect, on the date the Merger Agreement is terminated
in accordance with its terms.
(i) (i) This
Agreement shall automatically terminate and each Warrant hereunder shall automatically be cancelled, without any further action
of the Company or any other party, upon the Closing and issuance of shares of Class A Common Stock to the Registered Holders of
the Public Warrants and Private Placement Warrants in accordance with this Section 10. Each Registered Holder of Warrants
shall cease to have any rights related to this Agreement or such Warrants upon such termination and cancellation.
2. Effect of Amendment. The undersigned hereby agree and acknowledge that, except as provided in this Amendment, the
Original Warrant Agreement shall remain in full force and effect and has not been modified or amended in any respect, it being
the intention of the undersigned that this Amendment and the Warrant be read, construed and interpreted as one and the same instrument.
3. Headings. The section headings herein are for convenience only and are not part of this Amendment and shall not affect
the interpretation thereof.
4. Counterparts. This Amendment may be executed in any number of original or facsimile counterparts and each of such
counterparts shall for all purposes be deemed to be an original, and all such counterparts shall together constitute but one and
the same instrument.
5. Governing Law. The validity, interpretation, and performance of the Agreement, including this Amendment, and of the
Warrants shall be governed in all respects by the laws of the State of New York, without giving effect to conflicts of law principles
that would result in the application of the substantive laws of another jurisdiction.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties hereto have
caused this Agreement to be duly executed as of the date first above written.
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Name: R. Andrew White |
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Title: President and Chief Executive Officer |
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Continental Stock Transfer & Trust Company, as Warrant Agent |
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[Signature Page to Amendment No. One
to Warrant Agreement]
Exhibit 99.1
SANUWAVE
Health, Inc., a Leading Provider of FDA Approved Next-Generation Wound Care Products, Enters into a Merger Agreement with Sweat
Equity Partners and Mercury Life Sciences-affiliated SEP Acquisition Corp., a Nasdaq-Listed Company
| ● | SANUWAVE
Health Inc. (OTCQB: SNWV) has entered into a definitive merger agreement with SEP Acquisition
Corp. (Nasdaq: SEPA). Upon closing, the combined company is expected to trade on the
Nasdaq Capital Market under the symbol “SNWV”. |
| ● | The
combined company expects to receive approximately $13.0 million of gross proceeds at
closing, including $12.0 million from non-redeeming holders of SEPA’s Class A common
stock and other PIPE investors, and $1.0 million from the SPAC sponsor converting a loan
into equity on the same terms as the PIPE. Approximately $8.5 million of capital has
already been committed. |
| ● | This
funding is expected to be anchored by investors affiliated with Sweat Equity Partners
and Mercury Life Sciences. The Company plans to solicit further participation from SANUWAVE’s
existing investor base, other institutions and strategic partners. |
| ● | SANUWAVE
has two FDA approved medical devices in the wound care space. Its lead product, the UltraMIST®
(“UM”) system, has nationwide schedule 1 reimbursement and is used
by many top medical centers, including the Mayo Clinic. SANUWAVE has over 550 UM systems
in active use and generated 59% of its Q2 2023 revenue from consumable sales of single
use applicators. |
| ● | The
proposed business combination values the combined company at a pro forma enterprise value
of $127.5 million. |
| ● | The
transaction is expected to close in the fourth quarter of 2023, subject to the satisfaction
of the agreed upon closing conditions. |
August
23, 2023
Eden
Prairie, Minnesota and Houston, Texas – (GLOBE NEWSWIRE) -- via NewMediaWire - SANUWAVE Health, Inc. (OTCQB: SNWV)
(“SANUWAVE” or the “Company”), a leading provider of next-generation FDA approved wound care products,
today announced a business combination with SEP Acquisition Corp. (Nasdaq: SEPA) (“SEPA”), a publicly listed special
purpose acquisition company. The transaction is expected to create a Nasdaq-listed company focused on the use of directed energy
to improve healing in the $45 billion U.S. wound care market.
Upon
completion of the proposed transaction, the combined company is expected to operate under the SANUWAVE name and will be listed
on the Nasdaq Capital Market under the symbol “SNWV”. The proposed transaction values the combined company at an enterprise
value of $127.5 million. SANUWAVE investors are anticipated to have an approximately 69.6% equity ownership in the new entity,
assuming the combined company receives approximately $13.0 million of gross proceeds at closing, including $12.0 million from
non-redeeming holders of SEPA’s Class A common stock and other PIPE investors, and $1.0 million from the SPAC sponsor converting
a loan into equity on the same terms as the PIPE. Approximately $8.5 million of capital has already been committed, including
$7.0 million of shares of SEPA’s Class A common stock held by investors affiliated with Sweat Equity Partners and Mercury
Life Sciences who have agreed to enter into voting and non-redemption agreements.
“I
am pleased to announce this proposed transaction to the SANUWAVE and SEPA stockholders,” said SANUWAVE CEO Morgan Frank.
“SEPA is a strong, value-add partner, and this transaction will allow SANUWAVE to simplify its capital structure and gain
a listing on the Nasdaq Capital Market while funding the Company for the exciting growth ahead. This is the next step in putting
the Company on sound footing that will allow us to focus on rapid, profitable growth and to garner an equity valuation commensurate
with our performance.”
“We
are excited to partner with SANUWAVE on a combination of our companies,” said SEPA CEO Andrew White. “We believe this
transaction is a 1+1=3 equation where new capabilities are created and opportunities opened. Sweat Equity Partners, together with
Mercury Life Sciences, have a broad investor base, with long track records of success in the medical device and healthcare sectors,
and we’ve already begun working with SANUWAVE to open new distribution opportunities and markets. We believe very strongly
in this Company and the UltraMIST product and look forward to being a part of SANUWAVE’s future success.”
About
SANUWAVE
SANUWAVE
is a rapidly growing commercial stage medical device company in the $45 billion U.S. wound care space. It has two FDA approved
products and its lead product, UltraMIST®, has nationwide schedule 1 reimbursement from CMS (the Centers for Medicare
& Medicaid Services, a part of the Department of Health and Human Services). The Company believes that wound care is undergoing
a major change to evidence-based medicine and that reimbursement is being restructured around efficacy and cost effectiveness.
To succeed, a product must align the needs of patients, physicians, and payors, and the Company believes that this favors SANUWAVE’s
directed energy products and that this is apparent in reimbursement rate trends. The Company has a strong IP portfolio with over
165 patents, and an attractive financial profile with high gross margins (for example, during
the three months ended June 30, 2023 the Company’s gross margin was 74%) and significant recurring revenue from consumables
(for example, 59% of the Company’s revenues in Q2 2023 were from UltraMist applicator sales). The Company anticipates positive
adjusted EBITDA in Q4 2023 as the product manufacturing ramp commences and expects meaningful growth acceleration and profitability
over the next several years.
The
UltraMIST system, which currently constitutes over 90% of the Company’s revenue, is a low frequency, non-contact ultrasound
system that delivers energy through a fluid mist. The system never touches the wound and is pain free. This system promotes wound
healing below the surface by modulating cell membranes to drive increased blood flow and capillary formation and enhances macrophage
mediate VEGF and PDGF release to enhance removal of damaged tissues by neutrophils. The system also reduces pro inflammatory cytokines
and kills bacteria and biofilms by lysing cell walls. The system is highly portable (weighing only 7 pounds) and fits with the
“care to the edge” movement of shifting treatment away from hospitals and toward doctor’s offices, nursing homes,
assisted living facilities, and patient homes. Treatments take 3 to 20 minutes (average of 6 minutes) and can be performed by
a nurse or physical therapist. The efficacy of the UltraMIST system is supported by numerous clinical studies performed at top
medical institutions.
The
Company has been operating under significant capacity constraints for the production of UltraMIST systems and anticipates a significant
step function in Q4 2023 and Q1 2024, which the Company expects will allow for engagement with larger customers with deeper ordering
potential. SANUWAVE anticipates being able to produce approximately two to three times more UltraMISTs in 2024 as in 2023. Owing
to better pricing and higher usage rates, the Company is seeing new customers added that have twice or more the dollar value of
consumables use of its existing customer base, and therefore plans to increase its capacity to produce consumables by approximately
four times over the next 12 to 18 months to accommodate additional demand for procedures.
The
Company’s goal is to show accelerating, profitable growth in 2024 and believes that the SEPA transaction represents the
next step in being able to focus on building this business and transforming the wound care space.
About
SEPA
Sweat
Equity Partners LP and Mercury Fund, including Mercury Life Sciences, are the co-sponsors of SEP Acquisition Corp. Sweat Equity
Partners is a family office led by Andrew White with investments in SaaS, MedTech, CleanTech, PropTech and Domestic Energy segments.
Mercury Life Sciences, a division of Mercury Fund, is a venture firm and studio dedicated to advancing innovation and breakthroughs
in the field of life sciences, investing in early-stage biotech, pharma, medtech, and digital health companies. Over the past
18 years, Mercury Life Sciences has investments and/or exits in over a dozen life science companies. For more information, please
see www.SEPLP.com and www.MercuryLifeSciences.com.
Transaction
Summary
The
business combination values the combined company at a $127.5 million pro forma enterprise value. The combined company expects
to receive approximately $13.0 million of gross proceeds, including $12.0 million from non-redeeming holders of SEPA’s Class
A common stock and other PIPE investors, and $1.0 million from the SPAC sponsor converting a loan into equity on the same terms
as the PIPE. Approximately $8.5 million of capital has already been committed. The net proceeds of this transaction will be used
to fund general corporate purposes. This offering is expected to be anchored by investors affiliated with Sweat Equity Partners
and Mercury Life Sciences. Assuming $13.0 million in gross investment proceeds and the closing of the business combination, existing
SANUWAVE shareholders will own approximately 69.62% of the combined company.
Subject
to stockholder approval, all of SEPA’s shares of Class B common stock are to be exchanged for shares of Class A common stock
at a ratio of one share of Class B common stock for [0.277] shares of Class A common stock. Furthermore, as a condition to closing,
all of SEPA’s warrants, both public and private, must be exchanged at the same ratio for shares in the combined company,
which will require stockholder and warrant holder approval. If approved by warrant holders, the publicly traded warrants will
be valued at $0.50 per warrant and exchanged for shares of SEPA’s Class A common stock at closing, comprising a total of
[450,336] shares of Class A common stock. In total, SEPA’s public warrant holders are expected to own approximately 4.0%
of the pro forma combined company at closing. Prior to closing, and as a condition to closing, SANUWAVE is required to obtain
the approval of the holders of 80.0% of its outstanding convertible promissory notes and warrants to convert such securities into
shares of SANUWAVE common stock immediately prior to the closing with the goal of creating a simpler capital structure.
The
boards of SANUWAVE and SEPA have unanimously approved the proposed business combination, which is expected to be completed in
fourth quarter of 2023 subject to, among other things, approval by SEPA’s stockholders, approval by SANUWAVE’s stockholders,
SANUWAVE’s ability to obtain the approval of the holders of 80.0% of its outstanding convertible promissory notes and warrants
to convert such securities into shares of SANUWAVE common stock immediately prior to the closing, and SEPA’s ability to
have at least $12.0 million at closing from proceeds of its Class A common stock that has not been redeemed and a PIPE transaction.
Faegre
Drinker Biddle & Reath LLP served as legal advisor to SANUWAVE. ValueScope Inc. and Baker Donelson, Bearman, Caldwell &
Berkowitz, PC served as financial and legal advisors, respectively, to SEPA.
Additional
information about the proposed transaction, including a copy of the business combination agreement and investor presentation,
will be provided in a Current Report on Form 8-K to be filed by SEPA and SANUWAVE today with the Securities and Exchange Commission
and will be available at www.sec.gov.
Conference
Call Information
A
business update will occur via conference call on August 24, 2023 at 8:30 a.m. EDT.
Telephone
access is available by dialing the following numbers:
Conference
ID: 13740784
Telephone
access to the call will be available by dialing the following numbers:
Participant
Listening: 1-877-407-0784 or 1-201-689-8560
OR
click the Call me™ link for instant telephone access to the event.
https://callme.viavid.com/viavid/?callme=true&passcode=13732361&h=true&info=company&r=true&B=6
A
replay will be made available through September 7, 2023:
Replay
Dial-In: 1-844-512-2921 or 1-412-317-6671
Access
ID: 13740784
Forward-Looking
Statements
This
press release may contain, “forward-looking statements” within the meaning of the “safe harbor” provisions
of the Private Securities Litigation Reform Act of 1995. SEPA’s and SANUWAVE’s actual results may differ from their
expectations, estimates and projections and consequently, you should not rely on these forward-looking statements as predictions
of future events. Words such as “expect,” “estimate,” “project,” “budget,”
“forecast,” “anticipate,” “intend,” “plan,” “may,”
“will,” “could,” “should,” “believes,” “predicts,”
“potential,” “might” and “continues,” and similar expressions are intended
to identify such forward-looking statements. These forward-looking statements may include, without limitation, the satisfaction
of the closing conditions to the transactions described above (the “Transactions”) and the timing of the closing of
the Transactions. These forward-looking statements involve significant risks and uncertainties that could cause actual results
to differ materially from expected results. Most of these factors are outside the control of SEPA and SANUWAVE, and are difficult
to predict. Factors that may cause such differences include, but are not limited to: (1) the occurrence of any event, change or
other circumstances that could give rise to the termination of the merger agreement; (2) the inability to consummate the Transactions,
including due to any failure to obtain approval of the stockholders of SEPA or SANUWAVE, or the other conditions to the closing
in the merger agreement, such as the requirements that (i) SANUWAVE obtain the approval of the holders of 80% of its outstanding
convertible promissory notes and warrants to convert such securities into shares of SANUWAVE’s common stock immediately
prior to the closing and (ii) SEPA shall have at least $12.0 million at closing resulting from proceeds of (a) SEPA’s Class
A common stock that has not been redeemed and (b) a private placement; (3) delays in obtaining or the inability to obtain any
necessary regulatory approvals required to complete the Transactions; (4) the inability to obtain or maintain the listing of SEPA’s
securities on Nasdaq following the Transactions; (5) costs related to the Transactions; (6) changes in applicable laws or regulations;
(7) the possibility that SEPA or SANUWAVE may be adversely affected by other economic, business, and/or competitive factors; and
(8) other risks and uncertainties to be identified in the registration statement/proxy statement (when available) relating to
the Transactions, including those under “Risk Factors” therein, and in other filings with the SEC made by SEPA and
SANUWAVE. SEPA and SANUWAVE caution that the foregoing list of factors is not exclusive, and caution readers not to place undue
reliance upon any forward-looking statements, which speak only as of the date made. Neither SEPA nor SANUWAVE undertakes or accepts
any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements to reflect any change
in its expectations or any change in events, conditions or circumstances on which any such statement is based, subject to applicable
law.
Readers
are referred to the most recent reports filed with the SEC by SEPA and SANUWAVE. Readers are cautioned not to place undue reliance
upon any forward-looking statements, which speak only as of the date made, and neither SEPA nor SANUWAVE undertakes any obligation
to update or revise the forward-looking statements, whether as a result of new information, future events or otherwise.
Important
Information About the Transactions and Where to Find It
SEPA
and SANUWAVE will file relevant materials with the Securities and Exchange Commission (the “SEC”), including a Form
S-4 registration statement to be filed by SEPA, which will include a prospectus with respect to SEPA’s securities to be
issued in connection with the proposed Merger and a proxy statement with respect to SEPA’s and SANUWAVE’s stockholder
meetings at which SEPA’s and SANUWAVE’s stockholders will be asked to vote on the proposed merger and related matters.
SEPA’S and SANUWAVE’S STOCKHOLDERS AND OTHER INTERESTED PERSONS ARE ADVISED TO READ, WHEN AVAILABLE, THE FORM S-4
AND THE AMENDMENTS THERETO AND OTHER INFORMATION FILED WITH THE SEC IN CONNECTION WITH THE TRANSACTIONS, AS THESE MATERIALS WILL
CONTAIN IMPORTANT INFORMATION ABOUT SEPA, SANUWAVE, AND THE TRANSACTIONS. When available, the proxy statement contained in the
Form S-4 and other relevant materials for the Transactions will be mailed to stockholders of SEPA and SANUWAVE as of a record
date to be established for voting on the proposed merger and related matters. The preliminary Form S-4 registration statement
and preliminary proxy statement, the final Form S-4 registration statement and definitive proxy statement and other relevant materials
in connection with the Transactions (when they become available), and any other documents filed by SEPA and SANUWAVE with the
SEC, may be obtained free of charge at the SEC’s website (www.sec.gov). SEPA’s stockholders will also be able to obtain
a copy of such documents, without charge, by directing a request to SEPA at 3737 Buffalo Speedway, Suite 1750 Houston, Texas 77098.
SANUWAVE’s stockholders will be able to obtain a copy of such documents, without charge, by directing a request to SANUWAVE
at 11495 Valley View Road, Eden Prairie, Minnesota 55344.
Participants
in Solicitations
SEPA
and SANUWAVE and their respective directors, executive officers and employees and other persons may be deemed to be participants
in the solicitation of proxies from the stockholders of SEPA and SANUWAVE, respectively, in respect of the proposed business combination.
SEPA and SANUWAVE stockholders and other interested persons may obtain more detailed information regarding the names and interests
in the Transactions of SEPA’s and SANUWAVE’s directors and executive officers in SEPA’s and SANUWAVE’s
filings with the SEC, including when filed, the Form S-4 registration statement and the proxy statement. These documents can be
obtained free of charge from the sources indicated above.
Disclaimer
This
communication shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect
of the proposed business combination. This communication shall not constitute an offer to sell or the solicitation of an offer
to buy any securities pursuant to the proposed Transactions or otherwise, nor shall there be any sale of securities in any jurisdiction
in which the offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws
of any such jurisdiction. No offering of securities shall be made except by means of a prospectus meeting the requirements of
Section 10 of the Securities Act of 1933, as amended.
CONTACT:
Investors@Sanuwave.com
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