|9 Months Ended|
Sep. 30, 2021
|Subsequent Events [Abstract]|
Note 16 — Subsequent Events
On October 1, 2021, ZVV and ZASH and AdRizer LLC (“AdRizer”) entered into a Letter of Intent (as amended, the “LOI”) for ZASH or ZVV to acquire all the outstanding membership and other equity interests of AdRizer. The LOI has an exclusivity period ending on December 31, 2021. The parties are continuing their negotiations of the structure of the transaction and preparation of definitive documentation for the acquisition. Pursuant to current discussions among the parties, ZVV is expected to acquire all the outstanding membership/equity interests in AdRizer, either via merger, purchase of such membership/equity interests from the AdRizer members, or other transaction structure, as mutually agreed, such that AdRizer will continue as a wholly owned subsidiary of ZVV, for an aggregate purchase price of $108,000,000 payable as follows: (i) $15,000,000 payable in cash at closing, to be funded by Vinco Ventures as a capital contribution to ZVV, (ii) $10,000,000 in cash to be funded by Vinco Ventures as a capital contribution to ZVV, which will be placed in escrow for a period of 12 months after the closing to secure the indemnification obligations of the AdRizer members, and (iii) $83,000,000 in common stock of ZASH or Vinco Ventures to be issued two years from (or otherwise locked up for two years from) the closing date, subject to conditions to be agreed upon. The stock consideration value will be based on a mutually agreeable valuation.
In addition, ZASH or ZVV are expected to invest a minimum of $5,000,000 of cash in AdRizer for its post-closing working capital needs, to be funded $1,000,000 at closing and $1,000,000 every 3 months thereafter.
On October 2, 2021, Vinco Ventures, Inc.’s wholly owned subsidiary, Cryptyde, Inc., filed Articles of Organization with the State of Nevada to form CW Machines, LLC. The formation of CW Machines, LLC is part of a joint venture with Wattum Management, Inc.
On October 8, 2021, the Company issued shares of common stock to a consultant for services performed in connection with EVNT Platform, LLC.
On October 12, 2021, ZVV entered into a promissory note (the “Magnifi U Note”) with Magnifi U, Inc. (“Magnifi U”), pursuant to which ZVV loaned Magnifi U $1,500,000. The Magnifi U Note bears interest at 3% annually and Magnifi U is obligated to pay the full amount of principal and interest in one balloon payment on October 12, 2023.
On October 14, 2021, the Company’s wholly owned subsidiary, Cryptyde, Inc. (the “Lender”), entered into a Senior Secured Promissory Note (the “Note”) with Wattum Management, Inc. (the “Borrower”) to loan funds in the principal amount of $4,000,000. The Note bears interest at 5% annually, to be amortized over 25 years and the Borrower shall pay the full amount of principal and interest in one balloon payment on October 12, 2026 (the “Maturity Date”). The Note is secured, through a Security Agreement, by all current and future assets of the Borrower. The transaction closed on October 26, 2021.
On October 19, 2021, the Company issued shares of common stock to note holders, EVNT Platform, LLC preferred members, consultants and employees and directors.
On October 26, 2021, the Company issued shares of common stock to warrant holders for the exercise of warrants.
On October 27, 2021, the Company issued shares of common stock to warrant holders for the exercise of warrants.
The following events occurred on October 19, 2021:
Christopher Ferguson, tendered his resignation as (i) the Company’s Chief Executive Officer, effective October 25, 2021 and (ii) Chairman of the Board of Directors, effective October 19, 2021.
Lisa King has been appointed as the Company’s Chief Executive Officer and President, effective October 25, 2021. The Company and Ms. King are entering into an employment agreement to be effective as of October 25, 2021.
Stephen Garrow has been appointed as the Company’s Chief Operating Officer, effective October 25, 2021. The Company and Mr. Garrow are entering into an employment agreement to be effective as of October 25, 2021.
Philip Jones is expected to be appointed as the Company’s Chief Financial Officer, effective on or about November 23, 2021. The Company and Mr. Jones plan to enter into an employment agreement to be effective as of the date of Mr. Jones’ appointment as the Chief Financial Officer.
On November 1, 2021, the Company announced that its wholly owned subsidiary, Cryptyde, Inc., had entered into a joint venture with Wattum Management, Inc. to launch a newly formed entity, CW Machines, LLC, to sale turnkey BTC mining operations.
On November 8, 2021, Cryptyde, Inc. filed its Form 10 registration statement with the United States Securities and Exchange Commission in connection with the planned spinoff of selected subsidiaries, Cryptyde, Inc., Ferguson Containers, Inc., EVNT Platform, LLC and Cryptyde Shared Services, LLC.
On November 11, 2021, the Company and Hudson Bay Master Fund Ltd (the “Holder”) entered into a Warrant Exercise Agreement (the “November WEA”), whereby, the Company and the Holder agreed the Holder would exercise 4.527 (the “November Warrants” and, together with the July Warrants and the August Series A Warrants, the “Warrants”), and to amend the September Warrant issued by the Company to the Holder pursuant to that certain Warrant Exercise Agreement dated as of September 1, 2021 by and among the Company and the Holder (“September WEA”) and the July Notes.July Warrants and August Series A Warrants (collectively, the “Exercised Warrants”) representing the right to acquire shares (the “Exercised Warrant Shares”) of Common Stock and the Company would issue additional warrants to purchase shares of Common Stock at a per-share exercise price equal to $
The proceeds to the Company from the exercise of the Exercised Warrants were approximately $31.86 million, before deducting certain expenses incurred by the Company in connection with the November WEA and, including, but not limited to, expenses of the Holder’s legal counsel.
Subject to the satisfaction (or waiver) of the conditions set forth in the November WEA, (i) the Holder shall pay to the Company an amount equal to the Exercise Price multiplied by the applicable Exercised Warrant Shares, (ii) the Company shall issue and deliver to the Holder the Exercised Warrant Shares of the Exercised Warrants, and (iii)Additionally, pursuant to the November WEA, the “Minimum Cash” requirement contained in the July Note was amended to provide that the Minimum Cash amount is not required at any time to exceed the Principal outstanding at such time.
Additionally, the parties executed and delivered a Registration Rights Agreement (the “Registration Rights Agreement”), pursuant to which the Company agreed to file an initial registration statement with respect to the shares of Common Stock underlying the Registrable Securities by January 15, 2022.
Pursuant to the November WEA, by no later than one hundred twenty (120) calendar days after the Closing Date, the Company shall file with the Securities and Exchange Commission a definitive proxy statement for a special meeting of the stockholders of Common Stock (the “Stockholder Meeting”), soliciting each such stockholder’s affirmative vote at the Stockholder Meeting for approval of resolutions providing for (i) the issuance of all the shares of Common Stock issuable pursuant to the November Warrants, (ii) approving any voluntary adjustments that the Company may offer pursuant to the terms of any of the November Warrants, and (iii) the increase in authorized number of shares of Common Stock of the Company to at least . The Stockholder Meeting shall be promptly called and held not later than one hundred fifty (150) calendar days after the Closing Date (the “Stockholder Meeting Deadline”). In the event Stockholder Approval is not obtained on or prior to the Stockholder Meeting Deadline, the Holder can elect to, instead of receiving the November Warrant Shares, receive an aggregate cash payment from the Company equal to such number of November Warrant Shares multiplied by $0.65 for each such November Warrant Share.
On November 11, 2021, the Company’s wholly owned subsidiary, Cryptyde, Inc. (“TYDE”), and Hudson Bay Master Fund Ltd (the “Holder”) entered into an Amendment Agreement (the “Amendment Agreement”) whereby the parties agreed that, subject to the satisfaction (or waiver) of the conditions set forth in the Amendment Agreement: (i) the Holder shall amend its right to receive the Spin-off Distribution in the form of shares of TYDE’s common stock (“TYDE Common Stock”) and to receive instead a warrant issued by TYDE to purchase TYDE Common Stock for such number of shares of TYDE Common Stock that the Holder would have been entitled to receive in the Spin-off Distribution had the Holder exercised all its Company Warrants on the record date for the Spin-off Distribution (the “TYDE Warrant”); and (ii) contemporaneously with the entry into the Amendment Agreement, for TYDE and the Holder to enter into a registration rights agreement (the “TYDE Registration Rights Agreement”) to provide for all Registrable Securities to be covered by a registration statement filed and declared effective on or prior to the distribution date of the Spin-off Transactions. The Company agreed to issue to the Holder the November Warrant pursuant to the terms and conditions set forth in the November WEA and (ii) TYDE agreed to issue to the Holder the TYDE Warrant pursuant to the terms and conditions set forth in the Amendment Agreement.
The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business.
Reference 1: http://www.xbrl.org/2003/role/disclosureRef