|9 Months Ended|
Sep. 30, 2022
|Subsequent Events [Abstract]|
Note 17 — Subsequent Events
On October 26, 2022, the Company entered into an engagement agreement with Ankura Consulting Group for interim CFO services, with Brendan Bosack, one of its principals, named as Interim CFO of the Company. The agreement calls for services to be rendered at $900 per hour up to $30,000 per week. The agreement is for an indefinite term and cancellable by either party.
ZASH Global Media Equity Transaction
On December 19, 2022, the Vinco Ventures, Inc. entered into a material definitive agreement to complete the purchase of the membership interests (“Membership Interests”) in ZVV Media Partners from ZASH Global Media. The purchase price shall be (a) 5,000,000, and (ii) the Secured Promissory Note issued by ZVV Media Partners, LLC, a joint venture of the Company and ZASH Global Media and Entertainment Corporation, to Vinco Ventures, Inc. dated June 29, 2022 in the original principal amount of $56,955,167.81. Vinco Ventures, Inc. shall issue the Purchase Equity to ZASH Global Media at the Closing (as defined herein) or such later time as agreed by the Parties in writing. shares of Vinco Ventures, Inc.’s Series B Preferred Stock (which shall be convertible into million common shares of ZVV Media Partners, for which issuance will be subject to Nasdaq rules) and for which a Certificate of Designation was to be filed in the State of Nevada before December 21, 2022 (and will be issued in the near future), was subject to approval of both ZVV Media Partners and ZASH Global Media and compliance with all Nasdaq and SEC compliance (“Purchase Equity”), and (b) the deemed satisfaction of all outstanding indebtedness and other obligations owing from ZASH Global Media to ZVV Media Partners or the ZVV Media Partners , including, without limitation, pursuant to (i) the Promissory Note issued by ZASH Global Media to ZVV Media Partners dated February 18, 2021 in the original principal amount of $
On August 26, 2022, the Company filed a Current Report on Form 8-K in which it disclosed that it had received notification from The Nasdaq Stock Market, LLC (“Nasdaq”) that required the Company to submit to Nasdaq, on or before October 17, 2022, a Plan of Compliance with regard to the filing of its Quarterly Report on Form 10-Q for the period ended June 30, 2022. The Plan of Compliance was submitted as of October 17, 2022.
As a result of a delinquency notice received, the Company submitted a plan of compliance to file the second quarter 10-Q and the third quarter 10-Q no later than February 13, 2023. The Company submitted the update to this plan of compliance to Nasdaq confirming the above referenced timetable. The Company was unable to file Form 10-Q for the periods ending June 30, 2022 and September 30, 2022 by February 13, 2023. The Company filed Form 10-Q for the period ended June 30, 2022 on February 22, 2023.
On November 17, 2022, the Company received a notice (the “November Notice”) from Nasdaq advising the Company that it was not in compliance with Nasdaq’s continued listing requirements under the Nasdaq Listing Rule 5250(c)(1) (“Rule 5250”) as a result of the Company’s failure to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 (“Form 10-Q”) with the United States SEC in a timely manner, which deadline was November 14, 2022. Rule 5250 requires listed companies to timely file all required periodic reports with the SEC.
On December 1, 2022, the Company received a notice (the “December Notice”) from Nasdaq advising the Company that it was not in compliance with Nasdaq’s continued listing requirements under the Nasdaq Listing Rule 5550(a)(2) (“Rule 5550”) as a result of requiring listed securities to maintain a minimum bid price of $1 for a minimum of ten consecutive business days, Nasdaq will provide written confirmation of compliance and this matter will be closed. per share. Based upon the closing bid price for the last 30 consecutive business days, the Company no longer meets this requirement. However, Rule 5550 also provides the Company a compliance period of 180 calendar days in which to regain compliance. If at any time during this 180 day period the closing bid price of the Company’s security is at least $
On February 14, 2023, the Company received a Staff Determination letter (the “Letter”) from Nasdaq. The Letter states that on August 19 and November 17, 2022, the Company was notified that it did not comply with Nasdaq’s filing requirements set forth in Rule 5250 because it had not filed its Form 10-Q for the period ended June 30, 2022, and its Form 10-Q for the period ended September 30, 2022 (the “Delinquent Filings”). Staff granted the Company an exception until January 31, 2023, to regain compliance with Rule 5250. Subsequently, on January 26, 2023, the Company requested additional time to file the Delinquent Filings and Staff granted the Company an exception until February 13, 2023, to regain compliance with the Rule.
Upon further review, it was determined that the Company did not meet the terms of the exception because it had not filed the Delinquent Filings by February 13, 2023. The Company appealed the determination to a Hearings Panel (the “Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series. A hearing request will stay the suspension of the Company’s securities and the filing of the Form 25-NSE pending the Panel’s decision. The Company filed a hearing request and remitted the hearing filing fee on February 16, 2023. The hearing occurred on March 30, 2023 and the Company is awaiting additional instruction from Nasdaq.
On October 14, 2022, the Company filed an amendment to its Articles of Incorporation to reallocate its previously authorized million shares of stock as million shares of Common Stock and million shares of Preferred Stock, which Preferred Stock may be issued upon the subsequent filing with the Nevada Secretary of State of one or more certificates of designation for series of preferred stock. It subsequently amended the filing to be million shares of Common Stock and million shares of Preferred Stock.
Acquisition of National Enquirer
On February 6, 2023, the Company entered into a joint venture with ICON Publishing, LLC to acquire for cash the National Enquirer (both U.S. and U.K. editions), the National Examiner, and Globe under an Asset Purchase Agreement from magazine publisher A360 Media, LLC. The transaction includes the acquisition of all print and digital assets and owned intellectual property of the National Enquirer, National Examiner and Globe. The closing of the acquisition is subject to certain consents and customary conditions to closing as described in the Asset Purchase Agreement.
Subject to the terms and conditions of the agreement, the aggregate purchase price for the purchased assets (the “Purchase Price”) is up to $33,700,000 plus certain assumed liabilities of A360 related to the Business. The Purchase Price is paid as follows at the closing of the transactions contemplated by the Agreement: $33,000,000 in cash, minus the amount of any assumed payroll liability, and minus the amount of certain deposits made by VVIP to A360 pursuant to the Agreement up to an aggregate amount of $2,000,000; and the amount of certain printing paper inventory included in the Purchased Assets, calculated as set forth in the Agreement and not to exceed $700,000, in cash or, at VVIP’s election, by use of a credit granted to VVIP by A360 under the Agreement.
Securities Purchase Agreement
On February 5, 2023, the Company has entered into a Securities Purchase Agreement for the sale of a $1,500,000 principal amount convertible note, a $10,000,000 principal amount convertible note and shares of Series A perpetual non-convertible preferred stock of the Company designated as Series A Preferred Stock, $ par value. The $10,000,000 proceeds from the sale of the $10,000,000 note shall be held in a DACA account and is redeemable by the investors when certain conditions are met, and the $1,500,000 note shall be convertible by the investors pursuant to the term set forth therein. The note shall be convertible into Company common stock at an initial conversion price of $0.7831, representing 110% of the closing price of the Common Stock on February 3, 2023.
Each holder of outstanding share of Series A Preferred Stock will have the voting rights to vote together with the class of stockholders of Common Stock, as a single class, upon any matter submitted to the stockholders of Common Stock for a vote as of a record date established by the Board of Directors of the Company. For so long as any Series A shares remain issued and outstanding, the holders of each share shall have the right to vote, in an amount equal to one percent (1%) of the total voting power of then-outstanding shares of Common Stock of the Company entitled to vote in such class, calculated as provided herein.
The Company closed the transaction on February 10, 2023.
On February 5, 2023, the Company entered into an Exchange Agreement with an accredited investor (the “Holder”) pursuant to which the Company and the Holder desire: (i) to exchange $250,000 aggregate principal amount of that certain convertible secured Note issued to the Holder on July 22, 2021 (the “July Note”) for an aggregate of shares of Common Stock and (ii) to amend the July Note as set forth herein. On the Initial Closing Date, $105,000 aggregate principal amount of the July Note was exchanged into shares of Common Stock and on the first (1st) trading day immediately following the date on which the Company amends its Articles of Incorporation to increase the authorized shares of the Company, $ aggregate principal amount of the July Note shall be exchanged into shares of Common Stock.
The Company and the Holder agreed that Section 2 of the July Note is amended and restated to be non-interest bearing except if there is an event of default at which time the interest rate shall be 18%, and the minimum cash on deposit in the Control Account shall not be less than $3,000,000. The conversion price of the July Note was voluntarily and irrevocably reduced to $0.7831.
On February 10, 2022, the Holder released $4,000,000 from the Control Account to the Company. Up to another $3,000,000 shall be released over future time periods if certain conditions are met.
No definition available.
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