Auddia Inc S-1/A, filed Dec 14, 2020
Auddia Inc. (AUUD)
As filed with the Securities and Exchange Commission on December 14, 2020
Registration No. 333-235891
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT No. 8 to
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
Clip Interactive, LLC
[to be converted as described herein to a corporation named]
Auddia Inc.
(Exact name of registrant as specified in its charter)
| Delaware | ||||
(State or other jurisdiction of incorporation or organization) |
(Primary Standard Industrial Classification Code Number) |
(I.R.S. Employer Identification Number) |
5755 Central Ave., Suite C
Boulder, Colorado 80301
Michael Lawless
Chief Executive Officer
Clip Interactive, LLC
5755 Central Ave., Suite C
Boulder, Colorado 80301
(303) 219-9771
Copies to:
| Stanley Moskowitz, Esq. | Lawrence Cohen Esq | |
| Bingham & Associates Law Group APC | Gordon Rees Scully & Mansukhani LLP | |
| Second Street. Suite 195 | Two North Central Avenue, Suite 2200 | |
| Encinitas, CA 92024 | Phoenix, AZ 85004 | |
| 858-523-0100 | 602-794-2485 |
Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this Registration Statement.
If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. ⊠
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:
| Large accelerated filer | ☐ | Accelerated filer | ☐ | |||
| Non-accelerated filer | ☐ | Smaller reporting company | ☒ | |||
| 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 to Section 7(a)(2)(B) of the Securities Act. ☒
CALCULATION OF REGISTRATION FEE
| Title of each class of securities to be registered | Amount to be registered |
Proposed maximum offering price per Unit/Share (1) |
Proposed maximum aggregate offering price (1) | Amount of registration fee (2) |
||||||||||
| Units, Each Consisting of One Share of Common Stock, $0.001 Par Value Per Share and One Series A Warrant (1)(2)(3) | 3,624,242 Units | $ | 4.125 | $ | 14,949,998 | $ | ||||||||
| Shares of Common Stock Included as Part of the Units (3) | 3,624,242 shares | (4) | (4) | – | ||||||||||
| Series A Warrants Included as Part of the Units | 3,624,242 | (4) | (4) | – | ||||||||||
| Common shares being registered on behalf of selling shareholders | 1,568,182 | – | 6,468,750 | 705.74 | ||||||||||
| Shares of Common Stock Underlying the Series A Warrants Included as Part of the Units (3)(5) | 3,624,242 | $ | 4.54 | $ | 16,454,059 | $ | ||||||||
| Units underlying the Representative’s Unit Warrant (Representative’s Units”) (6) | 252,121 | 4.95 | 1,247,999 | |||||||||||
| Shares of Common Stock underlying the Representative’s Units (3) | 252,121 | $ | – | $ | (4) | $ | – | |||||||
| Series A Warrants Included as Part of the Representative’s Units (7) | 252,121 | – | (4) | – | ||||||||||
| Shares of Common Stock Underlying the Series A Warrants Included in the Representative’s Units (3)(5) | 252,121 | $ | – | $ | 1,247,999 | $ | ||||||||
| Total | $ | 40,363,805 | $ | |||||||||||
___________________________
| (1) | Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(a) under the Securities Act of 1933, as amended (the “Securities Act”). Includes the offering price of any additional shares that the underwriters have the option to purchase. |
| (2) | The fee is calculated by multiplying the aggregate offering amount by 0.0001091, effective October 1, 2020, pursuant to Section 6(b) of the Securities Act. |
| (3) | Includes 472,727 Units that may be sold pursuant to the Underwriters over-allotment option |
| (4) | No registration fee pursuant to Rule 457(g) under the Securities Act. |
| (5) | Estimated solely for the purposes of calculating the registration fee pursuant to Rule 457(g) under the Securities Act. The warrants are exercisable at a per share exercise price equal to 1.10% of the public offering price per unit. |
| (6) | Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(g) under the Securities Act, the proposed maximum aggregate offering price of the Representative's Units is $1,247,999 (which is equal to 252,121 Units at $4.95, or 125% of $4.125, per Unit,). |
| (7) | All of all of the warrants included as part of the Representatives Warrant are exercisable at 1.10% of the public offering price per unit |
| * | ______ has been previously paid. |
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
EXPLANATORY NOTE
Clip Interactive, LLC. (the “Registrant”) is filing this Amendment No. 8 (the “Amendment”) to its Registration Statement on Form S-1 (Registration Statement No.333-235891) (the “Registration Statement”) to file Exhibits: 5.1 and 23.2 (which is included in Exhibits: 5.1), 2.2, 3.8, and 3.9 . Accordingly, this Amendment consists only of the facing page, this explanatory note, Item 16 of Part II of the Registration Statement, the signature page, Exhibits 5.1 and 23.2 (which is included in Exhibit 5.1), 2.2, 3.8, and 3.9. The remainder of the Registration Statement is unchanged and therefore has not been included in this Amendment.
| II-8 |
Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this Registration Statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of Denver, in the State of Colorado, on this 14 day of December, 2020.
| CLIP INTERACTIVE, LLC | |||
| By: |
/s/ Michael Lawless | ||
| Michael Lawless | |||
| Chief Executive Officer | |||
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jeffrey Thramann and Michael Lawless his or her true and lawful attorneys-in-fact and agents, with full power to act separately and full power of substitution and re-substitution, for him or her and in his or her name, place and stead, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement and all additional registration statements pursuant to Rule 462(b) of the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or his or her substitute or substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended, this Registration Statement on Form S-1 has been signed by the following persons in the capacities and on the dates indicated.
| Signature | Title | Date | ||
| /s/ Michael Lawless | Chief Executive Officer and Director | December 14, 2020 | ||
| Michael Lawless | (Principal Executive Officer) | |||
| President and Director | ||||
| /s/ Richard Liebman | Chief Financial Officer | December 14, 2020 | ||
| Richard Liebman | (Principal Financial and Accounting Officer) | |||
| /s/ Jeffery Thramann | Chairman of the Board of Directors | December 14, 2020 | ||
| Jeffrey Thramann | ||||
| II-9 |
EXHIBIT INDEX
____________________________
| * | To be filed by Amendment to this Registration Statement |
| ** | Certain information contained in this Exhibit has been redacted and appears as “XXXXX” as the disclosure of same would be a disadvantage to the Registrant in the marketplace |
| *** | Previously filed |
| II-10 |
Exhibit 5.1
December 11, 2020
Clip Interactive , LLC (Auddia Inc).
5755 Central Avenue, Suite C
Boulder, CO 80301
Re: Registration Statement on Form S-1
Ladies and Gentlemen:
We have acted as special counsel to Clip Interactive, LLC, a Colorado limited liability company, that will, prior to the consummation of the offering described below, be converted (the “Conversion”) into Auddia Inc., a Delaware corporation (the “Company”), in connection with the filing of the Registration Statement (as amended, the “Registration Statement”) on Form S-1 (File No. 333-235891) with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933, as amended (the “Act”). The Registration Statement relates to the proposed offering and sale of the following securities (the “Securities”):
1. Units, each Unit consisting of one share of common stock (par value $.001) and one Series A Common Stock Purchase Warrant (“Warrants”) to purchase one share of common stock, (the “Units”, “Primary Shares” and “Warrant Shares”) to be issued and sold by the Company,
2. The Representative’s Units (the “Representatives Units”), each Representative’s Unit consisting of one share of common stock (the Representative’s Shares) and one Series A Warrant (the “Representative’s Warrants”), and the shares of common stock underlying the Representatives Warrants.
3 Shares of common stock (the “Secondary Shares”) to be sold by the equity holders of the Company (the “Selling Stockholders”),
The Securities, except for the Secondary Shares, are to be sold by the Company in accordance with an Underwriting Agreement to be entered into by the Company, and Network 1 Financial Securities, Inc. as the representative of the underwriters (the “Underwriting Agreement”), the form of which has been filed as Exhibit 1.1 to the Registration Statement.
In connection herewith, we have examined:
| (1) | the Registration Statement; and |
| (2) | the form of the Underwriting Agreement. |
We have also examined originals or copies, certified or otherwise identified to our satisfaction, of the Plan of Conversion of the Company and the form of Certificate of Conversion attached thereto pursuant to which the Conversion will be effected, the form of the Company’s Certificate of Incorporation to be in effect upon the Conversion and the form of the Company’s Bylaws to be in effect upon the Conversion, in each case in the form filed as an exhibit to the Registration Statement, and such other limited liability company records, agreements and instruments of the Company, certificates of public officials and officers of the Company, and such other documents, records and instruments, and we have made such legal and factual inquiries, as we have deemed necessary or appropriate as a basis for us to render the opinions hereinafter expressed. In our examination of the foregoing, we have assumed the genuineness of all signatures, the legal competence and capacity of natural persons, the authenticity of documents submitted to us as originals and the conformity with authentic original documents of all documents submitted to us as copies or by facsimile or other means of electronic transmission, or which we obtained from the Commission’s Electronic Data Gathering, Analysis and Retrieval system (“Edgar”) or other sites maintained by a court or governmental authority or regulatory body and the authenticity of the originals of such latter documents. If any documents we examined in printed, word processed or similar form has been filed with the Commission on Edgar or such court or governmental authority or regulatory body, we have assumed that the document so filed is identical to the document we examined except for formatting changes. When relevant facts were not independently established, we have relied without independent investigation as to matters of fact upon statements of governmental officials and certificates and statements of appropriate representatives of the Company.
| 1 |
Also, in connection herewith, we have assumed that, other than with respect to the Company, at such times as the Securities are issued and sold, all of the documents referred to in this opinion letter will have been duly authorized by, duly executed and delivered and countersigned by, and will constitute the valid, binding and enforceable obligations of, all of the parties to such documents, all of the signatories to such documents will have been duly authorized and all such parties will be duly organized and validly existing and will have the power and authority (corporate or other) to execute, deliver and perform such documents.
Based upon the foregoing and in reliance thereon, and subject to the assumptions, comments, qualifications, limitations and exceptions set forth herein, and assuming the Certificate of Conversion and the Certificate of Incorporation have been duly filed with the Secretary of State of the State of Delaware and the Conversion has been effected, we are of the opinion that:
(1) assuming the due execution and delivery of the Underwriting Agreement by the Company and the underwriters named therein, and the receipt by the Company of all consideration in the manner contemplated by the Underwriting Agreement and the Registration Statement, the Units, the Primary Shares and Warrants, the common shares underlying the Warrants, the Representatives Units, Representative’s Shares, the Representative’s Warrants, and the common shares underlying the Representative’s Warrants, when issued as contemplated by the Registration Statement, will be duly authorized, validly issued, fully paid and nonassessable; and
(2) The Warrants and the Representative’s Warrants, when issued, will be binding obligations of the Company under the laws of the State of Delaware, and
(3) the Secondary Shares will be validly issued, fully paid and non-assessable.
Our opinions herein reflect only the application of the General Corporation Law of the State of Delaware. The opinions set forth herein are made as of the date hereof and are subject to, and may be limited by, future changes in factual matters, and we undertake no duty to advise you of the same. The opinions expressed herein are based upon the law in effect (and published or otherwise generally available) on the date hereof, and we assume no obligation to revise or supplement these opinions should such law be changed by legislative action, judicial decision or otherwise. In rendering our opinions, we have not considered, and hereby disclaim any opinion as to, the application or impact of any laws, cases, decisions, rules or regulations of any other jurisdiction, court or administrative agency.
We do not render any opinions except as set forth above. We hereby consent to the filing of this opinion letter as Exhibit 5 to the Registration Statement and to the use of our name under the caption “Legal Matters” in the prospectus filed as a part thereof. We also consent to your filing copies of this opinion letter as an exhibit to the Registration Statement with agencies of such states as you deem necessary in the course of complying with the laws of such states regarding the offering and sale of the Shares. In giving such consent, we do not thereby concede that we are within the category of persons whose consent is required under Section 7 of the Securities Act or the rules and regulations of the Commission thereunder.
Regards,
Bingham & Associates Law Group, APC
/s/ Bingham & Associates Law Group APC
| 2 |
Exhibit 2.2
PLAN OF CONVERSION
This Plan of Conversion (this “Plan of Conversion”) of Clip Interactive, LLC, a Colorado limited liability company (the “LLC”), is made and entered into effective as of December __, 2020, in accordance with the terms of the LLC’s Fourth Amended and Restated Limited Liability Company Operating Agreement, dated as of October 19, 2018, as amended (the “LLC Agreement”), the Colorado Limited Liability Company Act and the Delaware General Corporation Law. Capitalized terms used but not otherwise defined in this Plan of Conversion have the meanings ascribed to such terms in the LLC Agreement.
RECITALS
A. The LLC was formed under the name Clip Interactive, LLC on January 14, 2012 by the filing of a certificate of formation with the Secretary of State of the State of Colorado. Under the terms of the LLC Agreement, the LLC is managed by its board of managers (the “Board”).
B. A conversion of a Colorado limited liability company into a Delaware corporation may be made under Section 265 of the Delaware General Corporation Law and Section 7-90-201 of the Colorado Corporations and Associations Act.
C. Section 9.1.9 of the LLC Agreement provides that upon the effective date of a firmly underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933 (as amended) covering the offer and sale of common shares for the account of the LLC in which the gross cash proceeds to the LLC (before underwriting discounts, commissions and fees) are at least $2,000,000 (a “Qualified IPO”) all outstanding Preferred Shares of the LLC shall automatically convert into common shares of the LLC on a one-for-one basis (the “Automatic Share Conversion”).
D. Section 3.10 of the LLC Agreement provides that upon the approval of (x) the Board and (y) the holders of a majority of (i) the LLC’s outstanding shares and (ii) the LLC’s outstanding Series F Preferred shares (together, the “Required Holders”), the LLC may convert into the corporate form of organization (whether organized under the laws of the State of Colorado or any other state).
E. The LLC has filed a registration statement on Form S-1 (the “Registration Statement”) with the Securities and Exchange Commission for an initial public offering (the “IPO”) of the LLC’s common shares. The proposed terms of the IPO would constitute a Qualified IPO. The proposed terms of the IPO contemplate that the LLC would convert into a Delaware corporation (the “Conversion”).
F. The Conversion is intended to facilitate the LLC’s IPO.
G. The Board and the Required Holders have approved (i) the Conversion, and (ii) the terms of this Plan of Conversion.
NOW, THEREFORE, the LLC does hereby adopt this Plan of Conversion to effectuate the Conversion as follows:
1. Terms and Conditions of Conversion.
(a) The name of the converting entity is Clip Interactive, LLC, which is a Colorado limited liability company. The name of the converted entity is Auddia Inc. (the “Corporation”), which will be a Delaware corporation.
(b) The Conversion shall become effective at the time specified (the “Effective Time”) in the Certificate and Statement of Conversion filed with (x) the Secretary of State of the State of Delaware and (y) the Secretary of State of the State of Colorado, in substantially the form attached hereto as Exhibit A.
(c) At the Effective Time, the LLC shall continue its existence in the organizational form of a Delaware corporation. All of the rights, privileges and powers of the LLC and all property and all debts due to the LLC, as well as all other things and causes of action belonging to the LLC, shall remain vested in the Corporation and shall be the property of the Corporation. All actions and resolutions of the Board and the Members, as applicable, taken or adopted from the inception of the LLC prior to the Effective Time shall continue in full force and effect as if the Corporation’s Board of Directors and the stockholders, respectively, had taken such actions and adopted such resolutions. All rights of creditors and all liens upon any property of the LLC shall be preserved unimpaired, and all debts, liabilities and duties of the LLC shall remain attached to the Corporation and may be enforced against the Corporation to the same extent as if said debts, liabilities and duties had originally been incurred or contracted by the Corporation in its capacity as a Delaware corporation.
| 1 |
(d) At the Effective Time, each outstanding Preferred Share of the LLC (whether Series A, Series B, Series C or Series F) and each outstanding Common Share of the LLC shall be automatically converted into shares of common stock of the Corporation, par value $0.0001 (the “Common Stock”), as provided in Section 3 below, with such shares of Common Stock having the respective rights, preferences and privileges set forth in the Certificate of Incorporation (as defined below).
(e) At the Effective Time, the LLC Agreement shall be terminated and of no further force or effect, and no party shall have any further rights, duties or obligations pursuant to the LLC Agreement, except that Article 7 of the LLC Agreement (relating to Liability; Indemnification) shall survive. Notwithstanding the foregoing, the termination of the LLC Agreement shall not relieve any party thereto from any liability arising in connection with any breach by such party of the LLC Agreement.
2. Certificate of Incorporation; Bylaws; Directors and Officers. At the Effective Time, a Certificate of Incorporation of the Corporation shall be filed with the Secretary of State of the State of Delaware in substantially in the form attached hereto as Exhibit B (the “Certificate of Incorporation”). From and after the Effective Time, the LLC Agreement shall terminate and no longer govern the affairs of the Corporation, but instead the affairs of the Corporation shall be conducted under the bylaws of the Corporation, substantially in the form of Exhibit C attached hereto, and the Certificate of Incorporation. The directors and officers of the Corporation immediately after the Effective Time shall be those individuals who are set forth on Exhibit D attached hereto. The LLC and, after the Effective Time, the Corporation and its board of directors shall take such actions as to cause each of such individuals to be appointed as a director and/or officer, as the case may be, of the Corporation
3. Manner and Basis of Converting LLC Units in the LLC.
(a) At the Effective Time, each Preferred Share and each Common Share of the LLC outstanding immediately prior to the Effective Time shall be converted automatically, without any action on the part of the holder thereof, into validly issued, fully paid and non-assessable shares of the Corporation’s Common Stock. . Each Preferred Share and each Common Share outstanding immediately prior to the Effective Time shall, by reason of the Conversion, be converted into [1/__th]1 of one share of the Corporation’s Common Stock (the “Conversion Exchange Ratio”).
(b) All outstanding options, warrants, convertible notes and other convertible or exchangeable securities of the LLC (the “LLC Derivative Securities”) (i) shall be assumed by the Corporation, (ii) shall be adjusted and/or converted in accordance with the terms of such LLC Derivative Securities, and (iii) shall remain outstanding after the Effective Time as derivative securities of the Corporation (to the extent and as provided in the terms of such LLC Derivative Securities).
(c) No fractional shares of Common Stock will be issued in connection with the Conversion. In lieu of issuing fractional shares, the Corporation will eliminate any fractional shares by rounding up or down (as appropriate) to the nearest whole share, with 0.5 and higher being rounded up.
(d) The shares of Common Stock issued in connection with the Conversion have not been registered under the Securities Act or the securities laws of any state and may not be transferred, pledged or hypothecated except as permitted under the Securities Act and applicable state securities laws pursuant to registration or exemption therefrom; any certificates evidencing the Common Stock, if any, or any other securities issued in respect of the Common Stock upon any split, dividend, recapitalization, merger, consolidation or similar event, shall bear any legend required by the Corporation, required under applicable U.S. federal and state securities laws or called for by any agreement between the Corporation and any stockholder.
1 The final actual Conversion Exchange Ratio will be determined by the Board shortly before the effective date of the Registration Statement. The Corporation’s current estimate is that each LLC share will be converted into 1/70th of one share of the Corporation’s Common Stock.
| 2 |
4. U.S. Federal Income Tax Consequences. The Conversion has been structured to be treated, for U.S. federal income tax purposes, as if the LLC transferred its assets to the Corporation for shares of the Corporation’s Common Stock pursuant to an exchange described in Section 351 of the Internal Revenue Code of 1986, as amended, followed by a distribution of the shares of the Corporation’s Common Stock to the Members in liquidation of the LLC, as described in Rev. Rul. 2004-59.
5. Amendment or Termination. This Plan of Conversion may be amended or terminated by the LLC and the Conversion may be abandoned at any time prior to the Effective Time, notwithstanding any prior approval of this Plan of Conversion by the Board and the Required Holders. If the closing of the IPO does not occur within fifteen (15) days after the effectiveness of the Registration Statement (the “Closing Period”), then, the board of directors of the Corporation may take, after consultation with the Company’s tax advisors and with the consent of a majority of the holders of Common Stock, as promptly as practicable after the expiration of the Closing Period, all necessary action to rescind the Conversion to the fullest extent permitted by applicable law causing the Corporation to convert back to a limited liability company and reinstate the LLC Agreement and all of the relative equity interests and other rights, preferences and privileges of all parties thereunder as existed immediately prior to the Effective Time.
6. Further Assurances. If, at any time after the Effective Time, the Corporation shall determine or be advised that any deeds, bills of sale, assignments, agreements, documents or assurances or any other acts or things are necessary, desirable or proper, consistent with the terms of this Plan of Conversion, (a) to vest, perfect or confirm, of record or otherwise, in the Corporation its right, title or interest in, to or under any of the rights, privileges, immunities, powers, purposes, franchises, properties or assets of the LLC, or (b) to otherwise carry out the purposes of this Plan, the Corporation and its proper officers and directors (or their designees), are hereby authorized to solicit in the name of the LLC any third party consents or other documents required to be delivered by any third party, to execute and deliver, in the name and on behalf of the LLC all such deeds, bills of sale, assignments, agreements, documents and assurances and do, in the name and on behalf of the LLC, all such other acts and things necessary, desirable or proper to vest, perfect or confirm its right, title or interest in, to or under any of the rights, privileges, immunities, powers, purposes, franchises, properties or assets of the LLC and otherwise to carry out the purposes of this Plan of Conversion.
7. Counterparts. This Plan of Conversion may be executed in two or more counterparts, and each such counterpart and copy shall be and constitute an original instrument.
8. Governing Law. This Plan of Conversion shall be governed by and construed under the laws of the State of Delaware (and, to the extent applicable, the State of Colorado).
IN WITNESS WHEREOF, the undersigned, having received the required approval from the Board, hereby adopts this Plan of Conversion as of the date set forth above.
| CLIP INTERACTIVE, LLC | |||
| By: | |||
| Name: Michael Lawless | |||
| Title: Chief Executive Officer | |||
| 3 |
Exhibit A
Certificate of Conversion
(for filing in Delaware)
and
Statement of Conversion
(for filing in Colorado)
(See attached)
| 4 |
STATE OF DELAWARE
CERTIFICATE OF CONVERSION
FROM A LIMITED LIABILITY COMPANY TO A CORPORATION
Pursuant to Title 8, Section 265 of the Delaware General Corporation Law, the undersigned, on behalf of Clip Interactive, LLC, a Colorado limited liability company, does hereby submit this Certificate of Conversion for the purpose of converting to a Delaware corporation.
| 1. | The date on which the Limited Liability Company was first formed is January 14, 2012. |
| 2. | The jurisdiction in which the Limited Liability Company was first formed is the State of Colorado. |
| 3. | The jurisdiction of the Limited Liability Company immediately prior to the filing of this Certificate of Conversion is the State of Colorado. |
| 4. | The name of the Limited Liability Company immediately prior to the filing of this Certificate of Conversion is “Clip Interactive, LLC”. |
| 5. | The name of the Corporation as set forth in its Certificate of Incorporation filed in accordance with Section 265(b)(2) of the Delaware General Corporation Law is “Auddia Inc.”. |
| 6. | The Conversion shall become effective [upon the filing of this Certificate] [at time and date]. |
IN WITNESS WHEREOF, the undersigned being duly authorized to sign on behalf of the converting limited liability company has executed this Certificate on this _____ day of December, 2020.
| Clip Interactive, LLC | |||
| By: | |||
| Name: Michael Lawless | |||
| Title: President and Chief Executive Officer | |||
| 5 |
STATE OF COLORADO
STATEMENT OF CONVERSION
FROM A LIMITED LIABILITY COMPANY TO A CORPORATION
Pursuant to Section 7-90-201 of the Colorado Corporations and Associations Act, the undersigned, on behalf of Clip Interactive, LLC, a Colorado limited liability company, does hereby submit this Statement of Conversion for the purpose of converting to a Delaware corporation.
| 1. | The date on which the Limited Liability Company was first formed is January 14, 2012. |
| 2. | The jurisdiction in which the Limited Liability Company was first formed is the State of Colorado. |
| 3. | The jurisdiction of the Limited Liability Company immediately prior to the filing of this Statement of Conversion is the State of Colorado. |
| 4. | The name of the Limited Liability Company immediately prior to the filing of this Statement of Conversion is “Clip Interactive, LLC”. |
| 5. | The name of the Corporation as set forth in its Certificate of Incorporation filed in accordance with Section 265(b)(2) of the Delaware General Corporation Law is “Auddia Inc.”. |
| 6. | The principal office for the Limited Liability Company in Colorado is 5755 Central Avenue, Suite C, Boulder, CO 80301. |
| 7. | The principal office for the Corporation in Delaware is The Corporation Trust Company, 1209 Orange Street, City of Wilmington, County of New Castle, Delaware 19801. |
| 8. | The Conversion shall become effective [upon the filing of this Statement] [at time and date]. |
IN WITNESS WHEREOF, the undersigned being duly authorized to sign on behalf of the converting limited liability company has executed this Statement on this ________ day of December, 2020.
| Clip Interactive, LLC | |||
| By: | |||
| Name: Michael Lawless | |||
| Title: President and Chief Executive Officer | |||
| 6 |
Exhibit B
CERTIFICATE OF INCORPORATION
OF
AUDDIA INC.
(See Attached)
| 7 |
Exhibit C
BYLAWS
OF
AUDDIA INC.
(See Attached)
| 8 |
Exhibit D
AUDDIA INC.
DIRECTORS AND OFFICERS
Board of Directors
Jeffrey Thramann, M.D. (Chairman)
Michael Lawless
Stephen Deitsch
Timothy J. Hanlon
Officers
Jeffrey Thramann, M.D. – Executive Chairman
Michael Lawless—President and Chief Executive Officer
Stephen Deitsch – Vice President and Chief Technology Officer
Richard Liebman – Vice President, Secretary, Treasurer and Chief Financial Officer
| 9 |
Exhibit 3.8
CLIP INTERACTIVE, LLC
AMENDMENT NO. 3 TO THE
FOURTH amended and restated
LIMITED LIABILITY COMPANY AGREEMENT
THIS AMENDMENT NO. 3 (this “Amendment”) TO THE FOURTH AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (the “Operating Agreement”), of CLIP INTERACTIVE, LLC (the “Company”), dated and effective as of November 1, 2020 (the “Effective Date”), by and among the Company, Jeffrey J. Thramann (the “Founder”) and each other person who becomes a member of the Company in accordance with the terms of the Agreement (collectively, the “Shareholders”). All capitalized terms used herein and not otherwise defined in this Amendment shall have the meanings assigned to them in the Operating Agreement.
RECITALS
WHEREAS, the Shareholders have formed the Company as a limited liability company pursuant to the Colorado Limited Liability Company Act.
WHEREAS, the Shareholders are holders of the Company’s Shares and are a party to the Fourth Amended and Restated Limited Liability Company Agreement of the Company, dated and effective as of October 19, 2018 (and as amended by Amendment No. 1 thereto dated as of March 22, 2019 and Amendment No. 2 thereto dated as of April 7, 2020) by and among the Shareholders, the Founder and the Company; and
WHEREAS, the parties to such Operating Agreement desire to amend the Operating Agreement as provided herein.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants herein contained and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Shareholders agree as follows:
1. Section 3.6.10 of the Operating Agreement is hereby amended and restated in its entirety to read as follows:
3.6.10 2020 Bridge Note Offering; Adjustments in Respect of Certain Outstanding Shares and Outstanding Derivative Securities.
3.6.10.1 The Company has authorized an offering (the “2020 Bridge Note Offering”) of its 2020 bridge notes (the “2020 Bridge Notes”) to its existing investors. The 2020 Bridge Note Offering will be made in three tranches. The first tranche (“Tranche 1”) was closed on June 15, 2020 (the “Tranche 1 Closing Date”). The second tranche (“Tranche 2”) was closed on August 13, 2020 (the “Tranche 2 Closing Date”). The third tranche (“Tranche 3”) will be commenced immediately after the effectiveness of this Amendment and will close on a date specified in the terms of such offering (but in no event later than Friday November 9, 2020) (the “Tranche 3 Closing Date”).
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3.6.10.2 Effective as of 5:00 PM Mountain Time on the Tranche 1 Closing Date (the “Tranche 1 Issue Date”), all outstanding securities of the Company constituting Tranche 1 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 1 Distribution”). Any outstanding securities of the Company constituting Tranche 1 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 1 Distribution. Tranche 1 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 1 Issue Date and the Tranche 1 Distribution.
3.6.10.3 Effective as of 5:00 PM Mountain Time on the Tranche 2 Closing Date (the “Tranche 2 Issue Date”), all outstanding securities of the Company constituting Tranche 2 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 2 Distribution”). Any outstanding securities of the Company constituting Tranche 2 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 2 Distribution. Tranche 2 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 2 Issue Date and the Tranche 2 Distribution.
3.6.10.4 Effective as of 5:00 PM Mountain Time on the Tranche 3 Closing Date (the “Tranche 3 Issue Date”), all outstanding securities of the Company constituting Tranche 3 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 3 Distribution”). Any outstanding securities of the Company constituting Tranche 3 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 3 Distribution. Tranche 3 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 3 Issue Date and the Tranche 3 Distribution.
3.6.10.5 As of the Tranche 1 Issue Date, all Tranche 1 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 1 Participating Securities, shall receive the Tranche 1 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 1 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 1 Distribution.
3.6.10.6 As of the Tranche 2 Issue Date, all Tranche 2 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 2 Participating Securities, shall receive the Tranche 2 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 2 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 2 Distribution.
3.6.10.7 As of the Tranche 3 Issue Date, all Tranche 3 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 3 Participating Securities, shall receive the Tranche 3 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one-half additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one-half additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one-half additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one-half additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one-half additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 3 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 3 Distribution.
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3.6.10.8 Following the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution, (i) the Series A Original Issue Price shall remain at $1.00 per share; (ii) the Series B Original Issue Price shall remain at $1.0435 per share; (iii) the Series C Original Issue Price shall remain at $0.115 per share; and (iv) the Series F Original Issue Price shall remain at $0.01 per share. Following the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution, the applicable Conversion Price and Conversion Rate for the Series A, Series B, Series C and Series F Preferred Shares shall remain unchanged.
3.6.10.9 For outstanding options and warrants which are considered Tranche 1 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 1 Distribution as of the Tranche 1 Issue Date. Accordingly, as of the Tranche 1 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.10 For outstanding options and warrants which are considered Tranche 2 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 2 Distribution as of the Tranche 2 Issue Date. Accordingly, as of the Tranche 2 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.11 For outstanding options and warrants which are considered Tranche 3 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 3 Distribution as of the Tranche 3 Issue Date. Accordingly, as of the Tranche 3 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one-half for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.12 The number of shares of any particular class or series of securities to be issued to any holder of Tranche 1 or Tranche 2 or Tranche 3 Participating Securities (including options and warrants) pursuant to the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution shall be rounded up or down (as applicable) to the nearest whole share, with 0.50 and higher being rounded up. Each holder in the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution contemplated by this Section 3.6.12 hereby acknowledges and agrees that such holder forfeits any fractional share to which such holder is otherwise entitled to upon the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution as a result of the rounding functions set forth in this Section 3.6.12. The adjusted per share exercise price of any options or warrants shall be calculated out to four decimal places (rounded).
3.6.10.13 For purposes of this Section 3.6.10, the term “Tranche 1 Non-Participating Securities“ shall mean (as of the Tranche 1 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 1 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 1 Allocation in the 2020 Bridge Note Offering (defined below).
3.6.10.14 For purposes of this Section 3.6.10, the term “Tranche 2 Non-Participating Securities“ shall mean (as of the Tranche 2 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 2 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 2 Allocation in the 2020 Bridge Note Offering (defined below).
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3.6.10.15 For purposes of this Section 3.6.10, the term “Tranche 3 Non-Participating Securities“ shall mean (as of the Tranche 3 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 3 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 3 Allocation in the 2020 Bridge Note Offering (defined below).
3.6.10.16 For purposes of this Section 3.6.10, the term “Tranche 1 Participating Securities“ shall mean (as of the Tranche 1 Issue Date) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities.
3.6.10.17 For purposes of this Section 3.6.10, the term “Tranche 2 Participating Securities“ shall mean (as of the Tranche 2 Issue Date only) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities, but shall not include any outstanding securities that were issued in the Tranche 1 Distribution. By way of clarification, (x) the Tranche 1 Distribution and the Tranche 2 Distribution will be issued only in respect of participating outstanding Company securities which were outstanding prior to the Tranche 1 Issue Date, and (y) the Tranche 1 Distribution and the Tranche 2 Distribution will not be issued in respect of outstanding Company securities which were issued in the Tranche 1 Distribution.
3.6.10.18 For purposes of this Section 3.6.10, the term “Tranche 3 Participating Securities“ shall mean (as of the Tranche 3 Issue Date only) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities, but shall not include any outstanding securities that were issued in the Tranche 1 Distribution or the Tranche 2 Distribution. By way of clarification, (x) the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution will be issued only in respect of participating outstanding Company securities which were outstanding prior to the Tranche 1 Issue Date, and (y) the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution will not be issued in respect of outstanding Company securities which were issued in the Tranche 1 Distribution or the Tranche 2 Distribution.
3.6.10.19 For purposes of this Section 3.6.10, the term “Tranche 1 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $10,000 or (ii) an amount equal to 10% of such Shareholder’s prior capital investment in the Company (measured prior to the Tranche 1 closing).
3.6.10.20 For purposes of this Section 3.6.10, the term “Tranche 2 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $10,000 or (ii) an amount equal to 10% of such Shareholder’s prior capital investment in the Company (measured prior to the Tranche 1 closing).
3.6.10.21 For purposes of this Section 3.6.10, the term “Tranche 3 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $5,000 or (ii) an amount equal to 5% of such Shareholder’s prior capital investment in the Company.
* * * * * * * * *
Except as specifically amended herein, the Operating Agreement shall continue in full force and effect.
IN WITNESS WHEREOF, the undersigned have executed and delivered this Amendment as of the day and year first above written.
CLIP INTERACTIVE, LLC:
By: /s/ Michael Lawless
Michael Lawless
Chief Executive Officer
FOUNDER:
By: /s/Jeffrey Thramann
Jeffrey Thramann
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Exhibit 3.9
CLIP INTERACTIVE, LLC
AMENDMENT NO. 4 TO THE
FOURTH amended and restated
LIMITED LIABILITY COMPANY AGREEMENT
THIS AMENDMENT NO. 4 (this “Amendment”) TO THE FOURTH AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT (the “Operating Agreement”), of CLIP INTERACTIVE, LLC (the “Company”), dated and effective as of December 4, 2020 (the “Effective Date”), by and among the Company, Jeffrey J. Thramann (the “Founder”) and each other person who becomes a member of the Company in accordance with the terms of the Agreement (collectively, the “Shareholders”). All capitalized terms used herein and not otherwise defined in this Amendment shall have the meanings assigned to them in the Operating Agreement.
RECITALS
WHEREAS, the Shareholders have formed the Company as a limited liability company pursuant to the Colorado Limited Liability Company Act.
WHEREAS, the Shareholders are holders of the Company’s Shares and are a party to the Fourth Amended and Restated Limited Liability Company Agreement of the Company, dated and effective as of October 19, 2018 (and as amended by Amendment No. 1 thereto dated as of March 22, 2019 and Amendment No. 2 thereto dated as of April 7, 2020 and Amendment No. 3 thereto dated as of November 1, 2020) by and among the Shareholders, the Founder and the Company; and
WHEREAS, the parties to such Operating Agreement desire to amend the Operating Agreement as provided herein.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants herein contained and other valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Shareholders agree as follows:
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1. Section 3.6.10 of the Operating Agreement is hereby amended and restated in its entirety to read as follows:
3.6.10 2020 Bridge Note Offering; Adjustments in Respect of Certain Outstanding Shares and Outstanding Derivative Securities.
3.6.10.1 The Company has authorized an offering (the “2020 Bridge Note Offering”) of its 2020 bridge notes (the “2020 Bridge Notes”) to its existing investors. The 2020 Bridge Note Offering will be made in four tranches. The first tranche (“Tranche 1”) was closed on June 15, 2020 (the “Tranche 1 Closing Date”). The second tranche (“Tranche 2”) was closed on August 13, 2020 (the “Tranche 2 Closing Date”). The third tranche (“Tranche 3”) was closed on November 9, 2020 (the “Tranche 3 Closing Date”). The fourth tranche (“Tranche 4”) will be commenced immediately and will close on a date specified in the terms of such offering (but in no event later than Friday December 4, 2020) (the “Tranche 4 Closing Date”).
3.6.10.2 Effective as of 5:00 PM Mountain Time on the Tranche 1 Closing Date (the “Tranche 1 Issue Date”), all outstanding securities of the Company constituting Tranche 1 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 1 Distribution”). Any outstanding securities of the Company constituting Tranche 1 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 1 Distribution. Tranche 1 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 1 Issue Date and the Tranche 1 Distribution.
3.6.10.3 Effective as of 5:00 PM Mountain Time on the Tranche 2 Closing Date (the “Tranche 2 Issue Date”), all outstanding securities of the Company constituting Tranche 2 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 2 Distribution”). Any outstanding securities of the Company constituting Tranche 2 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 2 Distribution. Tranche 2 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 2 Issue Date and the Tranche 2 Distribution.
3.6.10.4 Effective as of 5:00 PM Mountain Time on the Tranche 3 Closing Date (the “Tranche 3 Issue Date”), all outstanding securities of the Company constituting Tranche 3 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 3 Distribution”). Any outstanding securities of the Company constituting Tranche 3 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 3 Distribution. Tranche 3 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 3 Issue Date and the Tranche 3 Distribution.
3.6.10.5 Effective as of 5:00 PM Mountain Time on the Tranche 4 Closing Date (the “Tranche 4 Issue Date”), all outstanding securities of the Company constituting Tranche 4 Participating Securities (as defined below) shall receive a distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 4 Distribution”). Any outstanding securities of the Company constituting Tranche 4 Non-Participating Securities (as defined below) shall not be eligible for the Tranche 4 Distribution. Tranche 4 Non-Participating Securities shall continue to remain outstanding and unchanged following the Tranche 4 Issue Date and the Tranche 4 Distribution.
3.6.10.6 In addition, effective as of 5:00 PM Mountain Time on the Tranche 4 Closing Date, each holder of Company securities who has participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 4 Allocation in the 2020 Bridge Note Offering (defined below) (a “Tranche 4 Participating Investor”) shall receive a bonus distribution of additional securities of the Company as provided for in this Section 3.6.10 (such distribution being referred to herein as the “Tranche 4 Bonus Distribution”).
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3.6.10.7 As of the Tranche 1 Issue Date, all Tranche 1 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 1 Participating Securities, shall receive the Tranche 1 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 1 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 1 Distribution.
3.6.10.8 As of the Tranche 2 Issue Date, all Tranche 2 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 2 Participating Securities, shall receive the Tranche 2 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 2 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 2 Distribution.
3.6.10.9 As of the Tranche 3 Issue Date, all Tranche 3 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 3 Participating Securities, shall receive the Tranche 3 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one-half additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one-half additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one-half additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one-half additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one-half additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 3 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 3 Distribution.
3.6.10.10 As of the Tranche 4 Issue Date, all Tranche 4 Participating Securities (as defined below) shall automatically, and without any further action on the part of any holder of such Tranche 3 Participating Securities, shall receive the Tranche 4 Distribution of additional securities of the Company as follows: (A) each Series A Preferred Share shall be issued one additional Series A Preferred Share, (B) each Series B Preferred Share shall be issued one additional Series B Preferred Share, (C) each Series C Preferred Share shall be issued one additional Series C Preferred Share, (D) each Series F Preferred Share shall be issued one additional Series F Preferred Share, (E) each Series 1 Common Share shall be issued one additional Series 1 Common Share. Any outstanding securities of the Company constituting Tranche 4 Non-Participating Securities (as defined below) shall not be eligible to receive the Tranche 4 Distribution.
3.6.10.11 As of the Tranche 4 Issue Date, each Tranche 4 Participating Investor shall automatically, and without any further action on the part of any such Tranche 4 Participating Investor, receive a portion of the Tranche 4 Bonus Distribution. The aggregate Tranche 4 Bonus Distribution shall consist of 780,157,960 Series 1 Common Shares. Such Series 1 Common Shares shall be allocated among the Tranche 4 Participating Investors in a method (i) mutually agreed to by the Founder and a majority (by Tranche 4 dollar amount invested) of the Tranche 4 Participating Investors and (ii) applied in an equal and consistent manner to all Tranche 4 Participating Investors.
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3.6.10.12 Following the Tranche 1 Distribution, the Tranche 2 Distribution, the Tranche 3 Distribution, the Tranche 4 Distribution and the Tranche 4 Bonus Distribution, (i) the Series A Original Issue Price shall remain at $1.00 per share; (ii) the Series B Original Issue Price shall remain at $1.0435 per share; (iii) the Series C Original Issue Price shall remain at $0.115 per share; and (iv) the Series F Original Issue Price shall remain at $0.01 per share. Following the Tranche 1 Distribution, the Tranche 2 Distribution, the Tranche 3 Distribution, the Tranche 4 Distribution and the Tranche 4 Bonus Distribution, the applicable Conversion Price and Conversion Rate for the Series A, Series B, Series C and Series F Preferred Shares shall remain unchanged.
3.6.10.13 For outstanding options and warrants which are considered Tranche 1 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 1 Distribution as of the Tranche 1 Issue Date. Accordingly, as of the Tranche 1 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.14 For outstanding options and warrants which are considered Tranche 2 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 2 Distribution as of the Tranche 2 Issue Date. Accordingly, as of the Tranche 2 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.15 For outstanding options and warrants which are considered Tranche 3 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 3 Distribution as of the Tranche 3 Issue Date. Accordingly, as of the Tranche 3 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one-half for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.16 For outstanding options and warrants which are considered Tranche 4 Participating Securities, the number of exercisable shares of such options and warrants shall be automatically increased to reflect the Tranche 4 Distribution as of the Tranche 4 Issue Date. Accordingly, as of the Tranche 4 Issue Date (i) the number of shares for which such option or warrant is exercisable shall be increased by one for each share that such option or warrant was exercisable for prior to the Tranche 1 Distribution, and (ii) the per share exercise price shall remain unchanged.
3.6.10.17 The number of shares of any particular class or series of securities to be issued to any holder of Tranche 1 or Tranche 2 or Tranche 3 or Tranche 4 Participating Securities (including options and warrants) pursuant to the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution or Tranche 4 Distribution or Tranche 4 Bonus Distribution shall be rounded up or down (as applicable) to the nearest whole share, with 0.50 and higher being rounded up. Each holder in the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution or Tranche 4 Distribution or Tranche 4 Bonus Distribution contemplated by this Section 3.6.10 hereby acknowledges and agrees that such holder forfeits any fractional share to which such holder is otherwise entitled to upon the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution as a result of the rounding functions set forth in this Section 3.6.10. The adjusted per share exercise price of any options or warrants shall be calculated out to four decimal places (rounded).
3.6.10.18 For purposes of this Section 3.6.10, the term “Tranche 1 Non-Participating Securities“ shall mean (as of the Tranche 1 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 1 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 1 Allocation in the 2020 Bridge Note Offering (defined below).
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3.6.10.19 For purposes of this Section 3.6.10, the term “Tranche 2 Non-Participating Securities“ shall mean (as of the Tranche 2 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 2 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 2 Allocation in the 2020 Bridge Note Offering (defined below).
3.6.10.20 For purposes of this Section 3.6.10, the term “Tranche 3 Non-Participating Securities“ shall mean (as of the Tranche 3 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 3 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 3 Allocation in the 2020 Bridge Note Offering (defined below).
3.6.10.21 For purposes of this Section 3.6.10, the term “Tranche 4 Non-Participating Securities“ shall mean (as of the Tranche 4 Issue Date) any securities of the Company (whether preferred shares, common shares, options or warrants) held by any holder of shares of Series A Preferred Shares or Series B Preferred Shares or Series C Preferred Shares who (as of the Tranche 4 Issue Date) had not participated in the 2020 Bridge Note Offering by purchasing in the aggregate at least 100% of such holder’s Tranche 4 Allocation in the 2020 Bridge Note Offering (defined below).
3.6.10.22 For purposes of this Section 3.6.10, the term “Tranche 1 Participating Securities“ shall mean (as of the Tranche 1 Issue Date) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities.
3.6.10.23 For purposes of this Section 3.6.10, the term “Tranche 2 Participating Securities“ shall mean (as of the Tranche 2 Issue Date only) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities, but shall not include any outstanding securities that were issued in the Tranche 1 Distribution. By way of clarification, (x) the Tranche 1 Distribution and the Tranche 2 Distribution will be issued only in respect of participating outstanding Company securities which were outstanding prior to the Tranche 1 Issue Date, and (y) the Tranche 1 Distribution and the Tranche 2 Distribution will not be issued in respect of outstanding Company securities which were issued in the Tranche 1 Distribution.
3.6.10.24 For purposes of this Section 3.6.10, the term “Tranche 3 Participating Securities“ shall mean (as of the Tranche 3 Issue Date only) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities, but shall not include any outstanding securities that were issued in the Tranche 1 Distribution or the Tranche 2 Distribution. By way of clarification, (x) the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution will be issued only in respect of participating outstanding Company securities which were outstanding prior to the Tranche 1 Issue Date, and (y) the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution will not be issued in respect of outstanding Company securities which were issued in the Tranche 1 Distribution or the Tranche 2 Distribution.
3.6.10.25 For purposes of this Section 3.6.10, the term “Tranche 4 Participating Securities“ shall mean (as of the Tranche 4 Issue Date only) all securities of the Company (whether preferred shares, common shares, options or warrants) other than Non-Participating Securities, but shall not include any outstanding securities that were issued in the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution. By way of clarification, (x) the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution and the Tranche 4 Distribution will be issued only in respect of participating outstanding Company securities which were outstanding prior to the Tranche 1 Issue Date, and (y) the Tranche 1 Distribution and the Tranche 2 Distribution and the Tranche 3 Distribution and the Tranche 4 Distribution will not be issued in respect of outstanding Company securities which were issued in the Tranche 1 Distribution or the Tranche 2 Distribution or the Tranche 3 Distribution.
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3.6.10.26 For purposes of this Section 3.6.10, the term “Tranche 1 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $10,000 or (ii) an amount equal to 10% of such Shareholder’s prior capital investment in the Company (measured prior to the Tranche 1 closing).
3.6.10.27 For purposes of this Section 3.6.10, the term “Tranche 2 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $10,000 or (ii) an amount equal to 10% of such Shareholder’s prior capital investment in the Company (measured prior to the Tranche 1 closing).
3.6.10.28 For purposes of this Section 3.6.10, the term “Tranche 3 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $5,000 or (ii) an amount equal to 5% of such Shareholder’s prior capital investment in the Company.
3.6.10.29 For purposes of this Section 3.6.10, the term “Tranche 4 Allocation in the 2020 Bridge Note Offering” shall mean the lesser of (i) $10,000 or (ii) an amount equal to 10% of such Shareholder’s prior capital investment in the Company (measured prior to the Tranche 1 closing).
Except as specifically amended herein, the Operating Agreement shall continue in full force and effect.
IN WITNESS WHEREOF, the undersigned have executed and delivered this Amendment as of the day and year first above written.
CLIP INTERACTIVE, LLC:
By: /s/ Michael Lawless
Michael Lawless
Chief Executive Officer
FOUNDER:
By: /s/Jeffrey Thramann
Jeffrey Thramann
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