SOWG 8-K
Sow Good Inc. (SOWG)
UNITED STATES
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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CURRENT REPORT
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INTRODUCTORY NOTE
On December 31, 2025, Sow Good Inc. (the “Company”) entered into a series of Transactions (as defined below), including a $6.0 million Private Placement (as defined below), an asset sale of the Purchased Assets (as defined below) to the Buyer (as defined below), and a Distribution Agreement (as defined below) for certain distribution services. The Company intends to utilize the net proceeds from the Private Placement to fund ongoing operations, satisfy outstanding obligations and preserve the Company’s ability to operate as a going concern while it evaluates and pursues potential strategic alternatives.
In addition, the Company will continue to manage its corporate functions, including finance, accounting, public company reporting, compliance, investor relations and strategic planning.
Following the consummation of the Transactions, the Company will pursue strategic alternatives while continuing to sell and distribute its candy products in the ordinary course of business. The transaction does not alter Sow Good’s ongoing commercial activities related to the sale and distribution of candy.
Item 1.01. Entry into a Material Definitive Agreement.
Securities Purchase Agreement
On December 31, 2025 (the “SPA Effective Date”), Sow Good Inc. (the “Company”) entered into a Securities Purchase Agreement (the “Securities Purchase Agreement”) with the David Lazar (the “Investor”), pursuant to which the Company agreed to issue and sell, in a private placement, shares (the “Series AA Preferred Shares”) of Series AA Convertible Non-Redeemable Preferred Stock, par value $0.001 per share, of the Company (the “Series AA Preferred Stock”) and shares (the “Series AAA Preferred Shares”, and together with the Series AA Preferred Shares, the “Placement Shares”) of Series AAA Convertible Non-Redeemable Preferred Stock, par value $0.001 per share, of the Company (the “Series AAA Preferred Stock”), in two closings for aggregate gross proceeds of $6.0 million, subject to the terms and conditions set forth in the Securities Purchase Agreement (collectively, the “Private Placement”).
Pursuant to the Securities Purchase Agreement, Company has agreed to issue and sell to the Investor at a first closing of the Private Placement to be held immediately following the execution of the Securities Purchase Agreement (the “First Closing”), 1,500,000 Series AA Preferred Shares, at a price per Series AA Preferred Share equal to $2.00, for aggregate gross proceeds of $3.0 million. The First Closing occurred on December 31, 2025, with the filing of the Series AA Certificate of Designations (as defined below) with the Secretary of State of the State of Delaware and satisfaction of the other customary closing conditions.
Pursuant to the Securities Purchase Agreement, the Company has also agreed to issue and sell to the Investor at a second closing of the Private Placement (the “Second Closing”), 1,500,000 Series AAA Preferred Shares, at a price per Series AAA Preferred Share equal to $2.00, for aggregate gross proceeds of $3.0 million (the “Second Closing Purchase Price”). The Second Closing is expected to take place promptly following receipt of the Stockholder Approvals (as defined below) and prior to March 31, 2026, subject to (i) the approval by the Company’s stockholders at a meeting of stockholders or acting through written consent of (A) all such matters as may be required by the applicable rules and regulations of the Nasdaq Capital Market (or any successor entity) or under applicable law from the stockholders of the Company with respect to the conversion of all the Placement Shares to the Investor into shares of common stock, $0.001 par value per share, of the Company (the “Common Stock”), as provided in the respective certificates of designation of the Placement Shares; (B) an amendment to the Company’s certificate of incorporation that increases the authorized shares of Common Stock to at least the maximum aggregate number of shares of Common Stock issuable or potentially issuable in the future pursuant to this transaction (C) a reverse stock split in the range of 1 to 2 to 1 for 1 to 99; (D) an increase in the shares available under the Company’s equity plan to 10,000,000 shares; and (E) the election of up to eight (8) individuals recommended by the investor to serve as directors (the “Investor Nominees”) on the Company’s board of directors (the “Board”) (collectively, the “Stockholder Approvals”); (ii) the filing of a Certificate of Designations, Preferences and Rights of Series AAA Convertible Non-Redeemable Preferred Stock (the “Series AAA Certificate of Designations”), with the Secretary of State of the State of Delaware creating the Series AAA Preferred Stock, and (iii) the satisfaction of other customary closing conditions.
The Company has agreed to use commercially reasonable efforts to either (i) hold the Stockholder Meeting or (ii) facilitate a written consent of stockholders representing a majority of the voting power of the Company’s voting stock, in lieu of the Stockholder Meeting (a “Stockholder Written Consent”) before March 31, 2026, the purposes of which will include, among other things, to obtain the Stockholder Approvals.
The filing by the Company of the Series AAA Certificate of Designation with the Secretary of State of the State of Delaware with respect to the Series AAA Preferred Stock is subject to the receipt of the Stockholder Approvals and will occur, if at all, in connection with the Second Closing. The terms of the Series AAA Preferred Stock are substantially similar to the terms of the Series AA Preferred Stock, except that each share of Series AA Preferred Stock is initially convertible into 14 shares of Common Stock and each share of Series AAA Preferred Stock is initially convertible into 250 shares of Common Stock (subject to adjustment as provided in the Series AAA certificate of designations).
The net proceeds from the Private Placement will be used to fund the current operations, pay outstanding liabilities (whether known, unknown or contingent) and expenses of the Company. A portion of the net proceeds will be used to pay certain of the Company’s creditors, including related parties.
Until the Second Closing, without the Investor’s consent, the Company has agreed to not, subject to certain specified exceptions: (i) change the number of directors of the Board or fill any vacancy in the Board (except as contemplated by the Securities Purchase Agreement), (ii) change the nature of the Company’s operations (except as contemplated by Securities Purchase Agreement), (iii) incur any debt for borrowed money outside of the ordinary course of business as presently conducted, (iv) guarantee any obligation of any third party, (v) issue any capital stock, subject to certain specified exceptions, (vi) issue or grant any new common stock equivalents, (vii) amend its Restated Certificate of Incorporation or Bylaws, or (viii) agree to any of the foregoing.
Pursuant to the Securities Purchase Agreement, if at any time during the six-month period following the date of the First Closing (the “Participation Period”), the Company proposes to offer and sell new equity securities in an offering that is conducted pursuant to an exemption from registration under the Securities Act of 1933, as amended (the “Securities Act”), or in an offering that is registered under the Securities Act that is not conducted as a firm-commitment underwritten offering, then, subject to compliance with securities laws and regulations, the Company has agreed to offer the Investor the right to purchase, on the same terms, including the price per security, and subject to the same conditions, as are applicable to the other investors in such offering, that amount of new equity securities equal to up to 25% of the total amount of new equity securities being offered for sale in such offering. In addition, if during the Participation Period, the Company proposes to offer and sell new equity securities in a firm-commitment underwritten offering registered under the Securities Act, then subject to compliance with securities laws and regulations, the Company has agreed to use its commercially reasonable efforts to cause the managing underwriters of such offering to contact the Investor about potentially participating in such offering and to provide to the Investor the opportunity to purchase up to 25% of the total new equity securities, subject to certain conditions and limitations.
Pursuant to the Securities Purchase Agreement, subject to obtaining Stockholder Approvals and the consummation of the Second Closing, the Investor will have the right to recommend to the Company up to eight Investor Nominees, provided that such right shall at all times be subject to, and in compliance with, Nasdaq Listing Rule 5640.
From the SPA Effective Date through the date of Stockholder Approvals and subject to the Investor complying with Investor’s obligations under the Securities Purchase Agreement, the Company has agreed to not voluntarily initiate, or cause to be initiated, any bankruptcy proceeding for itself, unless required by applicable law or as a result of an exercise of fiduciary duty.
The Securities Purchase Agreement contains customary representations, warranties and agreements by the Company and customary closing conditions. The representations, warranties and covenants contained in the Securities Purchase Agreement were made solely for the benefit of the parties thereto and as of specific dates and may be subject to limitations agreed upon by the contracting parties.
The foregoing description of the Securities Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Securities Purchase Agreement, a copy of which is filed as Exhibit 10.1 hereto and is incorporated by reference herein.
Asset Purchase Agreement and Distribution Agreement
On December 30, 2025 (the “APA Effective Date”), the Company entered into an asset purchase agreement (the “Asset Purchase Agreement”) with Trea Grove, LLC (the “Buyer”), a related party, pursuant to which the Company agreed to sell, and Buyer agreed to purchase, a significant portion of the assets related to the Company’s freeze-dried snacks and candy business (the “Purchased Assets”), and Buyer agreed to assume certain specified liabilities, for aggregate cash consideration of $1,500,000, payable in installments through March 31, 2026, subject to the terms and conditions set forth in the Asset Purchase Agreement. The Purchased Assets include real property improvements, proprietary and intellectual property rights, transferable governmental licenses and permits, and other assets as detailed in the agreement. The Asset Purchase Agreement also provides for customary representations, warranties, indemnification provisions, and post-closing obligations.
On December 31, 2025 (the “Distribution Agreement Effective Date”), the Company entered into a Distribution Agreement (the “Distribution Agreement”) with Trea Grove, LLC (the “Distributor”), pursuant to which the Distributor was appointed as the exclusive distributor of certain Company products, including fruits, snacks, and candy, through July 31, 2026, unless extended by the Company. Under the Distribution Agreement, the Distributor is responsible for customer communications, order management, billing, collections, shipping, logistics, and fulfillment. The Distributor will remit to the Company ten percent (10%) of gross receipts from product sales. The agreement allocates product liability to the Company and distribution liability to the Distributor, and provides the Distributor with a limited license to use the Company’s trademarks for distribution and marketing purposes. The Distribution Agreement also contains customary confidentiality, transition, and termination provisions, and is governed by Texas law.
The foregoing descriptions of the Asset Purchase Agreement and the Distribution Agreement do not purport to be complete and are qualified in their entirety by reference to the full text of the Asset Purchase Agreement, a copy of which is filed as Exhibit 10.2 hereto, and the full text of the Distribution Agreement, a copy of which is filed as Exhibit 10.3 hereto, respectively, and are incorporated by reference herein.
The transactions contemplated by the Securities Purchase Agreement, the Asset Purchase Agreement and the Distribution Agreement (collectively, the “Transactions”) were approved and authorized by a special committee consisting of disinterested members of the Company’s Board.
While the Company has completed the asset sale of certain manufacturing-related assets, the Transactions do not represent the liquidation or cessation of operations. Rather, the Company is transitioning to a more asset-light operating structure while continuing its commercial activities and maintaining its public company infrastructure. The Company believes this structure provides flexibility to stabilize operations, address liabilities and evaluate future strategic opportunities and acquisitions.
Voting Agreement
Pursuant to the Securities Purchase Agreement, on December 31, 2025 (the “Proxy Effective Date”), the Company entered into a voting agreement with Ira Goldfarb, in his capacity as a stockholder of the Company; Claudia Goldfarb, in her capacity as a stockholder of the Company; and Lyle Berman, in his capacity as a stockholder of the Company (each, a “Voting Agreement”, and together the “Voting Agreements”), pursuant to which Mr. Goldfarb, Ms. Goldfarb and Mr. Berman agreed, for two years following the Proxy Effective Date, to vote all of their Proxy Shares (as defined below) in favor of all proposals recommended by the Board at the Stockholders Meeting. The “Proxy Shares” include (i) 1,630,597 shares held individually by Mr. Goldfarb; (ii) 466,625 shares held individually by Ms. Goldfarb; (iii) 1,212,825 shares held individually by Mr. Berman; and (iv) 2,082,490 shares held jointly by Mr. Goldfarb and Ms. Goldfarb, as well as any additional shares of Common Stock which may be acquired by Mr. Goldfarb, Ms. Goldfarb and Mr. Berman until the expiration of the Voting Agreements. To the extent that the Proxy Shares are not voted, Mr. Goldfarb, Ms. Goldfarb and Mr. Berman have granted the Company an irrevocable proxy to vote all of the Proxy Shares in the manner and to the effect determined by the Company in its sole and absolute discretion with respect to actions proposed to be taken by the Company.
In addition, upon and following the Proxy Effective Date, Mr. Goldfarb, Ms. Goldfarb and Mr. Berman agree that, for a period of two years from the Proxy Effective Date, unless such shall have been specifically invited in advance in writing by the Investor, neither Mr. Goldfarb, Ms. Goldfarb and Mr. Berman, nor any of their representatives acting on their behalf, will in any manner, directly or indirectly: (i) effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or participate in or in any way advise, assist or encourage any other person to effect or seek, offer or propose (whether publicly or otherwise) to effect or participate in, (a) any acquisition of any securities (or beneficial ownership thereof) or assets of the Company, or any rights to acquire any such securities (including derivative securities representing the right to vote or economic benefit of any such securities) or assets; (b) any tender or exchange offer, merger or other business combination involving the Company; (c) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company; or (d) any “solicitation” of “proxies” (as such terms are used in the proxy rules of the SEC) or consents to vote any voting securities of the Company; (ii) form, join or in any way participate in a “group” (as defined under the Securities Exchange Act of 1934) with respect to any securities of the Company; (iii) otherwise act, alone or in concert with others, to seek to control or influence the management, board of directors or policies of the Company; (iv) take any action which might force the Company to make a public announcement regarding any of the types of matters set forth in (i) above; (v) enter into any discussions or arrangements with any third party with respect to any of the foregoing; or (vi) request that the Company (or its directors, officers, employees or agents) amend or waive any provision of this paragraph (including this clause (vi)).
The foregoing description of the Voting Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form Voting Agreement, a copy of which is filed as Exhibit 10.4 hereto and is incorporated by reference herein.
Settlement Agreement with Officer
On December 31, 2025, the Company entered into a settlement agreement and general and mutual release (the “Officer Settlement Agreement”) with Ira Goldfarb, the Company’s executive chairman. Pursuant to the terms of the Officer Settlement Agreement, Mr. Goldfarb is entitled to receive from the Company a cash settlement payment, upon the Stockholder Meeting, of $1.25 million, less all applicable taxes and withholdings (the “Officer Settlement Payment”), in exchange for waiving his rights to contractual severance pursuant to his employment agreement.
The foregoing description of the Officer Settlement Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the form of Officer Settlement Agreement, a copy of which is filed as Exhibit 10.5 hereto and is incorporated by reference herein.
Settlement Agreements with Directors
On December 31, 2025, the Company entered into settlement agreements and general and mutual releases (each, a “Director Settlement Agreement”, and together the “Director Settlement Agreements”) with Joe Mueller and Chris Ludeman, both directors of the Company.
The foregoing description of the Director Settlement Agreements does not purport to be complete and is qualified in its entirety by reference to the full text of the form of Director Settlement Agreements, a copy of which is filed as Exhibit 10.6 hereto and is incorporated by reference herein.
Item 3.02. Unregistered Sales of Equity Securities.
The information contained in Item 1.01 of this Current Report on Form 8-K and the information contained in Item 5.03 of this Current Report on Form 8-K regarding the terms of conversion of Series AA Preferred Stock are incorporated by reference into this Item 3.02. Based in part upon the representations of the Investor in the Securities Purchase Agreement, the offering and sale of the Placement Shares will be exempt from registration under Rule 903 of Regulation S promulgated under the Securities Act. The sale of the Placement Shares by the Company in the Private Placement will not be registered under the Securities Act or any state securities laws and such shares may not be offered or sold in the United States absent registration with the SEC or an applicable exemption from the registration requirements. The sale of such shares will not involve a public offering and will be made without general solicitation or general advertising. In the Securities Purchase Agreement, the Investor represented, among other things, that it is a
“non-U.S. person” as defined under Regulation S, that it is not acquiring the Placement Shares for the account or benefit of a U.S. Person and that it is acquiring the Placement Shares for investment purposes only and not with a view to any immediate resale, distribution or other disposition of the Placement Shares.
Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
Resignation of Executive Officer
On December 31, 2025, in connection with the Transactions, Ira Goldfarb, the Company’s Executive Chairman, resigned from his role as a Company officer effective as of the business day following the First Closing.
Resignations of Directors
On December 31, 2025, the Board accepted the resignation of Joe Mueller and Chris Ludeman as directors of the Board, effective as of the business day following the First Closing. Each of Mr. Mueller and Mr. Ludeman resigned in connection with the Transactions to allow for the appointment of David Lazar and David Natan to the Board, and not due to any disagreements with the Board or management of the Company.
Appointment of Chief Executive Officer and Director
In accordance with the Securities Purchase Agreement, on December 31, 2025, Claudia Goldfarb stepped down as Chief Executive Officer (while continuing to be an employee of the Company) and the Board appointed David Lazar as the Chief Executive Officer (and principal executive officer) of the Company, effective as of immediately following the First Closing and as the principal financial officer of the Company, effective as of the business day following the First Closing. As a result of Mr. Lazar’s appointment as Chief Executive Officer, Claudia Goldfarb ceased to serve as the Company’s principal executive officer. Ms. Goldfarb continues to serve on the Board.
Election of Directors
On December 31, 2025, the Board elected David Lazar and David Natan as directors of the Board, effective as of immediately prior to the execution and effectiveness of the Securities Purchase Agreement, to serve on the Board until the Company’s 2025 Annual Meeting of Stockholders and until their successors have been duly elected and qualified or until their earlier death, resignation or removal. Upon his election to the Board, Mr. Lazar will serve as the Chair of Board and Ira Goldfarb will no longer serve as Chair of the Board.
David Lazar, age 35, currently serves as the CEO and Chairman of Kala Bio Inc. (NASDAQ: KALA) since December 2025. David previously served as Chief Executive Officer of Novabay Pharmaceuticals, Inc. (NASDAQ: NBY) from August to November 2025. Prior to that, Mr. Lazar previously served as director on the board of directors of FiEE, Inc. (NASDAQ: FIEE) (formerly Minim, Inc.) where he also previously served as the Chief Executive Officer and Chief Financial Officer from December 2023 to February 2025. Mr. Lazar served as interim Chief Executive Officer and principal financial officer of Bio Green Med Solution Inc. (NASDAQ: BGMS) (formerly Cyclacel Pharmaceuticals, Inc.), from January 2, 2025 through February 26, 2025. Mr. Lazar served as the Chief Executive Officer of Black Titan Corporation listed on Nasdaq (NASDAQ: BTTC) (formerly Titan Pharmaceuticals, Inc.) from August 2022 to April 2024, where he also served as a director and board chairman from August 2022 until October 2023. Mr. Lazar also served as the chief executive officer and chairman of the board of directors of OpGen, Inc. (OTC: OPGN) from March 2024 to August 2024. Mr. Lazar also served as the president and a member of the board of directors of LQR House Inc. (NASDAQ: YHC) from October 2024 to April 2025. Mr. Lazar served as the Chief Executive Officer of Activist Investing from March 2018 to April 2022. The Board believes that Mr. Lazar’s expertise as an investor with a diverse knowledge of capital markets and experience leading public companies qualifies him to serve as a member of the Company’s Board of Directors.
David Natan, age 72, currently serves as President and Chief Executive Officer of Natan & Associates, LLC, a consulting firm offering chief financial officer services to public and private companies in a variety of industries, both domestically and internationally, since 2007. From 2010 to May 2020, Mr. Natan served as Chief Executive Officer of Forcefield Energy, Inc., a company focused on the solar industry and LED lighting products. From February 2002
to November 2007, Mr. Natan served as Executive Vice President of Reporting and Chief Financial Officer of PharmaNet Development Group, Inc., a drug development services and clinical trials company, and, from June 1995 to February 2002, as Chief Financial Officer and Vice President of Global Technovations, Inc., a manufacturer and marketer of oil analysis instruments and speakers and speaker components. Before that, Mr. Natan served various roles in increasing responsibility with Deloitte & Touche LLP, a global accounting and consulting firm. Mr. Natan currently serves as a member of the Board of Directors and Chair of the Audit Committee of Sunshine Biopharma, Inc. (Nasdaq: SBFM), a pharmaceutical and nutritional supplement company, since February 2022. Additionally, since April 2024, Mr. Natan has served as a member of the Board of Directors and Audit Committee Chair of FIEE, Inc. (formerly Minim, Inc.), a technology company specializing in SAAS solutions and AI software development. Previously, Mr. Natan has served as a director for the following public companies: Global Technovations, ForceField Energy, Black Titan (Nasdaq: BTTC) (formerly Titan Pharmarceuticals, Inc.), Vivakor Inc. (Nasdaq: VIVK), NetBrands Corp. (OTC: NBND), OpGen Inc. (OTC: OPGN), and Bio Green Med Solutions (Nasdaq: BGMS) (formerly Cyclacel Pharmaceuticals, Inc.). Mr. Natan is a CPA (inactive), holds a B.A. in Economics from Boston University, and was appointed to Omicron Delta Epsilon, an international honor society in the field of Economics. The Board believes that Mr. Natan’s financial expertise and experience with public companies and public company boards qualifies him to serve as a member of the Company’s Board of Directors.
Other than pursuant to the Securities Purchase Agreement, there is no arrangement or understanding between Mr. Lazar, Mr. Natan and any other person pursuant to which Mr. Lazar was appointed as the Chief Executive Officer and a director of the Company and pursuant to which Mr. Natan was appointed as a director of the Company. Neither Mr. Lazar nor Mr. Natan has a family relationship with any of the Company’s officers or directors. Other than interests in the Private Placement, the Securities Purchase Agreement and the Voting Agreement, neither Mr. Lazar nor Mr. Natan has any direct or indirect interest in any transaction required to be disclosed pursuant to Item 404(a) of Regulation S-K.
Officer Settlement Agreement
The information contained in Item 1.01 of this Current Report on Form 8-K regarding the Officer Settlement Agreement is incorporated by reference into this Item 5.02.
Director Settlement Agreements
The information contained in Item 1.01 of this Current Report on Form 8-K regarding the Director Settlement Agreements is incorporated by reference into this Item 5.02.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
On December 31, 2025 (the “Filing Date”), the Company filed a Certificate of Designations, Preferences and Rights of Series AA Convertible Non-Redeemable Preferred Stock (the “Series AA Certificate of Designations”) with the Secretary of State of the State of Delaware with respect to the Series AA Preferred Stock. The rights, preferences and privileges of the Series AA Preferred Stock are set forth in the Series AA Certificate of Designations.
At any time after the Stockholder Approvals and filing of the Charter Amendment, each share of Series AA Preferred Stock is initially convertible into 14 shares of Common Stock (subject to adjustment as provided in the Series AA Certificate of Designations) at any time at the option of the holder. The Series AA Preferred Stock is not convertible into Common Stock at any time prior to receipt of the Stockholder Approvals and the filing of the Charter Amendment.
The Series AA Preferred Stock shall rank:
in each case, as to distributions of assets upon the Company’s liquidation, dissolution or winding up, whether voluntarily or involuntarily (each, a “Dissolution”).
In the event of a Dissolution, subject to any prior or superior rights of the holders of Senior Securities, holders of the Series AA Preferred Stock will be entitled to receive, before any distributions to the holders of the Common Stock and the holders of Junior Securities and pari passu with any distributions to the holders of Parity Securities, an amount per share of Series AA Preferred Stock equal to the greater of (i) $2.00 (subject to adjustment in the event of any stock split, combination or reclassification), plus any dividends declared but unpaid thereon, or (ii) such amount per share as would have been payable had all shares of Series AA Preferred Stock been converted into Common Stock (without regard to any restrictions on conversion) immediately prior to such Dissolution. Shares of Series AA Preferred Stock will be entitled to receive dividends equal to (on an as-if-converted-to-Common Stock basis), and in the same form and manner as, dividends actually paid on shares of Common Stock. For the avoidance of any doubt, neither a change in control of the Company, the merger or consolidation of the Company with or into any other entity, nor the sale, lease, exchange or other disposition of all or substantially all of the Company’s assets shall, in and of itself, be deemed to constitute a Dissolution.
Shares of Series AA Preferred Stock will generally have no voting rights, except to the extent provided by applicable law, and except that the consent of the holders of a majority of the outstanding shares of Series AA Preferred Stock will be required to (i) alter, repeal or change the powers, preferences or rights of the Series AA Preferred Stock or alter or amend the Series AA Certificate of Designations so as to adversely affect the Series AA Preferred Stock, (ii) supplement, amend, restate, repeal, or waive any provision of the Company’s Restated Certificate of Incorporation or Bylaws, or file any certificate of amendment, certificate of designation, preferences, limitations and relative rights of any series of preferred stock, if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the Series AA Preferred Stock, regardless of whether any of the foregoing actions shall be by means of amendment to the Company’s Restated Certificate of Incorporation or by merger, consolidation, recapitalization, reclassification, conversion or otherwise, (iii) increase or decrease (other than by conversion) the number of authorized shares of Series AA Preferred Stock; or (iv) enter into any agreement with respect to any of the foregoing.
The foregoing description of the rights, preferences and privileges of the Series AA Preferred Stock does not purport to be complete and is qualified in its entirety by the full text of the Series AA Certificate of Designations, a copy of which is filed as Exhibit 3.1 hereto and is incorporated by reference herein.
The filing of the Series AAA Certificate of Designations with the Secretary of State of the State of Delaware with respect to the Series AAA Preferred Stock is subject to the receipt of the Stockholder Approvals and will occur, if at all, in connection with the Second Closing. The terms of the Series AAA Preferred Stock are substantially similar to the terms of the Series AA Preferred Stock, except that each share of Series AAA Preferred Stock is initially convertible into 250 shares of Common Stock (subject to adjustment as provided in the Series AAA Certificate of Designations).
Cautionary Note Regarding Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve substantial risks and uncertainties. Any statements in this Current Report on Form 8-K about the Company’s future expectations, plans and prospects, including but not limited to statements about the Company’s expectations with respect to the occurrence of the First Closing and Second Closing, the potential officer and director appointments, the potential receipt of Stockholder Approvals, the Company’s ability to identify and consummate a strategic alternative transaction on the timeline anticipated or at all and other statements containing the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “likely,” “will,” “would,” “could,” “should,” “continue,” and similar expressions constitute forward-looking statements. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including: whether the conditions for the Second Closing of the Private Placement will be satisfied, including the failure to obtain Stockholder Approvals; uncertainties as to the timing of the consummation of First Closing and the Second Closing; the Company’s ability to maintain its listing on The Nasdaq Capital Market; and other important factors, any of which could cause the Company’s actual results to differ from those contained in the forward-looking statements discussed in the “Risk Factors” section of the Company’s Annual Report on Form 10-K, most recently
filed Quarterly Report on Form 10-Q and other filings the Company makes with the SEC. These forward-looking statements represent the Company’s views as of the date of this Current Report on Form 8-K and should not be relied upon as representing the Company’s views as of any date subsequent to the date hereof. The Company does not assume any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No. |
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Description |
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3.1 |
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4.1 |
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10.1* |
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Securities Purchase Agreement, dated December 31, 2025, by and among Sow Good Inc. and David Lazar |
10.2* |
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Asset Purchase Agreement dated December 30, 2025, by and among Sow Good Inc. and Trea Grove, LLC |
10.3 |
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Distribution Agreement, dated December 31, 2025, by and among Sow Good Inc. and Trea Grove, LLC |
10.4 |
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10.5 |
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10.6 |
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104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document) |
* Schedules and/or exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Registrant agrees to furnish supplementally a copy of any omitted schedule or attachment to the SEC on a confidential basis upon its request.
SIGNATURES
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.
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SOW GOOD INC. |
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By: |
/s/ David Lazar |
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David Lazar |
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Chief Executive Officer
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Date: January 5, 2026 |
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3 |
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CERTIFICATE OF DESIGNATIONS, PREFERENCES
AND RIGHTS OF
SERIES AA CONVERTIBLE NON-REDEEMABLE PREFERRED STOCK
OF
SOW GOOD INC.
(Pursuant to Section 151 of the
Delaware General Corporation Law)
SOW GOOD INC., a Delaware corporation (the “Corporation”), in accordance with the provisions of Section 103 of the Delaware General Corporation Law (the “DGCL”) does hereby certify that, in accordance with Sections 151 of the DGCL, the following resolution was duly adopted by the Board of Directors of the Corporation (the “Board of Directors”) on December 31, 2025:
RESOLVED, pursuant to authority expressly set forth in the Amended and Restated Certificate of Incorporation of the Corporation, as amended (the “Certificate of Incorporation”), the issuance of a series of Preferred Stock, par value $0.001 per share (the “Preferred Stock”) designated as the Series AA Convertible Non-Redeemable Preferred Stock, par value $0.001 per share, of the Corporation is hereby authorized and the number of shares, powers, designations, preferences and relative, participating, optional or other special rights of, and the qualifications, limitations or restrictions upon, the Series AA Convertible Non-Redeemable Preferred Stock (in addition to any provisions set forth in the Certificate of Incorporation that are applicable to the Preferred Stock of all classes and series) are hereby fixed, and the Certificate of Designation, Preferences and Rights of Series AA Convertible Non-Redeemable Preferred Stock (“Certificate of Designations”) is hereby approved as follows:
SECTION 1 Designation of Amount.
(a) One million five hundred thousand (1,500,000) shares of Preferred Stock shall be, and hereby are, designated the “Series AA Convertible Non-Redeemable Preferred Stock” (the “Series AA Preferred Stock”), par value $0.001 per share.
(b) Subject to the requirements of the DGCL, the Certificate of Incorporation and this Certificate of Designations, the number of shares of Preferred Stock that are designated as Series AA Preferred Stock may be increased or decreased by vote of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series AA Preferred Stock to a number less than the number of such shares then outstanding. Any shares of Series AA Preferred Stock converted, redeemed, purchased or otherwise acquired by the Corporation in any manner whatsoever shall, automatically and without further action, be retired and canceled promptly after the acquisition thereof, and shall become authorized but unissued shares of Preferred Stock and may not be reissued as shares of Series AA Preferred Stock when the Corporation shall take such action as may be necessary to reduce the number of authorized shares of the Series AA Preferred Stock and may be reissued as part of a new series of any class or series of Preferred Stock in accordance with the Certificate of Incorporation.
SECTION 2 Certain Definitions.
Unless the context otherwise requires, the terms defined in this Section 2 shall have, for all purposes of this resolution, the meanings specified (with terms defined in the singular having comparable meanings when used in the plural).
“Affiliate” means any person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Board of Directors” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Business Day” shall mean any day other than Saturday, Sunday or other day on which commercial banks in the City of New York are authorized or required by law to remain closed.
“Bylaws” shall mean the Amended and Restated By-Laws of the Corporation, as amended from time to time.
“Certificate of Incorporation” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Common Stock” shall mean the common stock, par value $0.001 per share, of the Corporation.
“Conversion Notice” shall have the meaning set forth in Section 6(d).
“Conversion Price” shall mean $0.14286, subject to adjustment from time to time in accordance with Section 6(d).
“Conversion Time” shall have the meaning set forth in Section 6(d).
“Corporation” shall have the meaning set forth in the preamble to this Certificate of Designations.
“DGCL” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Exchange Act” shall have the meaning set forth in Section 6(c).
“Holder” means any holder of Series AA Preferred Stock, all of such holders being the “Holders.”
“Junior Securities” shall have the meaning set forth in Section 5(a).
“Parity Securities” shall have the meaning set forth in Section 5(a).
“Participating Dividends” shall have the meaning set forth in Section 4.
“Permitted Exchange” means any of The New York Stock Exchange, The Nasdaq Global Select Market, The Nasdaq Global Market, The Nasdaq Capital Market (or any of their respective successors).
“Person” shall mean any individual, partnership, company, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or agency or political subdivision thereof, or other entity.
“Preferred Stock” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Requisite Holders” shall mean the holders of a majority of the then outstanding shares of Series AA Preferred Stock.
“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Series AA Preferred Stock” shall have the meaning set forth in Section 1(a).
“Stated Value” shall mean the per share stated value for a share of Series AA Preferred Stock of $2.00, subject to adjustment in the event of any stock dividend, stock split, combination, reorganization, recapitalization, reclassification, or other similar event with respect to the Series AA Preferred Stock.
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SECTION 3 Voting Rights.
(a) Non-Voting Stock. Until the Series AA Preferred Stock are convertible under Section 6 hereof, or except as otherwise provided by the DGCL, other applicable law or as provided in this Certificate of Designations, the holders of Series AA Preferred Stock shall not be entitled to vote (or render written consents) on any matter submitted for a vote of (or written consents in lieu of a vote as permitted by the DGCL, the Certificate of Incorporation and the Bylaws) holders of Common Stock.
(b) Limited Voting Rights. So long as any shares of Series AA Preferred Stock are outstanding, the Corporation shall not, without first obtaining the approval of the Requisite Holders:
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alter, repeal or change the powers, preferences or rights of the Series AA Preferred Stock or alter or amend this Certificate of Designations so as to adversely affect the Series AA Preferred Stock; |
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supplement, amend, restate, repeal, or waive any provision of the Certificate of Incorporation or Bylaws, or file any certificate of amendment, certificate of designation, preferences, limitations and relative rights of any series of preferred stock, if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the Series AA Preferred Stock, regardless of whether any of the foregoing actions shall be by means of amendment to the Certificate of Incorporation or by merger, consolidation, recapitalization, reclassification, conversion or otherwise; |
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increase or decrease (other than by conversion) the number of authorized shares of Series AA Preferred Stock; or |
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enter into any agreement with respect to any of the foregoing. |
SECTION 4 Dividends.
If the Board of Directors shall declare a dividend or other distribution payable upon the then outstanding shares of Common Stock, whether in cash, in kind or in other securities or property (other than dividends payable in shares of Common Stock), the holders of the outstanding shares of Series AA Preferred Stock shall be entitled to the amount of dividends as would be payable in respect of the number of shares of Common Stock into which the shares of Series AA Preferred Stock held by each holder thereof could be converted, without regard to any restrictions on conversion, in accordance with the provisions of Section 6 hereof, such number to be determined as of the record date for determination of holders of Common Stock entitled to receive such dividend or, if no such record date is established, as of the date of such dividend (“Participating Dividends”). Participating Dividends are payable at the same time as and when dividends on the Common Stock are paid to the holders of Common Stock.
SECTION 5 Liquidation Preference.
(a) Ranking. The Series AA Preferred Stock shall rank (i) senior to all of the Common Stock; (ii) senior to any class or series of capital stock of the Corporation hereafter created specifically ranking by its terms junior to any Series AA Preferred Stock (“Junior Securities”); and (iii) on parity with any other class or series of capital stock of the Corporation hereafter created specifically ranking by its terms on parity with the Series AA Preferred Stock (“Parity Securities”), in each case, as to distributions of assets upon liquidation, dissolution or winding up of the Corporation, whether voluntarily or involuntarily (each, a “Dissolution”).
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(b) Distribution to Series AA Preferred Stock and Parity Securities. Upon a Dissolution, each Holder shall be entitled to receive, prior and in preference to any distributions of any of the assets or surplus funds of the Corporation to the holders of the Common Stock and Junior Securities and pari passu with any distribution to the holders of Parity Securities, an amount per share of Series AA Preferred Stock held by such Holder equal to the greater of (i) the Stated Value, plus any dividends declared but unpaid on such share of Series AA Preferred Stock, or (ii) such amount per share as would have been payable had all shares of Series AA Preferred Stock been converted into Common Stock pursuant to Section 6 (without regard to any restrictions on conversion) immediately prior to such Dissolution. If, upon any such Dissolution, the assets of the Corporation shall be insufficient to pay the holders of shares of the Series AA Preferred Stock the amount required under the preceding sentence, the holders of Series AA Preferred Stock and the holders of shares of Parity Securities shall share in any distribution of the assets available for distribution in proportion to the respective amounts which would otherwise be payable in respect of the shares of Series AA Preferred Stock and Parity Securities held by them upon such distribution if all amounts payable on or with respect to such shares of Series AA Preferred Stock and Parity Securities were paid in full. For the avoidance of any doubt, but without limiting the foregoing, neither a change in control of the Corporation, the merger or consolidation of the Corporation with or into any other entity, nor the sale, lease, exchange or other disposition of all or substantially all of the Corporation’s assets shall, in and of itself, be deemed to constitute a Dissolution.
SECTION 6 Conversion Rights.
(a) General. Subject to and upon compliance with the provisions of this Section 6 and subject to the Corporation’s stockholders approving each of (A) an increase in the number of authorized shares of Common Stock to enable the Corporation to issue all of the shares of Common Stock that are issuable upon the conversion of the Series AA Preferred Stock and any Series AAA Preferred Stock, par value $0.001 per share (the “Series AAA Preferred Stock”), that is issued and outstanding, and (B) the conversion of the Series AA Preferred Stock and any Series AAA Preferred Stock that is issued and outstanding into shares of Common Stock in accordance with the listing rules of the Nasdaq Stock Market (the “Stockholder Approvals”), and subject to the Corporation filing an amendment to the Certificate of Incorporation with the Secretary of State of the State of Delaware (the “Charter Amendment”) evidencing such stockholder approval, each Holder shall be entitled, at its option, at any time and from time to time after the Stockholder Approvals and the filing of the Charter Amendment, to convert all or any such shares of Series AA Preferred Stock into the number of fully paid and nonassessable shares of Common Stock equal to the number obtained by dividing (i) the Stated Value of such Series AA Preferred Stock by (ii) the Conversion Price in effect at the Conversion Time (determined as provided in this Section 6).
(b) Fractions of Shares. Fractional shares of Common Stock may not be issued in connection with any conversion of the Series AA Preferred Stock. As to any fraction of a share which a Holder would otherwise be entitled to receive upon such conversion, the Corporation shall pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price.
(c) Adjustments to Conversion Price.
(i) Upon Subdivisions. If, at any time after the date the first share of Series AA Preferred Stock was issued, the number of shares of Common Stock outstanding is increased by a subdivision of shares of Common Stock, then, following the record date for the determination of holders of Common Stock affected by such subdivision, the Conversion Price in effect immediately before such subdivision shall be proportionately decreased so that the number of shares of Common Stock issuable on conversion of Series AA Preferred Stock shall be increased in proportion to such increase in outstanding shares of Common Stock.
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(ii) Upon Combinations. If, at any time after the date the first share of Series AA Preferred Stock was issued, the number of shares of Common Stock outstanding is decreased by a combination of the outstanding shares of Common Stock into a smaller number of shares of Common Stock, then, following the record date to determine shares affected by such combination, the Conversion Price in effect immediately before such combination shall be proportionately increased so that the number of shares of Common Stock issuable on conversion of each share of Series AA Preferred Stock shall be decreased in proportion to such decrease in outstanding shares of Common Stock.
(iii) Stock Dividends. If, at any time after the date the first share of Series AA Preferred Stock was issued, the Corporation shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or other distribution payable on the Common Stock in additional shares of Common Stock, then and in each such event the Conversion Price in effect immediately before such event shall be decreased as of the time of such issuance or, in the event such a record date shall have been fixed, as of the close of business on such record date, by multiplying the Conversion Price then in effect by a fraction: (1) the numerator of which shall be the total number of shares of Common Stock outstanding immediately prior to the time of such issuance or the close of business on such record date, and (2) the denominator of which shall be the total number of shares of Common Stock outstanding immediately prior to the time of such issuance or the close of business on such record date plus the number of shares of Common Stock issuable in payment of such dividend or distribution. Notwithstanding the foregoing, (a) if such record date shall have been fixed and such dividend is not fully paid or if such distribution is not fully made on the date fixed therefor, the Conversion Price shall be recomputed accordingly as of the close of business on such record date and thereafter the Conversion Price shall be adjusted pursuant to this Section 6(c)(iii) as of the time of actual payment of such dividends or distributions; and (b) no such adjustment shall be made if the holders of Series AA Preferred Stock simultaneously receive a dividend or other distribution of shares of Common Stock in a number equal to the number of shares of Common Stock as they would have received if all outstanding shares of Series AA Preferred Stock had been converted into Common Stock on the date of such event.
(iv) Reorganization, Reclassification, Merger or Consolidation. If at any time or from time to time there shall be a reorganization, recapitalization, reclassification, merger or consolidation involving the Corporation in which the Common Stock is converted into or exchanged for securities, cash or property (other than a subdivision or combination provided for elsewhere in this Section 6), then, as a part of such reorganization, recapitalization, reclassification, merger, or consolidation, provision shall be made so that holders of Series AA Preferred Stock shall thereafter be entitled to receive upon conversion of the Series AA Preferred Stock, the kind and amount of shares of stock, cash or other property to which such holder would have been entitled if such holder had converted its shares of Series AA Preferred Stock immediately prior to such reorganization, recapitalization, reclassification, merger or consolidation. In any such case, appropriate adjustment shall be made in the application of the provisions of this Section 6 with respect to the rights of the holders of the Series AA Preferred Stock after the reorganization, recapitalization, reclassification, merger or consolidation, to the end that the provisions of this Section 6 (including provisions with respect to changes in and other adjustments of the Conversion Price then in effect for the Series AA Preferred Stock) shall be applicable after that event in as nearly equivalent a manner as may be practicable.
(d) Exercise of Conversion Privilege. In order to exercise the conversion privilege, the holder of any share of Series AA Preferred Stock shall, (i) provide written notice in the form attached hereto as Annex A (a “Conversion Notice”) to the Corporation at any office or agency of the Corporation maintained for such purpose, that the Holder elects to convert all such shares of Series AA Preferred Stock or, if less than the entire amount thereof is to be converted, the portion thereof to be converted and (ii) if such Holder’s shares are certificated, surrender the certificate evidencing such shares of Series AA Preferred Stock, duly endorsed or assigned to the Corporation in blank, at such office or agency. The Conversion Notice shall state such Holder’s name or the names of the nominees in which such Holder wishes the shares of Common Stock to be issued. Series AA Preferred Stock shall be deemed to have been converted immediately prior to the close of business on the date of surrender of such shares of Series AA Preferred Stock for conversion in accordance with the foregoing provisions or such later time as specified in the Conversion Notice (the “Conversion Time”), and the shares of Common Stock issuable upon conversion of the specified shares shall be deemed to be outstanding of record as of such Conversion Time. As promptly as practicable on or after the Conversion Time, the Corporation shall (i) issue and shall deliver a certificate or certificates for the number of full shares of Common Stock issuable upon conversion (or a notice of such issuance if uncertificated shares are issued) and (ii) pay all declared but unpaid dividends on the shares of Series AA Preferred Stock converted. In the case of any certificate
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evidencing shares of Series AA Preferred Stock that is converted in part only, upon such conversion the Corporation shall also execute and deliver a new certificate evidencing the number of shares of Series AA Preferred Stock that are not converted (or a notice of such issuance if uncertificated shares are issued).
(e) Notice of Adjustment of Conversion Price. Whenever the provisions of Section 6(c) require that the Conversion Price be adjusted as herein provided, the Corporation shall compute the adjusted Conversion Price in accordance with Section 6(c) and shall prepare a certificate signed by the Corporation’s principal executive officer or principal financial officer setting forth the adjusted Conversion Price and showing in reasonable detail the facts upon which such adjustment is based, and such certificate shall forthwith be filed at each office or agency maintained for such purpose for conversion of shares of Series AA Preferred Stock and mailed by the Corporation at its expense to all holders of Series AA Preferred Stock at their last addresses as they shall appear in the stock register.
(g) Corporation to Reserve Common Stock. Following the receipt of Stockholder Approval and the filing of the Charter Amendment, the Corporation shall at all times reserve and keep available, free from preemptive rights, out of the authorized but unissued Common Stock or out of the Common Stock held in treasury, for the purpose of effecting the conversion of Series AA Preferred Stock, the full number of shares of Common Stock issuable upon the conversion of all outstanding shares of Series AA Preferred Stock. Before taking any action that would cause an adjustment reducing the Conversion Price below the then par value (if any) of the shares of Common Stock deliverable upon conversion of the Series AA Preferred Stock, the Corporation will take any corporate action that, in the opinion of its counsel, is necessary in order that the Corporation may validly and legally issue fully paid and non-assessable shares of Common Stock at such adjusted Conversion Price.
(h) Taxes on Conversions. The Corporation will pay any and all original issuance, transfer, stamp and other similar taxes that may be payable in respect of the issue or delivery of shares of Common Stock on conversion of Series AA Preferred Stock pursuant hereto. The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock in a name other than that of the holder of the share(s) of Series AA Preferred Stock to be converted (nor shall the Corporation be responsible for any other taxes payable by the holders of the Series AA Preferred Stock), and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Corporation the amount of any such tax or has established to the satisfaction of the Corporation that such tax has been paid.
SECTION 7 Waiver. Notwithstanding anything to the contrary herein, any provisions of this Certificate of Designations may be waived on behalf of all of the holders of Series AA Preferred Stock by the affirmative written consent or vote of the Requisite Holders.
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IN WITNESS WHEREOF, the Corporation has caused this Certificate of Designations, Preferences and Rights to be duly executed by its Chief Executive Officer, this 31st day of December, 2025.
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/s/ Claudia Goldfarb |
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Claudia Goldfarb |
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Chief Executive Officer |
ANNEX A
CONVERSION NOTICE
(To be Executed by the Registered Holder in order to Convert Shares of Preferred Stock)
The undersigned being the Holder of Sow Good Inc., a Delaware corporation (the “Corporation”) Series AA Convertible Non-Redeemable Preferred Stock (the “Series AA Preferred Stock”) hereby elects to convert the number of shares of Series AA Preferred Stock indicated below into shares of common stock, par value $0.001 per share (the “Common Stock”), of Sow Good Inc., according to the conditions as set forth in the Certificate of Designations, Preferences and Rights of Series AA Convertible Non-Redeemable Preferred Stock (the “Certificate of Designations”), as of the date written below. If shares of Common Stock are to be issued in the name of a Person other than the undersigned, the undersigned holder will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as may be required by the Corporation in accordance with the Securities Purchase Agreement, dated December __, 2025. No fee will be charged to the Holders for any conversion, except for any such transfer taxes.
Conversion calculations:
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Date to Effect Conversion: |
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Number of shares of Preferred Stock owned prior to Conversion: |
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Number of shares of Preferred Stock to be Converted: |
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Stated Value of shares of Preferred Stock to be Converted: |
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Number of shares of Common Stock to be Issued: |
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Applicable Conversion Price: |
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Number of shares of Preferred Stock subsequent to Conversion: |
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Address for Delivery: |
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or |
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DWAC Instructions: |
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Broker no: ______________________________ |
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Account no: _____________________________ |
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[HOLDER] |
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Annex A-1
SECURITIES PURCHASE AGREEMENT
This Securities Purchase Agreement (this “Agreement”) is dated as of December 31, 2025 (the “Effective Date”), by and between Sow Good Inc., a Delaware corporation (the “Company”), and Mr. David Lazar, an Israeli and E.U. citizen residing in Panama (the “Purchaser” or “Lazar”).
WHEREAS, the Company has been exploring the strategic options available to it that will result in, what it believes to be, the best opportunity available to maximize the value of the Company and its stakeholders;
WHEREAS, the Purchaser, who has experience investing in U.S. public companies, proposed completing a series of transactions with the Company that will involve, among other transactions set forth in this Agreement, (i) an investment of Six Million Dollars (USD $6,000,000) of cash (Three Million Dollars (USD $3,000,000) at the First Closing (as defined below); and Three Million Dollars (USD $3,000,000) at the Second Closing (as defined below)) to the Company in exchange for the Company issuing equity securities as described herein (the “Investment”), which such securities, upon becoming fully convertible will be convertible into an aggregate of three hundred ninety-six million (396,000,000) shares of Common Stock (as defined below), and (ii) Lazar, immediately prior to the execution and effectiveness of this Agreement (the “Effective Time”), being appointed to the Board of Directors (as defined below) and as Chairman of the Board of Directors, and, in connection with the Second Closing, having a right to nominate up to five (5) additional individuals to be elected to the Board of Directors; and
WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to the applicable regulations under the Securities Act, including pursuant to Regulation S of the Securities Act (“Regulation S”), the Company desires to issue and sell to the Purchaser, and the Purchaser desires to purchase from the Company, the Securities (as defined below) of the Company and to consummate the other transactions contemplated by this Agreement and the other Transaction Documents (collectively, the “Contemplated Transactions”) as more fully described in this Agreement.
WHEREAS, it is the intention of the parties hereto that the Purchaser’s acquisition of Securities pursuant to this Agreement shall be exempt from Section 16(b) of the Exchange Act, and, accordingly, prior to the Effective Date, the Board of Directors adopted resolutions appointing Lazar to the Board of Directors effective immediately prior to the Effective Time and as Chief Executive Officer of the Company effective immediately following the First Closing, and subsequently approving Lazar’s acquisition of Securities hereunder and exempting such acquisition from Section 16(b) of the Exchange Act pursuant to Rule 16b-3 (the “Rule 16b-3 Exemption Approvals”).
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Company and the Purchaser agree as follows:
DEFINITIONS
“Acquiring Person” shall have the meaning given such term in Section 4.9.
“Action” shall have the meaning given such term in Section 3.1(k).
“Affiliate” means any Person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a Person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Board of Directors” means the board of directors of the Company or any authorized committee thereof.
“Business Day” means any day other than Saturday, Sunday, any day which is a federal legal holiday in the United States or any other day on which commercial banks in the City of New York, New York are authorized or required by law to remain closed; provided, however, for clarification, commercial banks shall not be deemed to be authorized or required by law to remain closed due to “stay at home”, “shelter-in-place”, “non-essential employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental authority so long as the electronic funds transfer systems (including for wire transfers) of commercial banks in the City of New York, New York are generally open for use by customers on such day.
“Certificates of Designations” means the Certificate of Designations of the Series AA Preferred Stock and the Certificate of Designations of the Series AAA Preferred Stock, each to be filed prior to the applicable Closing by the Company with the Secretary of State of Delaware, in the forms attached hereto as Exhibit A and Exhibit B, respectively.
“Charter Amendment” shall have the meaning set forth in Section 4.14(b).
“Closing” shall have the meaning given such term in Section 2.2.
“Closing Date” means, with respect to each of the First Closing and Second Closing, the date all conditions precedent to (i) the Purchaser’s obligations to pay the applicable portion of the Purchase Price and (ii) the Company’s obligations to deliver the applicable portion of the Securities, in each case, have been satisfied or waived, but in no event later than the second (2nd) Trading Day following the date thereof.
“Commission” means the United States Securities and Exchange Commission.
“Common Stock” means the common stock of the Company, par value $0.001 per share, and any other class of securities into which such securities may hereafter be reclassified or changed.
“Common Stock Equivalents” means any securities of the Company which would entitle the holder thereof to acquire at any time Common Stock, including, without limitation, any debt, preferred stock, right, option, warrant or other instrument that is at any
time convertible into or exercisable or exchangeable for, or otherwise entitles the holder thereof to receive, Common Stock.
“Company Creditors” means the persons listed in Schedule 3.1(aa).
“Company Party” means all directors, officers, stockholders, employees, agents, and representatives, including those directors comprising the current Board of Directors.
“Confidentiality Agreement” shall have the meaning set forth in Section 3.2(g).
“Contemplated Transactions” shall have the meaning given such term in the recitals.
“Continued Services Agreement” means the Distribution Agreement dated the date of the First Closing, for certain business services to be provided by Trea Grove, LLC to the Company in the form set forth in Exhibit F.
“Conversion Shares” means, collectively, the shares of Common Stock issuable upon conversion of the shares of Preferred Stock in accordance with the terms of the Certificates of Designations.
“Disclosure Schedules” means the Disclosure Schedules of the Company scheduled to this Agreement.
“Effective Time” shall have the meaning given such term in the recitals.
“Effective Date” shall have the meaning given such term in preamble.
“Evaluation Date” shall have the meaning given such term in Section 3.1(s).
“Exchange Act” means Securities Exchange Act of 1934, as amended.
“Exempt Issuance” means the issuance of (a) shares of Common Stock or options, restricted stock units or other equity awards to employees, consultants, contractors, advisors, officers or directors of the Company pursuant to any stock, option or equity plan duly adopted for such purpose, (b) securities upon the exercise, exchange or conversion of any Securities issued hereunder, and/or other securities exercisable or exchangeable for or convertible into shares of Common Stock issued and outstanding on the Effective Date, provided that such securities have not been amended since the Effective Date to increase the number of such securities or to decrease the exercise price, exchange price or conversion price of such securities (other than in connection with stock splits or combinations) or to extend the term of such securities, (c) securities issued pursuant to acquisitions or strategic transactions, approved by a majority of the disinterested directors on the Board of Directors, provided that such securities are issued as “restricted securities” (as defined in Rule 144) and carry no registration rights that require or permit the filing of any registration statement in connection therewith during the prohibition period in Section 4.16(a) herein, provided that any such issuance shall only be to a Person (or to the equity holders of a Person) which is, itself or through its subsidiaries, an operating company or an owner of an asset in a business synergistic with the business of the Company and shall
provide to the Company additional benefits in addition to the investment of funds, but shall not include a transaction in which the Company is issuing securities primarily for the purpose of raising capital or to an entity whose primary business is investing in securities, or (d) the issuance of shares of Common Stock to the Purchaser contemplated by this Agreement.
“Expected Sale Date” shall have the meaning given such term in 4.16(a)(ii).
“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended.
“First Closing” shall have the meaning given such term in Section 2.2.
“First Closing Shares” means the aggregate shares of Series AA Preferred Stock issued at the First Closing, which will not be convertible into shares of Common Stock prior to Stockholder Approval.
“GAAP” shall have the meaning given such term in Section 3.1(i).
“Indebtedness” shall have the meaning given such term in Section 3.1(aa).
“Investment” shall have the meaning given such term in the recitals.
“Lazar” shall have the meaning set forth in the preamble.
“Liens” means an adverse claim, lien, charge, pledge, security interest, encumbrance, right of first refusal, or preemptive right.
“Material Adverse Effect” shall have the meaning assigned to such term in Section 3.1(b).
“Nasdaq” means the Nasdaq Stock Market, LLC.
“New Securities” means, collectively, equity securities of the Company, whether or not currently authorized, as well as options or warrants to purchase such equity securities, or securities of any type whatsoever that are convertible or exchangeable into or exercisable for such equity securities, other than (i) any shares of capital stock or options to purchase shares of capital stock, or other equity-based awards (including restricted stock units), issued or granted to employees (or prospective employees who have accepted an offer of employment), directors or consultants of the Company or any of its subsidiaries, pursuant to any Company stock-based compensation plan or arrangement; (ii) any securities issued by the Company upon the exercise, exchange or conversion of any securities that are exercisable or exchangeable for, or convertible into, shares of capital stock and are outstanding as of the Effective Date or issued pursuant to this Agreement, provided that such exercise, exchange or conversion is effected pursuant to the terms of such securities as in effect on the Effective Date or as provided in this Agreement; (iii) any securities issued by the Company as full or partial consideration in connection with a merger, acquisition, consolidation or purchase of all or substantially all of the securities or assets of a corporation or other entity approved by the Board of Directors, (iv) any securities issued by the Company in connection with a transaction with an unaffiliated third party approved by the Board of Directors that includes a bona fide commercial relationship
with the Company (including any joint venture, marketing or distribution arrangement, strategic alliance, collaboration agreement or corporate partnering, intellectual property license agreement or acquisition agreement with the Company) and (v) any securities issued by the Company to banks, equipment lessors or other financial institutions, or to real property lessors, pursuant to a debt financing, equipment leasing or real property leasing transaction approved by the Board of Directors. For clarity New Securities does not include securities issued pursuant to any Company at-the-market offering facility or equity line.
“Offer Notice” shall have the meaning given such term in 4.16(a)(ii).
“Participation Period” shall have the meaning given such term in 4.16(a)(i).
“Person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.
“Preferred Stock” means the shares of the Series AA Preferred Stock and Series AAA Preferred Stock.
“Proceeding” means an action, claim, suit, investigation or proceeding (including, without limitation, an informal investigation or partial proceeding, such as a deposition), whether commenced or, to the Company’s knowledge, threatened in writing, against the Company before or by any court, arbitrator, governmental, or administrative agency or regulatory authority.
“Purchase Price” shall have the meaning set forth in Section 2.1.
“Purchaser” shall have the meaning set forth in the preamble.
“Purchaser Available Funds” shall have the meaning set forth in Section 3.2(j).
“Purchaser Nominees” shall have the meaning given such term in Section 4.15(d).
“Purchaser Party” shall have the meaning given such term in Section 4.13.
“Regulation S” shall have the meaning given such term in the recitals.
“Required Approvals” shall have the meaning given such term in Section 3.1(f).
“Required Minimum” means, as of any date, the maximum aggregate number of shares of Common Stock issuable or potentially issuable in the future pursuant to the Transaction Documents, including through the conversion of the Preferred Stock, ignoring any conversion and other limits that may be set forth in the applicable Certificate of Designations.
“Rule 144” means Rule 144 promulgated by the Commission pursuant to the Securities Act, as such Rule may be amended or interpreted from time to time, or any similar rule or regulation hereafter adopted by the Commission having substantially the same purpose and effect as such Rule.
“Rule 16b-3 Exemption Approvals” shall have the meaning given such term in the recitals.
“SEC Reports” shall have the meaning given such term in Section 3.1(i).
“Second Closing” shall have the meaning given such term in Section 2.2.
“Second Closing Shares” shall mean the aggregate shares of Series AAA Preferred Stock issued at the Second Closing.
“Second Meeting” shall have the meaning given such term in Section 4.15(c).
“Securities” means the Preferred Stock and the Conversion Shares.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Securities Purchase Rights” shall have the meaning given such term in Section 2.3(a)(iv).
“Securities Purchase Rights Transfer Right” shall have the meaning given such term in Section 2.3(a)(iv).
“Series AA Preferred Stock” means Series AA Convertible Non-Redeemable Preferred Stock, par value $0.001 per share, of the Company, issuable to the Purchaser pursuant to this Agreement on the terms set forth in the Certificate of Designations, having the rights, preferences and privileges therein, in the forms set forth in Exhibit A.
“Series AAA Preferred Stock” means Series AAA Convertible Non-Redeemable Preferred Stock, par value $0.001 per share, of the Company, issuable to the Purchaser pursuant to this Agreement on the terms set forth in the Certificate of Designations, having the rights, preferences and privileges therein, in the forms set forth in Exhibit B.
“Stated Value” means the Stated Value of the Preferred Stock as set forth in the Certificate of Designations.
“Stockholder Approval” means (i) all such approvals as may be required by the applicable rules and regulations of the Nasdaq Capital Market (or any successor entity) or under applicable law from the stockholders of the Company with respect to the conversion of all the Securities to the Purchaser, as provided in the Certificates of Designation, (ii) approval from the stockholders of the Company of an amendment to the Company’s certificate of incorporation that increases the authorized shares of Common Stock to at least the Required Minimum, (iii) approval from the stockholders of the Company of a reverse stock split in the range of 1 for 2 to 1 for 99, (iv) approval from the stockholders of the Company of an increase in the shares available under the Company’s equity plan to 10,000,000 shares, and (v) the election of the Purchaser Nominees.
“Stockholders Meeting” means in the instance a Stockholder Written Consent is not made or is unavailable, the meeting of the stockholders of the Company in which Stockholder Approval is voted on as set forth in a proxy statement prepared by the
Company and distributed to its stockholders, which shall be subject to input from the Purchaser to confirm his rights and the Company’s obligations under this Agreement.
“Stockholder Written Consent” means a written consent of stockholders representing a majority of the voting power of the Company’s voting stock in which Stockholder Approval is provided, in lieu of a meeting of stockholders, which shall be subject to input from the Purchaser to confirm his rights and the Company’s obligations under this Agreement.
“Trading Day” means a day on which the principal Trading Market is open for trading.
“Trading Market” means any of the following markets or exchanges on which the Common Stock is listed or quoted for trading on the date in question: the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market, the New York Stock Exchange, the OTC (or any successors to any of the foregoing).
“Transaction Documents” means this Agreement, the Certificates of Designations, all exhibits and schedules hereto and thereto, the Confidentiality Agreement, the Continued Services Agreement, the Voting Agreements, and any other documents or agreements executed by all or any of the parties hereto in connection with the Contemplated Transactions.
“Transfer Agent” means Empire Stock Transfer Inc. and any successor transfer agent of the Company.
“Voting Agreements” means those certain Voting Agreements entered into by the Company and Ira Goldfarb, Claudia Goldfarb, and Lyle Berman.
PURCHASE AND SALE
REPRESENTATIONS AND WARRANTIES
The Company acknowledges and agrees that the representations contained in this Section 3.2 shall not modify, amend or affect the Purchaser’s right to rely on the Company’s representations and warranties contained in this Agreement or any representations and warranties contained in any other Transaction Document or any other document or instrument executed and/or delivered in connection with this Agreement or the consummation of the Contemplated Transactions.
OTHER AGREEMENTS OF THE PARTIES
THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR UNDER ANY STATE SECURITIES OR BLUE SKY LAWS. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY ARE BEING OFFERED AND ISSUED TO INVESTORS WHO ARE NOT U.S. PERSONS (AS DEFINED IN REGULATION S OF THE SECURITIES ACT) IN RELIANCE UPON REGULATION S PROMULGATED UNDER THE SECURITIES ACT. THE SECURITIES ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS. HEDGING TRANSACTIONS MAY NOT BE CONDUCTED UNLESS IN COMPLIANCE WITH THE SECURITIES ACT. INVESTORS SHOULD BE AWARE THAT THEY MAY BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME. THIS SECURITY AND THE SECURITIES ISSUABLE UPON CONVERSION OF THIS SECURITY ARE SUBJECT TO THE TRANSFER RESTRICTION SET FORTH HEREIN AND IN THE SECURITIES PURCHASE AGREEMENT, DATED DECEMBER 31, 2025 AS AMENDED FROM TIME TO TIME, COPIES OF WHICH ARE AVAILABLE WITH THE SECRETARY OF THE COMPANY.
(a) Except to the extent limited by the Company’s authorized shares of Common Stock, the Company shall maintain a reserve from its duly authorized shares of Common Stock for issuance pursuant to the Transaction Documents in such amount as may then be required to fulfill its obligations in full under the Transaction Documents.
MISCELLANEOUS
(Signature Pages Follow)
IN WITNESS WHEREOF, the parties hereto have caused this Securities Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.
Sow Good Inc.
By: /s/ Claudia Goldfarb Name: Claudia Goldfarb Title: Chief Executive Officer |
Address for Notice:
Sow Good Inc. 1440 N Union Bower Rd, Irving, Texas 75061 Attention: Claudia Goldfarb Email address: [email protected] |
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[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGE FOR THE PURCHASER FOLLOWS]
THE PURCHASER SIGNATURE PAGE TO SECURITIES PURCHASE AGREEMENT
PURCHASER:
DAVID LAZAR
/s/ David Lazar |
Address for Notice: Mr. David Lazar 44, Tower 100 The Towers, Winston Churchill, San Francisco, Paitilla, Panama City, Panama. 07196 |
With a copy to (which shall not constitute notice): ABZ Law Offices Attn: Avraham Ben-Tzvi, Adv. 28 General Pierre Koenig, Floor 3 Jerusalem, Israel E-mail: [email protected]
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E-Mail: [email protected] |
EXHIBIT A
SERIES AA PREFERRED STOCK CERTIFICATE OF DESIGNATIONS
EXHIBIT B
SERIES AAA PREFERRED STOCK CERTIFICATE OF DESIGNATIONS
CERTIFICATE OF DESIGNATIONS, PREFERENCES
AND RIGHTS OF
SERIES AAA CONVERTIBLE NON-REDEEMABLE PREFERRED STOCK
OF
SOW GOOD INC.
(Pursuant to Section 151 of the
Delaware General Corporation Law)
SOW GOOD INC., a Delaware corporation (the “Corporation”), in accordance with the provisions of Section 103 of the Delaware General Corporation Law (the “DGCL”) does hereby certify that, in accordance with Sections 151 of the DGCL, the following resolution was duly adopted by the Board of Directors of the Corporation (the “Board of Directors”) on December 31, 2025:
RESOLVED, pursuant to authority expressly set forth in the Amended and Restated Certificate of Incorporation of the Corporation, as amended (the “Certificate of Incorporation”), the issuance of a series of Preferred Stock, par value $0.001 per share (the “Preferred Stock”) designated as the Series AAA Convertible Non-Redeemable Preferred Stock, par value $0.001 per share, of the Corporation is hereby authorized and the number of shares, powers, designations, preferences and relative, participating, optional or other special rights of, and the qualifications, limitations or restrictions upon, the Series AAA Convertible Non-Redeemable Preferred Stock (in addition to any provisions set forth in the Certificate of Incorporation that are applicable to the Preferred Stock of all classes and series) are hereby fixed, and the Certificate of Designation, Preferences and Rights of Series AAA Convertible Non-Redeemable Preferred Stock (“Certificate of Designations”) is hereby approved as follows:
SECTION 1 Designation of Amount.
(a) One million five hundred thousand (1,500,000) shares of Preferred Stock shall be, and hereby are, designated the “Series AAA Convertible Non-Redeemable Preferred Stock” (the “Series AAA Preferred Stock”), par value $0.001 per share.
(b) Subject to the requirements of the DGCL, the Certificate of Incorporation and this Certificate of Designations, the number of shares of Preferred Stock that are designated as Series AAA Preferred Stock may be increased or decreased by vote of the Board of Directors; provided, that no decrease shall reduce the number of shares of Series AAA Preferred Stock to a number less than the number of such shares then outstanding. Any shares of Series AAA Preferred Stock converted, redeemed, purchased or otherwise acquired by the Corporation in any manner whatsoever shall, automatically and without further action, be retired and canceled promptly after the acquisition thereof, and shall become authorized but unissued shares of Preferred Stock and may not be reissued as shares of Series AAA Preferred Stock when the Corporation shall take such action as may be necessary to reduce the number of authorized shares of the Series AAA Preferred Stock and may be reissued as part of a new series of any class or series of Preferred Stock in accordance with the Certificate of Incorporation.
SECTION 2 Certain Definitions.
Unless the context otherwise requires, the terms defined in this Section 2 shall have, for all purposes of this resolution, the meanings specified (with terms defined in the singular having comparable meanings when used in the plural).
“Affiliate” means any person that, directly or indirectly through one or more intermediaries, controls or is controlled by or is under common control with a person, as such terms are used in and construed under Rule 405 under the Securities Act.
“Board of Directors” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Business Day” shall mean any day other than Saturday, Sunday or other day on which commercial banks in the City of New York are authorized or required by law to remain closed.
“Bylaws” shall mean the Amended and Restated By-Laws of the Corporation, as amended from time to time.
“Certificate of Incorporation” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Common Stock” shall mean the common stock, par value $0.001 per share, of the Corporation.
“Conversion Notice” shall have the meaning set forth in Section 6(d).
“Conversion Price” shall mean $0.00800, subject to adjustment from time to time in accordance with Section 6(d).
“Conversion Time” shall have the meaning set forth in Section 6(d).
“Corporation” shall have the meaning set forth in the preamble to this Certificate of Designations.
“DGCL” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Exchange Act” shall have the meaning set forth in Section 6(c).
“Holder” means any holder of Series AAA Preferred Stock, all of such holders being the “Holders.”
“Junior Securities” shall have the meaning set forth in Section 5(a).
“Parity Securities” shall have the meaning set forth in Section 5(a).
“Participating Dividends” shall have the meaning set forth in Section 4.
“Permitted Exchange” means any of The New York Stock Exchange, The Nasdaq Global Select Market, The Nasdaq Global Market, The Nasdaq Capital Market (or any of their respective successors).
“Person” shall mean any individual, partnership, company, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or agency or political subdivision thereof, or other entity.
“Preferred Stock” shall have the meaning set forth in the preamble to this Certificate of Designations.
“Requisite Holders” shall mean the holders of a majority of the then outstanding shares of Series AAA Preferred Stock.
“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Series AAA Preferred Stock” shall have the meaning set forth in Section 1(a).
“Stated Value” shall mean the per share stated value for a share of Series AAA Preferred Stock of $2.00, subject to adjustment in the event of any stock dividend, stock split, combination, reorganization, recapitalization, reclassification, or other similar event with respect to the Series AAA Preferred Stock.
SECTION 3 Voting Rights.
(a) Non-Voting Stock. Until the Series AA Preferred Stock are convertible under Section 6 hereof, or except as otherwise provided by the DGCL, other applicable law or as provided in this Certificate of Designations, the holders of Series AAA Preferred Stock shall not be entitled to vote (or render written consents) on any matter submitted for a vote of (or written consents in lieu of a vote as permitted by the DGCL, the Certificate of Incorporation and the Bylaws) holders of Common Stock.
(b) Limited Voting Rights. So long as any shares of Series AAA Preferred Stock are outstanding, the Corporation shall not, without first obtaining the approval of the Requisite Holders:
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alter, repeal or change the powers, preferences or rights of the Series AAA Preferred Stock or alter or amend this Certificate of Designations so as to adversely affect the Series AAA Preferred Stock; |
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supplement, amend, restate, repeal, or waive any provision of the Certificate of Incorporation or Bylaws, or file any certificate of amendment, certificate of designation, preferences, limitations and relative rights of any series of preferred stock, if such action would adversely alter or change the preferences, rights, privileges or powers of, or restrictions provided for the benefit of the Series AAA Preferred Stock, regardless of whether any of the foregoing actions shall be by means of amendment to the Certificate of Incorporation or by merger, consolidation, recapitalization, reclassification, conversion or otherwise; |
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increase or decrease (other than by conversion) the number of authorized shares of Series AAA Preferred Stock; or |
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enter into any agreement with respect to any of the foregoing. |
SECTION 4 Dividends.
If the Board of Directors shall declare a dividend or other distribution payable upon the then outstanding shares of Common Stock, whether in cash, in kind or in other securities or property (other than dividends payable in shares of Common Stock), the holders of the outstanding shares of Series AAA Preferred Stock shall be entitled to the amount of dividends as would be payable in respect of the number of shares of Common Stock into which the shares of Series AAA Preferred Stock held by each holder thereof could be converted, without regard to any restrictions on conversion, in accordance with the provisions of Section 6 hereof, such number to be determined as of the record date for determination of holders of Common Stock entitled to receive such dividend or, if no such record date is established, as of the date of such dividend (“Participating Dividends”). Participating Dividends are payable at the same time as and when dividends on the Common Stock are paid to the holders of Common Stock.
SECTION 5 Liquidation Preference.
(a) Ranking. The Series AAA Preferred Stock shall rank (i) senior to all of the Common Stock; (ii) senior to any class or series of capital stock of the Corporation hereafter created specifically ranking by its terms junior to any Series AAA Preferred Stock (“Junior Securities”); and (iii) on parity with any other class or series of capital stock of the Corporation hereafter created specifically ranking by its terms on parity with the Series AAA Preferred Stock (“Parity Securities”), in each case, as to distributions of assets upon liquidation, dissolution or winding up of the Corporation, whether voluntarily or involuntarily (each, a “Dissolution”).
(b) Distribution to Series AAA Preferred Stock and Parity Securities. Upon a Dissolution, each Holder shall be entitled to receive, prior and in preference to any distributions of any of the assets or surplus funds of the Corporation to the holders of the Common Stock and Junior Securities and pari passu with any distribution to the holders of Parity Securities, an amount per share of Series AAA Preferred Stock held by such Holder equal to the greater of (i) the Stated Value, plus any dividends declared but unpaid on such share of Series AAA Preferred Stock, or (ii) such amount per share as would have been payable had all shares of Series AAA Preferred Stock been converted into Common Stock pursuant to Section 6 (without regard to any restrictions on conversion) immediately prior to such Dissolution. If, upon any such Dissolution, the assets of the Corporation shall be insufficient to pay the holders of shares of the Series AAA Preferred Stock the amount required under the preceding sentence, the holders of Series AAA Preferred Stock and the holders of shares of Parity Securities shall share in any distribution of the assets available for distribution in proportion to the respective amounts which would otherwise be payable in respect of the shares of Series AAA Preferred Stock and Parity Securities held by them upon such distribution if all amounts payable on or with respect to such shares of Series AAA Preferred Stock and Parity Securities were paid in full. For the avoidance of any doubt, but without limiting the foregoing, neither a change in control of the Corporation, the merger or consolidation of the Corporation with or into any other entity, nor the sale, lease, exchange or other disposition of all or substantially all of the Corporation’s assets shall, in and of itself, be deemed to constitute a Dissolution.
SECTION 6 Conversion Rights.
(a) General. Subject to and upon compliance with the provisions of this Section 6 and subject to the Corporation’s stockholders approving each of (A) an increase in the number of authorized shares of Common Stock to enable the Corporation to issue all of the shares of Common Stock that are issuable upon the conversion of the Series AAA Preferred Stock and any Series AA Preferred Stock, par value $0.001 per share (the “Series AA Preferred Stock”), that is issued and outstanding and (B) the conversion of the Series AAA Preferred Stock and any Series AA Preferred
Stock that is issued and outstanding into shares of Common Stock in accordance with the listing rules of the Nasdaq Stock Market (the “Stockholder Approvals”), and subject to the Corporation filing an amendment to the Certificate of Incorporation with the Secretary of State of the State of Delaware (the “Charter Amendment”) evidencing such stockholder approval, each Holder shall be entitled, at its option, at any time and from time to time after the Stockholder Approvals and the filing of the Charter Amendment, to convert all or any such shares of Series AAA Preferred Stock into the number of fully paid and nonassessable shares of Common Stock equal to the number obtained by dividing (i) the Stated Value of such Series AAA Preferred Stock by (ii) the Conversion Price in effect at the Conversion Time (determined as provided in this Section 6).
(b) Fractions of Shares. Fractional shares of Common Stock may not be issued in connection with any conversion of the Series AAA Preferred Stock. As to any fraction of a share which a Holder would otherwise be entitled to receive upon such conversion, the Corporation shall pay a cash adjustment in respect of such final fraction in an amount equal to such fraction multiplied by the Conversion Price.
(c) Adjustments to Conversion Price.
(i) Upon Subdivisions. If, at any time after the date the first share of Series AAA Preferred Stock was issued, the number of shares of Common Stock outstanding is increased by a subdivision of shares of Common Stock, then, following the record date for the determination of holders of Common Stock affected by such subdivision, the Conversion Price in effect immediately before such subdivision shall be proportionately decreased so that the number of shares of Common Stock issuable on conversion of Series AAA Preferred Stock shall be increased in proportion to such increase in outstanding shares of Common Stock.
(ii) Upon Combinations. If, at any time after the date the first share of Series AAA Preferred Stock was issued, the number of shares of Common Stock outstanding is decreased by a combination of the outstanding shares of Common Stock into a smaller number of shares of Common Stock, then, following the record date to determine shares affected by such combination, the Conversion Price in effect immediately before such combination shall be proportionately increased so that the number of shares of Common Stock issuable on conversion of each share of Series AAA Preferred Stock shall be decreased in proportion to such decrease in outstanding shares of Common Stock.
(iii) Stock Dividends. If, at any time after the date the first share of Series AAA Preferred Stock was issued, the Corporation shall make or issue, or fix a record date for the determination of holders of Common Stock entitled to receive, a dividend or other distribution payable on the Common Stock in additional shares of Common Stock, then and in each such event the Conversion Price in effect immediately before such event shall be decreased as of the time of such issuance or, in the event such a record date shall have been fixed, as of the close of business on such record date, by multiplying the Conversion Price then in effect by a fraction: (1) the numerator of which shall be the total number of shares of Common Stock outstanding immediately prior to the time of such issuance or the close of business on such record date, and (2) the denominator of which shall be the total number of shares of Common Stock outstanding immediately prior to the time of such issuance or the close of business on such record date plus the number of shares of Common Stock issuable in payment of such dividend or distribution. Notwithstanding the foregoing, (a) if such record date shall have been fixed and such dividend is not fully paid or if such distribution is not fully made on the date fixed therefor, the Conversion Price shall be recomputed accordingly as of the close of business on such record date and thereafter the Conversion Price shall be adjusted pursuant to this Section 6(c)(iii) as of the time of actual payment of such dividends or distributions; and (b) no such adjustment shall be made if the holders of Series AAA Preferred Stock simultaneously receive a dividend or other distribution of shares of Common Stock in a number equal to the number of shares of Common Stock as they would have received if all outstanding shares of Series AAA Preferred Stock had been converted into Common Stock on the date of such event.
(iv) Reorganization, Reclassification, Merger or Consolidation. If at any time or from time to time there shall be a reorganization, recapitalization, reclassification, merger or consolidation involving the Corporation in which the Common Stock is converted into or exchanged for securities, cash or property (other than a subdivision or combination provided for elsewhere in this Section 6), then, as a part of such reorganization, recapitalization, reclassification, merger, or consolidation, provision shall be made so that holders of Series AAA Preferred Stock shall thereafter be entitled to receive upon conversion of the Series AAA Preferred Stock, the kind and amount of shares of stock, cash or other property to which such holder would have been entitled if such holder had converted its shares of Series AAA Preferred Stock immediately prior to such reorganization, recapitalization, reclassification, merger or consolidation. In any such case, appropriate adjustment shall be made in the application of the provisions of this Section 6 with respect to the rights of the holders of the Series AAA Preferred Stock after the reorganization, recapitalization,
reclassification, merger or consolidation, to the end that the provisions of this Section 6 (including provisions with respect to changes in and other adjustments of the Conversion Price then in effect for the Series AAA Preferred Stock) shall be applicable after that event in as nearly equivalent a manner as may be practicable.
(d) Exercise of Conversion Privilege. In order to exercise the conversion privilege, the holder of any share of Series AAA Preferred Stock shall, (i) provide written notice in the form attached hereto as Annex A (a “Conversion Notice”) to the Corporation at any office or agency of the Corporation maintained for such purpose, that the Holder elects to convert all such shares of Series AAA Preferred Stock or, if less than the entire amount thereof is to be converted, the portion thereof to be converted and (ii) if such Holder’s shares are certificated, surrender the certificate evidencing such shares of Series AAA Preferred Stock, duly endorsed or assigned to the Corporation in blank, at such office or agency. The Conversion Notice shall state such Holder’s name or the names of the nominees in which such Holder wishes the shares of Common Stock to be issued. Series AAA Preferred Stock shall be deemed to have been converted immediately prior to the close of business on the date of surrender of such shares of Series AAA Preferred Stock for conversion in accordance with the foregoing provisions or such later time as specified in the Conversion Notice (the “Conversion Time”), and the shares of Common Stock issuable upon conversion of the specified shares shall be deemed to be outstanding of record as of such Conversion Time. As promptly as practicable on or after the Conversion Time, the Corporation shall (i) issue and shall deliver a certificate or certificates for the number of full shares of Common Stock issuable upon conversion (or a notice of such issuance if uncertificated shares are issued) and (ii) pay all declared but unpaid dividends on the shares of Series AAA Preferred Stock converted. In the case of any certificate
evidencing shares of Series AAA Preferred Stock that is converted in part only, upon such conversion the Corporation shall also execute and deliver a new certificate evidencing the number of shares of Series AAA Preferred Stock that are not converted (or a notice of such issuance if uncertificated shares are issued).
(e) Notice of Adjustment of Conversion Price. Whenever the provisions of Section 6(c) require that the Conversion Price be adjusted as herein provided, the Corporation shall compute the adjusted Conversion Price in accordance with Section 6(c) and shall prepare a certificate signed by the Corporation’s principal executive officer or principal financial officer setting forth the adjusted Conversion Price and showing in reasonable detail the facts upon which such adjustment is based, and such certificate shall forthwith be filed at each office or agency maintained for such purpose for conversion of shares of Series AAA Preferred Stock and mailed by the Corporation at its expense to all holders of Series AAA Preferred Stock at their last addresses as they shall appear in the stock register.
(g) Corporation to Reserve Common Stock. Following the receipt of Stockholder Approval and the filing of the Charter Amendment, the Corporation shall at all times reserve and keep available, free from preemptive rights, out of the authorized but unissued Common Stock or out of the Common Stock held in treasury, for the purpose of effecting the conversion of Series AAA Preferred Stock, the full number of shares of Common Stock issuable upon the conversion of all outstanding shares of Series AAA Preferred Stock. Before taking any action that would cause an adjustment reducing the Conversion Price below the then par value (if any) of the shares of Common Stock deliverable upon conversion of the Series AAA Preferred Stock, the Corporation will take any corporate action that, in the opinion of its counsel, is necessary in order that the Corporation may validly and legally issue fully paid and non-assessable shares of Common Stock at such adjusted Conversion Price.
(h) Taxes on Conversions. The Corporation will pay any and all original issuance, transfer, stamp and other similar taxes that may be payable in respect of the issue or delivery of shares of Common Stock on conversion of Series AAA Preferred Stock pursuant hereto. The Corporation shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock in a name other than that of the holder of the share(s) of Series AAA Preferred Stock to be converted (nor shall the Corporation be responsible for any other taxes payable by the holders of the Series AAA Preferred Stock), and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Corporation the amount of any such tax or has established to the satisfaction of the Corporation that such tax has been paid.
SECTION 7 Waiver. Notwithstanding anything to the contrary herein, any provisions of this Certificate of Designations may be waived on behalf of all of the holders of Series AAA Preferred Stock by the affirmative written consent or vote of the Requisite Holders.
IN WITNESS WHEREOF, the Corporation has caused this Certificate of Designations, Preferences and Rights to be duly executed by its Chief Executive Officer, this [__] day of [______], 2026.
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By: |
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Name: |
Claudia Goldfarb |
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Title: |
Chief Executive Officer |
ANNEX A
CONVERSION NOTICE
(To be Executed by the Registered Holder in order to Convert Shares of Preferred Stock)
The undersigned being the Holder of Sow Good Inc., a Delaware corporation (the “Corporation”) Series AAA Convertible Non-Redeemable Preferred Stock (the “Series AAA Preferred Stock”) hereby elects to convert the number of shares of Series AAA Preferred Stock indicated below into shares of common stock, par value $0.001 per share (the “Common Stock”), of Sow Good Inc., according to the conditions as set forth in the Certificate of Designations, Preferences and Rights of Series AAA Convertible Non-Redeemable Preferred Stock (the “Certificate of Designations”), as of the date written below. If shares of Common Stock are to be issued in the name of a Person other than the undersigned, the undersigned holder will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as may be required by the Corporation in accordance with the Securities Purchase Agreement, dated December __, 2025. No fee will be charged to the Holders for any conversion, except for any such transfer taxes.
Conversion calculations:
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Number of shares of Preferred Stock owned prior to Conversion: |
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Number of shares of Preferred Stock to be Converted: |
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Stated Value of shares of Preferred Stock to be Converted: |
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Number of shares of Common Stock to be Issued: |
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Annex A-1
EXHIBIT C
FLOW OF FUNDS
EXHIBIT D
FORM OF VOTING AGREEMENT
EXHIBIT E
WIRE INSTRUCTIONS
EXHIBIT F
CONTINUED SERVICES AGREEMENT
SCHEDULE 2.3
SETTLEMENT AND RELEASE AGREEMENTS
SCHEDULE 3.1(h)
CAPITALIZATION
SECTION 3.1(j)
MATERIAL CHANGES; UNDISCLOSED EVENTS, LIABILITIES OR DEVELOPMENTS
SCHEDULE 3.1(p)
OWNED AND LEASED PROPERTY
SCHEDULE 3.1(r)
TRANSACTIONS WITH AFFILIATES AND EMPLOYEES
SCHEDULE 3.1(w)
LISTING AND MAINTENANCE REQUIREMENTS
SCHEDULE 3.1(aa)
INDEBTEDNESS
SCHEDULE 4.15(a)
USE OF FUNDS
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this “Purchase Agreement”), dated December 30, 2025, is by and between Sow Good Inc., (the “Seller”), and Trea Grove, LLC, a Texas limited liability company (the “Buyer,” and together with the Seller, each a “Party,” and collectively, the “Parties”). Capitalized terms used but not defied herein shall have the meanings ascribed to such terms on Exhibit A hereto.
RECITALS
WHEREAS, the Seller is engaged in the business of manufacturing and producing freeze-dried snacks and candy for human consumption (the “Business”); and
WHEREAS, the Seller desires to sell to the Buyer, and the Buyer desires to purchase from the Seller, the Purchased Assets (as defined below), and to assume certain specified liabilities and contracts, upon the terms and subject to the conditions set forth in this Purchase Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties hereto agree as follows:
TRANSFER OF PURCHASED ASSETS AND ASSUMPTION OF ASSUMED LIABILITIES
(a) all right, title and interest in and to the improvements located at 1440 N. Union Bower Rd., Irving, Texas;
(b) all proprietary and intellectual property rights of the Seller related to the Business, including, but not limited to, domain names, trade names, common law trademarks, and related goodwill;
(c) all transferable governmental licenses, permits, approvals, and authorizations related to the Purchased Assets or the operation of the Business, to the extent transferable by Law; and
(d) all other assets expressly identified as Purchased Assets on Schedule 1.01 of the disclosure schedules of the Company scheduled to this Purchase Agreement (the “Disclosure Schedules”)(subsections (a) through (d) collectively, the “Purchased Assets”).
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CLOSING
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Representations and warranties of THE SELLER
The Seller represents and warrants to the Buyer that the statements contained in this Article III are true and correct as of the Closing Date.
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Representations and warranties of THE BUYER
The Buyer represents and warrants to the Seller that the statements contained in this Article IV are true and correct as of the date hereof.
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Covenants
Upon expiration or termination of the distribution agreement, Buyer and Seller shall reasonably cooperate to effect an orderly transition off such systems.
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termination
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SURVIVAL OR REPRESENTATIONS AND WARRANTIES; Indemnification
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Miscellaneous
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Notices to the Buyer:
Trea Grove, LLC 5959 Colhurst St. Dallas, TX 75201 Attention: Ira Goldfarb Email: [email protected] |
with a copy to (copy not constituting notice):
Husch Blackwell LLP 1900 N. Pearl Street, Suite 1800 Dallas, TX 75201 Attention: Richard A. Illmer Email: [email protected] |
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Notices to the Seller:
Sow Good, Inc. 1440 N Union Bower Rd. Irving, TX 75061 Attention: Claudia Goldfarb Email: [email protected] |
with a copy to (copy not constituting notice):
White and Case LLP 1221 Avenue of the Americas New York, NY 10020 Attention: Drew Valentine Email: [email protected] |
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[signature page follows]
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IN WITNESS WHEREOF, the Parties have caused this Asset Purchase Agreement to be executed by their duly authorized representatives, all as of the day and year first above written.
THE SELLER:
SOW GOOD INC.:
By: /s/ Claudia Goldfarb
Name: Claudia Goldfarb
Title: Chief Executive Officer
THE BUYER:
TREA GROVE, LLC:
By: /s/ Ira Goldfarb
Name: Ira Goldfarb
Title: Managing Member
EXHIBIT A
DEFINITIONS
For the purposes of this Purchase Agreement, the following terms have the meaning set forth below:
“Assumed Liabilities” means solely the liabilities and obligations of Sellers related solely to the Business, that have been incurred by Sellers in the Ordinary Course, and which are to be paid or performed after the Closing Date solely that are an accounts payable of the Business as of immediately prior to the Closing that is specifically set forth on, and in an amount not to exceed the amount set forth with respect to, such specific accounts payable of the Business set forth on Schedule 1.03.
“Contemplated Transactions” means all of the transactions contemplated by this Purchase Agreement and the other Transaction Documents, including (i) the sale by Sellers to Buyer of the Purchased Assets, (ii) the assumption by Buyer of the Assumed Liabilities, and (iii) the performance by the Parties of their respective covenants, agreements and obligations under this Purchase Agreement and the Transaction Documents.
“Contract” means any agreement, instrument, document, lease, sublease, license, sublicense, contract, purchase order, statement of work, note, bond, indenture, mortgage, assignment or other arrangement, understanding, or commitment (in each case, whether written or oral and including any extension, renewal, amendment or other modification thereof).
“Excluded Assets” means each Seller’s rights in, to or under the following, in each case, to the extent existing immediately prior to the Closing Date.
“Excluded Liabilities” means all Liabilities of any Seller or any of their respective Affiliates (or otherwise relating to any Seller, its Affiliates, the Business or the Purchased Assets) not explicitly included in the definition of Assumed Liabilities.
“Proprietary Rights” means all of the following items and all corresponding rights, throughout the world: (i) patents, patent applications, patent disclosures and inventions (whether or not patentable and whether or not reduced to practice), all improvements thereto and any reissue, continuation, continuation-in-part, divisional, provisional, revision, extension, renewal, substitution or reexamination of the foregoing; (ii) trademarks, service marks, certification marks, trade dress, logos, trade names, slogans, Internet domain names and corporate names and design rights and all other indicia of origin, together with all translations, adaptations, derivations, and combinations thereof, all registrations, applications and renewals for any of the foregoing, and all goodwill associated with the foregoing (collectively, “Marks”); (iii) copyrights and works of authorship (whether or not copyrightable, including look and feel), mask works and moral rights, and all registrations, applications and renewals for any of the foregoing; (iv) trade secrets and proprietary confidential information (including inventions, discoveries, ideas, formulae, compositions, technologies, know-how, processes, techniques, methods, research and development information, drawings, specifications, designs, plans, proposals, technical data, financial, business and marketing plans, and customer and supplier lists and related information); (v) computer software and software systems, including source code, object code, firmware, middleware, tools, data, databases and related documentation (collectively, “Software”); (vi) rights of publicity and privacy, including the right to use names, likenesses, voices and biographical
information of real persons; (vii) other intellectual property and proprietary rights; and (viii) all copies and tangible embodiments of the foregoing (in whatever form or medium).
SCHEDULE 1.01
PURCHASED ASSETS
SCHEDULE 1.03
ASSUMED LIABILITIES
SCHEDULE 1.04
EXCLUDED ASSETS
SCHEDULE 3.09
INTELLECTUAL PROPERTY
SCHEDULE 3.11
PERMITS & LICENSES
DISTRIBUTION AGREEMENT
This Distribution Agreement (this “Agreement”) is entered into as of December 31, 2025 (the “Effective Date”), by and between Sow Good Inc., a Delaware corporation (“SOWG”), and Trea Grove, LLC, a Texas limited liability company (“Distributor”). SOWG and Distributor may be referred to individually as a “Party” and collectively as the “Parties.”
1. PURPOSE AND RELATIONSHIP
1.1 Purpose. SOWG desires to appoint Distributor, and Distributor desires to act, as the exclusive distributor of certain SOWG products as set forth herein.
1.2 Independent Contractors. The Parties are independent contractors. Nothing in this Agreement or a certain asset purchase agreement, by and among SOWG and the Distributor as of December 30, 2025 (the “Asset Purchase Agreement”), shall be deemed to create any partnership, joint venture, fiduciary relationship, or agency relationship between the Parties, nor shall either Party have authority to bind the other except as expressly set forth herein.
2. PRODUCTS
2.1 Products. The products subject to this Agreement (the “Products”) shall consist of SOWG fruits, snacks, and candy products, as may be mutually agreed upon by the Parties from time to time.
3. APPOINTMENT AND SCOPE
3.1 Appointment. SOWG hereby appoints Distributor, and Distributor accepts appointment, to provide distribution services for the Products in accordance with this Agreement.
3.2 Territory. The territory covered by this Agreement (the “Territory”) shall be all territories worldwide, or as mutually agreed upon by the Parties.
3.3 Exclusivity. Distribution under this Agreement shall be exclusive within the Territory during the Term (as defined herein).
4. DISTRIBUTION SERVICES
4.1 Services. Distributor shall be responsible for services in connection with the distribution of the Products, including, but not limited to, customer communications, order intake and management, billing and invoicing, collection of customer payments, shipping, logistics, fulfillment, customer service related to orders (the “Services”).
5. PRICING, BILLING, AND REMITTANCE
5.1 Pricing and Customers. Distributor shall have full authority to, among other things, control pricing, customer relationships, and sales channels for the Products.
5.2 Billing and Collections. Distributor shall invoice customers directly and collect all amounts due from customers.
5.3 Remittance to SOWG. Distributor shall remit to SOWG ten percent (10%) of gross receipts from sales of the Products, within thirty (30) days after Distributor’s receipt of payment from customers.
6. SYSTEMS AND COMMUNICATIONS ACCESS
6.1 Email and Systems Access. During the Term (as defined herein), Distributor shall have the right to access and use the sowginc.com email address and SOWG’s NetSuite system in the ordinary course of performing the Services, consistent with the Asset Purchase Agreement.
6.2 Termination of Access. Upon expiration or earlier termination of this Agreement, the Parties shall reasonably cooperate to effect an orderly transition off such systems.
7. TERM AND TERMINATION
7.1 Term. The term of this Agreement shall commence on the Effective Date and continue through July 31, 2026, unless earlier terminated by mutual written agreement (the “Term”). The Term may be extended as needed in the sole discretion of SOWG upon written notice to Distributor.
7.2 Termination. This Agreement may be terminated only by mutual written agreement of the Parties.
7.3 Orderly Wind-Down and Transition. Upon expiration or termination, the Parties shall cooperate to effect an orderly wind-down, including fulfillment of accepted orders, transition of customer communications, and data export as reasonably required.
8. LIABILITY ALLOCATION
8.1 Product Liability. SOWG shall retain all liability relating to the manufacture, formulation, quality, safety, and regulatory compliance of the Products.
8.2 Distribution Liability. Distributor shall be responsible for liabilities arising from distribution activities.
8.3 Chargebacks and Returns. Distributor shall be responsible for all chargebacks and returns.
8.4 Customer Non-Payment. If Distributor has remitted payment to SOWG and the underlying customer payment is not collected, SOWG shall reimburse Distributor to the extent not absorbed by Distributor.
9. INTELLECTUAL PROPERTY
9.1 Ownership. All intellectual property related to the Products shall remain the exclusive property of SOWG, except as expressly transferred under the Asset Purchase Agreement.
9.2 Limited License. During the Term, SOWG grants Distributor a non-exclusive, royalty-free license to use SOWG trademarks solely for distribution and marketing of the Products.
10. CONFIDENTIALITY
Each Party shall maintain the confidentiality of the other Party’s confidential information.
11. GOVERNING LAW
This Agreement shall be governed by the laws of the State of Texas.
12. MISCELLANEOUS
12.1 Consistency with Asset Purchase Agreement. In the event of any conflict, the Asset Purchase Agreement shall control.
12.2 Entire Agreement; Amendments. This Agreement constitutes the entire agreement between the Parties and may be amended only in writing signed by both Parties.
12.3 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts and by electronic signature.
IN WITNESS WHEREOF, the Parties have executed this Agreement as of the Effective Date.
SOW GOOD INC.
By: /s/ Claudia Goldfarb
Name: Claudia Goldfarb
Title: Chief Executive Officer
Trea Grove, LLC
By: /s/ Ira Goldfarb
Name: Ira Goldfarb
Title: Managing Member
VOTING AGREEMENT
THIS VOTING AGREEMENT (this “Agreement”) is being signed on December __, 2025 (the “Original Signature Date”) by and among (a) Sow Good Inc., a Delaware corporation whose Common Stock (as defined herein) is listed for trading on the Nasdaq (the “Proxy” or the “Company”), (b) Mr. David Elliot Lazar, an individual (“Lazar”), and (c) _______, an individual (the “Original Stockholder” and, together with any subsequent stockholders, or transferees, who become parties hereto pursuant to Section 12 below, the “Stockholders”).
WHEREAS, the Company and Lazar are contemplating entering into a Securities Purchase Agreement (the “Securities Purchase Agreement”) that will provide for the sale and issuance of, inter alia, shares of newly designated series of the Company’s preferred stock (“Preferred Stock”), which shares, among other rights, are expected to be convertible into shares of the Company’s common stock, par value $0.001 per share (“Common Stock”), subject to and in accordance with the terms of the Securities Purchase Agreement once finalized, and in connection with that Securities Purchase Agreement, the Stockholder desires to provide the Proxy with certain contractual rights as set forth below.
WHEREAS, the Original Stockholder hereby represents that it does not have any beneficial interest in capital stock of the Company and in any other shares or securities of the Company and/or any of its subsidiaries issued or issuable in respect thereof on and after the Original Signature Date, other than the _______ shares of Common Stock of the Company held prior to the date hereof.
NOW, THEREFORE, in consideration of the recitals set forth hereinabove (the “Recitals”) and the mutual covenants and agreements herein contained, and other good and valuable consideration, the receipt and sufficiency of which are acknowledged hereby, each of the parties hereto, intending legally to be bound, hereby agrees as follows:
In addition, upon and following the Proxy Effective Date, each Stockholder hereby agrees that, for a period of two (2) years from the Proxy Effective Date [or the Joinder Date (as defined herein), as applicable], unless specifically invited in advance in writing by Lazar, neither the Stockholder, nor any of its representatives acting on its behalf, will in any manner, directly or indirectly: (i) effect or seek, offer or propose (whether publicly or otherwise) to effect, or cause or participate in or in any way advise, assist or encourage any other person to effect or seek, offer or
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propose (whether publicly or otherwise) to effect or participate in, (a) any acquisition of any securities (or beneficial ownership thereof) or assets of the Company, or any rights to acquire any such securities (including derivative securities representing the right to vote or economic benefit of any such securities) or assets; (b) any tender or exchange offer, merger or other business combination involving the Company; (c) any recapitalization, restructuring, liquidation, dissolution or other extraordinary transaction with respect to the Company; or (d) any “solicitation” of “proxies” (as such terms are used in the proxy rules of the Securities and Exchange Commission) or consents to vote any voting securities of the Company; (ii) form, join or in any way participate in a “group” (as defined under the Securities Exchange Act of 1934) with respect to any securities of the Company; (iii) otherwise act, alone or in concert with others, to seek to control or influence the management, board of directors or policies of the Company; (iv) take any action which might force the Company to make a public announcement regarding any of the types of matters set forth in (i) above; (v) enter into any discussions or arrangements with any third party with respect to any of the foregoing; or (vi) request that the Company (or its directors, officers, employees or agents) amend or waive any provision of this paragraph (including this clause (vi)).
Notwithstanding anything to the contrary contained in the prior paragraph (the “Standstill Provision”) the Stockholders shall be permitted to: (1) make proposals to the Company’s Board of Directors or special committee, the chairman of the Board of Directors and/or chief executive officer of the Company on a confidential, nonpublic basis for either (A) a proposed transaction between the parties, so long as Stockholder reasonably believes in good faith, based on the written advice of its outside counsel, that neither it nor the Company nor the Proxy would reasonably be expected to be required by applicable law, regulation or stock exchange requirement to disclose publicly any such proposal or (B) a waiver of this Section 4 and (2) dispose of Stockholders’ shares in the Company, whenever acquired on the open market, provided that the Stockholders shall not dispose of any shares owned as of the Signature Date until after it has voted their respective shares of Common Stock pursuant to a unanimous written consent or at the next applicable stockholders’ meeting, in each case as recommended by the Board of Directors of the Company for the approval of the transactions contemplated by the Securities Purchase Agreement (the “Approval”).
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IN WITNESS WHEREOF, the parties have executed this Voting Agreement as of the Signature Date.
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[Signature Page to Voting Agreement]
Schedule A
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Company/Proxy: |
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Sow Good Inc. Address: 1440 N Union Bower Rd Irving, TX 75061 Attention: E-mail:
With a copy, which shall not constitute notice, shall also be sent to
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Attention: _______ E-mail: _______
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Lazar: |
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Mr. David Elliot Lazar |
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Address: 44, Tower 100 The Towers, Winston Churchill, San Francisco, Paitilla, Panama City, Panama. 07196
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E-mail: [email protected]
With a copy, which shall not constitute notice, shall also be sent to:
Mr. Avraham Ben-Tzvi, Attorney Address: 28 General Pierre Koenig St., 3rd Floor – Asif Business Center, Jerusalem 9346936, Israel
Email: [email protected] |
Schedule A-1
SETTLEMENT AGREEMENT AND GENERAL AND MUTUAL RELEASE
This Settlement Agreement and General and Mutual Release (the “Agreement”) is on this __ day of December, 2025 by and between Sow Good Inc. (the “Company”) and ________, the Chief ______ [and Director] of the Company (“Officer”), collectively known herein as the “Parties.”
WHEREAS, Officer was appointed as [Chief _____ Officer] of the Company to provide the services commensurate with such position(s) in other public companies of similar sizes and industries (the “Services”).
WHEREAS, Officer has provided the Services above and beyond such as commonly performed by an officer and director of a company in a similar position.
WHEREAS, there is no dispute as to the provision of the Services nor any disagreements with the Company.
WHEREAS, the Parties desire and intend that this Agreement supplement and modify all prior contracts, agreements and understandings between the Parties.
WHEREAS, the Parties desire that Officer submits his resignation forthwith as Chief ______ Officer of the Company.
NOW, THEREFORE, the Parties, intending to be legally bound, and in consideration of the mutual promises, covenants and agreements contained herein and other good and valuable consideration, the sufficiency of which is hereby acknowledged, agree as follows:
Upon execution hereof, the Company shall pay to Officer an settlement payment, including with respect to any and all accrued and unpaid salary and the Officer’s contractual severance payment, as applicable to Officer, in an amount equal to ___________.
Officer hereby resigns as Chief _______ Officer of the Company and irrevocably and unconditionally releases, acquits and forever discharges the Company and any principals of any and any successors and assigns (and any officers, directors, shareholders, managers, members, employees, representatives, attorneys, consultants, and agents of such entities) (hereinafter referred to for purposes of this section as the “Clients”), from any and all claims, demands, rights, causes of action, liens, actions, suits, attorneys’ fees, costs, damages, losses, expenses and contractual obligations of whatever kind or nature, whether absolute or contingent, liquidated or unliquidated, direct or indirect, in law or in equity, fully accrued or not fully accrued, matured or unmatured, known or unknown, foreseen or unforeseen, suspected or unsuspected, relating to any matter whatsoever (collectively, “Claims”) which Officer had, currently has, shall or may have; provided that such release shall not apply to any Claims relating to Company indemnification obligations to the Officer in connection with actions in [his/her] capacity as officer of the Company..
Notwithstanding the foregoing, the release contained herein shall not release Officer from their obligations pursuant to this Agreement.
The Company, for itself and for its successors and assigns hereby irrevocably and unconditionally release, acquit and forever discharge Officer, any successors and assigns (and any officers, directors, shareholders, managers, members, employees, representatives, attorneys, consultants, and agents of such entities), from any and all Claims (as defined above) which the Company had, currently has, shall or may have. Notwithstanding the foregoing, the release contained herein shall not release the Company from their obligations pursuant to this Agreement, and shall not release the Company from maintaining commercially reasonable D&O insurance coverage (or tail policy) to cover Director’s actions in [his/her] former capacity as a director on the Board of Directors of the Company.
4. No Admission. The Parties understand and agree that this Agreement shall not be construed as (i) an admission of liability by one party to the other, (ii) that either party has violated any federal, state or local statute, law, ordinance or regulation, or (iii) there has been any material disagreements with the Company.
5. Binding Agreement. This Agreement supersedes all prior agreements between the Parties. This Agreement shall be binding upon the Parties hereto and their respective successors and assigns. The Parties agree and stipulate that this Agreement is enforceable in all respects and is not subject to any affirmative claim, once this Agreement is executed.
6. Entire Agreement. This Agreement constitutes the entire and complete understanding between the Parties hereto, and no other representation, promise, or agreement shall be binding upon either of them unless it is in writing and executed by the Parties.
7. Amendment. This Agreement may not be amended or modified in any manner except by a writing signed by each of the Parties hereto.
8. Recitals. The Parties hereto acknowledge and agree that the recitals set forth at the beginning of this Agreement are true and correct in all respects and are incorporated herein by this reference.
9. Governing Law; Venue. This Agreement is made and delivered in and shall be governed by and construed in accordance with, the applicable laws of the State of Delaware. Any suit involving any dispute or matter arising under this Agreement, the Parties hereby consent to personal jurisdiction in the State of Delaware.
10. Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable, the provision shall be modified to the extent necessary to render it enforceable and, if necessary, shall be fully severable.
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IN WITNESS WHEREOF, the Parties have made and entered into this Settlement Agreement and General and Mutual Release as of the date set forth above.
Sow Good Inc.
_____________________________
By:
Its:
____________
____________________________
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SETTLEMENT AGREEMENT AND GENERAL AND MUTUAL RELEASE
This Settlement Agreement and General and Mutual Release (the “Agreement”) is on this ____ day of December, 2025 by and between Sow Good Inc. (the “Company”) and _________ (the “Director”), collectively known herein as the “Parties.”
WHEREAS, the Director was elected to act as a Member of the Board of Directors of the Company (the “Services”).
WHEREAS, the Director has provided the Services commonly performed by a director of a company in a similar position.
WHEREAS, there is no dispute as to the provision of the Services nor any disagreements with the Company.
WHEREAS, in connection with, and as a condition to the transactions contemplated, by the Securities Purchase Agreement, dated December 31, 2025 between the Company and David Lazar (the “Purchase Agreement”), the Parties desire and intend that this Agreement supplement and modify all prior contracts, agreements and understandings between the Parties.
WHEREAS, upon and subject to the terms and conditions of this Agreement, the Parties desire that the Director submits his resignation, as provided in Section 2, to be effective as of the Resignation Effective Date.
NOW, THEREFORE, the Parties, intending to be legally bound, and in consideration of the mutual promises, covenants and agreements contained herein and other good and valuable consideration, the sufficiency of which is hereby acknowledged, agree as follows:
On the Resignation Effective Date, the Company shall pay to the Director _________ shares of common stock of the Company, representing the unpaid director’s fees as of the date hereof as applicable to the Director.
The Director hereby agrees to confirm the termination of his service as a director on the Board of Directors by also resigning as a director of the Board of Directors of the Company to be effective on the closing of the Purchase Agreement (the “Resignation Effective Date. The Director irrevocably and unconditionally releases, acquits and forever discharges the Company and any principals and any successors and assigns (and any officers, directors, shareholders, managers, members, employees, representatives, attorneys, consultants, and agents of such entities) (hereinafter referred to for purposes of this section as the “Clients”), from covenants not to sue or initiate any action for, any and all claims, demands, rights, causes of action, liens, actions, suits, attorneys’ fees, costs, damages, losses, expenses and contractual obligations of whatever kind or nature, whether absolute or contingent, liquidated or unliquidated, direct or indirect, in law or in equity, fully accrued or not fully accrued, matured or unmatured, known or unknown, foreseen or unforeseen, suspected or unsuspected, relating to any matter whatsoever (collectively, “Claims”) which the Director
had, currently has, shall or may have; provided that such release shall not apply to any Claims relating to Company indemnification obligations to the Director in connection with actions in [his/her] capacity as a director of a Board of Directors of the Company. Notwithstanding the foregoing, the release contained herein shall not release the Director from [her/his] obligations pursuant to this Agreement.
The Company, for itself and for its successors and assigns, hereby irrevocably and unconditionally releases, acquits and forever discharges the Director, any successors and assigns (and any officers, directors, shareholders, managers, members, employees, representatives, attorneys, consultants, and agents of such entities), from any and all Claims (as defined above) which the Company had, currently has, shall or may have. Notwithstanding the foregoing, the release contained herein shall not release the Company from their obligations pursuant to this Agreement, and shall not release the Company from maintaining commercially reasonable D&O insurance coverage (or tail policy) to cover Director’s actions in [his/her] former capacity as a director on the Board of Directors of the Company.
3. No Admission. The Parties understand and agree that this Agreement shall not be construed as (i) an admission of liability by one party to the other, (ii) that either party has violated any federal, state or local statute, law, ordinance or regulation, or (iii) there has been any material disagreements with the Company.
4. Binding Agreement. This Agreement constitutes the entire and complete understanding between the Parties hereto, and no other representation, promise, or agreement shall be binding upon either of them unless it is in writing and executed by the Parties. This Agreement supersedes all prior agreements between the Parties; however, this Agreement does not supersede the Indemnification Agreement entered into between the Company and the Director, which remains in full force and effect. This Agreement shall be binding upon the Parties hereto and their respective successors and assigns. The Parties agree and stipulate that this Agreement is enforceable in all respects and is not subject to any affirmative claim, once this Agreement is executed.
5. Amendment. This Agreement may not be amended or modified in any manner except by a writing signed by each of the Parties hereto.
6. Recitals. The Parties hereto acknowledge and agree that the recitals set forth at the beginning of this Agreement are true and correct in all respects and are incorporated herein by this reference.
7. Governing Law; Venue. This Agreement is made and delivered in and shall be governed by and construed in accordance with, the applicable laws of the State of Delaware. Any suit involving any dispute or matter arising under this Agreement, the Parties hereby consent to personal jurisdiction in the State of Delaware.
8. Severability. If any provision of this Agreement is held to be illegal, invalid or unenforceable, the provision shall be modified to the extent necessary to render it enforceable and, if necessary, shall be fully severable.
9. Authority. Each signer below warrants that [she/he] has actual authority to enter into this Agreement. It is understood that each party to this Agreement is relying on the other party
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executing [her/his] Agreement having actual authority to enter into the Agreement.
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IN WITNESS WHEREOF, the Parties have made and entered into this Settlement Agreement and General and Mutual Release as of the date set forth above.
Sow Good Inc.
_____________________________
By:
Its:
[DIRECTOR NAME]
____________________________
Name:
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