TWMC Trans World Entertainment

On June 6, 2023, Kaspien Inc. (“Kaspien”), a wholly-owned subsidiary of Kaspien Holdings Inc. (the “Company”), and Channel Key, LLC (“Buyer”) entered into an Asset Purchase Agreement (the “Asset Purchase Agreement”), pursuant to which Kaspien sold substantially all of the assets of and certain of the liabilities relating to Kaspien’s agency business model through which Kaspien provides support services for account management, media planning, media analytics, search strategy, business planning, and data reporting to its partners (the “Business” and the transaction, the “Transaction”).  The Transaction closed on June 6, 2023.

The consideration for the sale consisted of the base purchase price of $200,000, paid in cash, plus the assumption of certain liabilities. Kaspien will also be entitled to an earnout payment equal to 50% of the Total Revenue that Buyer earns for each quarter in the 12-month period immediately following the closing of the Transaction, up to a maximum aggregate amount of $550,000.  “Total Revenue” will be an amount equal to the quarterly retainer received by Buyer pursuant to each of the purchased assets, plus the quarterly commission received by Buyer pursuant to each of the purchased assets.

The parties to the Asset Purchase Agreement have each made customary representations and warranties in the Asset Purchase Agreement, and have agreed to indemnify each other for breaches of such representations and warranties, subject to certain specified limitations.

The Asset Purchase Agreement and the foregoing description has been included to provide the Company’s stockholders with information regarding its terms and is not intended to provide any other factual information about the parties to the Transaction. The Asset Purchase Agreement contains representations and warranties by each of the parties to the Asset Purchase Agreement, which are made solely for the benefit of the other parties to the Asset Purchase Agreement. The representations and warranties in the Asset Purchase Agreement (i) are not intended to be treated as categorical statements of fact but rather as a way of allocating risk to one of the parties if any such representation or warranty proves to be inaccurate, (ii) may be subject to standards of materiality applicable to the parties to the Asset Purchase Agreement that differ from what might be viewed as material to shareholders of such party and (iii) were made only as of the date of the Asset Purchase Agreement or such other date or dates as may be specified in the Asset Purchase Agreement. The Company’s stockholders should not rely on the representations, warranties and covenants, or any descriptions thereof, as characterizations of the actual state of facts or condition of the parties to the Transaction.

The foregoing description of the Asset Purchase Agreement is qualified in its entirety by reference to the complete text thereof, a copy of which is included as Exhibit 2.1 to this Current Report on Form 8-K and is incorporated herein by reference.