AYRO, INC. : Entry into a Material Definitive Agreement, Other Events, Financial Statements and Exhibits (form 8-K)

Item 1.01 Entry into a Material Definitive Agreement.

On September 25, 2020, AYRO, Inc. (the "Company") entered into a Master Manufacturing Services Agreement (the "Agreement") with Karma Automotive LLC ("Karma"), pursuant to which Karma will provide certain manufacturing services to the production of the Company's vehicles. For such manufacturing services, the Company agreed to pay $1,160,800 to Karma, of which (i) $520,000 was paid at closing and (ii) $640,000 will be due and payable on beginning of the fifth month following the satisfaction of certain production requirements as set forth in the Agreement.

Under the terms of the Agreement, the Agreement will expire (i) 12 months from the start of volume production of the vehicles or (ii) until such time as the parties will mutually agree in writing. In addition, Karma, in its sole discretion, may terminate the Agreement at any time, without cause, by providing at least twelve months prior written notice to the Company. The Company, in its sole discretion, may terminate the Agreement, without cause, by providing at least six months prior written notice to Karma. Either Karma or the Company may terminate the Agreement if the other party is in breach of any material provision of the Agreement and such breach is not cured in 30 days of written notice thereof, the other party may terminate the Agreement immediately upon notice.

The Agreement contains, among other provisions, representations, warranties, and covenants customary for agreements of this type. The Agreement also provides certain indemnification rights in favor of both parties, subject to limitations of liability therein.

Item 8.01 Other Events.

On September 29, 2020, the Company issued a press release announcing the entry into the Agreement. A copy of this press release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits



Exhibit No.   Description

99.1            Press Release, dated September 29, 2020

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