Item 1.01. Entry into a Material Definitive Agreement.
On May 26, 2022, Basanite, Inc. (the "Company") entered into a consulting
agreement (the "Agreement") with Technicon Consulting Group, Inc. (the
"Consultant") and Key Honey Contracting, LLC ("Key Honey", and, with the
Company, each individually a "Party", and collectively the "Parties"). The
effective date of the Agreement is February 21, 2022 (the "Effective Date"). The
Consultant is an affiliate of Frederick H. Tingberg, Jr. ("Mr. Tingberg"), an
employee of Consultant and current member of the Company's Board of Directors.
Pursuant to the Agreement, the Company has retained the Consultant as an
independent contractor to provide technical, marketing and sales services to the
Company (as described further below and referenced hereafter as the "Services"),
and the Parties agreed that the Consultant began to perform the Services as of
the Effective Date. The Services will be performed for Consultant by Mr.
Tingberg, who serve in the capacity of Chief Technical Officer of the Company.
Specifically, Mr. Tingberg will use his good faith best efforts to market and
drive sales of the Company's products by: (i) making introductions to federal,
state and local governments, including municipalities, as well as construction
companies and other businesses likely to purchase the Company's products; (ii)
working with the Company's personnel to close such sales; and (iii) developing
and implementing marketing and sales strategies for the Company. Mr. Tingberg
shall also provide technical expertise regarding the Company's product
development and manufacturing capabilities.
The Agreement contains a Confidentiality, Non-Solicitation and Assignment of
Inventions Agreement (in the form annexed as Appendix A to the Agreement, the
"Confidentiality Agreement") which, as a condition to the Agreement, was
executed by the Consultant and Mr. Tingberg effective as of the Effective Date.
As an independent contractor, the Parties agreed that Consultant is free to work
for other parties during the term of the Agreement and does not exclusively work
for the Company or for Key Honey.
Consultant's sole compensation for the Services shall be a monthly fee of
$25,000 (Twenty-Five Thousand Dollars) (the "Fee") which will be paid solely by
Key Honey (an unaffiliated third party for whom the Consultant provides separate
services). The Agreement has an initial term ending on the first anniversary of
the Effective Date, and such initial term shall be automatically extended for
successive twelve (12) month terms unless the Consultant or the Company provide
the other with no less than fifteen (15) days prior written notice of its
intention not to renew the term. At any time, Consultant or Key Honey (on the
one hand) or the Company (on the other hand) may terminate the Agreement at will
on fifteen (15) days' written notice. In addition, Consultant or Key Honey (on
the one hand) or the Company (on the other hand) may terminate this Agreement on
seven (7) days' written notice of material breach of the Agreement.
In consideration of Key Honey's payment of Consultant's Fee and expenses, the
Company granted Key Honey a warrant (the "Warrant") to purchase 2,000,000 shares
of the Company's common stock, par value $0.001 per share (the "Warrant Shares")
at an exercise price per share of $0.33. Key Honey's right to acquire Warrant
Shares hereunder shall vest as follows: (i) the right to acquire 333,333 Warrant
Shares vested upon execution of the Agreement; and (ii) thereafter the right to
acquire the remaining Warrant Shares vests in equal monthly installments of
166,667 Warrant Shares on the 23rd day of each of the remaining initial ten (10)
months of the Agreement, subject to continuing effectiveness of the Agreement.
The Warrant contains a customary "cashless" exercise provision as well as
customary stock-based, but not price-based, anti-dilution provisions.
The foregoing descriptions of the Agreement and the Warrant do not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
the full text of the Agreement and the Warrant attached as Exhibits 10.1 and
4.1, respectively, to this Current Report on Form 8-K, which text is
incorporated herein by reference.
Item 8.01 Other Information.
On June 1, 2022, the Company issued a press release regarding the matters
described in this Current Report, which press release is filed as Exhibit 99.1
hereto and incorporated herein by reference.
Cautionary Statement Regarding Forward-Looking Statements
This Current Report on Form 8-K contains forward-looking statements.
Forward-looking statements include, but are not limited to, statements that
express the Company's intentions, beliefs, expectations, strategies, predictions
or any other statements related to the Company's future activities, or future
events or conditions. These statements are based on current expectations,
estimates and projections about the Company's business based, in part, on
assumptions made by its management. These statements are not guarantees of
future performances and involve risks, uncertainties and assumptions that are
difficult to predict. Therefore, actual outcomes and results may differ
materially from what is expressed or forecasted in the forward-looking
statements due to numerous factors, including those risks discussed in documents
that the Company files from time to time with the SEC. Any forward-looking
statements speak only as of the date on which they are made, and the Company
undertakes no obligation to update any forward-looking statement to reflect
events or circumstances after the date of this Current Report on Form 8-K,
except as required by law.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
4.1 Form of Warrant to Key Honey Contracting, LLC
10.1 Consulting Agreement, dated May 26, 2022 between the Company,
Technicon Consulting Group, Inc. and Key Honey Contracting, LLC
99.1 Press Release of the Company dated June 1, 2022
104 Cover Page Interactive Data File (the cover page XBRL tags are embedded
within the inline XBRL document)
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BASANITE, INC. 
