AEYE AudioEye Inc

On March 9, 2022, AudioEye, Inc. (the “Company”) entered into a Stock Purchase Agreement by and between the Company, as Buyer, Mark Shapiro, Kim Testa, Garry Harstad, Ken Berquist and Betaspring Fund 100, LLC, a Delaware limited liability company (collectively “Sellers”), and Mark Shapiro, as Sellers’ Representative (the “Purchase Agreement”).

Pursuant to the Purchase Agreement, on March 9, 2022, the Company purchased all of the issued and outstanding equity securities of Bureau of Internet Accessibility Inc., a Delaware corporation (“BOIA”), from the Sellers (the “Acquisition”) for the cash purchase price of $5.0 million (the “Purchase Price”). The Purchase Price is subject to customary adjustments for cash and indebtedness of BOIA as of the closing, Acquisition expenses and BOIA’s net working capital. Based upon the performance of BOIA, Sellers may also be entitled to (i) an additional payment in the aggregate amount of $1.0 million on or around the first anniversary of the closing of the Acquisition, and (ii) certain earn-out consideration tied to BOIA’s revenue, calculated following the end of the 2022 and 2023 calendar years, with the total consideration payable to Sellers not to exceed $10.5 million, subject to the customary adjustments to the Purchase Price mentioned above.

The Purchase Agreement contains standard representations, warranties and covenants, and mutual indemnification provisions. Sellers, except for Betaspring Fund 100, LLC, are subject to a five-year non-competition covenant and non-solicitation covenant.

The foregoing description of the Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the Purchase Agreement, a copy of which is filed as Exhibit 10.1 hereto and incorporated herein by reference.

The representations, warranties and covenants in the Purchase Agreement have been made only for the purposes of, and were and are solely for the benefit of the parties to, the Purchase Agreement, may be subject to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures made for the purposes of allocating contractual risk between the parties to the Purchase Agreement instead of establishing these matters as facts, and may be subject to standards of materiality applicable to the contracting parties that differ from those applicable to investors. Accordingly, the representations and warranties may not describe the actual state of affairs at the date they were made or at any other time, and investors should not rely on them as statements of fact. In addition, such representations and warranties were made only as of the date of the Purchase Agreement or such other date as is specified in the Purchase Agreement. Accordingly, the Purchase Agreement is included with this filing only to provide investors with information regarding the terms of the Purchase Agreement, and not to provide investors with any factual information regarding the Company or BOIA or their respective businesses.