Item
1.01 Entry into a Material Definitive Agreement.
On
September 1, 2021, Worksport Ltd. (the “Company” or “us” or “we”) entered into an Agreement (the
“Agreement”) with AI Media Data LLC (“MD”).
Pursuant
to the Agreement, MD will build out a social media presence to develop a network of multiple media accounts across different online platforms
(the “Network”).
The
object of the Agreement is for MD to produce a minimum of three (3) million followers of the Company created by or through the Network
(the “Goal”).
The
Network will consist of but will not be limited to automotive-related social media Accounts, for the Company to directly and indirectly
increase exposure of its products, drive brand awareness, increase online sales, and decrease future social media marketing costs.
MD
will spend $1,500,000 of its own capital to expand the Network. MD may dedicate additional financial resources determined by MD to be
beneficial or necessary to accomplish the Goal.
MD
shall dedicate daily and weekly staff members to maintain and continue to grow the Network on a daily basis. MD’s team members
dedicated to this purpose may include such professionals as a daily social marketing consult, weekly social media trend researchers to
increase hashtag visibility, daily media planners and posters, and weekly ad managers.
As
compensation, the Company will issue MD 700,000 shares of its Common Stock (the “Shares”) and an option (the “Option”)
to purchase 400,00 shares of its Common Stock at an exercise price of $5.32 per share, the closing price of the Company’s
Common Stock on September 1, 2021.
The
Shares and Option were approved by the Company’s Compensation
Committee on August 31, 2021.
The
Shares vested upon execution of the Agreement. The Option will vest in 100,000 increments, every six months beginning on September 1,
2021. The Option will expire on September 1, 2026.
If
MD is able to deliver six (6) million followers under the Network, MD will be issued an additional 250,000 shares of restricted Common
Stock.
This
Agreement has a term of 24 months, or, until MD reaches the Goal of 3 million followers, whichever is sooner. In the event that MD reaches
3 million followers, MD will have been considered to have fully performed under the Agreement and be entitled to its full compensation.
The
foregoing summary of the Agreement is qualified in its entirety by reference to the full text of the Agreement, a copy of which is attached
as Exhibit 1.1 to this Current Report on Form 8-K and is incorporated herein by reference.