BASA Basanite Inc (QB)

 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 23^rd 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.