Sillerman Clause Samples

Sillerman. Upon completion of the Offering, the Company will change its name to Function (X) Inc. and its shares will continue to be quoted on the OTC Bulletin Board or the Pink Sheets. The Shares to be issued in the Offering will be restricted securities under the Securities Act and cannot be resold unless pursuant to registration or an exemption from registration under the Securities Act. The Company has agreed to file with the Securities and Exchange Commission (“SEC”) a Registration Statement on Form S-1 promptly (but not later than 90 days) after closing of the Offering to register the shares for resale (and to use commercially reasonable efforts thereafter to promptly have such Registration Statement declared effective by the SEC).

Sillerman. Upon completion of the Offering, the Company will change its name to Function (X) Inc. and its shares will continue to be quoted on the OTC Bulletin Board or the Pink Sheets. The Shares to be issued in the Offering will be restricted securities under the Securities Act and cannot be resold unless pursuant to registration or an exemption from registration under the Securities Act. If the Company files a registration statement with the Securities and Exchange Commission (“SEC”) to register for resale securities of the Company held by stockholders of the Company, the Company shall include in such registration statement the resale of the Shares; provided that this registration obligation shall terminate if and when the Shares are eligible for resale pursuant to Rule 144 of the Securities Act.

Sillerman. At all times while any Debentures remain outstanding, the Company shall maintain an available cash balance in its commercial bank account or other liquid and available funds of $1,000,000 (the “Minimum Cash Reserve”). By his signature hereunder, ▇▇▇▇▇▇ F.X. Sillerman (the “Guarantor”) hereby guarantees that if and to the extent the Company is unable to maintain the Minimum Cash Reserve, the Guarantor shall provide within three (3) business days unrestricted cash to the Company in the amount of the shortfall to be held in the Minimum Cash Reserve. The maximum amount to be provided to the Company pursuant to this Section 4.18 shall initially be $6,000,000 in the aggregate (the “Maximum Amount”). Of this amount, the first $5,000,000 shall be provided to the Company through the Company’s draws on that certain Line of Credit Grid Promissory Note dated June 12, 2015, as amended July 20, 2016, between the Company and Sillerman Investment Company IV, LLC, an affiliate of the Guarantor (the “Grid Note”). Any and all amounts drawn by the Company under the Grid Note shall reduce the Maximum Amount on a dollar for dollar basis. In no event shall the Guarantor be liable for any payment of the Maximum Amount until the Grid Note has been fully drawn. Guarantor’s liability under this Section 4.18 shall be limited to a maximum of $1,000,000 in the aggregate, regardless of the remaining Maximum Amount or the Minimum Cash Reserve. To the extent there are additional shortfalls in the Minimum Cash Reserve, neither Guarantor nor Sillerman Investment Company IV, LLC shall have any obligation to provide additional amounts once an aggregate amount of $6,000,000 pursuant to this Section 4.18 has been provided. The obligations of the Guarantor hereunder are absolute and continuing at all times while any Debenture remains outstanding.