Material Agreement Form 8 K

Item 1.01.

Entry into a Material Definitive Agreement.

Convertible Note Financing

On July 15, 2024, BranchOut Food Inc. (the "Company"), entered into a Securities Purchase Agreement (as amended, the "SPA") with Daniel L. Kaufman, pursuant to which Mr. Kaufman agreed to purchase from the Company, in a private placement (i) a 12% Senior Secured Convertible Promissory Note in the principal amount of up to $3,400,000 (the "Convertible Note"), convertible into shares of the Company's common stock, par value $.0001 per share ("Common Stock") at a fixed price of $0.7582 per share of Common Stock, a (ii) a warrant to purchase 1,000,000 shares of Common Stock at an exercise price of $1.00 per share (the "$1.00 Warrant"), and (iii) a warrant to purchase 500,000 shares of Common Stock at an exercise price of $1.50 per share (the "$1.50 Warrant" and, together with the $1.00 Warrant, the "Warrants" and together with the Convertible Note, the "Purchased Securities"), in consideration of an initial loan in the principal amount of $2,000,000 to be made to the Company under the Convertible Note on the "Initial Closing Date" (as defined in the SPA), subject to the terms and conditions thereof. On July 19, 2024, the Company, Mr. Kaufman and Kaufman Kapital LLC entered into an amendment to the SPA (the "SPA Amendment"), which among other things, replaced Mr. Kaufman with Kaufman Kapital LLC as the "Investor" under the SPA.

The SPA

Pursuant to the SPA, the Investor has agreed to make an additional loan to the Company under the Convertible Note in the amount of up to $1,400,000 upon the satisfaction of certain conditions, including EnWave Corporation completing the manufacture of a new dehydration machine for the Company, and the Company's manufacturing facility in Peru having exported product expected to generate revenues of at least $100,000 and receipt of the approval of its shareholders as described below. The SPA also requires the Company to (A) seek the approval of its shareholders, in accordance with Listing Rules 5635(b) and 5635(d) of The Nasdaq Stock Market, Inc., as such may be applicable, so as to permit the Investor to (i) acquire more than 19.9% of the Company's outstanding shares of Common Stock upon conversion of the Convertible Note, and (ii) exercise the Warrants, and (B) register the shares of Common Stock underlying the Convertible Note and Warrants under the Securities Act of 1933, as amended, upon demand made by the Investor following such date as the Investor holds at least 2,000,000 shares of Common Stock. The SPA also includes conditions to closing, representations and warrantees, covenants, and other terms and conditions customary in transactions of this nature.

The Convertible Note

The Convertible Note matures on the earlier of (i) December 31, 2025, (ii) the sale by the Company of $5,000,000 of equity or debt securities in a single transaction or series of related transactions (excluding certain specified transactions), or (iii) the closing of a change of control transaction as provided in the Convertible Note. Loans outstanding under the Convertible Note bear interest at an initial rate of 12% per annum, and together with accrued principal are convertible into Common Stock, provided that the holder may not convert amounts outstanding under the Convertible Note into Common Stock until the Company has obtained the approval of its shareholders for such conversion in accordance with Listing Rule 5635(b) and 5635(d) of The Nasdaq Stock Market, Inc., as applicable, to the extent that, at such time, such approval is required under such Listing Rules for such conversion.

The Company's obligations under the Convertible Note will be secured by a lien granted to the Investor on substantially all of the Company's assets pursuant to a Security Agreement to be entered between the Company and the Investor. In addition, the Convertible Note includes affirmative and negative covenants, events of defaults and other terms and conditions, customary in transactions of this nature.

The Warrants

The Warrants are exercisable until December 31, 2025, provided that the Warrants may not be exercised until the Company has obtained the approval of its shareholders to the exercise of the Warrants in accordance with Listing Rules 5635(b) and 5635(d) of The Nasdaq Stock Market, Inc.

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