KASPIEN HOLDINGS INC. such as entering into a material definitive agreement, creation of a direct financial obligation or obligation under an off-balance sheet arrangement of a registrant, unregistered sale of equity securities, amendments to articles of association or regulations; Change of fiscal year, financial statements and supporting documents (Form 8-K)

Section 1.01 Entering into a Material Definitive Agreement.

Amendment No. 4 to the loan and guarantee agreement

At March 2, 2022, Kaspien Management Inc. (f/k/a Trans World Entertainment Corporation) (the “Company”) and KASPIEN INC (f/k/a Etailz Inc.) (“Kaspien” and, together with the Company, the “Loan Parties”), a wholly owned subsidiary of the Company, have entered into this Amendment No. 4 to the Loan and Guarantee Agreement (“Amendment No. 4 “) with Eclipse Business Capital LLC (f/k/a Encina Business Credit, LLC) (“Eclipse”), as administrative agent, and the lenders parties thereto, pursuant to which the parties have amended the Loan and Security Agreement, dated February 20, 2020 and modified from March 30, 2020, April 13, 2021 and from September 16, 2021between the company, KaspianEclipse and the lenders parties thereto.

Pursuant to Amendment No. 4, among others, the Loan and Guarantee Agreement has been amended to permit the subscription of the Additional Subordinated Loan (as defined below) under the Subordinated Loan Agreement (as defined below). below).

The Lending Parties have paid certain customary fees and expenses in connection with Amendment No. 4.

The foregoing description of the Amendment is qualified in its entirety by reference to the complete text thereof, a copy of which is filed as Schedule 10.1 to this Current Report on Form 8-K, and is incorporated herein by reference.

Amendment No. 2 to the Subordinated Loan and Security Agreement

At March 2, 2022the Loan Parties have entered into this Amendment No. 2 to the Subordinated Loan and Guarantee Agreement (“Amendment No. 2”) with the lenders who are parties thereto from time to time (the “Lenders”) and Loan Guarantee Agent TWEC, LLC (“Collateral Agent”), as collateral agent for the Lenders, pursuant to which the parties have amended the Subordinated Loan and Security Agreement, dated March 30, 2020 and modified from September 16, 2021 between the company,
Kaspianthe Security Agent and the Lenders (as amended by Amendment No. 2, the “Subordinated Loan Agreement”).

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In accordance with Amendment No 2, inter alia, Alimco Re Ltd. (the “Tranche B Lender”) made an additional loan $5,000,000.00 secured term loan (the “Additional Subordinated Loan”) with an expected maturity date of March 31, 2024which corresponds to the same maturity as the existing borrowings under the Subordinated Loan Agreement.

Interest on the Additional Subordinated Loan accrues, subject to certain terms and conditions under the Subordinated Loan Agreement, at the rate of fifteen percent (15.0%) per annum, compounded on the last day of each calendar quarter in becoming part of the principal amount of the Additional Subordinated Loan.

The proceeds of the Additional Subordinated Loan will be used by Kaspian for working capital purposes and to pay certain transaction fees.

The additional subordinated loan is also secured by a second lien on substantially all of the assets of the loan parties, including inventory, accounts receivable, cash and cash equivalents and certain other security interests of borrowers and guarantors. under the subordinated loan agreement. The Company will provide a limited warranty of from Kaspian obligations under the Additional Subordinated Loan.

Among other things, the subordinated loan agreement limits the ability of the parties to the loan to incur additional debt, create liens, make investments, make restricted payments or specified payments, and merge or acquire assets.

The Subordinated Loan Agreement contains customary events of default, including but not limited to defaults in payment, breach of representations and warranties, defaults of covenants, cross defaults on other obligations , customary ERISA defaults, certain bankruptcy and insolvency events, lapses in judgment, invalid collateral liens, change of control, cessation of business or liquidation of material assets of borrowers and guarantors taken as a whole and the occurrence of an uninsured loss on a material portion of the coverage.

The Lending Parties have paid certain customary fees and expenses in connection with the Additional Subordinated Loan and Amendment No. 2.

The foregoing description of Amendment No. 2 and the Subordinated Loan Agreement does not purport to be complete and is qualified in its entirety by reference to Amendment No. 2, a copy of which is attached as Schedule 10.2 to this Current Report on Form 8-K and incorporated herein by reference.

Common stock purchase warrants

At March 2, 2022the Company has entered into common equity warrants (the “Warrants”) with the Tranche B lender pursuant to the subordinated loan agreement pursuant to which the Company issued to the Tranche B lender, in aggregate, warrants to purchase up to 320,000 ordinary shares of shares of the Company (subject to adjustment pursuant to the terms of the Warrants, the “Warrant Shares”) at an exercise price of $0.01 per share. Warrants are exercisable during the period beginning on March 2, 2022 and ending at the first of (a) 5:00 p.m. Eastern Standard Time on the fifth (5) anniversary thereof, or if such day is not a business day of the next following business day, or (b) the occurrence of certain consolidations, mergers or similar extraordinary events involving the Company.

The Warrants provide for certain adjustments that may be made to the number of Warrant Shares issuable upon exercise due to customary anti-dilution provisions based on future events on the Company. In addition, in connection with certain consolidations, mergers or similar extraordinary events involving the Company, immediately prior to such event, each warrant will be automatically converted into the right to receive the number of common shares of . . .

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under a

Off-balance sheet arrangement of a registrant.

The information appearing in point 1.01 (under the headings “Addendum No. 4 to the loan and guarantee agreement”, “Addendum No. 2 to the subordinated loan and guarantee agreement” and “Agreement relating to the rights of conditional”) of this current report on Form 8-K is incorporated herein by reference.

Item 3.02 Unrecorded Sales of Equity securities.

The information set forth in Section 1.01 (under the heading “Common Stock Purchase Warrant”) of this Current Report on Form 8-K is incorporated herein by reference.

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Tax change

Year.

Item 5.03(a)(i). Amendment of the certificate of incorporation.

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At March 8, 2022the Company has filed with the New York State Department of State a certificate of amendment to its certificate of incorporation, amending that certificate to exclude the warrants issued by the company to the Tranche B lender from certain transfer restrictions intended to prevent a change in ownership that could significantly reduce the tax benefits associated with the net operating losses of the company under Section 382 of the Internal Revenue Code of 1986, as amended, after the Board has approved such amendments and the shareholders of the Company have approved by the written consent of the majority of the shareholders of the Company.

The Certificate of Amendment is filed as Exhibit 3.1 hereto and is incorporated herein by reference.

Item 5.03(a)(ii). Amendment to the articles of association.

Effective March 8, 2022the Company’s articles of association have been amended to exclude the BSAs issued by the Company to the Tranche B Lender from certain transfer restrictions intended to prevent a change in ownership which could substantially reduce the tax benefits associated with net operating losses of the Company under section 382 of the Internal Revenue Code 1986, as amended, after the Board has approved such amendments.

The By-Law Amendments are filed as Exhibit 3.2 hereto and are incorporated herein by reference.

Item 9.01 Financial statements and supporting documents.

(d)  Exhibits.

Exhibit
No.       Description

  3.1     Certificate of Amendment of Certificate of Incorporation of Kaspien
          Holdings Inc., dated March 8, 2022
  3.2     Amendment No. 3 to Bylaws of Kaspien Holdings Inc., dated March 8,
          2022
  4.1     Common Stock Purchase Warrant
  10.1    Amendment No. 4 to Loan and Security Agreement
  10.2    Amendment No. 2 to Subordinated Loan and Security Agreement
  10.3    Registration Rights Agreement
  10.4    Contingent Values Rights Agreement

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