UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, ~~2021~~2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ~~________~~ _______ to ~~________~~_______

Commission file number: 001-38448

VINCO VENTURES, INC.

(Exact Name of Registrant as Specified in Its Charter)

Nevada		82-2199200
(State or Other Jurisdiction		(I.R.S. Employer
of Incorporation or Organization)		Identification No.)

~~1 West Broad Street~~, ~~Suite 1004~~24 Aspen Park Blvd
~~Bethlehem~~East Syracuse, ~~Pennsylvania~~NY13057		~~18018~~14450
(Address of Principal Executive Offices)		(Zip Code)

(866) 900-0992

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or Section 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

☐Yes ☒~~Yes~~No ~~☐ No~~

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

☒Yes ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer ☐	Accelerated filer ☐
Non-accelerated filer ☒	Smaller Reporting Company ☒
	Emerging Growth Company ☒☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☒☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes ☒ No

Securities registered pursuant to Section 12(b) of the Act:

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock, $0.001 par value per share		BBIG		The Nasdaq Stock Market LLC

As of ~~August 17, 2021,~~February 21, 2023, there were ~~65,564,435~~ 248,987,660shares of the registrant’s common stock outstanding.

~~EDISON NATION,~~VINCO VENTURES, INC.

TABLE OF CONTENTS

		Page Number

PART I	4
Item 1.	Financial Statements (Unaudited)	4
	Condensed Consolidated Balance Sheets as of June 30, ~~2021~~2022 (Unaudited) and December 31, ~~2020~~2021	5
	Condensed Consolidated Statements of Operations for the three and six months ended June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	6
	Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and the six months ended June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	7
	Condensed Consolidated Statements of Cash Flows for the six months ended June 30, ~~2021~~2022 and ~~2020~~2021 (Unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3432
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	5550
Item 4.	Controls and Procedures	5650

PART II		58
Item 1.	Legal Proceedings	5853
Item 1A.	Risk Factors	5853
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	5856
Item 3.	Defaults Upon Senior Securities	6056
Item 4.	Mine Safety Disclosures	6056
Item 5.	Other Information	6056
Item 6.	Exhibits	6056

	Signatures	6357

~~USE OF MARKET AND INDUSTRY DATA~~

This Quarterly Report on Form 10-Q includes market and industry data that we have obtained from third-party sources, including industry publications, as well as industry data prepared by our management on the basis of its knowledge of and experience in the industries in which we operate (including our management’s estimates and assumptions relating to such industries based on that knowledge). Management has developed its knowledge of such industries through its experience and participation in these industries. While our management believes the third-party sources referred to in this Quarterly Report on Form 10-Q are reliable, neither we nor our management have independently verified any of the data from such sources referred to in this Quarterly Report on Form 10-Q or ascertained the underlying economic assumptions relied upon by such sources. Furthermore, internally prepared and third-party market prospective information, in particular, are estimates only and there will usually be differences between the prospective and actual results, because events and circumstances frequently do not occur as expected, and those differences may be material. Also, references in this Quarterly Report on Form 10-Q to any publications, reports, surveys or articles prepared by third parties should not be construed as depicting the complete findings of the entire publication, report, survey or article. The information in any such publication, report, survey or article is not incorporated by reference in this Quarterly Report on Form 10-Q.

Solely for convenience, we refer to trademarks in this Quarterly Report on Form 10-Q without the ® or the ™ or symbols, but such references are not intended to indicate that we will not assert, to the fullest extent under applicable law, our rights to our own trademarks. Other service marks, trademarks and trade names referred to in this Quarterly Report on Form 10-Q, if any, are the property of their respective owners, although for presentational convenience we may not use the ® or the ™ symbols to identify such trademarks.

~~OTHER PERTINENT INFORMATION~~

Unless the context otherwise indicates, when used in this Quarterly Report on Form 10-Q, the terms “Vinco Ventures” “we,” “us,” “our,” the “Company” and similar terms refer to Vinco Ventures, Inc., a Nevada corporation formerly known as Edison Nation, Inc., Xspand Products Lab, Inc. and Idea Lab Products, Inc., and all of our subsidiaries and affiliates.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Quarterly Report on Form 10-Q for the period ended June 30, ~~2021~~2022 (the “Quarterly Report”) contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements relate to future events ~~(including,~~including, without limitation, ~~the terms, timing~~our ability to raise capital, our operational and ~~closing of our proposed acquisitions~~strategic initiatives or our future financial ~~performance).~~performance. We have attempted to identify forward-looking statements by using terminology such as “anticipates,” “believes,” “expects,” “can,” “continue,” “could,” “estimates,” “expects,” “intends,” “may,” “plans,” “potential,” “predict,” ~~“should”~~“should,” or “will” or the negative of these terms or other comparable terminology. These statements are only predictions; uncertainties and other factors may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels or activity, performance or achievements expressed or implied by these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Our expectations are as of the date this Quarterly Report is filed, and we do not intend to update any of the forward-looking statements after the date this Quarterly Report is filed to confirm these statements to actual results, unless required by law.

You should not place undue reliance on forward looking statements. The cautionary statements set forth in this Quarterly Report identify important factors which you should consider in evaluating our forward-looking statements. These factors include, among other things:

	●	Our ability to effectively execute our business ~~plan;~~
		plans including transitioning from being focused on end-to-end consumer product innovation, development, and commercialization to being focused on digital media, advertising and content technologies innovation, development, and commercialization;
	●	Our ability to manage our expansion, growth and operating expenses;
	●	Our ability to protect our brands, reputation and intellectual property rights;
	●	Our ability to ~~protect~~obtain adequate financing to support our ~~brands and reputation;~~
		development plans;
	●	Our ability to repay our debts;

	●	Our ability to rely on third-party suppliers, ~~outside of the United States;~~
		content contributors, developers, and other business partners;
	●	Our ability to evaluate and measure our business, prospects and performance metrics;

	●	Our ability to compete and succeed in a highly competitive and evolving industry;

	●	Our ability to respond and adapt to changes in technology and ~~customer~~consumer behavior;
	●	Our dependence on information technology, and being subject to potential cyberattacks, security problems, network disruptions, and other incidents;
	●	Our ability to comply with complex and evolving laws and regulations including those relating to privacy, data use and data protection, content, competition, safety and consumer protection, e-commerce, digital assets and other matters, many of which are subject to change and uncertain interpretation;
	●	Our ability to enhance disclosure and financial reporting controls and procedures and remedy the existing weakness;
	●	Risks in connection with completed or potential acquisitions, dispositions and other strategic growth opportunities and initiatives;

	●	~~Risks related to the anticipated timing of the closing of any potential acquisitions;~~

	●	Risks related to the integration of completed acquisitions and the achievement of our expected benefits from our acquisitions and investments, including, but not limited to, our investment in Lomotif Private Limited (“Lomotif”) through ZVV Media Partners, LLC (“ZVV”), our investment in Magnifi U Inc. (“Magnifi U”), our joint venture with ~~regards to potential or completed acquisitions;~~
		ZASH Global Media and Entertainment Corporation (“ZASH”), and our acquisitions of AdRizer, LLC (“AdRizer”) and Honey Badger Media, LLC (“Honey Badger”);
	●	Various risks related to health epidemics, pandemics and similar outbreaks, such as the coronavirus disease 2019 (“COVID-19”) pandemic, which may have material adverse effects on our business, financial position, results of operations and/or cash ~~flows.~~flows;
	●	Other risk factors discussed in our Annual Report on Form 10-K for the year ended December 31, 2021.

~~This Quarterly Report on Form 10-Q also contains estimates~~Specifically, our investment in Lomotif and ~~other statistical data made by independent parties and by us~~related growth initiatives may fail to deliver our expected benefits, for reasons relating to market size and growth and other industry data. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. We have not independently verified the statistical and other industry data generated by independent parties and contained in this Quarterly Report and, accordingly, we cannot guarantee their accuracy or completeness, though we do generally believe the data to be reliable. In addition, projections, assumptions and estimates of our future performance and the future performance of the industries in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons, including, but not limited to, our and Lomotif’s capital requirements and whether we will be able to raise capital as needed; our ability to successfully develop the ~~possibility~~business and revenue models for Lomotif’s social media platform; whether Lomotif can retain its existing users and attract new users to its platform; whether our cross-platform user engagement strategy will enhance our ability to monetize the Lomotif platform; whether Lomotif can attract and maintain relationships with influencers, artists, and other content creators or publishers who will provide compelling content to the platform; our ability to integrate the operations of Lomotif within the Vinco Ventures conglomerate and create synergies between Lomotif and other businesses and assets we have acquired or plan to acquire, including AdRizer; the ability of Lomotif’s platform and associated promotional activities to compete effectively for user engagement; Lomotif’s ability to retain reliable developers, vendors and suppliers to support its operations; failure of third parties to promote Lomotif’s platform and associated products and services effectively or at all; breaches of network and data security measures; a disruption or failure of networks and information systems; Lomotif’s ability to protect its patents and other intellectual property and operate its businesses without infringing upon the intellectual property rights of others; changes in local, state, federal and international laws and regulations that we may ~~fail~~adversely affect Lomotif’s business or prospects; risk of attempts at unauthorized or improper use of the platform and resulting damages to ~~preserve our expertise in consumer product development; that existing and potential distribution partners may opt to work with, or favor~~Lomotif’s reputation; the ~~products of, competitors if our competitors offer more favorable products or pricing terms; that we may be unable~~inability to maintain or ~~grow sources~~increase the value of ~~revenue; that we may be unable maintain profitability; that we may be unable~~the Lomotif brands; the inability to ~~attract~~successfully respond to rapid changes in technologies and user tastes and preferences and remain competitive; the impact of any legal proceedings or governmental action against Lomotif; and whether Lomotif will continue to receive the services of key management and retain ~~key personnel;~~qualified personnel.

In addition, AdRizer’s advertising business and our efforts to integrate AdRizer with our other businesses or ~~that we~~investments such as Lomotif and Honey Badger are subject to risks including, but not limited to, AdRizer is faced with intensive competition in the digital advertising industry; high customer concentration, long sales cycles and payment-related risks may ~~not be able~~subject AdRizer to ~~effectively manage,~~significant fluctuations or declines in revenues; the reliability of operational and performance issues with AdRizer’s platform, whether real or perceived, including a failure to respond to technological changes or to ~~increase, our relationships~~upgrade its technology systems, may adversely affect AdRizer’s business and operational results; AdRizer’s technology solutions are dependent on third parties including data hosting service, data providers and various technology, software, products and services from third parties or available as open source; AdRizer’s business practices are subject to governmental regulation, legal requirements or industry standards relating to consumer privacy, data protection and consumer protection, and unfavorable changes or failure by AdRizer to comply with ~~customers; that we~~these laws and regulations could substantially harm its business; and to the extent the use of “third-party cookies” or other technology to uniquely identify devices is rejected by Internet users, restricted by government regulations, blocked or limited by technical changes on end users’ devices and web browsers, AdRizer’s performance may ~~have unexpected increases in costs~~decline and ~~expenses.~~ AdRizer may lose advertisers.

These and other factors discussed above could cause results to differ materially from those expressed in the estimates made by ~~the~~any independent parties and by us.

USE OF MARKET AND INDUSTRY DATA

~~PART I~~This Quarterly Report includes market and industry data that we have obtained from third-party sources, including industry publications, as well as industry data prepared by our management on the basis of its knowledge of and experience in the industries in which we operate (including our management’s estimates and assumptions relating to such industries based on that knowledge). Management has developed its knowledge of such industries through its experience and participation in these industries. While our management believes the third-party sources referred to in this Quarterly Report are reliable, neither we nor our management have independently verified any of the data from such sources referred to in this Quarterly Report or ascertained the underlying economic assumptions relied upon by such sources. Furthermore, internally prepared and third- party market prospective information, in particular, are estimates only and there will usually be differences between the prospective and actual results, because events and circumstances frequently do not occur as expected, and those differences may be material. Also, references in this Quarterly Report to any publications, reports, surveys or articles prepared by third parties should not be construed as depicting the complete findings of the entire publication, report, survey or article. The information in any such publication, report, survey or article is not incorporated by reference in this Quarterly Report.

TRADEMARKS, SERVICE MARKS AND TRADE NAMES

~~INDEX TO FINANCIAL STATEMENTS~~

Solely for convenience, we refer to trademarks in this Quarterly Report without the ® or the ™ or symbols, but such references are not intended to indicate that we will not assert, to the fullest extent under applicable law, our rights to our own trademarks. Other service marks, trademarks and trade names referred to in this Quarterly Report, if any, are the property of their respective owners, although for presentational convenience we may not use the ® or the ™ symbols to identify such trademarks.

	OTHER PERTINENT INFORMATION Unless the context otherwise indicates, when used in this Quarterly Report, the terms “Vinco Ventures”, “Vinco”, “we,” “us,” “our,” the “Company” and similar terms refer to Vinco Ventures, Inc., a Nevada corporation formerly known as Edison Nation, Inc., Xspand Products Lab, Inc. and Idea Lab Products, Inc., and all of our consolidated subsidiaries and variable interest entities. The Company was formerly known as Edison Nation Inc., Xspand Products Lab, Inc. and Idea Lab Products, Inc. prior to its name change to “Vinco Ventures, Inc.” on November 10, 2020. ~~Page~~ ~~Number~~

~~Condensed Consolidated Balance Sheets as of June 30, 2021 (Unaudited) and December 31, 2020~~	5
~~Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2021 and 2020 (Unaudited)~~	6
~~Condensed Consolidated Statements of Changes in Stockholders’ Equity for the three and six months ended June 30, 2021 and 2020 (Unaudited)~~	7
~~Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020 (Unaudited)~~	8
~~Notes to Condensed Consolidated Financial Statements~~	9

PART ONE – FINANCIAL INFORMATION

Vinco Ventures, Inc. and Subsidiaries

CONDENSED CONSOLIDATED BALANCE SHEETS

June 30,
2021

December 31,
2020

(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 74,756,573 $ 249,356
Accounts receivable, net 2,907,002 1,382,163
Short-term investments 895,600 1,018,000
Inventory 852,147 1,127,725
Prepaid expenses and other current assets 1,209,435 522,259
Current assets of discontinued operations - 1,042,680
Total current assets 80,620,757 5,342,183
Property and equipment, net 1,033,810 1,010,801
Right of use assets, net 104,707 153,034
Loan receivable 5,000,000 -
Equity method investment 12,000,000 -
Intangible assets, net 16,533,373 9,798,813
Goodwill 5,983,852 5,983,852
Non-current assets of discontinued operations - 5,739,524
Total assets $ 121,276,499 $ 28,028,207

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable $ 1,791,982 $ 3,618,339
Accrued expenses and other current liabilities 1,284,168 2,101,610
Deferred revenues 131,578 152,040
Current portion of operating leases liabilities 99,293 96,777
Income tax payable 27,643 27,643
Line of credit, net of debt issuance costs of $0 and $15,573, respectively 1,133,652 1,500,953
Current portion of convertible notes payable, net of debt issuance costs of $6,666,667 and $0, respectively 3,333,333 577,260
Current portion of notes payable, net of debt issuance costs of $0 and $212,848, respectively 15,185 1,301,212
Current portion of notes payable – related parties 876,500 1,389,923
Due to related party 15,401 32,452
Current liabilities of discontinued operations 120,729 487,454
Total current liabilities 8,829,464 11,285,663
Operating leases liabilities –net of current portion 8,483 58,713
Convertible notes payable – related parties, net of current portion, net of debt discount of $172,984 and $366,666, respectively 267,183 1,161,495
Notes payable, net of current portion 19,966 595,879
Notes payable – related parties, net of current portion - 1,403,756
Warrant liability 139,695,115 -
Total liabilities $ 148,820,211 $ 14,505,506
Commitments and Contingencies (Note 12) - -

Stockholders’ equity
Preferred stock, $0.001 par value, 30,000,000 shares authorized as of June 30, 2021 and December 31, 2020, respectively $ - $ -
Series B Preferred Stock, $0.001 par value, 1,000,000 shares authorized; 0 and 764,618 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively - 765
Preferred stock., value - -
Common stock, $0.001 par value, 250,000,000 shares authorized 59,927,241 and 14,471,403 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively 59,927 14,471
Additional paid-in-capital 244,026,879 39,050,260
Accumulated deficit (269,787,198 ) (23,648,898 )
Total stockholders’ (deficit) equity attributable to Vinco Ventures, Inc. (25,700,392 ) 15,416,598
Noncontrolling interests (1,843,320 ) (1,893,897 )
Total stockholders’ equity (27,543,712 ) 13,522,701
Total liabilities and stockholders’ equity $ 121,276,499 $ 28,028,207

	June 30, 2022			December 31, 2021
	(Unaudited)
Assets*
Current assets:
Cash and cash equivalents	$	99,216,863		$	86,700,982
Restricted cash - short term		-			100,000,000
Short-term investments		145,000			178,000
Accounts receivable, net		6,270,929			257,394
Inventory, net		-			365,002
Prepaid expenses and other current assets		3,612,761			7,043,685
Loans held-for-investment—related parties - current portion		15,740,000			3,950,000
Current assets of discontinued operations		-			5,248,600
Total current assets		124,985,553			203,743,664

Restricted cash long-term		80,000,000			-
Property and equipment, net		760,992			368,981
Right of use assets, net		629,521			168,914
Loan held-for-investment		750,000			250,000
Loan held-for-investment - related parties		8,451,250			16,500,000
Intangible assets, net		74,940,932			40,525,453
Goodwill		138,166,483			121,580,144
Investment in Mind Tank, LLC		3,093,926			-
Investments		1,000,000			1,000,000
Film and television productions		424,096			-
Other assets		3,140,836			-
Due from related party		15,416,136			15,997,803
Due from Cryptyde (related party)		6,750,130			-
Non-current assets of discontinued operations		-			5,007,770
Total assets	$	458,509,854		$	405,142,729

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	10,314,122		$	6,105,963
Accrued expenses and other current liabilities		4,476,083			12,230,879
Current portion of operating lease liabilities		203,022			100,733
Current portion of convertible notes payable, net of debt issuance costs of $4,066,590 and $68,911,823, respectively		29,046,245			44,238,177
Current portion of warrant liability to be settled by cash		33,886,612			-
Current portion of notes payable		-			15,530
Current portion of notes payable - related parties		112,835			112,835
Current liabilities of discontinued operations		-			7,285,429
Total current liabilities		78,038,919			70,089,546

Operating lease liabilities, net of current portion		437,369			70,514
Convertible notes payable - related parties, net of current portion		2,500,000			2,500,000
Notes payable -related parties, net of current portion		108,923			93,393
Convertible notes payable, net of current portion, net of debt issuance costs of $30,224,392 and $0, respectively.		49,652,774			-
Derivative liability		94,300,999			198,519,395
Deferred tax liability		61,645			108,420
Deferred acquisition purchase price		11,080,000			-
Non-current liabilities of discontinued operations		-			74,419
Total liabilities		236,180,629			271,455,687

Commitments and contingencies (Note 14)		-

Stockholders’ equity
Common stock, $0.001 par value, 250,000,000 shares authorized; 233,140,993 and 150,118,024 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively		233,141			150,118
Additional paid-in capital		1,181,292,871			850,096,635
Accumulated deficit		(963,776,852	)		(736,821,840	)
Total stockholders’ equity attributable to Vinco Ventures, Inc.		217,749,161			113,424,913
Noncontrolling interest		4,580,065			20,262,129
Total stockholders’ equity		222,329,225			133,687,042
Total liabilities and stockholders’ equity	$	458,509,854		$	405,142,729

*	The assets of the variable interest entities (the “VIEs”) can be used to settle obligations of the consolidated entities. Conversely, liabilities recognized as a result of consolidating these VIEs do not represent additional claims on the Company’s general assets (Note 4).

The accompanying notes are an integral part of these condensed consolidated financial statements.

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)


	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2022			2021			2022			2021
Revenues
Total revenue, net	$	10,365,300		$	685,117		$	18,142,566		$	1,492,627

Cost of revenues
Total costs of revenue		10,946,367			316,900			18,723,030			687,123
Gross profit (deficit)		(581,066	)		368,217			(580,464	)		805,504

Operating expenses:
Selling, general and administrative		30,739,339			5,410,233			55,588,027			16,692,058
Impairment expense		453,449			-			453,449			-
Total operating expenses		31,192,788			5,410,233			56,041,476			16,692,058
Operating loss		(31,773,855	)		(5,042,016	)		(56,621,939	)		(15,886,554	)

Other income (expense):
Interest income (expense)		(16,107,800	)		(2,650,306	)		(38,634,780	)		(15,377,596	)
Loss on issuance of warrants		-			(133,699,181	)		(243,681,478	)		(208,855,715	)
Loss on inventory write down		(365,001	)		-			(365,001	)		-
Loss on investments		(1,641,521	)		-			(1,641,521	)		-
Change in fair value of warrant liability		173,059,037			(37,154,989	)		86,110,179			(773,447	)
Change in fair value of contingent purchase price related to Adrizer, LLC acquisition		12,170,000			-			12,170,000			-
Other income (loss)		66,010			(353,645	)		215,604			(423,645	)
Total other income (expense)		167,180,725			(173,858,121	)		(185,826,997	)		(225,430,403	)
Income (loss) before income taxes		135,406,870			(178,900,137	)		(242,448,937	)		(241,316,957	)
Income tax expense		-			-			-			-
Net income (loss)		135,406,870			(178,900,137	)		(242,448,937	)		(241,316,957	)
Net (loss) income attributable to noncontrolling interests		(12,532,866	)		22,543			(18,690,055	)		50,577
Net income (loss) attributable to Vinco Ventures, Inc. from continuing operations		147,939,736			(178,922,680	)		(223,758,881	)		(241,367,534	)
Net loss from discontinued operations		(2,011,571	)		(4,746,066	)		(3,260,912	)		(4,770,766	)

Net income (loss) attributable to Vinco Ventures, Inc.	$	145,928,165		$	(183,668,746	)	$	(227,019,793	)	$	(246,138,300	)
Net income (loss) per share- Basic
Net income (loss) per share- Continuing operations	$	0.62		$	(9.39	)	$	(1.22	)	$	(8.78	)
Net income (loss) per share- Noncontrolling interests		(0.06	)		0.00			(0.09	)		0.00
Net loss per share – Vinco Ventures, Inc.		0.68			(9.39	)		(1.13	)		(8.78	)
Net loss per share- Discontinued operations		(0.01	)		(0.25	)		(0.02	)		(0.17	)
Net loss per share	$	0.67		$	(9.64	)	$	(1.14	)	$	(8.95	)
Net income (loss) per share – Diluted
Net income (loss) per share - Continuing operations	$	0.56		$	(9.39	)	$	(1.22	)	$	(8.78	)
Net income (loss) per share - Noncontrolling interests		(0.06	)		0.00			(0.09	)		0.00
Net loss per share – Vinco Ventures, Inc.		0.61			(9.39	)		(1.13	)		(8.78	)
Net loss per share - Discontinued operations		(0.01	)		(0.25	)		(0.02	)		(0.17	)
Net loss per share	$	0.60		$	(9.64	)	$	(1.14	)	$	(8.95	)

Weighted Average Number of Common Shares Outstanding – Basic		217,127,978			19,055,006			198,777,747			27,489,580
Weighted Average Number of Common Shares Outstanding – Diluted		245,799,190			19,055,006			198,777,747			27,489,580

The accompanying notes are an integral part of these condensed consolidated financial statements.

Vinco Ventures, Inc. and Subsidiaries

CONDENSED CONSOLIDATED ~~STATEMENTS~~STATEMENT OF ~~OPERATIONS~~CHANGES IN STOCKHOLDERS’ EQUITY

(Unaudited)

For the six months ended June 30, 2022 and 2021:

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2021
(Unaudited)
2020
(Unaudited)

2021
(Unaudited)

2020
(Unaudited)

Revenues, net $ 2,691,811 $ 5,173,982 $ 5,256,973 $ 7,127,328
Cost of revenues 1,721,189 4,004,936 3,374,570 5,368,655
Gross profit 970,622 1,169,046 1,882,403 1,758,673

Operating expenses:
Selling, general and administrative 5,941,652 2,377,853 17,602,532 5,567,516
Operating loss (4,971,030 ) (1,208,807 ) (15,720,129 ) (3,808,843 )

Other (expense) income:
Rental income 28,703 25,703 54,407 51,407
Interest expense (2,715,481 ) (847,154 ) (15,410,414 ) (1,571,111 )
Loss on issuance of warrants (133,699,181 ) - (208,855,715 ) -
Change in fair value of warrant liability (37,154,989 ) - (773,447 ) -
Change in fair value of short-term investment (52,000 ) - (122,000 ) -
Loss on disposal of interest in joint venture (301,645 ) - (301,645 ) -
Gain on divestiture - - - -
Total other (expense) income (173,894,593 ) (821,451 ) (225,408,814 ) (1,519,704 )
Loss before income taxes (178,865,623 ) (2,030,258 ) (241,128,943 ) (5,328,547 )
Income tax expense - - - -
Net loss from continuing operations $ (178,865,623 ) $ (2,030,258 ) $ (241,128,943 ) $ (5,328,547 )
Net income (loss) attributable to noncontrolling interests 22,543 22,241 50,577 22,241
Net loss from continuing operations attributable to Vinco Ventures, Inc. (178,888,166 ) (2,052,499 ) (241,179,520 ) (5,350,788 )
Net loss from discontinued operations (4,780,580 ) 428,119 (4,958,780 ) 4,995,900
Provision for income taxes for discontinued operations - - - -
Net loss attributable to Vinco Ventures, Inc. $ (183,668,746 ) $ (1,624,380 ) $ (246,138,300 ) $ (354,888 )
Net loss per share:
Net (loss) income per share - basic $ (5.13 ) $ (0.18 ) $ (8.95 ) $ (0.04 )
Net (loss) income per share - diluted $ (5.13 ) $ (0.18 ) $ (8.95 ) $ (0.04 )
Weighted average number of common shares outstanding – basic and diluted 35,831,466 8,920,554 27,489,580 8,551,012

Retained
Preferred Stock Common Stock
Additional
Paid in

Earnings
Accumulated

Non-
controlling

Total
Stockholders’

Shares Amount Share Amount Capital (Deficit) Interest Equity

Balance, January 1, 2021 764,618 $ 765 14,471,403 $ 14,471 $ 39,050,260 $ (23,648,898 ) $ (1,893,897 ) $ 13,522,701
Sale of common stock – investors - - 1,500,000 1,500 3,253,500 - - 3,255,000
Issuance of common stock - note holders - - 303,483 304 422,368 - - 422,672
Issuance of common stock - consultants - - 1,394,272 1,394 2,034,941 - - 2,036,335
Issuance of common stock - employees - - 2,861,227 2,861 3,289,329 - - 3,292,190
Issuance of common stock upon exercise of warrants - - 31,742,986 31,743 87,753,676 - - 87,785,419
Offering costs -exercise of warrants - - - - (7,379,064 ) - - (7,379,064 )
Issuance of common stock for acquisition - - 750,000 750 1,251,750 - - 1,252,500
Share-based compensation - - - - 5,053,704 - - 5,053,704
Conversion under notes payable - - 6,139,252 6,139 12,242,368 - - 12,248,507
Exercise of warrant liabilities - - - - 89,654,047 - - 89,654,047
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition - - - - 7,400,000 - - 7,400,000
Conversion of preferred stock to common (764,618 ) (765 ) 764,619 765 - - - -
Net (loss) income - - - - - (246,138,300 ) 50,577 (246,087,723 )
Balance, June 30, 2021 - - 59,927,242 $ 59,927 $ 244,026,879 $ (269,787,198 ) $ (1,843,320 ) $ (27,543,712 )

Balance, January 1, 2022 - - 150,118,024 $ 150,118 $ 850,096,635 $ (736,821,840 ) $ 20,262,129 $ 133,687,042
Issuance of common stock – note holders - - 1,000,000 1,000 2,189,000 - - 2,190,000
Issuance of common stock - consultants - - 40,000 40 102,523 - - 102,563
Warrants exercised, net of offering costs - - 81,982,969 81,983 100,954,855 - - 101,036,838
Share-based compensation - - - - - - 2,081,764 2,081,764
Exercise of warrant liabilities - - - - 227,949,858 - - 227,949,858
Write off of investments - - - - - - 927,875 927,875
Investment in Magnifi U
- - - - - - (301,256 ) (301,256 )
Common stock issued by Cryptyde, Inc. - - - - - 12,001,000 - 12,001,000
Spin-off of Cryptyde, Inc. - - - - - (11,936,218 ) 299,608 (11,636,610 )
Net loss - - - - - (227,019,793 ) (18,690,055 ) (245,709,849 )
Net (loss) loss - - - - - (227,019,793 ) (18,690,055 ) (245,709,849 )
Balance, June 30, 2022 - $ - 233,140,993 $ 233,141 $ 1,181,292,871 $ (963,776,852 ) $ 4,580,064 $ 222,329,225

The accompanying notes are an integral part of these condensed consolidated financial statements.

6
For the three months ended June 30, 2022 and 2021:

1 2 3 4 5 6 7 8
Retained
Preferred Stock Common Stock
Additional
Paid-in

Earnings
Accumulated

Non-
controlling

Total
Stockholders’

Shares Amount Shares Amount Capital (Deficit) Interest Equity

Balance, March 31, 2021 764,618 $ 765 25,685,981 $ 25,686 $ 66,002,229 $ (86,118,452 ) $ (1,865,863 ) $ (21,955,635 )
Issuance of common stock – consultants - - 451,272 451 (451 ) - - -
Issuance of common stock – employees - - 1,598,355 1,598 (1,598 ) - - -
Issuance of common stock upon exercise of warrants - - 30,862,188 30,862 86,063,953 - - 86,094,815
Offering costs -exercise of warrants - - - - (7,379,064 ) - - (7,379,064 )
Share-based compensation - - - - 1,393,268 - - 1,393,268
Conversion under notes payable - - 564,827 565 1,153,922 - - 1,154,487
Exercise of warrant liabilities - - - - 89,394,620 - - 89,394,620
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition - - - - 7,400,000 - - 7,400,000
Conversion of preferred stock to common (764,618 ) (765 ) 764,619 765 - - - -
Net (loss) income - - - - - (183,668,746 ) 22,543 (183,646,203 )
Balance, June 30, 2021 - - 59,927,242 $ 59,927 $ 244,026,879 $ (269,787,198 ) $ (1,843,320 ) $ (27,543,712 )

Balance, March 31, 2022 - - 188,052,593 188,053 $ 1,053,407,146 $ (1,109,769,797 ) $ 15,145,821 $ (41,028,777 )
Beginning balance, value - - 188,052,593 188,053 $ 1,053,407,146 $ (1,109,769,797 ) $ 15,145,821 $ (41,028,777 )
Issuance of common stock - note holders - - - - 10,000 - - 10,000
Issuance of common stock - consultants - - 40,000 - 102,563 - - 102,563
Warrants exercised, net of offering costs - - 45,048,400 45,088 (45,088 ) - - -
Share-based compensation - - - - (102,563 ) - 1,040,882 938,319
Exercise of warrant liabilities - - - - 127,920,814 - - 127,920,814
Write off of investments - - - - - - 927,875 927,875
Investment in Magnifi U - - - - - - (301,256 ) (301,256 )
Common stock issued by Cryptyde, Inc. - - - - - 12,001,000 - 12,001,000
Spin-off of Cryptyde, Inc. - - - - - (11,936,218 ) 299,608 (11,636,610 )
Net (loss) income - - - - - 145,928,164 (12,532,865 ) 133,395,298
Balance, June 30, 2022 - - 233,140,993 $ 233,141 $ 1,181,292,871 $ (963,776,852 ) $ 4,580,064 $ 222,329,225
Ending balance, value - - 233,140,993 $ 233,141 $ 1,181,292,871 $ (963,776,852 ) $ 4,580,064 $ 222,329,225
~~Vinco Ventures, Inc. and Subsidiaries~~
~~CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY~~

For the six months ended June 30, 2021 and 2020:
Preferred stock Common Stock Additional
Paid-in Accumulated Noncontrolling Total
Stockholders’
Shares Amount Shares Amount Capital Deficit Interest Equity

Balance, January 1, 2021 764,618 765 14,471,403 $ 14,471 $ 39,050,260 $ (23,648,898 ) $ (1,893,897 ) $ 13,522,701
Issuance of common stock to noteholders - - 303,483 304 422,368 - - 422,672
Returned common stock from note holder
Returned common stock from note holder, shares
Issuance of common stock to investors - - 1,500,000 1,500 3,253,500 - - 3,255,000
Offering costs
Issuance of common stock to noteholders
Issuance of common stock for divestiture, shares
Returned common stock from noteholder
Returned common stock from noteholder, shares
Issuance of common stock to consultants - - 1,394,272 1,394 2,034,941 - - 2,036,335
Issuance of warrants to noteholders and beneficial conversion option
Issuance of common stock to employees - - 2,861,227 2,861 3,289,329 - - 3,292,190
Issuance of common stock upon exercise of warrants - - 31,742,986 31,743 87,753,676 - - 87,785,419
Offering costs – exercise of warrants - - - - (7,379,064 ) - - (7,379,064 )
Conversion under notes payable - - 6,139,252 6,139 12,242,368 - - 12,248,507
Exercise of warrant liabilities - - - - 89,654,047 - - 89,654,047
Stock-based compensation - - 5,053,704 - - 5,053,704
Issuance of common stock acquisitions - - 750,000 750 1,251,750 - - 1,252,500
Conversion of preferred stock to common (764,618 ) (765 ) 764,618 765 - - - -
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition - - - - 7,400,000 - - 7,400,000
Issuance of common stock for Global Clean Solutions, LLC acquisition
Issuance of common stock for Global Clean Solutions, LLC acquisition, shares
Divestiture of Cloud B
Common stock reserved for future issuance to Emmersive sellers
Distributions
Net income - - - - - (246,138,300 ) 50,577 (246,087,723 )
Balance, June 30, 2021 (Unaudited) - $ - 59,927,241 $ 59,927 $ 244,026,879 $ (269,787,198 ) $ (1,843,320 ) $ (27,543,712 )

Balance, January 1, 2020 - - 8,015,756 $ 8,016 $ 26,259,576 $ (18,495,462 ) $ (317,698 ) $ 7,454,432
Issuance of common stock to note holders - - 439,400 439 789,575 - - 790,014
Returned common stock from noteholder - - (153,005 ) (153 ) 153 - - -
Issuance of common stock to consultants - - 866,250 866 561,896 - - 562,762
Issuance of warrants to noteholders and beneficial conversion option - - - - 1,018,953 - - 1,018,953
Divestiture of Cloud B - - - - - - (26,392 ) (26,392 )
Issuance of common stock for divestiture - - 150,000 150 404,850
-

-
405,000
Stock-based compensation - - - - 1,068,380
-

-
1,068,380
Issuance of common stock for Global Clean Solutions, LLC acquisition 0 - 300,000 300 698,700
-

-
699,000
Distributions -
-
- - -
-
(699,000 ) (699,000 )
Net (loss) income
-

-
- - - (354,888 ) 22,241 (332,647 )
Balance, June 30, 2020 (Unaudited)
-
$
-
9,618,401 $ 9,618 $ 30,802,083 $ (18,850,350 ) $ (1,020,849 ) $ 10,940,502
For the three months ended June 30, 2021 and 2020:
Preferred stock Common Stock Additional
Paid-in Accumulated Noncontrolling Total
Stockholders’
Shares Amount Shares Amount Capital Deficit Interest Equity

Balance, March 31, 2021 (Unaudited) 764,618 765 25,685,981 $ 25,686 $ 66,002,229 $ (86,118,452 ) $ (1,865,863 ) $ (21,955,635 )
Issuance of common stock to consultants - - 451,272 451 (451 ) - - -
Issuance of common stock to employees - - 1,598,355 1,598 (1,598 ) - - -
Issuance of common stock upon exercise of warrants - - 30,862,188 30,862 86,063,953 - - 86,094,815
Offering costs – exercise of warrants - - - - (7,379,064 ) - - (7,379,064 )
Conversions under notes payable - - 564,827 565 1,153,922 - - 1,154,487
Conversion of preferred stock into common stock (764,618 ) (765 ) 764,618 765 - - - -
Exercise of warrant liabilities - - - - 89,394,620 - - 89,394,620
Stock-based compensation - - - - 1,393,268 - - 1,393,268
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition - - - - 7,400,000 - - 7,400,000
Net income (loss) - - - - - (183,668,746 ) 22,543 (183,646,203 )
Balance, June 30, 2021 (Unaudited) - $ - 59,927,241 $ 59,927 $ 244,026,879 $ (269,787,198 ) $ (1,843,320 ) $ (27,543,712 )

Balance, March 31, 2020 (Unaudited) - $ - 8,676,501 $ 8,677 $ 28,790,704 $ (17,225,970 ) $ (344,090 ) $ 11,229,321
Issuance of common stock to note holders - - 279,400 279 588,411 - - 588,690
Issuance of common stock for divestiture - - 150,00 150 404,850 - - 405,000
Issuance of common stock to consultants - - 212,500 212 (212 ) - - -
Stock-based compensation - - - - 319,630 - - 319,630
Issuance of common stock for Global Clean Solutions, LLC acquisition - - 300,000 300 698,700 - - 699,000
Distributions - - - - - - (699,000 ) (699,000 )
Net (loss) income - - - - - (1,624,380 ) 22,241 (1,602,139 )
Balance, June 30, 2020 (Unaudited) - - 9,618,401 9,618 30,802,083 (18,850,350 ) (1,020,849 ) 10,940,502
~~The accompanying notes are an integral part of these condensed consolidated financial statements.~~

7

Vinco Ventures, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

2021
(Unaudited)

2020
(Unaudited)

Six Months Ended June 30,

2021
(Unaudited)

2020
(Unaudited)

Cash Flow from Operating Activities
Net loss from continuing operations attributable to Vinco Ventures, Inc. $ (241,179,520 ) $ (5,350,788 )
Net income attributable to noncontrolling interests 50,577 22,241
Net loss from continuing operations (241,128,943 ) (5,328,547 )
Adjustments to reconcile net (income) loss to net cash used in operating activities:
Discontinued operations (4,958,780 )
4,995,900

Depreciation and amortization 1,081,623 612,406
Amortization of financing costs 15,597,936 1,227,046
Stock-based compensation 10,003,767 1,588,427
Amortization of right of use asset 48,327 153,820
Gain on debt extinguishment (852,352 ) -
Loss on disposal of discontinued operations 4,130,580
(4,911,760
)
Change in fair value of short-term investments 122,400 -
Loss on issuance of warrants 208,855,715 -
Change in fair value of warrant liability 773,447 -
Changes in assets and liabilities:
Accounts receivable (1,596,881 ) (978,097 )
Inventory 169,793 178,227
Prepaid expenses and other current assets (378,831 ) (967,109 )
Accounts payable (819,943 ) (344,847 )
Accrued expenses and other current liabilities (775,082 ) 1,425,622
Operating lease liabilities (47,714 ) (148,518 )
Due from related party (17,050 ) 9,532
Net cash used in operating activities (9,791,988 ) (2,487,898 )

Cash Flows from Investing Activities
Purchase of property and equipment
(88,633
)
(61,917
)
Cash received from sale of assets of CBAV 1, LLC
2,529,564
-
Equity method investment (12,000,000 ) -
Funding of loan receivable (5,000,000 ) -
Net cash used in investing activities (14,559,069 ) (61,917 )

Cash Flows from Financing Activities
(Repayments) borrowings under line of credit (379,333 ) 1,678,540
Borrowings under convertible notes payable 19,720,000 1,436,000
Borrowings under notes payable 73,000 1,767,352
Repayments under notes payable (2,145,475 ) (824,472 )
Repayments under notes payable- related parties (1,951,012 ) (14,508 )
Fees paid for financing costs (120,261 ) (143,479 )
Net proceeds from issuance of common stock 3,255,000 -
Net proceeds from exercise of warrants 80,406,355 -
Net cash provided by financing activities 98,858,274 3,899,433
Net increase (decrease) in cash and cash equivalents 74,507,217 1,349,618
Cash and cash equivalents - beginning of period 249,356 412,719
Cash and cash equivalents - end of period $ 74,756,573 1,762,337

Supplemental Disclosures of Cash Flow Information
Cash paid during the period for:
Interest $ 858,388 $ 144,740
Income taxes $ (14,738 ) $ 235,725
Noncash investing and financing activity:
Shares issued to note holders $ 422,672 $ -
Conversions under notes payable $ 12,248,507 $ 424,000
Issuance of warrants to note holders $ 208,855,715 $ -
Shares reserved for EVNT, LLC $ 7,400,000 $ -
(Unaudited)

For the Six Months Ended June 30,
2022 2021
Cash Flow from Operating Activities
Net loss attributable to Vinco Ventures, Inc. $ (223,758,881 ) $ (241,367,534 )
Net (loss) income attributable to noncontrolling interest (18,690,055 ) 50,577
Net income (loss) (242,448,937 ) (241,316,957 )
Adjustments to reconcile net loss to net cash used in operating activities:
Discontinued operations (3,260,912 ) (4,770,766 )
Amortization of financing costs 36,873,397 15,597,936
Share-based compensation 2,184,327 10,003,767
Depreciation and amortization 4,974,199 1,081,623
Amortization of right of use asset 35,604 48,327
Change in fair value of short-term investment 33,000 122,400
Loss on disposal of discontinued operations - 4,130,580
Gain on debt extinguishment - (852,352 )
Loss on issuance of warrants 243,681,478 208,855,715
Change in fair value of warrant liability (86,110,179 ) 773,447
Inventory write-off (365,001 ) -
Write off of investments and Impairment Expense 2,100,045 -
Equity method investment - Income share of Mind Tank LLC (293,926 ) -
Change in fair value of deferred acquisition (12,170,000 ) -

Changes in assets and liabilities: ��
Accounts receivable (674,375 ) (1,596,881 )
Inventory (1,234,422 ) 169,793
Prepaid expenses and other assets 993,247 (378,831 )
Accounts payable (3,366,760 ) (819,943 )
Related party, net (862,501 ) (17,050 )
Accrued expenses and other liabilities (12,053,808 ) (775,082 )
Operating lease liabilities (35,303 ) (47,714 )

Net Cash Used in Operating Activities (72,000,827 ) (9,791,988 )

Cash Flows from Investing Activities
Issuance of loans held-for-investment-related parties (6,290,000 ) -
Repayments of loans held-for-investment-related parties 1,048,750 -
Issuance of loans held-for-investment (500,000 ) -
Purchases of property and equipment (544,653 ) (88,633 )
Cash received from sale of assets of CBAV 1, LLC - 2,529,564
Equity method investment - (12,000,000 )
Funding of loan receivable - (5,000,000 )
Consolidation of Magnifi U (VIE)
1,752,935 -
Acquisition of business, net of cash acquired (34,850,577 ) -
Net Cash Used in Investing Activities (39,383,544 ) (14,559,069 )

Cash Flows from Financing Activities
Net repayments under line of credit - (379,333 )
Net (repayments) borrowings under convertible notes payable - 19,720,000
Net (repayments) borrowings under notes payable (165,530 ) (2,072,475 )
Net (repayments) borrowings under notes payable - related parties 37,833 (1,951,012 )
Fees paid for financing costs - (120,261 )
Net proceeds from exercise of warrants 101,036,839 80,406,355
Net proceeds from issuance of common stock - 3,255,000
Common stock issued by Cryptyde, Inc. 12,001,000 -
Cash paid with Cryptyde, Inc. spinoff (9,921,084 ) -
Net Cash Provided by Financing Activities 102,989,059 98,858,274

Net Increase (Decrease) in Cash and Cash Equivalents and Restricted Cash (8,395,313 ) 74,507,217
Cash and Cash Equivalents and Restricted Cash - Beginning of Period 187,612,176 249,356
Cash and Cash Equivalents and Restricted Cash - End of Period $ 179,216,863 $ 74,756,573

Supplemental Disclosures of Cash Flow Information:
Cash paid during the year for:
Interest $ 414,297 $ 858,388
Income taxes $ - $ (14,738 )
Noncash investing and financing activity:
Issuance of warrants to note holders $ 243,681,478 $ 208,855,715
Deferred acquisition purchase price $ 11,080,000 $ -
Shares issued to note holders $ 2,190,000 $ 422,672
Conversions under notes payable $ - $ 12,248,507
Shares reserved for EVNT, LLC $ - $ 7,400,000
Asset acquisition of Love is Blurred, LLC - Repayment of held-for-investment-related parties $ 1,048,750 $ -
Consolidation of Magnifi U (VIE), net of cash $ (2,054,191 ) $ -
Acquisition of business, net of cash acquired $ 64,272,070 $ -
The accompanying notes are an integral part of these condensed consolidated financial statements.

8
Vinco Ventures, Inc. and Subsidiaries
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1 — Basis of Presentation and Nature of Operations
Unaudited Interim Condensed Consolidated Financial Information

The unaudited condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial statements and with Form 10-Q and Article 10 of Regulation S-X of the United States Securities and Exchange Commission (the “SEC”). Accordingly, they do not contain all information and footnotes required by GAAP for annual financial statements. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned and majority-owned ~~subsidiaries.~~subsidiaries and consolidated variable interest entities. All intercompany balances and transactions have been eliminated in consolidation. In the opinion of the Company’s management, the accompanying unaudited condensed consolidated financial statements contain all the adjustments necessary (consisting only of normal recurring accruals) to present the financial position of the Company as of June 30, ~~2021~~2022 and the results of operations, changes in stockholders’ equity, and cash flows for the periods presented. The interim results ~~of operations for the three and six months ended June 30, 2021~~ are not necessarily indicative of the operating results to be expected for the ~~full~~ fiscal year ending December 31, 2022 or for any other interim period or for any other future ~~period.~~year.

~~These~~The unaudited condensed consolidated financial statements and related financial information should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2020.~~2021 (the “Annual Report”). The Company’s accounting policies are described in the Notes to Consolidated Financial Statements in its Annual Report on Form 10-K for the year ended December 31, ~~2020,~~2021, and updated, as necessary, in this Quarterly ~~Report on Form 10-Q.~~Report.

As used herein, the terms the “Company,” “Vinco Ventures” “we,” “us,” “our” and similar refer to Vinco Ventures, Inc. (f/k/a Edison Nation, Inc.), a Nevada corporation incorporated on July 18, 2017 under the lawsDescription of the State of Nevada as Idea Lab X Products, Inc. and also formerly known as Xspand Products Lab, Inc. prior to its name change on September 12, 2018, and/or its wholly-owned and majority-owned operating subsidiaries. On November 5, 2020, the Company (the “Parent”) and its wholly owned subsidiary, Vinco Ventures, Inc. (the “Merger Sub”), entered into an Agreement and Plan of Merger (the “Agreement”). Under the terms of the Agreement, the Merger Sub merged with and into the Parent and the Parent became the surviving corporation of the Merger (the “Surviving Corporation”). The name of the Surviving Corporation became Vinco Ventures, Inc. The transaction closed on November 10, 2020.Business

Vinco Ventures is ~~a vertically-integrated, end-to-end, consumer product research & development, manufacturing, sales~~focused on digital media, advertising and ~~fulfillment company. The Company’s proprietary web-enabled platform provides a low risk, high reward platform and process to connect innovators of new product ideas with potential licensees.~~content technologies.

As of June 30, ~~2021,~~2022, Vinco Ventures ~~had eight~~ wholly-owned ~~subsidiaries: TBD Safety, LLC (“TBD”),~~subsidiaries included: AdRizer, Vinco Ventures Shared Services LLC, (“~~Vinco Shared”),~~ ~~Ferguson Containers, Inc. (“Fergco”), CBAV1, LLC (“CB1”), Pirasta, LLC (“Pirasta”),~~ Honey Badger, ~~Media LLC (“Honey Badger”),~~ EVNT Platform LLC (“DBA Emmersive ~~Entertainment”~~Entertainment (“EVNT”), Love is Blurred LLC and Edison Nation Holdings, LLC. ~~Vinco Ventures owns~~ 50~~% of Best Party Concepts, LLC and Global Clean Solutions, LLC, all of which are consolidated as VIE’s with noncontrolling interests.~~ Edison Nation Holdings, LLC is the single member of Edison Nation, LLC and Everyday Edisons, LLC. Edison Nation, LLC is the single member of Safe TV Shop, LLC. Vinco Ventures owns a 50% voting membership interest and a 25% economic interest after return of unreturned capital contributions in ZVV, which are consolidated as Variable Interest Entities (“VIE”) with noncontrolling interests. ZVV owns 80% of the outstanding equity interests in Lomotif and Lomotif owns 100% of Lomotif, Inc. Vinco Ventures also has an outstanding loan with Magnifi U Inc which is consolidated as a VIE with a noncontrolling interest.

~~In April 2021, the Company agreed to unwind the joint venture of Ed Roses, LLC~~Going Concern and ~~recognized a loss of $301,645~~.
Liquidity

These condensed consolidated financial statements have been prepared assuming that we will continue as a going concern. This basis of accounting contemplates the recovery of our assets and the satisfaction of our liabilities in the normal course of business.
The Company has incurred and continues to incur losses from operations as well as negative cash flows from operations. For the six months ended June 30, 2022, the Company had a net loss of $242,448,937, negative cash flows from operations of $72,471,541 and an accumulated deficit of $963,776,852. On June 30, 2022, the Company postponed its special stockholder meeting from July 1, 2022 to July 26, 2022 which was subsequently postponed again to August 23, 2022 and then postponed indefinitely. This meeting was to be held to approve various proposals including amending the Company’s Amended and Restated Articles of Incorporation to increase the number of its authorized shares of common stock from 250,000,000to 750,000,000. The postponement of the meeting triggered an alternative exercise notice clause in the Company’s November and December 2021 warrants, as amended, which allows the holder to put the warrants back to the Company in exchange for cash payments of $0.65 and $0.36 per warrant for the November and December 2021 warrants, respectively (Note 12 – Warrant Liability). The Holder exercised this provision in July 2022 resulting in a cash payment of $33,886,612and cancelation of 82,260,699warrants. Additionally, per the terms of the amended July 2021 convertible note the Company made a cash payment of $33,000,000 against principal and cash interest payment of $115,500 on July 19, 2022. On August 18, 2022, the Company paid an additional $65,000,000 to the note holder, of which $55,000,000 was applied to the principal. These payments along with our cash flows from operations ~~lost~~have reduced our cash balance from $179,216,863at June 30, 2022 to approximately $~~15,720,129~~10,000,000 in Restricted Cash and $5,500,000 in unrestricted cash ~~, of which approximately $11,085,000~~ ~~was non-cash and approximately $1,428,000~~ ~~was related to transaction costs and other non-recurring items.~~
at January 31, 2023. At June 30, ~~2021,~~2022 we ~~had total current assets of~~have approximately $~~80,620,757~~14.7 million in accounts payable and ~~current liabilities~~accrued expenses, and during the first six months of 2022, we utilized approximately $~~8,829,464resulting in working capital of approximately $71,791,293~~1 , ~~of which $3,333,333~~ ~~was convertible notes payable. At June 30, 2021, we had total assets of $121,276,499and total liabilities of $148,820,211, of which~~ ~~139,695,115~~ ~~related~~million in cash per month. Furthermore, due to the ~~warrant liabilities,resulting in stockholders’ deficit~~postponement of $~~27,543,712~~.
~~The Company believes it has sufficient~~special stockholder meeting, the Company’s ability to raise additional cash ~~for at least the next twelve months from the date of~~through issuance of ~~these condensed financial statements. The~~common shares is limited. These conditions raise substantial doubt about the Company’s ability to continue as a going concern ~~is dependent upon~~and meet its obligations through twelve months following the ~~Company’s ability to attract significant new sources of capital, attain a reasonable threshold of operating efficiencies and achieve profitable operations from~~date the ~~sale of its products.~~condensed consolidated financial statements are issued.

Our operating needs include the planned costs to operate our business, including amounts required to fund working capital and capital expenditures. Our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully commercialize our products and services, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product and service offerings.
9

~~Vinco Ventures, Inc.~~Management’s plans include evaluating different strategies to obtain required funding for future operations, develop and ~~Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~implement cost reduction initiatives, and pursue revenue generating programs with strategic partners. As these plans have not yet been implemented, management has concluded that substantial doubt about the Company’s ability to continue as a going concern has not been alleviated.

The condensed consolidated financial statements do not include any adjustments relating to the recoverability and reclassification of recorded asset amounts or the amounts and classification of liabilities that might result from the outcome of this uncertainty.
Note 2 — Summary of Significant Accounting Policies
Principles of Consolidation

The consolidated financial statements include the accounts of Vinco Ventures, Inc. and its wholly-owned ~~and~~subsidiaries, majority owned ~~subsidiaries.~~ subsidiaries and consolidated variable interest entities. All intercompany balances and transactions have been eliminated.
~~Reclassifications~~
Certain amounts previously presented in the consolidated financial statements have been reclassified to conform to the current year presentation. Such reclassifications had no effect on the previously reported net loss, Stockholders’ equity or cash flows.

Use of Estimates

Preparation of financial statements in conformity with ~~U.S.~~ GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, together with amounts disclosed in the related notes to the financial statements.

The Company’s significant estimates used in these financial statements include, but are not limited to, accounts receivable reserves, the valuation allowance related to the Company’s deferred tax assets, the recoverability and useful lives of long-lived assets, debt conversion features, stock-based compensation, certain assumptions related to the valuation of the reserved shares and the assets acquired and liabilities assumed related to the Company’s acquisitions. Certain of the Company’s estimates could be affected by external conditions, including those unique to the Company and general economic conditions. It is reasonably possible that these external factors could have an effect on the Company’s estimates and could cause actual results to differ from those estimates.

~~Discontinued Operations~~Significant Accounting Policies

A component of an entity that is disposed of by sale or abandonment is reported as discontinued operations if the transaction represents a strategic shift that will have a major effect on an entity’s operations and financial results. The results of discontinued operationsSignificant accounting policies are ~~aggregated and presented separately~~disclosed in the ~~Consolidated Statement~~Company’s Annual Report on Form 10-K for the year ended December 31, 2021. There have been no changes in such policies or the application of ~~Operations. Assets and liabilities~~such policies during the six months ended June 30, 2022. As a result of the ~~discontinued operations are aggregated~~acquisition of Adrizer, the Company added a new revenue stream, Digital Media Advertising and ~~reported separately~~Licensing, to its Revenue Recognition policy. Additionally, as a result of the Company’s interest in Love is Blurred, the Company has recorded Film and Television Production assets ~~and liabilities~~in accordance with Topic 926. As a result of ~~discontinued operations~~these changes in the ~~Consolidated Balance Sheet, including the comparative prior year period.~~first six months of 2022, new Investments have been recognized. The ~~Company’s cash flows are reflected as cash flows from discontinued operations within the Company’s Consolidated Statements of Cash Flows~~details for each ~~period presented.~~of these topics are as follows:

~~Cash and Cash Equivalents~~
~~The Company considers all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents in the consolidated financial statements.~~
10

~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~Revenue Recognition

~~Note 2 — Summary of Significant Accounting Policies — (Continued)~~
The Company has cash on deposit in several financial institutions which, at times, may be in excess of Federal Deposit Insurance Corporation (“FDIC”) insurance limits. The Company has not experienced losses in such accounts and periodically evaluates the creditworthiness of its financial institutions. The Company reduces its credit risk by placing its cash and cash equivalents with major financial institutions. The Company had approximately $~~74,756,573~~ ~~of cash and cash equivalents at June 30, 2021 of which none was held in foreign bank accounts not covered by FDIC insurance limits as of June 30, 2021.~~
~~Accounts Receivable~~
Accounts receivable are carried at their contractual amounts, less an estimate for uncollectible amounts. Management estimates the allowance for bad debts based on existing economic conditions, historical experience, the financial conditions of the customers, and the amount and age of past due accounts. Receivables are considered past due if full payment is not received by the contractual due date. Past due accounts are generally written off against the allowance for bad debts only after all collection attempts have been exhausted.
~~No customers represented more than 10% of total accounts receivable.~~
~~Inventory~~
Inventory is recorded at the lower of cost or net realizable value on a first-in, first-out basis. The Company reduces the carrying value of inventories for those items that are potentially excess, obsolete, or slow moving based on changes in customer demand, technology developments, or other economic factors.
~~Short-Term Investments~~
Short-term investments consisted of equity securities. The Company classified its investments as trading securities. Accordingly, such investments were reported at fair market value, with the resultant unrealized gains and losses reported as a component of the consolidated statements of operations. Fair value for trading securities was determined by reference to quoted market prices.
~~Property and Equipment, Net~~
Property and equipment are stated at cost, net of accumulated depreciation and amortization, which is recorded commencing at the in-service date using the straight-line method over the estimated useful lives of the assets, as follows: 3 to 5 ~~years for office equipment,~~ 5 to 7 ~~years for furniture and fixtures,~~ 6 to 10 ~~years for machinery and equipment,~~ 10 to 15 ~~years for building improvements,~~ 5 ~~years for software,~~ 5 ~~years for molds,~~ 5 to 7 ~~years for vehicles and~~ 40 ~~years for buildings.~~
~~Equity Method Investments~~
~~We apply the equity method of accou~~nting to investments when we have significant influence, but not controlling interest in the investee. Judgment regarding the level of influence over each equity method investment includes considering key factors such as ownership interest, representation on the board of directors, participation in policy-making decisions and material intercompany transactions. The Company’s proportionate share of the net income (loss) resulting from these investments will be reported under a line-item captioned equity method investment income in our Consolidated Statements of Operations. The carrying value of our equity method investments is reported in equity method investments in the Consolidated Balance Sheets. The Company’s equity method investments are reported at cost and adjusted each period for the Company’s share of the investee’s income or loss and dividend paid, if any. The Company classifies distributions received from equity-method investments using the cumulative earnings approach on the Consolidated Statements of Cash Flows. The Company assesses investments for impairment whenever events or changes in circumstances indicate that the carrying value of an investment may not be recoverable. The Company did not record any impairments relate~~d to its investments in 2021. For the six months ended June 30, 2021, there was no income or loss.~~
~~Revenue Recognition~~
~~Generally, the~~ Company considers all revenues as arising from contracts with ~~customers.~~customers. Revenue is recognized based on the five-step process outlined in the Accounting Standards Codification (“ASC”) ~~606:~~606 as disclosed in the Company’s Annual Report on Form 10-K. Additional clarification on the Company’s Digital Media Advertising and Licensing revenue recognition policy is provided below.

~~Step 1 – Identify~~Digital Media Advertising and Licensing
The Company’s digital media advertising revenues are generated primarily from the ~~Contract with~~posting of original digital content through third-party online platforms which are then delivered to users of the ~~Customer – A contract exists when (a)~~online platform across the ~~parties~~customer’s digital advertising platform and becomes monetizable to the ~~contract have approved~~Company, which the ~~contract~~Company concludes is its performance obligation. The Company recognizes revenue when control of the services are transferred to customers and the transaction price is determined by the third-party online platform. Revenue from the digital media platform is primarily recognized based on impressions delivered to customers. An “impression” is delivered when an advertisement appears on pages viewed by users. For impressions-based digital advertising, revenues are ~~committed~~recognized as impressions are delivered over the term of the arrangement, while revenue from non-impressions-based digital advertising is recognized over the period that the advertisements are displayed. Such amounts are recognized net of agency commissions and provisions for estimated sales incentives, including rebates, rate adjustments or discounts.
Licensing revenues are derived from the sale of a licensee’s products that incorporates the Company’s intellectual property. Royalty revenues are recognized during the quarter in which the Company receives a report from the licensee detailing the shipment of products that incorporate the Company’s intellectual property, which receipt is in the quarter following the licensee’s sale of such products to ~~perform their respective obligations, (b)~~its customers. Royalties are calculated as a percentage of the ~~entity can identify each party’s rights regarding~~revenues received by the Company’s licensees on sales of products incorporating the Company’s intellectual property.
Identification of a Customer and Gross Versus Net Revenue Recognition
In the normal course of business, the Company acts as or uses an intermediary or agent in executing transactions with third parties. When the intermediary or agent is determined to be the Company’s customer, the Company records revenue based on the amount it expects to receive from the agent or intermediary.
In other circumstances, the determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company is acting as the principal or an agent in the transaction. If the Company is acting as a principal in a transaction, the Company reports revenue on a gross basis. If the Company is acting as an agent in a transaction, the Company reports revenue on a net basis. The determination of whether the Company is acting as a principal or an agent in a transaction involves judgment and is based on an evaluation of the terms of the arrangement. The Company serves as the principal in transactions in which it controls the goods or services prior to be transferred, (c) the entity can identify the payment terms for the goods or services to be transferred, (d) the contract has commercial substance and it is probable that the entity will collect substantially all of the consideration to which it will be entitled in exchange for the goods or services that will bebeing transferred to the ultimate customer.
For AdRizer, FASB ASC 606 requires an entity to determine whether it is a principal (recognizes revenue at the gross amount) or an agent (recognizes revenue at the net amount) for each promised good or service. Based on the FASB guidance, the Company has determined that AdRizer is the principal for each promised good or service, thus, revenue is recognized at the gross amount of the transactions. Revenue from traffic sales and traffic management services are generally recognized at the end of each month when the performance obligation is satisfied.

Film and Television Productions
The Company accounts for the film and television productions in accordance with Topic 926, Entertainment – Films. Production costs qualifying for capitalization, are recorded as film and television productions on the consolidated balance sheet and amortized using forecast methods that match amortization to estimated revenue. Currently all productions are actively under development and, as such, amortization has not commenced.
Investments
Investments in equity securities (excluding equity method investments) with readily determinable fair values are accounted for at fair value. For investments in equity securities without readily determinable fair values, the Company elects the measurement alternative permitted under GAAP to measure these investments at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.
Investments in which the Company has the ability to exercise significant influence but does not control and is not the primary beneficiary are equity method investments. Significant influence typically exists if the Company has a 20% to 50% ownership interest in a venture unless persuasive evidence to the contrary exists. Under this method of accounting, the Company records its proportionate share of the net earnings or losses of equity method investees and a corresponding increase or decrease to the investment balances. Cash payments to equity method investees such as additional investments, loans and advances and expenses incurred on behalf of investees as well as payments from equity method investees such as dividends, distributions and repayments of loans and advances are recorded as adjustments to investment balances. The Company applies the cumulative earnings approach for determining the cash flow presentation of cash distributions received from equity method investees. Distributions received are included in the consolidated statements of cash flows as operating activities, unless the cumulative distributions exceed the Company’s portion of the cumulative equity in the net earnings of the equity method investment, in which case the excess distributions are deemed to be returns of the investment and are classified as investing activities in the consolidated statements of cash flows. The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable.
Note 3 — Acquisitions and Divestitures
Acquisitions AdRizer, LLC
On February 11, 2022, the Company acquired all of the outstanding equity interests of AdRizer and cancelled all outstanding performance units under AdRizer’s phantom equity plan (“Performance Units”) pursuant to that certain Unit Purchase Agreement among the Company, AdRizer, the members of AdRizer and the holders of Performance Units of AdRizer (collectively, the “Seller Members”), and Innovative Assets LLC, in its capacity as the sellers’ representative (the “Unit Purchase Agreement”), resulting in AdRizer becoming a wholly-owned subsidiary of the Company. The purchase price paid and payable consists of (i) $38 million in cash paid at closing, of which $10 million was deposited in an escrow account to secure the Seller Members’ indemnification obligations under the Unit Purchase Agreement, subject to customary post-closing adjustments for working capital and other items, and (ii) up to 10 million shares of the Company’s common stock to be issued on January 1, 2024, determined by dividing $50 million by the volume weighted average price of the Company’s common stock reported by Bloomberg LP for the 20 trading days preceding such date, subject to a floor price of $5.00 and maximum price of $8.00 per share (the “Purchase Price Equity”). The Company estimated the fair value of the Purchase Price Equity to be issued was $23,250,000.
If a Company change of control transaction occurs on or prior to January 1, 2024, the issuance of the Purchase Price Equity may be accelerated to allow each Seller Member to participate in such transaction on the same terms as other common stockholders of the Company (the “Acceleration”), provided that, to the extent that the consideration to be paid to the common stockholders of the Company in such transaction does not consist entirely of cash or free-trading securities listed on a national stock exchange, (i) each Seller Member may elect the Acceleration except with respect to Purchase Price Equity issuable in respect of the Performance Units, and (b) if any Seller Member has not elected the Acceleration, to the extent permitted and with respect to the Performance Units, the Company shall (i) pay each such applicable Seller Member a cash amount equal to 50% of such Seller’s Member’s pro rata portion of the Purchase Price Equity (the “Forfeited Purchase Price Equity”) and (ii) issue such Seller Member’s pro rata portion of the Purchase Price Equity less the Forfeited Purchase Price Equity.
Upon the closing of the acquisition, AdRizer entered into a new employment agreement with its chief executive officer, Kenneth Bond. Certain Seller Members including those who are employees, officers, directors or managers of AdRizer and their affiliates also agreed to be bound by three-year post-closing non-competition and non-solicitation restrictive covenants pursuant to the Unit Purchase Agreement.
11

~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 2 — Summary of Significant Accounting Policies — (Continued)~~
~~Step 2 – Identify Performance Obligations in the Contract – Upon execution of a contract, the~~The Company identifies as performance obligations each promise to transfer to the customer either (a) goods or services that are distinct, or (b) a series of distinct goods or services that are substantially the same and have the same pattern of transfer to the customer. To the extent a contract includes multiple promised goods or services, the Company must apply judgement to determine whether the goods or services are capable of being distinct within the context of the contract. If these criteria are not met, the goods or services arehas accounted for the AdRizer acquisition as a ~~combined performance obligation.~~
Step 3 – Determine the Transaction Price – When (or as) a performance obligation is satisfied, the Company shall recognize as revenue the amount of the transaction price that is allocated to the performance obligation. The contract terms are used to determine the transaction price. Generally, all contracts include fixed consideration. If a contract did include variable consideration, the Company would determine the amount of variable consideration that should be included in the transaction price based on expected value method. Variable consideration would be included in the transaction price, if in the Company’s judgement, it is probable that a significant future reversal of cumulative revenuebusiness combination under the ~~contract would not occur.~~
Step 4 – Allocate the Transaction Price – After the transaction price has been determined, the next step is to allocate the transaction price to each performance obligation in the contract. If the contract only has one performance obligation, the entire transaction price will be applied to that obligation. If the contract has multiple performance obligations, the transaction price is allocated to the performance obligations based on the relative standalone selling price (SSP) at contract inception.
~~Step 5 – Satisfaction~~acquisition method of ~~the Performance Obligations (and Recognize Revenue) – Revenue is recognized when (or as) goods or services are transferred to a customer.~~accounting. The Company ~~satisfies each of its performance obligations by transferring control of~~has classified the promised good or service underlying that performance obligation to the customer. Control is the ability to direct the use of and obtain substantially all of the remaining benefits from an asset. It includes the ability to prevent other entities from directing the use of and obtaining the benefits from an asset. Indicators that control has passed to the customer include:Purchase Price Equity as a present obligation to pay; physical possession of the asset; legal title; risks and rewards of ownership; and acceptance of the asset(s). Performance obligations can be satisfied at a point in time or over time.
Substantially all of the Company’s revenues continue to be recognized when control of the goods is transferred to the customer, which is upon shipment of the finished goods to the customer. All sales have fixed pricing and there are currently no material variable components included in the Company’s revenue. Additionally, the Company will issue credits for defective merchandise, historically these credits for defective merchandise have not been material.
~~Disaggregation of Revenue~~deferred acquisition liability.

The ~~Company’s primary revenue streams~~purchase price allocation presented below is preliminary given the recent closing of the AdRizer acquisition. We are in the process of evaluating additional information necessary to finalize the valuation of assets acquired and liabilities assumed as of the acquisition date including, but not limited to, post-closing adjustments to the working capital acquired and identification and valuation of developed technology and intangible assets acquired which include customer relationships and trade name, and the ~~sale and/or licensing~~fair value of ~~consumer goods~~AdRizer’s investment in Mind Tank, LLC, of which we own 50% as a result of our ownership of AdRizer.
The fair value in AdRizer, and ~~packaging materials~~AdRizer’s investment in Mind Tank, used several methodologies to arrive at the current estimate. To value assets, fixed assets were reported at NBVwhich approximates fair value. The fair value of the intangible assets employed the following methodologies: customer relationships (Distributor method); developed technology (Multi- period Excess Earnings Method); trade name (Relief-from-Royalty); and the existing workforce was also valued (Replacement Cost method) but is included in Goodwill for ~~innovative products. The Company’s licensing business is not material and has not been separately disaggregated for segment~~reporting purposes. The ~~Company’s disaggregated revenues~~estimated useful life of the various intangibles was based on the cash flow estimated for the ~~three~~particular asset. Qualitative factors regarding the valuation included expected synergies between businesses and integration of the technology.
The following purchase price allocation is preliminary and details management’s estimate and allocation of the purchase price and fair value of the asset acquired and liabilities assumed at the time of closing.
Summary of Business Combination Acquired Assets and Liabilities Purchase Price

AdRizer
Cash paid $ 37,936,323
Fair value of deferred acquisition price 23,250,000
Purchase consideration $ 61,186,323

AdRizer

Cash and cash equivalents $ 3,085,747
Accounts receivable 5,564,539
Other current assets 847,273
Property and equipment 191,654
Investment in Mind Tank, LLC 2,800,000
Customer relationships 8,800,000
Developed technology 28,000,000
Trade Name 2,200,000
Goodwill 17,039,788
Total assets acquired 68,529,001

Accounts payable and accrued expenses 7,342,678
Total liabilities assumed 7,342,678
$ 61,186,323
Statement of Cash Flow reconciliation:
Schedule of Cash Flow Reconciliation

Purchase consideration $ 61,186,323
Fair value of deferred acquisition price (23,250,000 )
Cash and cash equivalents, acquired (3,085,747 )
Net cash paid $ 34,850,576
During the six months ended June 30, ~~2021~~2022, the Company made a provisional estimate and ~~2020 was as follows:~~adjustment for amortization of the preliminary intangible assets including customer list, developed technology, and trade name. The Company has estimated a seven-year useful life and recorded amortization expense of approximately $1,752,000 during the six months ended June 30, 2022. The final fair value determination could result in material adjustments to the values presented in the preliminary purchase price allocation, including the fair value of Mind Tank, LLC, intangible assets, goodwill and the related tax impact of such adjustments. We expect to finalize the purchase price allocation within the measurement period.
~~Schedule~~ The Company recognized $8,216,000 of ~~Disaggregation~~acquisition related costs, including $6,750,000 paid to ZASH for the assignment of ~~Revenue~~
2021 2020 2021 2020

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2021 2020 2021 2020
Revenues:
Product sales $ 2,626,689 $ 5,123,067 $ 5,114,558 $ 7,036,204
Service - - - -
Licensing 65,122 50,915 142,415 91,124
Total revenues, net $ 2,691,811 $ 5,173,982 $ 5,256,973 $ 7,127,328
ZASH’s rights under a letter of intent to acquire AdRizer (See Note 13- Related Party Transactions) that were expensed during the six months ended June 30, 2022. These costs are included in the consolidated statement of operations in the line item entitled “Selling, General and Administrative”.

12
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 2 — Summary of Significant Accounting Policies — (Continued)~~
~~For the three and six months ended June 30, 2021 and 2020, the following customer represented more than 10% of total net revenues:~~
~~Schedule of Revenue from External Customers and Long-Lived Assets, by Geographical Areas~~

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2021 2020 2021 2020
Customer:
Customer A 11 % * 11 % *
Customer B * 11 % * *
Customer C
* 11 % * *
* ~~Customer did not represent greater than 10% of total net revenue.~~
~~For the three and six months ended June 30, 2021 and 2020, the following geographical regions represented more than 10% of total net revenues:~~

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2021 2020 2021 2020
Region:
North America 100 % 98 % 100 % 93 %
* ~~Region did not represent greater than 10% of total net revenue.~~
13
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 2 — Summary of Significant Accounting Policies — (Continued)~~

~~Fair Value of Financial Instruments~~

The ~~Company measures~~activity of AdRizer is included in the ~~fair value~~Company’s consolidated financial statements from the acquisition date to June 30, 2022. The amounts of ~~financial assets~~revenue and ~~liabilities based on~~earnings of AdRizer from the ~~guidance~~acquisition date of ~~ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”) which defines fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.~~February 11, 2022 to June 30, 2022 are as follows:
ASC 820 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:
~~Level 1 — quoted prices in active markets for identical assets or liabilities~~
~~Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable~~
~~Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions)~~
The carrying amounts of the Company’s financial instruments, such as cash, accounts receivable and accounts payable, approximate fair values due to the short-term nature of these instruments. The carrying amount of the Company’s notes payable approximates fair value because the effective yields on these obligations, which include contractual interest rates, taken together with other features such as concurrent issuance of warrants, are comparable to rates of returns for instruments of similar credit risk. The loan held for investment was acquired at fair value, which resulted in a discount.
~~The following fair value of financial assets and liabilities and the input level used to determine the fair value at June 30, 2021 is presented below:~~
Schedule of ~~Fair Value Financial Assets~~Business Combination Revenue and ~~Liabilities~~
Fair Value Measurements as of June 30, 2021
Level 1 Level 2 Level 3

Assets:
Short-term investments $ 895,600 $ - $ -

Liabilities:
Warrant liability - - 139,695,115
Total 895,600 - 139,695,115
~~The following fair value of financial assets and liabilities and the input level used to determine the fair value at December 31, 2020 is presented below:~~
Fair Value Measurements as of December 31, 2021
Level 1 Level 2 Level 3

Assets:
Short-term investments $ 1,018,000 $ - $ -

Liabilities:
Warrant liability - - -
Total 1,018,000 - -
The following table presents a reconciliation of the Company’s liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2021:
~~Schedule of Reconciliation of Liabilities Measured at Fair Value~~

Warrant
Liability
(Level 3)

Balance, December 31, 2020 $ -
Issuance of warrants 228,575,715
Change in fair value 773,447
Exercise of warrants (89,654,047 )
Balance, June 30, 2021 $ 139,695,115
U.S. equity stocks represent investment in stocks of U.S. based companies. The valuation inputs for U.S. equity stocks are based on the last published price reported on the major stock market on which the securities are traded and are primarily classified as Level 1. Securities whose valuation inputs are not based on observable market information are classified as Level 3.
~~Warrant Accounting~~
The Company evaluates its financial instruments to determine if such instruments are derivatives or contain features that qualify as embedded derivatives in accordance with ASC Topic 815, “Derivatives and Hedging”.
The Company classifies a warrant to purchase shares of its common stock as a liability on its consolidated balance sheets as this warrant is a free-standing financial instrument that may require the Company to transfer consideration upon exercise (Please see ~~Note 11 — Warrant Liability~~ for further information). Each warrant is initially recorded at fair value on date of grant using the Black-Scholes model and net of issuance costs, and it is subsequently re-measured to fair value at each subsequent balance sheet date. Changes in fair value of the warrant are recognized as a component of other income (expense), net in the consolidated statement of operations and comprehensive loss. The Company will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of the warrant.
~~Sequencing Policy~~
Under ASC 815-40-35, the Company follows a sequencing policy whereby, in the event that reclassification of contracts from equity to assets or liabilities is necessary pursuant to ASC 815 due to the Company’s inability to demonstrate it has sufficient authorized shares as a result of certain securities with a potentially indeterminable number of shares, shares will be allocated on the basis of the earliest issuance date of potentially dilutive instruments, with the earliest grants receiving the first allocation of shares. Pursuant to ASC 815, issuance of securities to the Company’s employees or directors are not subject to the sequencing policy.
14
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 2 — Summary of Significant Accounting Policies — (Continued)~~
~~Foreign Currency Translation~~
The Company uses the United States dollar as its functional and reporting currency since the majority of the Company’s revenues, expenses, assets and liabilities are in the United States. Assets and liabilities in foreign currencies are translated using the exchange rate at the balance sheet date, while revenue and expense accounts are translated at the average exchange rates prevailing during the year. Equity accounts are translated at historical exchange rates. Gains and losses from foreign currency transactions and translation for the three and six months ended June 30, 2021 and 2020 and the cumulative translation gains and losses as of June 30, 2021 and December 31, 2020 were not material.
~~Net~~ Earnings ~~or Loss per Share~~
Basic net income (loss) per common share is computed by dividing net loss by the weighted average number of vested common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number vested of common shares, plus the net impact of common shares (computed using the treasury stock method), if dilutive, resulting from the exercise of dilutive securities. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.
As of June 30, 2021 and 2020, the Company excluded the common stock equivalents summarized below, which entitled the holders thereof to ultimately acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive.
~~Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share~~
June 30, June 30,
2021 2020
Selling Agent Warrants - 160,492
Shares reserved in exchange for the cancellation of certain non-voting membership interest in Edison Nation Holdings, LLC - 990,000
Shares reserved in exchange for the cancellation of certain non-voting membership interest in EVNT, LLC 1,000,000 -
Placement Agent Warrants 4,911,692 -
Options 80,000 80,000
Convertible shares under notes payable 2,700,587 999,536
Warrants for noteholders 45,491,829 750,000
Warrants for investors 1,500,000 -
Restricted stock units - 270,000
Series B Convertible Stock - -
Shares to be issued - 46,500
Total $ 55,684,108 $ 3,296,528
15
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 2 — Summary of Significant Accounting Policies — (Continued)~~
~~Subsequent Events~~
The Company has evaluated subsequent events through the date which the financial statements were issued. Based upon such evaluation, except for items described in Note 15, the Company did not identify any recognized or non-recognized subsequent events that would have required adjustment or disclosure in the financial statements.
~~Segment Reporting~~
The Company uses “the management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by the Company’s chief operating decision maker for making operating decisions and assessing performance as the source for determining the Company’s reportable segments. The Company’s chief operating decision maker is the Chairman and Chief Executive Officer (“CEO”) of the Company, who reviews operating results to make decisions about allocating resources and assessing performance for the entire Company. The Company deploys resources on a consolidated level to all brands of the Company and therefore the Company only identifies one reportable operating segment with multiple product offerings.
16
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 3 —~~ ~~Acquisitions and Divestitures~~
~~Divestiture of Subsidiary~~
On March 12, 2021, the bankruptcy court approved the sale of the CBAV1, LLC Assets to BTL Diffusion SARL, the winning bidder, at the auction held on March 10, 2021 and March 11, 2021 for a total sum of $~~3,000,000, which includes a cash payment at closing in the amount of $2,650,000, less certain closing costs and credits, and additional royalty payments in the amount of $150,000~~ ~~on April 15, 2022 and in the amount of $200,000~~ ~~on April 15, 2023 (“CBAV1-BTL Transaction”).~~
~~A first closing of the CBAV1-BTL Transaction occurred on April 16, 2021, with the transfer of assets and release of funds completed on April 21, 2021 (“Final Closing”). Contemporaneously with the Final Closing, a certain license agreement between CBAV1 and Edison Nation, LLC (“Edison Nation”) terminated and any remaining operational assets of Edison Nation were transferred to BTL.~~
~~The table below shows the assets that the Company transferred to BTL and the components of the loss on discontinued operations:~~
~~Schedule of Loss on Income Operations of Discontinued Operations~~
~~June 30, 2021~~
~~Cash received from buyer~~ ~~2,529,565~~

~~Accounts receivable~~Revenue $ ~~(293,005~~17,940,338 )
~~Inventory~~Net income $ (~~665,522~~1,533,041 )
~~Prepaid expenses~~ ~~(160,666~~ )
~~Intangible assets~~ ~~(5,540,952~~ )
~~Loss on divestiture~~ ~~4,130,580~~
~~Operating loss of discontinued operations~~ ~~178,200~~
~~Bankruptcy costs~~ ~~650,000~~
~~Loss on discontinued operations~~ ~~4,958,780~~
On February 17, 2020, the Company divested its Cloud B, Inc. subsidiary and entered into an Agreement for the Purchase and Sale of Cloud B, Inc.(the “Purchase Agreement”), with Pearl 33 Holdings, LLC (the “Buyer”), pursuant to which the Buyer purchased from the Company (and the Company sold and assigned) ~~80,065~~ ~~shares of common stock of Cloud B (the “Cloud B Shares”) for $1.00~~ ~~and an indemnification agreement as described below, constituting a~~ ~~72.15% ownership interest in Cloud B, based on~~ ~~110,964~~ ~~shares of Cloud B’s common stock outstanding as of February 17, 2020. In accordance with the agreement, all of the liabilities of Cloud B were assumed by Pearl 33.~~

~~On February 17, 2020,~~The following represents the pro forma consolidated statement of operations as ~~part~~if AdRizer had been included in the consolidated results of operations of the ~~sale~~Company for the six-month period ended June 30, 2022 and 2021. The pro forma financial information is for illustrative purposes only, does not include the pro forma adjustments that would be required under Regulation S-X for pro forma financial information, is not necessarily indicative of ~~Cloud B, Inc.,~~the financial position or results of operations that would have been realized if the acquisition had been completed on the dates indicated, does not reflect synergies that might have been achieved, nor is it indicative of future operating results or financial position. The pro forma information is based upon currently available information and does not reflect any additional depreciation or amortization that would have been charged assuming fair value adjustments to developed technology and other intangible assets, together with the consequential tax effects, which have not yet been finalized.

For the Three Months
Ended June 30,
For the Six Months
Ended June 30,
2022
(Unaudited) 2021
(Unaudited) 2022
(Unaudited) 2021
(Unaudited)
Revenues, net $ 6,607,748 $ 10,361,492 $ 21,340,746 $ 22,128,846
Net loss attributable to Vinco Ventures, Inc. $ 145,816,018 $ (178,799,924 ) $ (227,149,675 ) $ (241,174,878 )
PZAJ Holdings, LLC
On May 12, 2022, the Company entered into an ~~indemnification~~ agreement with ~~Pearl 33~~PZAJ Holdings, LLC ~~in connection with~~(“PZAJ”) to Convert Promissory Note to Capital Contributions (“5/12/2022 Conversion Agreement”). Under the ~~divestiture of Cloud B, Inc., whereby pursuant to such agreement~~5/12/2022 Conversion Agreement, the Company ~~is limited~~was to be admitted as a PZAJ Member with 51% ownership subject to the ~~issuance of~~ ~~150,000~~ ~~shares~~terms of the ~~Company’s common stock~~agreement.
Because condition(s) precedent to the ~~Buyer for indemnification of claims against Cloud B Inc. In addition,~~Company’s admission to PZAJ as a member and to the May 12, 2022 Agreement to Convert Promissory Note to Capital Contributions failed to occur, the Company ~~shall indemnify~~did not record a membership interest in PZAJ. The notes receivable due from PZAJ will continue to be reported by the ~~Buyer~~Company. Because the intent is to be admitted as a member in exchange for ~~expenses (including attorneys’ fees and all other costs, expenses and obligations)~~the cancellation of the notes receivable, the Company will not establish a reserve against the loans that are included in ~~connection with defending any Claim in connection with~~ the ~~Cloud B. The Company has recorded $405,000~~ ~~related to~~conversion agreement as the fair value of the ~~150,000 shares~~membership interest approximates the fair value of ~~common stock which will be issued to~~ the ~~Buyer.~~loans receivable.
~~The table below shows the assets and liabilities that the Company was relieved of in the transaction:~~
~~Schedule of Business Combination of Assets and Liabilities~~

February 17,
2020

Accounts payable 4,005,605
Accrued Expenses 370,289
Income Tax Payable 14,473
Notes Payable 900,000
Non-Controlling Interest 26,393
Shares to be issued to Buyer (405,000 )
Gain on divestiture $ 4,911,760
~~Please~~ ~~see~~~~Note 15 — Discontinued Operations~~ ~~for further information.~~

~~Divestiture of Subsidiary- SRM Entertainment, LTD~~
~~On November~~During the six months ended June 30, ~~2020,~~2022, the Company held loans for investment with PZAJ, which totaled $5,740,000. The notes accrue interest at 2% with a one-year repayment term and ~~its wholly owned subsidiary, SRM Entertainment, LTD entered into a Stock Exchange Agreement with Jupiter Wellness, Inc. (“Jupiter”). Under the terms~~are repaid through 50% of net revenues, as defined, of the Exchange Agreement, Jupiter agreed to purchase all outstanding shares of common stock (the “Exchange Shares”) issued by SRM from the Company. As consideration for the purchase of the Exchange Shares, Jupiter issued the Company ~~200,000~~ ~~shares of its restricted common stock, symbol JUPW as listed on NASDAQ Capital Markets. Please~~ ~~see~~~~Note 15 — Discontinued Operations~~ ~~for further information.~~
~~Acquisitions~~
related productions. On ~~September 29, 2020,~~July 7, 2022, the Company entered into an additional note for $840,000 accruing interest at 6% with a ~~Purchase and Sale Agreement (the “Agreement”) with Graphene Holdings, LLC, Mercury FundingCo, LLC, Ventus Capital, LLC and Jetco Holdings, LLC (together the “Sellers”) to acquire~~two-year repayment term.
The notes are principally funding film or TV production assets, all ~~outstanding Membership Units (the “Units”)~~ of ~~TBD Safety, LLC (“TBD”). Collectively, the Sellers owned all outstanding Units~~which are still in production. As of ~~TBD. Under the terms~~June 30, 2022, $950,000 of the ~~Agreement,~~loans have matured, and not been repaid to the ~~Company issued a total of Two Million Two Hundred Ten Thousand Three Hundred Eighty-Two (2,210,382~~Company.~~) shares of the Company’s common stock and a total of Seven Hundred Sixty-Four Thousand Six Hundred Eighteen (764,618~~) shares of a newly designated Preferred Stock (the “Preferred”). In addition, the Company and Sellers entered into a Registration Rights Agreement (the “Registration Rights Agreement”) in favor of the Sellers obligating the Company to register such common stock and shares of common stock to be issued upon conversion of the Preferred within 120 days after the Closing. The Sellers also had an Earn Out Consideration, which provides that at such time as the assets purchased in the Agreement achieve cumulative revenue of $~~10,000,000, the Sellers will earn a total of One Hundred Twenty-Five Thousand (125,000) shares of common stock. The closing of the transaction occurred on October 16, 2020.~~

13
Asset Acquisitions
Love is Blurred, LLC
On June 21, 2022, ZASH and the Company entered into a Love is Blurred LLC Membership Interest Assignment Agreement (“LIB Membership Interest Agreement”). Pursuant to the LIB Membership Interest Agreement, ZASH sold 100% of its membership interest in Love Is Blurred (“LIB”) to the Company to purchase 100% Membership Interests in LIB LLC from ZASH. The purchase price for the LIB asset was $531,279. Consideration to ZASH for the acquired asset was the reduction of outstanding principal by $1,048,750 and outstanding interest by $201,250 (totaling $1,250,000) on a loan between the Company and ZASH. The acquisition closed on June 21, 2022. The fair value of the asset was determined to be $531,279, and a loss on the Love is Blurred LLC acquisition of $718,721 was recognized.
The LIB LLC assets consist principally of a single film production asset. Because the LIB LLC is not a business, the acquisition has been accounted for as an asset.
Emmersive Entertainment Asset Contribution

On April 17, 2021, Vinco ~~Ventures, Inc. (“Vinco”)~~ and EVNT ~~Platform, LLC, a wholly owned subsidiary of Vinco (“the Company” or “Buyer”),~~ entered into (and closed on) a certain Asset Contribution Agreement (“Asset Contribution Agreement”) with Emmersive Entertainment, Inc. (“Emmersive” ~~or “Seller”~~), pursuant to which Emmersive contributed/transferred to the Company the assets used for Emmersive’s business, which include digital assets, software and certain physical assets (the “Contributed Assets”) in consideration for, among other things, the Company assuming certain obligations of Emmersive, hiring certain employees, and issuing 1,000,000preferred membership units (“Preferred Units”) in the Company to Emmersive and/or its shareholders (“Preferred Members”) pursuant to a First Amended and Restated Operating Agreement for the Company dated as of April 17, 2021(“Amended Operating Agreement”). Certain put rights are associated with Preferred Units, which if exercised by the Preferred Members, obligates Vinco to purchase the Preferred Units in exchange for 1,000,000shares of Vinco Venture’s common stock (“Put Rights”). In addition, the Preferred Members have the opportunity to earn up to 4,000,000Conditional Preferred Units if certain conditions are satisfied for each of the four earn out targets (“Earn-Out Targets”). ~~The Earn-Out Targets are described below:~~
~~Earn-Out Target 1~~: In the event that the Company (1) develops a minimally viable product for the NFT Technology to validate the utility of the product/platform with features to attract and transact with customers and (2) is successful on-boarding a minimum of 10 approved influential celebrities on or before December 31, 2021, the Company shall issue to Emmersive and/or Emmersive’s Shareholders, ~~1,000,000~~ ~~Conditional Preferred Units, with Put Rights.~~
~~Earn-Out Target 2~~: ~~In the event that the Company generates a minimum of $7,000,000~~ in annualized booked revenues inclusive of revenues generated from the celebrities onboarded by the Company (collectively “Attributed Revenue”) in any three-calendar-month period ending on or before March 31, 2022 (i.e. more than $~~1,750,000~~ ~~in Attributed Revenue in a period of three consecutive calendar months), the Company shall issue to Emmersive and/or Emmersive’s Shareholders~~ ~~1,000,000~~ ~~Conditional Preferred Units, with the Put Rights.~~
~~Earn-Out Target 3:In the event that the Company generates a minimum of $28,000,000~~ ~~in annualized Attributed Revenues in any three-calendar-month period ending on or before December 31, 2022 (i.e. more than $7,000,000~~ ~~in Attributed Revenue in a period of three consecutive calendar months), the Company shall issue to Emmersive and/or Emmersive’s Shareholders~~ ~~1,000,000~~ ~~Conditional Preferred Units, with Put Rights.~~
~~Earn Out Target 4~~: ~~In the event that the Company generates a minimum of $62,000,000~~ ~~in annualized Attributed Revenues in any three-calendar-month period ending on or before December 31, 2023 (i.e. more than $15,500,000~~ ~~in Attributed Revenue in a period of three consecutive calendar months), the Company shall issue to Emmersive and/or Emmersive’s Shareholders~~ ~~1,000,000~~ ~~Conditional Preferred Units, with Put Rights.~~

On April 17, 2021, the transactions under both the Asset Contribution Agreement and Amended Operating Agreement closed. The Preferred Units and Conditional Preferred Units were valued at $~~2,100,00~~2,100,000 and $5,300,000, respectively, and recorded as an intangible asset.
~~Honey Badger~~
On ~~November 10, 2020,~~October 19, 2021, the Company, through its wholly owned subsidiary, Honey Badger Media, LLC, entered into a series of transactions to acquire certain assets and license a platform with Honey Badger Media, LLC, a Delaware limited liability company, for $Preferred Unit Holders were issued ~~300,000~~ ~~and~~ ~~750,000~~1,000,000 shares of common ~~stock. The transaction was treated as an asset purchase and not accounted for as a business combination due to substantially all~~stock of the fair value of gross assets acquired were concentrated to a group of similar identifiable assets which was media licensing assets. In addition, there was limited inputs, processes and outputs, which did not meet the requirements to be a business. On January 5, 2021, the Company issued ~~750,000~~ ~~shares of our common stock~~Vinco in ~~connection with the asset acquisition.~~
17
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 3 — Acquisitions and Divestitures (continued)~~
~~HMNRTH~~
~~On March 11, 2020, the Company issued~~ ~~238,750shares of our common stock to acquire the assets of HMNRTH, LLC. On July 1, 2020, the Company made payment in the amount of $70,850~~to the principals of HMNRTH, LLC. The transaction was treated as an asset purchase and not accounted for as a business combination due to the limited inputs, processes and outputs, which did not meet the requirements to be a business.
~~Note 4 —~~ ~~Variable Interest Entities~~
The Company is involved in the formation of various entities considered to be Variable Interest Entities (“VIEs”). The Company evaluates the consolidation of these entities as required pursuant to ASC Topic 810 relating to the consolidation of VIEs. These VIEs are primarily partnerships formed to supply consumer goods to through various distribution and retail channels.
The Company’s determination of whether it is the primary beneficiary of VIE is based in part on an assessment of whether or not the Company and its related parties are exposed to the majority of the risks and rewards of the entity. Typically, the Company is entitled to substantially all or portion of the economics of these VIEs. The Company is the primary beneficiary of the VIE entities.
~~In April 2021, the Company agreed to unwind the joint venture of Ed Roses, LLC and recognized a loss of $301,645~~.
~~The following table presents the carrying values of the assets and liabilities of entities that are VIEs and consolidated by the Company at June 30, 2021:~~
~~Schedule of Variable Interest Entities~~
June 30, 2021 December 31, 2020

Assets
Current assets:
Cash and cash equivalents $ 3,845 $ 10,481
Accounts receivable, net - 94,195
Inventory - 240,158
Prepaid expenses and other current assets - -
Total current assets 3,845 344,834
Property and equipment, net - -
Total assets $ 3,845 $ 344,834

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable $ 29,164 $ 217,558
Accrued expenses and other current liabilities 43,473 113,576
Line of credit, net of debt issuance costs of $0 and $15,573, respectively 1,133,652 1,133,652
Notes payable, current - 150,000
Due to related party 315,666 315,666
Total current liabilities 1,521,955 1,930,452
18
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 4 — Variable Interest Entities — (Continued)~~
~~The following table presents the operations of entities that are VIEs and consolidated by the Company at June 30, 2021:~~
2021 2020 2021 2020

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2021 2020 2021 2020
Revenues, net $ 92,945 $ 1,051,945 $ 307,339 $ 1,274,477
Cost of revenues 9,530 789,000 93,685 994,923
Gross profit 83,415 262,945 213,654 279,554

Operating expenses:
Selling, general and administrative 4,320 136,648 104,741 203,562
Operating income 79,095 126,297 108,913 75,992

Other (expense) income:
Interest expense (34,010 ) (21,331 ) (7,760 ) (56,956 )
Total other (expense) income (34,010 ) (21,331 ) (7,760 ) (56,956 )
Loss before income taxes 45,085 104,966 101,153 19,036
Income tax expense - - - -
Net income $ 45,085 $ 104,966 $ 101,153 $ 19,036
~~At June 30, 2021, the Company had one unconsolidated VIE, ZVV Media Partners, LLC (“ZVV”), for which the Company held a variable interest.~~
~~Global Clean Solutions, LLC~~
On May 20, 2020 (the “Effective Date”), the Company entered into an Agreement and Plan of Share Exchange (the “Share Exchange Agreement”) with PPE Brickell Supplies, LLC, a Florida limited liability company (“PPE”), and Graphene Holdings, LLC, a Wyoming limited liability company (“Graphene”, and together with PPE, the “Sellers”), whereby the Company purchased 25 membership units of Global Clean Solutions, LLC, a Nevada limited liability company (“Global”) from each of PPE and Graphene, for a total of fifty (50) units, representing fifty percent (50%) of the issued and outstanding units of Global (the “Purchase Units”)~~. The Company issued~~ ~~250,000~~ ~~shares of its restricted common stock, $0.001~~ ~~par value per share (the “Common Stock”) to PPE, and~~ ~~50,000~~ ~~shares of Common Stock to Graphene, in consideration~~exchange for the ~~Purchase~~Preferred Units. ~~Global Clean Solutions, LLC is a VIE. The fair value of the shares of $699,000~~ ~~was treated as a distribution to the noncontrolling interest members.~~
Pursuant to the terms of the Share Exchange Agreement, the Sellers may earn additional shares of Common Stock upon Global realizing the following revenue targets: (i) In the event that Global’s total orders equal or exceed $~~1,000,000, Graphene shall receive~~ ~~200,000~~ ~~shares of Common Stock; (ii) In the event that Global’s total orders equal or exceed $10,000,000, PPE shall receive~~ ~~100,000~~ ~~shares of restricted Common Stock; and (iii) In the event that Global’s total orders equal or exceed $25,000,000, Graphene shall receive~~ ~~125,000~~ shares of restricted Common Stock. Additionally, the Company shall be entitled to appoint two managers to the Board of Managers of Global. The fair value of the shares is expensed over the estimated vesting period and is adjusted based on the number of shares that vest.

1914
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 4 — Variable Interest Entities — (Continued)~~

On the Effective Date, the Company entered into an Amended Limited Liability Company Agreement of Global (the “Amended LLC Agreement”). The Amended LLC Agreement amends the original Limited Liability Company Agreement of Global, dated May 13, 2020. The Amended LLC defines the operating rules of Global and the ownership percentage of each member: Vinco Ventures, Inc. 50~~%, PPE~~ 25~~% and Graphene~~ 25%.
On the Effective Date, the Company (as “Guarantor”) entered into a Secured Line of Credit Agreement (the “Credit Agreement”) with Global and PPE. Under the terms of the Credit Agreement, PPE is to make available to Global a revolving credit loan in a principal aggregate amount at any one time not to exceed $~~2,500,000. Upon each drawdown of funds against the credit line, Global shall issue a Promissory Note (the “Note”) to PPE. The Note shall accrue interest at~~ 3~~% per annum and have a~~ ~~maturity date of six (6) months~~. In the event of a default, any and all amounts due to PPE by Global, including principal and accrued but unpaid interest, shall increase by forty (40%) percent and the interest shall increase to five (5%) percent (the “Default Interest”).
On the Effective Date, the Company (as “Guarantor”) entered into a Security Agreement (the “Security Agreement”) with Global (as “Borrower”) and PPE as the secured party, whereby the Company placed ~~1,800,000~~ shares of Common Stock (the “Reserve Shares”) in reserve with its transfer agent in the event of default under the Credit Agreement. In the event of a default that is not cured by the defined cure period, the PPE may liquidate the Reserve Shares until the Global’s principal, interest and associated expenses are recovered. The number of Reserve Shares may be increased through the issuance of True-Up shares in the event the original number of Reserve Shares is insufficient.
20
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 5 —~~ ~~Short-Term Investments~~
~~As of June 30, 2021 and December 31, 2020, short-term investments consisted of the following:~~
~~Schedule of Short-Term Investments~~
June 30, December 31,
2021 2020
Jupiter Wellness, Inc. (JUPW) ⁽ⁱ⁾ $ 1,040,000 $ 1,040,000
Unrealized losses (144,400 ) (22,000 )
Total short-term investments $ 895,600 $ 1,018,000
~~(i)~~ On November 30, 2020, the Company and its wholly owned subsidiary, SRM Entertainment, LTD entered into a Stock Exchange Agreement with Jupiter Wellness, Inc. (“Jupiter”). Under the terms of the Exchange Agreement, Jupiter purchased all outstanding shares of common stock (the “Exchange Shares”) issued by SRM from the Company. As consideration for the purchase of the Exchange Shares, Jupiter issued the Company ~~200,000~~ ~~shares of its restricted common stock, symbol JUPW as listed on NASDAQ Capital Markets. On June 30, 2021, the closing price of JUPW was $4.48~~ ~~on the Nasdaq.~~
~~Note 6 —~~ ~~Property and Equipment, net~~
~~As of June 30, 2021 and December 31, 2020, property and equipment consisted of the following:~~
~~Schedule of Property and Equipment~~
June 30, December 31,
2021 2020
Land $ 79,100 $ 79,100
Buildings – rental property 463,635 463,635
Building improvements 800,225 800,225
Equipment and machinery 4,144,145 4,122,917
Furniture and fixtures 368,137 368,137
Computer software 55,500 -
Molds 79,300 79,300
Vehicles 533,866 521,962
Property, Plant and Equipment, Gross 6,523,908 6,435,276
Less: accumulated depreciation (5,490,098 ) (5,424,475 )
Total property and equipment, net $ 1,033,810 $ 1,010,801
~~Depreciation expense for the six months ended June 30, 2021 and 2020 was $65,623~~ ~~and $169,141, respectively.~~
~~Note 7 —~~ ~~Loan Receivable~~
~~As of June 30, 2021 and December 31, 2020, loan receivable consisted of the following:~~
~~Schedule of Loan Receivable~~
June 30, December 31,
2021 2020
Loan to Zash Global Media and Entertainment Corporation ⁽ⁱ⁾ $ 5,000,000 $ -
~~(i)~~ ~~On February 18, 2021, the Company loaned $5,000,000~~ ~~to ZASH Global Media and Entertainment Corporation (“ZASH”). The interest rate on the note is~~ 3~~% per annum. The maturity date of the loan is~~ ~~August 17, 2023. The purpose of the loan is to engage in the acquisition, development and production of consumer facing content and related activities.~~
~~Note 8 —~~ ~~Equity Method Investments~~
~~As of June 30, 2021 and December 31, 2020, the carrying amount of equity method investments consisted of the following:~~
~~Schedule of Equity Method Investments~~
June 30, December 31,
2021 2020
Investment in ZVV Media Partners, LLC ⁽ⁱ⁾ $ 12,000,000 $ -
~~(i)~~ On January 19, 2021, the Company, ZVV Media Partners, LLC (“ZVV”) and ZASH entered into a Contribution Agreement (the “Agreement”). The Company and ZASH established the newly formed entity, ZVV, in order to engage in the development and production of consumer facing content and related activities.
~~Note 9 —~~ ~~Goodwill~~
~~For the six months ended June 30, 2021, there was~~ 0 ~~change in the carrying amount of goodwill.~~
The Company utilized the simplified test for goodwill impairment. The amount recognized for impairment is equal to the difference between the carrying value and the asset’s fair value. The valuation methods used in the quantitative fair value assessment was a discounted cash flow method and required management to make certain assumptions and estimates regarding certain industry trends and future profitability of our reporting units.
~~Note 10 —~~ ~~Debt~~
~~As of June 30, 2021 and December 31, 2020, debt consisted of the following:~~
~~Schedule of Debt~~
June 30, December 31,
2021 2020
Line of credit:
Lines of credit $ 1,133,652 $ 1,133,652
Receivable financing - 367,301
Total lines of credit 1,133,652 1,500,953

Senior convertible notes payable:
Senior convertible notes payable– related parties 422,272 1,428,161
Convertible notes payable 10,000,000 591,104
Debt issuance costs (6,821,756 ) (280,511 )
Total long-term senior convertible notes payable 3,600,516 1,738,754
Less: current portion of long-term notes payable (3,333,333 ) (577,260 )
Noncurrent portion of long-term convertible notes payable 267,183 1,161,494

Notes payable:
Notes payable 35,151 1,932,088
Debt issuance costs - (34,997 )
Total long-term debt 35,151 1,897,091
Less: current portion of long-term debt (15,185 ) (1,301,212 )
Noncurrent portion of long-term debt 19,966 595,879

Notes payable – related parties:
Notes payable 876,500 2,827,512
Debt issuance costs - (33,833 )
Total notes payable – related parties: 876,500 2,793,679
Less: current portion of long-term debt – related parties (876,500 ) (1,389,922 )
Noncurrent portion of long-term debt – related parties $ - $ 1,403,757
21
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 10 — Debt — (Continued)~~
~~Convertible Notes Payable~~
~~Hudson Bay Financing- February 2021~~
On February 23, 2021 (the “Effective Date”), the Company consummated the closing of a private placement offering (the “Offering”) whereby pursuant to the Securities Purchase Agreement (the “Purchase Agreement”) entered into by the Company on February 18, 2021 with one accredited investor (the “Investor”), the Company issued a Senior Convertible Note for the purchase price of $~~10,000,000~~ ~~(the “Note”) and five (~~5~~) year warrants (the “February Warrants”) to purchase shares of the Company’s common stock, par value $0.001~~ ~~per share (“Common Stock”). The Company issued the February Warrants to the Investor representing the right to acquire an aggregate of~~ ~~18,568,188~~ ~~shares of Common Stock. The February Warrants contain an exercise price of $3.722~~ ~~per share.~~
~~The Note carries an interest rate of~~ 6~~% per annum compounding monthly and matures on~~ ~~February 23, 2022~~. The Note contains a voluntary conversion mechanism whereby the Noteholder may convert at any time after the Issuance Date, in whole or in part, the outstanding principal and interest under the Note into shares of the Common Stock at a conversion price of $~~4.847~~ per share (the “Conversion Shares”). The Note shall be a senior unsecured obligation of the Company and its subsidiaries. The Note contains customary events of default (each an “Event of Default”). If an Event of Default occurs, interest under the Note will accrue at a rate of twelve percent (12%) per annum and the outstanding principal amount of the Note, plus accrued but unpaid interest, liquidated damages and other amounts owing with respect to the Note will become, at the Note holder’s election, immediately due and payable in cash. Upon completion of a Change of Control (as defined in the Note), the Note’s holder may require the Company to purchase any outstanding portion of the Note in cash at a price in accordance with the terms of the Note.
22
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 10 — Debt — (Continued)~~
~~Pursuant to the Purchase Agreement, the Investor received a Warrant in an amount equal to~~ ~~900% of the shares of Common Stock initially issuable to the Investor pursuant to the conversion terms of the Investor’s Note. The Warrant contains an exercise price of $3.722~~ ~~per share, subject to adjustments as provided under the terms of the Warrant. In connection with the closing of the Offering, the Warrant was exercisable for an aggregate of~~ ~~18,568,188~~ ~~shares of Common Stock (the “Warrant Shares”). As of June 30, 2021, the Investor has exercised~~ ~~13,968,188~~ ~~warrants.~~
The Company also entered into a Registration Rights Agreement with the Investor (the “Registration Rights Agreement”). The Registration Rights Agreement provides that the Company shall (i) file with the Securities and Exchange Commission (the “Commission”) a Registration Statement by 30 days following the Closing Date of the Purchase Agreement to register the Conversion Shares and Warrant Shares (the “Registration Statement”); and (ii) use all commercially reasonable efforts to have the Registration Statement declared effective by the Commission within 60 days following the Closing Date or at the earliest possible date, or 75 days following the Closing Date if the Registration Statement receives comments from the Commission.
~~Palladium Capital Group, LLC. (the “Placement Agent”) acted as placement agent for the Offering.~~ ~~The Placement Agent received cash compensation of $900,000~~ ~~(8% of the gross proceeds to the Company plus an additional 1% of the gross proceeds to the Company for non-accountable expenses).~~ ~~The Placement Agent also received a Warrant granting the Holder the right to purchase~~ ~~1,650,346~~ ~~shares of the Company’s common stock at an exercise price of $3.722~~ ~~with an expiration date of February 23, 2026.~~
On June 4, 2021, the Company entered into a warrant exercise agreement (the “June 2021 Warrant Agreement”) with the Investor whereby the Company agreed to issue additional warrants, to purchase shares of Common Stock at a per-share exercise price equal to $~~3.30~~ (the “Incentive Warrants”, all pursuant to the terms and conditions set forth in the June 2021 Warrant Agreement. At the Closing (as defined in Section 2 of the June 2021 Agreement), the parties shall execute and deliver a registration rights agreement, (the “Registration Rights Agreement”), pursuant to which the Company will agree to register the shares of Common Stock underlying the Incentive Warrants.
Subject to the terms of June 2021 Warrant Agreement, the Company shall issue and deliver Incentive Warrants to the Investor to initially purchase zero shares of Common Stock, which number of shares shall be subject to adjustment, including the provision of Incentive Warrants on a 1.75-for-one basis for the additional exercise of each Existing Warrant on or prior to July 7, 2021. During the six months ended June 30, 2021, the Investor exercised ~~15,898,188~~ ~~warrants and received~~ ~~27,821,829~~ ~~incentive warrants.~~
~~The June 2021 Warrant Agreement includes customary representations, warranties and covenants, and customary conditions to closing, expense and reimbursement obligations and termination provisions.~~
On July 7, 2021, the Company entered into an Amendment to the June 2021 Warrant Agreement (the “Amendment Agreement”). Under the terms of the Amendment Agreement, the exercise date for the June Warrants has been extended to August 9, 2021 (the “Adjustment Date”).
~~Hudson Bay Financing- January 2021~~
On January 25, 2021 (the “Effective Date”), the Company consummated the closing of a private placement offering (the “Offering”) whereby pursuant to the Securities Purchase Agreement (the “Purchase Agreement”) entered into by the Company on January 21, 2021 with Hudson Bay Master Fund, Ltd (the “Investor”), the Company issued a Senior Convertible Note for the purchase price of $~~12,000,000~~ ~~(the “Note”) and a five (~~5~~) year warrant (the “January Warrant”) to purchase shares of the Company’s common stock, par value $0.001~~ ~~per share (“Common Stock”). The Company issued the January Warrants to the Investor representing the right to acquire an aggregate of~~ ~~15,000,000~~ ~~shares of the Company’s common stock, $0.001~~ ~~par value per share (the “Common Stock”). The January Warrants contain an exercise price of $2.00~~ ~~per share.~~
~~The Investor converted $11,000,000~~ ~~of principal and $39,190~~ ~~of interest into~~ ~~5,519,595~~ ~~of the Company’s common shares.~~
~~The Note carries an interest rate of~~ 6% per annum and matures on the 12-month anniversary of the Issuance Date (as defined in the Note). The Note contains a voluntary conversion mechanism whereby the Noteholder may convert at any time after the Issuance Date, in whole or in part, the outstanding balance of the Note into shares of the Common Stock at a conversion price of $~~2.00~~ per share (the “Conversion Shares”). The Note shall be a senior obligation of the Company and its subsidiaries. The Note contains customary events of default (each an “Event of Default”). If an Event of Default occurs, interest under the Note will accrue at a rate of twelve percent (12%) per annum and the outstanding principal amount of the Note, plus accrued but unpaid interest, liquidated damages and other amounts owing with respect to the Note will become, at the Note holder’s election, immediately due and payable in cash. Upon completion of a Change of Control (as defined in the Note), the Note’s holder may require the Company to purchase any outstanding portion of the Note in cash at a price in accordance with the terms of the Note.
~~Pursuant to the Purchase Agreement, the Investor received a Warrant in an amount equal to~~ ~~250% of the shares of Common Stock initially issuable to each Investor pursuant to the Investor’s Note. The Warrant contains an exercise price of $2.00~~ ~~per share. In connection with the closing of the Offering, the Warrant was issued to purchase an aggregate of~~ ~~15,000,000~~ ~~shares of Common Stock (the “Warrant Shares”). As of June 30, 2021, the Investor has exercised~~ ~~15,000,000~~ ~~warrants.~~
The Company also entered into a Registration Rights Agreement with the Investor (the “Registration Rights Agreement”). The Registration Rights Agreement provides that the Company shall (i) file with the Securities and Exchange Commission (the “Commission”) a Registration Statement by 30 days following the Closing Date to register the Conversion Shares and Warrant Shares (the “Registration Statement”); and (ii) use all commercially reasonable efforts to have the Registration Statement declared effective by the Commission within 60 days following the Closing Date or at the earliest possible date, or 75 days following the Closing Date if the Registration Statement receives comments from the Commission.
~~Palladium Capital Group, LLC (the “Placement Agent”) acted as placement agent for the Offering.~~ ~~The Placement Agent received cash compensation of $1,080,000~~ ~~(8% of the gross proceeds to the Company plus an additional 1% of the gross proceeds to the Company for non-accountable expenses).~~ ~~The Placement Agent also received a Warrant dated~~ ~~January 25, 2021~~ ~~granting the Holder the right to purchase~~ ~~480,000~~ ~~shares of the Company’s common stock at an exercise price of $2.00~~ ~~with an expiration date of January 25, 2026.~~
~~On May 24, 2021, the Company entered into a warrant exercise agreement (the “May 2021 Warrant Agreement”) with the Investor who agreed to exercise~~ ~~2,870,000~~ ~~shares of Common Stock underlying the January Warrants and the Company agreed to issue additional warrants, to purchase shares of Common Stock at a per-share exercise price equal to $3.20~~ (the “Incentive Warrants”, all pursuant to the terms and conditions set forth in the May 2021 Warrant Agreement. At the Closing (as defined in Section 2(b) of the May 2021 Warrant Agreement), the parties shall execute and deliver a registration rights agreement, (the “Registration Rights Agreement”), pursuant to which the Company will agree to register the shares of Common Stock underlying the Incentive Warrants. During the six months ended June 30, 2021, the Investor exercised ~~13,070,000~~ ~~warrants and received~~ ~~13,070,000~~ ~~incentive warrants.~~
~~Subject to the terms of May 2021 Warrant Agreement,~~ (i) the Investor shall pay to the Company an amount equal to the exercise price of the January Warrants in effect as of the date of such exercise multiplied by 2,870,000 shares (as adjusted for any share split or similar transaction after the date hereof) (the “Exercised Warrant Shares”) and (ii) the Company shall issue and deliver Incentive Warrants to the Investor to initially purchase an aggregate number of shares equal to the number of Exercised Warrant Shares, which number of shares shall be subject to adjustment, including the provision of Incentive Warrants on a one-for-one basis for the additional exercise of each January Warrant on or prior to June 1, 2021.
~~The May 2021 Warrant Agreement includes customary representations, warranties and covenants, and customary conditions to closing, expense and reimbursement obligations and termination provisions.~~
~~Jefferson Street Capital Financing~~
On July 29, 2020, the Company entered into a Securities Purchase Agreement (the “Agreement”) with Jefferson Street Capital, LLC (the “Investor”) wherein the Company issued the Investor a Convertible Promissory Note (the “Note”) in the amount of $~~224,000~~ ($~~24,000~~ ~~OID). The Note has a term of six (~~6~~) months, is due on~~ ~~January 29, 2021~~ ~~and has a one-time interest charge of~~ 2%~~. In addition, the Company issued the Investor~~ ~~14,266~~ shares of Common Stock (the “Origination Shares”) as an origination fee. The transaction closed on July 29, 2020. On January 28, 2021, the Company paid all outstanding principal and interest in the amount of $~~260,233~~.
23
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 10 — Debt — (Continued)~~
On April 7, 2020, the Company entered into a Securities Purchase Agreement (the “Agreement”) with Jefferson Street Capital, LLC (the “Investor”) wherein the Company issued the Investor a Convertible Promissory Note (the “Note”) in the amount of $~~168,000~~ ($~~18,000~~ ~~OID). The Note has a term of six (~~6~~) months, is due on~~ ~~October 7, 2020and has a one-time interest charge of~~ 2%~~. In addition, the Company issued the Investor~~ ~~10,700~~ shares of Common Stock (the “Origination Shares”) as an origination fee. The transaction closed on April 9, 2020. On October 7, 2020, the Company and Investor entered into a Forbearance Agreement (the “Forbearance Agreement”). Under the terms of the Forbearance Agreement, the Company requested and the Investor agreed to temporarily forebear, until the earlier of (i) December 9, 2020 or (ii) at such time as a default shall occur under and pursuant to the Purchase Agreement, the Note or the Agreement, from exercising its right to convert amounts due under the Note into Common Stock of the Company, in exchange for a one-time cash payment forbearance fee equal to $~~12,500~~ ~~paid upon execution of the Agreement.On December 23, 2020, the Investor submitted a Notice of Conversion for $45,000~~ ~~in principal and $750~~ ~~in fees. On December 29, 2020, the Company issued~~ ~~41,730~~ ~~shares to satisfy the conversion obligation. The Investor converted $54,830~~ ~~of principal into~~ ~~54,830~~ ~~of the Company’s common shares. The Note was paid in full on February 1, 2021.~~
~~BHP Capital Financing~~
On April 7, 2020, the Company entered into a Securities Purchase Agreement (the “Agreement”) with BHP Capital NY Inc. (the “Investor”) wherein the Company issued the Investor a Convertible Promissory Note (the “Note”) in the amount of $~~168,000~~ ($~~18,000~~ ~~OID). The Note has a term of six (~~6~~) months, is due on~~ ~~October 7, 2020~~ ~~and has a one-time interest charge of~~ 2%~~. In addition, the Company issued the Investor~~ ~~10,700~~ ~~shares of Common Stock (the “Origination Shares”) as an origination fee. The transaction closed on April 9, 2020. The note was paid in full on January 29, 2021.~~
24
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 10 — Debt — (Continued)~~
~~32E Financing~~
~~On December 4, 2019, the Company agreed to issue and sell to 32 Entertainment LLC (“32E”) a 10% Senior Secured Note (the “32E Note”), in the principal amount of $250,000. The maturity date of the 32E Note is~~ ~~December 4, 2020. In addition, the Company issued to 32E~~ ~~10,000~~ ~~shares of common stock as an inducement to 32E to purchase the 32E Note. The fees were recorded as a debt discount and amortized over the term of the note. The $250,000~~ of proceeds from the 32E Note was used for general working capital needs of the Company and the repayment of debt related to Horberg Enterprises. On May 19, 2020, the Company entered into an Amendment (the “Amendment”) to the 32E Note. Under the terms of the Amendment, the Company issued to 32E an Amended Subordinate Secured Note (the “Replacement Note”) in the principal amount of $~~200,000~~ ~~that accrued interest at~~ ~~16%~~ ~~annually and matured on May 21, 2021. On May 28, 2020, the Company paid $50,000~~ ~~toward the principal plus interest in the amount of $6,250~~ ~~for a total of $56,250. 32E also received~~ ~~40,000~~ ~~restricted stock units and surrendered the warrant issued to it in the December 4, 2019 financing transaction. The note was paid in full on January 28, 2021.~~
~~Promissory Notes~~
On January 2, 2020, Ed Roses, LLC (the “Partnership”) entered into a Loan Agreement (the “Agreement”) with Sook Hyun Lee (the “Lender”). Under the terms of the Agreement, the Lender agreed to lend $~~150,000~~ ~~to the Partnership for general working capital. The Loan is due on~~ ~~April 15, 2020~~ ~~(the “Maturity Date”) and accrues interest at~~ ~~15%~~ per annum. The Agreement shall automatically renew at the Maturity date for successive 90-day periods unless written notice is remitted by either party. On the Maturity date, the Partnership shall pay the Lender all unpaid principal and interest and a $~~30,000~~ ~~commitment fee. The Lender shall have a collateral interest in the accounts receivable of the Partnership, including but not limited to 7 Eleven receivables. As collateral, Edison Nation, Inc. placed~~ ~~75,000~~ ~~shares of common stock in reserve. The note was paid in full on March 11, 2021.~~
25
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 10 — Debt — (Continued)~~
~~On January 10, 2020, the Company entered into a 5% Promissory Note Agreement with Equity Trust Company on behalf of Rawleigh Ralls (“Ralls”) for an aggregate principal amount of $267,000~~ ~~(the “Ralls Note”), pursuant to which Ralls purchased the Ralls Note from the Company for $250,000~~ ~~and an original issue discount of $17,000, and the Company issued to Ralls a warrant (the “Ralls Warrant”) to purchase~~ ~~125,000~~ ~~shares of the Company’s common stock valued at $86,725~~ ~~estimated using the Black-Scholes option-valuation model. The Company paid the Note in full on January 27, 2021.~~
~~On January 15, 2020, the Company entered into a 5% Promissory Note Agreement with Paul J. Solit & Julie B. Solit (“Solits”) for an aggregate principal amount of $107,000~~ ~~(the “Solit Note”), pursuant to which the Solits purchased the Solit Note from the Company for $100,000~~ ~~and an original issue discount of $7,000, and the Company issued to the Solits a warrant (the “Solit Warrant”) to purchase~~ ~~50,000~~ ~~shares of the Company’s common stock valued at $31,755~~ ~~estimated using the Black-Scholes option-valuation model. The Company paid the Note in full on January 27, 2021. The Solit Warrant was exercised on January 22, 2021.~~
~~On January 17, 2020, the Company entered into a 5% Promissory Note Agreement with Richard O’Leary (“O’Leary”) (“Lender”) for an aggregate principal amount of $53,500~~ ~~(the “O’Leary Note”), pursuant to which O’Leary purchased the O’Leary Note from the Company for $50,000~~ ~~and an original issue discount of $3,500, and the Company issued to O’Leary a warrant (the “O’Leary Warrant”) to purchase~~ ~~25,000~~ ~~shares of the Company’s common stock valued at $16,797~~ ~~estimated using the Black-Scholes option-valuation model. The Company paid the Note in full on January 27, 2021. The O’Leary Warrant was exercised on February 18, 2021.~~
26
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 10 — Debt — (Continued)~~
~~Paycheck Protection Program~~
On April 15, 2020, the Company entered into a loan agreement (“PPP Loan”) with First Choice Bank under the Paycheck Protection Program (the “PPP”), which is part of the recently enacted Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the United States Small Business Administration (“SBA”). The Company received proceeds of $~~789,852~~ from the PPP Loan. In accordance with the requirements of the PPP, the Company intends to use proceeds from the PPP Loan primarily for payroll costs, subject to thresholds, rent and utilities. The PPP Loan has a ~~1.00%~~ ~~interest rate per annum and matures on~~ ~~April 15, 2022~~ and is subject to the terms and conditions applicable to loans administered by the SBA under the PPP. Under the terms of the PPP, certain amounts of the PPP Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. The PPP Loan is included in notes payable on the consolidated balance sheet. On May 4, 2021, the Company’s PPP loan was forgiven and the carrying value of $~~789,852~~ ~~was recorded as a gain on extinguishment as part of interest expense.~~
On May 4, 2020, TBD Safety, LLC, the Company’s wholly owned subsidiary, entered into a loan agreement (“PPP Loan”) with First Home Bank under the Paycheck Protection Program (the “PPP”), which is part of the recently enacted Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) administered by the United States Small Business Administration (“SBA”). The Company received proceeds of $~~62,500~~ from the PPP Loan. In accordance with the requirements of the PPP, the Company intends to use proceeds from the PPP Loan primarily for payroll costs, subject to thresholds, rent and utilities. The PPP Loan has a ~~1.00%~~ ~~interest rate per annum and matures on~~ ~~May 4, 2022~~ and is subject to the terms and conditions applicable to loans administered by the SBA under the PPP. Under the terms of the PPP, certain amounts of the PPP Loan may be forgiven if they are used for qualifying expenses as described in the CARES Act. The PPP Loan is included in notes payable on the consolidated balance sheet. ~~On April 16, 2021, the TBD Safety PPP loan was forgiven the carrying value of $62,500~~ ~~was recorded as a gain on extinguishment as part of interest expense.~~
~~Receivables Financing~~
~~On February 21, 2020, the Company entered into a receivables financing arrangement for certain receivables of the Company not to exceed $1,250,000~~ ~~at any one time. The agreement allows for borrowings up to~~ ~~85%~~ ~~of the outstanding receivable based on the credit quality of the customer. The fee is between~~ 1% ~~and~~ 2% ~~of the total invoices financed.~~
~~On November 12, 2019, the Company entered into a Receivables Purchase Agreement with a financial institution (the “Receivables Purchase Agreement”), whereby the Company agreed to the sale of $250,000~~ ~~of receivables for $200,000. The proceeds were used for general working capital. The note was paid in full on February 1, 2021.~~
~~In April 2019, we entered into a receivables financing arrangement for certain receivables of the Company. The agreement allows for borrowings up to~~ ~~80%~~ ~~of the outstanding receivable based on the credit quality of the customer. The fee is between~~ 1% ~~and~~ 2% ~~of the total invoices financed. The receivables financing arrangement was paid in full and terminated on March 30, 2021.~~
~~Line of Credit~~
On the Effective Date, the Company (as “Guarantor”) entered into a Secured Line of Credit Agreement (the “Credit Agreement”) with Global and PPE. Under the terms of the Credit Agreement, PPE is to make available to Global a revolving credit loan in a principal aggregate amount at any one time not to exceed $~~2,500,000. Upon each drawdown of funds against the credit line, Global shall issue a Promissory Note (the “Note”) to PPE.~~ The Note shall accrue interest at 3% per annum and have a maturity date of six (6) months. In the event of a default, any and all amounts due to PPE by Global, including principal and accrued but unpaid interest, shall increase by forty (40%) percent and the interest shall increase to five (5%) percent (the “Default Interest”). ~~The balance at June 30, 2021 is $1,133,652~~.
~~The scheduled maturities of the debt for the next five years as of June 30, 2021, are as follows:~~
~~Schedule of Maturities of Long-term Debt~~
For the Years Ended December 31, Amount
2021 (excluding the six months ended June 30, 2021) 2,017,659
2022 10,015,530
2023 434,386
2024 -
2025 -
Thereafter -
Long-term Debt, Gross 12,467,575
Less: debt discount (6,821,756 )
Long-term Debt $ 5,645,819
~~For the three and six months ended June 30, 2021, interest expense was $2,715,481~~ ~~and $15,410,414, respectively, of which $277,083~~ ~~and $190,549 was related party interest expense. For the three and six months ended June 30, 2020, interest expense was $847,154~~ ~~and $1,571,111, respectively of which $75,692~~ ~~and $152,326~~ ~~were related party interest expense.~~
27
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 11 —~~ ~~Warrant Liability~~
~~For the six months ended June 30, 2021, the Company issued warrants to purchase shares of the Company’s common stock related to multiple private placements. The warrants are as follows:~~
~~Schedule of Warrants Issued to Purchase Common Stock~~

Warrant
Shares

Exercise
Price

Hudson Bay Warrant; January 25, 2021 15,000,000 $ 2.000
Palladium Capital Warrant; January 25, 2021 480,000 $ 2.000
BHP Capital NY Warrant; January 28, 2021 1,500,000 $ 2.200
Hudson Bay Warrant; February 23, 2021 18,568,188 $ 3.722
Palladium Capital Warrant; February 23, 2021 1,650,346 $ 3.722
Hudson Bay Warrant; May 24, 2021 13,070,000 $ 3.200
Palladium Capital Warrant; May 24, 2021 1,200,000 $ 3.200
BHP Capital Warrant; June 4, 2021 1,500,000 $ 3.200
Hudson Bay Warrant; June 4, 2021 27,821,829 $ 3.300
Palladium Capital Warrant; June 4, 2021 2,071,346 $ 3.300
~~The warrants are subject to anti-dilution adjustments outlined in the Agreement. The warrants issued in the first quarter were classified as a liability with an initial fair value of $94,876,534, of which $75,156,534~~ ~~was immediately expensed and $19,720,000~~ ~~was recorded as a deferred debt discount. The warrants issued in the second quarter were classified as a liability with an initial fair value of $133,699,181~~ which was immediately expensed. In addition, the warrants must be valued every reporting period and adjusted to market with the increase or decrease being adjusted through earnings. The change in fair value of the warrant liability for the three and six months ended June 30, 2021 was a loss of ~~773,447~~ ~~and~~ ~~37,154,989, respectively. As of June 30, 2021, the fair value of the warrant liability was $139,695,115~~.
~~The warrants were valued using the Black-Scholes pricing model to calculate the grant-date fair value upon issuance of the warrants with the following assumptions:~~
~~Schedule of Warrant Assumptions~~

Dividend
Yield
Expected Volatility Risk-free Interest Rate
Expected
Life

Hudson Bay Warrant; January 25, 2021 0.00 % 109.95 % 0.13 % 2.5 years
Palladium Capital Warrant; January 25, 2021 0.00 % 109.95 % 0.13 % 2.5 years
BHP Capital NY Warrant; January 28, 2021 0.00 % 110.00 % 0.12 % 2.5 years
Hudson Bay Warrant; February 23, 2021 0.00 % 110.94 % 0.11 % 2.5 years
Palladium Capital Warrant; February 23, 2021 0.00 % 110.94 % 0.11 % 2.5 years
Hudson Bay Warrant; May 24, 2021 0.00 % 115.38 % 0.14 % 2.5 years
Palladium Capital Warrant; May 24, 2021 0.00 % 115.38 % 0.14 % 2.5 years
BHP Capital Warrant; June 4, 2021 0.00 % 117.11 % 0.16 % 2.5 years
Hudson Bay Warrant; June 4, 2021 0.00 % 117.14 % 0.16 % 2.5 years
Palladium Capital Warrant; June 4, 2021 0.00 % 117.14 % 0.16 %
~~The warrants were valued using the Black-Scholes pricing model to calculate the June 30, 2021 fair value of the warrants with the following assumptions:~~

Dividend
Yield
Expected Volatility Risk-free Interest Rate
Expected
Life

Hudson Bay Warrant; January 25, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Palladium Capital Warrant; January 25, 2021 0.00 % 118.33 % 0.25 % 2.5 years
BHP Capital NY Warrant; January 28, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Hudson Bay Warrant; February 23, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Palladium Capital Warrant; February 23, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Hudson Bay Warrant; May 24, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Palladium Capital Warrant; May 24, 2021 0.00 % 118.33 % 0.25 % 2.5 years
BHP Capital Warrant; June 4, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Hudson Bay Warrant; June 4, 2021 0.00 % 118.33 % 0.25 % 2.5 years
Palladium Capital Warrant; June 4, 2021 0.00 % 118.33 % 0.25 % 2.5 years
~~Note 12 —~~ ~~Related Party Transactions~~
~~Forever 8 Fund, LLC~~
On November 17, 2020, the Company, through its subsidiary, Edison Nation, LLC (the “Vendor”), entered into an Inventory Management Agreement (the “Agreement”) with the Forever 8 Fund, LLC (“F8”), an entity which our President holds a 45% ownership interest. Under the terms of the Agreement, F8 desires to maintain inventory of and sell to Vendor certain Products pursuant to the terms and conditions set forth in the Agreement. As consideration for the inventory management services provided under this Agreement, Vendor agrees to pay F8 a fee for each unit of each Product sold on a Platform determined in accordance with the fee schedule set forth in the applicable Product Schedule (the “Fee Schedule”) based on the Age of Inventory Sold set forth on the Fee Schedule (the “F8 Fees”). Prior to the signing of the agreement, F8 advanced the Vendor $239,283 that was utilized to pay for deposits with the Vendors factories. This Agreement shall commence on the Effective Date and shall continue in full force and effect until January 31, 2022 (the “Initial Term”), unless terminated earlier as provided in this Agreement. The balance outstanding at June 30, 2021 is $0.
~~NL Penn Capital, LP and SRM Entertainment Group LLC~~
As of June 30, 2021 and December 31, 2020, due to related party consists of net amounts due to SRM Entertainment Group LLC (“SRM LLC”) and NL Penn Capital, LP (“NL Penn”), the majority owner of both, which are owned by Chris Ferguson, our Chairman and Chief Executive Officer. The amount due to NL Penn was assigned to TXC Services, LLC. The amount due to related parties is related to the acquisitions of Pirasta, LLC and Best Party Concepts, LLC offset by operating expenses that were paid by SRM and Edison Nation on behalf of SRM LLC and NL Penn. As of June 30, 2021 and December 31, 2020, the net amount due to related parties was $~~15,401~~ ~~and $32,452~~, respectively. Such amounts are due currently. NL Penn and affiliated entities may lend additional capital to Edison Nation pursuant to terms and conditions similar to the current working capital lenders to Edison Nation such as Franklin Capital. In addition, Edison Nation borrows working capital from Franklin Capital, and Mr. Ferguson is a personal guarantor on the working capital facility provided to Edison Nation by Franklin Capital.
~~Note 13—~~ ~~Commitments and Contingencies~~
~~Employment Agreements~~
~~On February 2, 2021, the Company entered into an Employment Agreement (the “Agreement”) with Christopher Ferguson (the “Executive”) for the role of Chief Executive Officer.~~ ~~The Agreement is effective as of November 12, 2020 (the “Effective Date”) and has a term of three (~~3) years (the “Term”) from the Effective Date. Thereafter, the Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1 year (each a “Renewal Term”), unless such renewal is objected to by either the Company or the Executive. The Executive’s initial annual base salary shall be $~~200,000, less applicable withholdings (the “Base Salary”) and~~ ~~120,000~~ common shares that shall vest in their entirety on issuance. For 2021, the Executive shall receive a cash bonus in the amount equal to 30% of the annual Base Salary, and an award of 200% shares of the Company’s common stock, which shall vest in their entirety on issuance (the “Principal Market”), which shall be received by the Executive no later than the first 30 days of the current fiscal year. The Executive shall be entitled to ~~150,000~~ ~~shares of the Company’s common stock, due immediately upon an increase of 2.5 times the Enterprise Value of the Company on a 5-day closing average from the effectiveness of the Agreement. As of June 30, 2021, the Enterprise Value has been achieved.~~
~~On February 2, 2021, the Company entered into an Employment Agreement (the “Agreement”) with Brett Vroman (the “Executive”) for the role of Chief Financial Officer.~~ ~~The Agreement is effective as of November 12, 2020 (the “Effective Date”) and has a term of three (~~3) years (the “Term”) from the Effective Date. Thereafter, the Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1 year (each a “Renewal Term”), unless such renewal is objected to by either the Company or the Executive. The Executive’s initial annual base salary shall be $~~200,000, less applicable withholdings (the “Base Salary”) and~~ ~~120,000~~ common shares that shall vest in their entirety on issuance. For 2021, Executive shall receive a cash bonus in the amount equal to 30% of the annual Base Salary, and an award of 200% shares of the Company’s common stock, which shall vest in their entirety on issuance (the “Principal Market”), which shall be received by the Executive no later than the first 30 days of the current fiscal year. Upon the execution of this agreement, the Executive is entitled to a one-time past performance bonus for the work completed in fiscal years 2018, 2019 and 2020 of ~~150,000~~ ~~shares of the Company’s common stock, which shall vest in their entirety on issuance. The Executive shall be entitled to~~ ~~100,000~~ ~~shares of the Company’s common stock, due immediately upon an increase of 2.5 times the Enterprise Value of the Company on a 5-day closing average from the effectiveness of the Agreement.~~ ~~As of June 30, 2021, the Enterprise Value has been achieved.~~
~~On February 2, 2021, the Company entered into an Employment Agreement (the “Agreement”) with Brian Mc Fadden (the “Executive”) for the role of Chief Strategy Officer.~~ ~~The Agreement is effective as of November 12, 2020 (the “Effective Date”) and has a term of three (~~3) years (the “Term”) from the Effective Date. Thereafter, the Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1 year (each a “Renewal Term”), unless such renewal is objected to by either the Company or the Executive. The Executive’s initial annual base salary shall be $~~200,000, less applicable withholdings (the “Base Salary”) and~~ ~~120,000~~ common shares that shall vest in their entirety on issuance. For 2021, the Executive shall receive a cash bonus in the amount equal to 30% of the annual Base Salary, and an award of 200% shares of the Company’s common stock, which shall vest in their entirety on issuance (the “Principal Market”), which shall be received by the Executive no later than the first 30 days of the current fiscal year. Upon the execution of the Agreement, the Executive is entitled to a one-time signing bonus of 150,000 shares of the Company’s common stock, which shall vest in their entirety on issuance. The Executive shall be entitled to ~~100,000~~ ~~shares of the Company’s common stock, due immediately upon an increase of 2.5 times the Enterprise Value of the Company on a 5-day closing average from the effectiveness of the Agreement.~~ ~~As of June 30, 2021, the Enterprise Value has been achieved.~~
~~Operating Lease~~
The Company has entered into non-cancellable operating leases for office, warehouse, and distribution facilities, with original lease periods expiring through 2022. In addition to minimum rent, certain of the leases require payment of real estate taxes, insurance, common area maintenance charges, and other executory costs. Differences between rent expense and rent paid are recognized as adjustments to operating lease right-of-use assets on the consolidated balance sheets.
~~Total rent expense for the three and six months ended June 30, 2021 was $32.724 and $59,277, respectively. Total rent expense for the three and six months ended June 30, 2020 was $122,943~~ ~~and $269,709, respectively. Rent expense is included in general and administrative expense on the consolidated statements of operations.~~
~~As of June 30, 2021, the Company had operating lease liabilities of $107,776~~ ~~and right of use assets for operating leases of $104,707. During the three and six months ended June 30, 2021 and 2020, operating cash outflows relating to operating lease liabilities was $23,723~~ ~~and $74,776, respectively, and the expense for right of use assets for operating leases was $24,163~~ ~~and $77,823, respectively. As of June 30, 2021, the Company’s operating leases had a weighted-average remaining term of~~ ~~1.6~~ ~~years and weighted-average discount rate of~~ ~~4.5%~~. Excluded from the measurement of operating lease liabilities and operating lease right-of-use assets were certain office, warehouse and distribution contracts that qualify for the short-term lease recognition exception.
28
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 13— Commitments and Contingencies — (Continued)~~
~~Rental Income~~
Fergco leases a portion of the building located in Washington, New Jersey that it owns under a month-to-month lease. Total rental income related to the leased space for both the three and six months ended June 30, 2021 was $~~28,703~~ ~~and $54,407~~, respectively, and is included in other income on the consolidated statements of operations. Total rental income related to the leased space for both the three and six months ended June 30, 2020 was $~~25,703~~ ~~and $51,407, respectively, and is included in other income on the consolidated statements of operations.~~
~~Legal Contingencies~~
The Company is involved in claims and litigation in the ordinary course of business, some of which seek monetary damages, including claims for punitive damages, which are not covered by insurance. For certain pending matters, accruals have not been established because such matters have not progressed sufficiently through discovery, and/or development of important factual information and legal information is insufficient to enable the Company to estimate a range of possible loss, if any. An adverse determination in one or more of these pending matters could have an adverse effect on the Company’s consolidated financial position, results of operations or cash flows.
~~We are, and may in the future become, subject to various legal proceedings and claims that arise in or outside the ordinary course of business.~~
~~Oceanside Traders, LLC v. Cloud b, Inc. and Vinco Ventures, Inc. f/k/a Edison Nation, Inc.~~
On April 14, 2020, Oceanside Traders, LLC filed a complaint against Cloud B, Inc. and Vinco Ventures, Inc. with the Superior Court of Ocean County, State of New Jersey, alleging breach of contract and other claims resulting in total damages in the amount of $~~440,383, consisting of $141,007~~ ~~for failure to pay plaintiff for goods sold, for $138,180~~ ~~for overpayments and $161,196~~ for lost profits. On November 9, 2020, Plaintiff filed an amended complaint, adding other defendants, alleging breach of contract, breach of covenant of good faith and fair dealing, quasi-contract/unjust enrichment, conversion, fraud, negligent misrepresentation, fraudulent transfer, and piercing the corporate veil. On December 4, 2020, Vinco Ventures, Inc. filed its amended answer. On December 28, 2020, the other defendants filed a motion to dismiss on jurisdictional grounds which is currently pending before the court. On February 24, 2021, the Company entered into a Settlement Agreement and General Release of All Claims (the “Settlement Agreement”) with Edison Nation, LLC, Pearl 33 Holdings, LLC and Christopher Ferguson (collectively, the “Settling Defendants”) and Oceanside Traders, LLC (the “Plaintiff”). Under the terms of the Settlement Agreement, the Settling Defendants agreed to pay the Plaintiff the sum of $150,000 within one business day of execution of the Settlement Agreement. In exchange, the Plaintiff agreed to dismiss the Amended Complaint in its entirety and with prejudice against the Settling Defendants. The Company made payment in the amount of $150,000 on February 25, 2021.
~~Rosenberg Fortuna & Laitman, LLP and Mark Principe v. Safe TV, LLC~~
On March 13, 2019, Rosenberg Fortuna & Laitman, LLP and Mark Principe filed a complaint against Safe TV Shop, LLC with the Supreme Court of the State of New York, County of Nassau alleging a breach of indemnification arising out of the use of a certain packaging material. On February 12, 2020, the parties entered a Stipulation and Settlement and Consent Agreement for a Consent Judgment in the amount of $~~50,000~~. Safe TV, LLC has no assets and there have been no operations by Safe TV, LLC since the date of acquisition by Vinco Ventures, Inc. On April 5, 2021, the Company, through Safe TV Shop, LLC, entered into a Settlement Agreement and Release of Claims (the “Settlement”). ~~Under the terms of the Settlement, the Company is to make payment in the amount of $25,000 on or before April 9, 2021. The Company made payment in the amount of $25,000 on April 8, 2021.~~
~~Gerald Whitt, et al. v. Vinco Ventures, CBAV1, LLC, et al.~~
On October 27, 2020, Gerald Whitt, et al, the minority shareholders of Cloud b Inc. (“Whitt Plaintiffs”) filed a civil complaint in the Superior Court of the State of California against Vinco Ventures, Inc., CBAV1, LLC and other parties, alleging fraudulent concealment, breach of fiduciary duty, breach of contract, breach of confidence, intentional misrepresentation, negligent misrepresentation, unfair business practices and civil conspiracy (the “~~Whitt Complaint”). The Whitt Plaintiffs seek “in excess of $8,000,000~~” in damages. Defendants’ position is that the Whitt Complaint is frivolous and the filing of same was an abuse of process. Defendants have not been served with the Whitt Complaint. On or about June 4, 2021, CBAV1 entered into a settlement agreement with the trustee for Cloud b, Inc., whereby CBAV1 paid $~~500,000~~ to the Cloud b Estate for distribution to its unsecured creditors. As part of the settlement, all derivative claims on behalf of Cloud b, Inc. in the Whitt Complaint were released as to CBAV1 and its affiliates, shareholders, officers, directors, employees and other parties. There are a limited number of non-derivative claims that were not released.
~~In re CBAV1, LLC, Debtor, Chapter 11 Bankruptcy/In re Cloud b, Inc., Debtor Chapter 7 Bankruptcy~~
~~On October 30, 2020, CBAV1, LLC filed a voluntary petition under Chapter 11 of title 11 of the United States Code, as amended (the “Bankruptcy Code”).~~ On October 30, 2020, Cloud b filed a voluntary petition under Chapter 7 of the Bankruptcy Code. On November 15, 2020, a prospective buyer entered into a non-binding letter of intent to purchase the CBAV1 Assets for $2,250,000. On December 18, 2020, CBAV1, LLC filed a motion to sell substantially of the CBAV1 Assets free and clear of all interests, liens, claims and encumbrances. On that same date, CBAV1, LLC also filed a motion to approve (i) certain procedures for the submission of bids in connection with the sale of substantially all of the assets, (ii) the break-up fee and expense reimbursement, (iii) scheduling an auction and (iv) scheduling a sale hearing. On January 21, 2021, the prospective buyer entered into an asset purchase agreement to buy the CBAV1 Assets for $~~2,250,000, on terms and conditions set forth therein.~~ On March 12, 2021, the court approved the sale of the CBAV1 Assets to the winning bidder at the auction held on March 10, 2021 and March 11, 2021 for the total sum of $3,000,000 US. A cash payment in the amount of $2,650,000, less certain credits, was made at closing on April 21, 2021 with additional payments in the amounts of $150,000 US due on April 15, 2022 and $200,000 US on April 15, 2023.
~~Vinco Ventures, Inc., et al. v. Milam Knecht & Warner, LLP, Michael D. Milam, Gerald Whitt, Alexander Whitt, et al.~~
On December 31, 2020, Vinco Ventures, Inc., and other parties, filed a complaint against the Whitt Plaintiffs, and other parties, with the United States District Court for Eastern District of Pennsylvania, alleging intentional misrepresentation, negligent misrepresentation, negligence, conspiracy, unfair business practices, abuse of process, civil extortion, trade libel and defamation. Defendants entered their appearances, Plaintiffs filed an amended complaint and Defendants filed motions to dismiss the complaint, which are currently pending before the Court.
29
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 14 —~~ ~~Stockholders’ Equity~~
~~Common Stock~~
~~The Company is authorized to issue~~ ~~250,000,000shares of common stock. As of June 30, 2021 and December 31, 2020, there were~~ ~~59,927,241~~ ~~and~~ ~~14,471,403~~ ~~shares of common stock issued and outstanding, respectively.~~
~~On January 29, 2021 (the “Effective Date”), the Company consummated the closing of a private placement offering of $3,300,000~~ ~~whereby pursuant to the Securities Purchase Agreement entered into by the Company on January 28, 2021 with BHP Capital NY Inc (the “Investor”), the Company issued~~ ~~1,500,000~~ ~~shares of restricted common stock and a five (~~5~~) year warrant to purchase shares of the Company’s common stock.~~
~~During the six months ended June 30, 2021, warrant shares of~~ ~~31,742,986~~ ~~were exercised and the Company received net proceeds of $87,785,419~~.
~~Preferred Stock~~
~~On October 16, 2020, the Company filed a Certificate of Designation (the “Designation”) with the Secretary of State of Nevada, which designates~~ ~~1,000,000~~ ~~shares of the Company’s preferred stock, par value $0.001~~ per share, as Series B Convertible Preferred Stock (“Series B”). Pursuant to the terms of the Designation, holders of the Series B shall be entitled to dividends, a liquidation preference and shall have conversion rights. Each share of Series B shall be convertible into 1 share of Common Stock, on or after the twelve-month anniversary of the Original Issue Date at the option of the Holder thereof, for a total not to exceed ~~1,000,000~~ ~~shares of Common Stock. The holders of the Series B shall have no voting rights.~~
On February 2, 2021, the Company filed an Amendment to the Certificate of Designation (the “Amendment”) for the Company’s Series B Convertible Preferred Stock (“Preferred Stock”). Under the Amendment, each share of Preferred Stock shall entitle the holder thereof to vote on all matters voted on by the holders of Common Stock, voting together as a single class with other shares entitled to vote at all meetings of the stockholders of the Corporation. With respect to any such vote, each share of Preferred Stock shall entitle the holder thereof to cast the number of votes equal to the number of whole shares of Common Stock into which such shares of Preferred Stock are then convertible (the “Conversion Shares”). Such right may be exercised at any annual meeting or special meeting, or pursuant to any written consent of stockholders.
On March 25, 2020, the Company filed a certificate of amendment to the Company’s articles of incorporation with the Secretary of State of the State of Nevada in order to: (i) increase the number of shares of the Company’s authorized preferred stock, par value $~~0.001~~ ~~per share, from~~ 0 ~~shares to~~ ~~30,000,000~~ shares of preferred stock; (ii) clarify the application of the forum selection clause in the Company’s amended and restated articles of incorporation, specifically that such clause does not apply to federal causes of actions arising under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended (the “Exchange Act”); and (iii) include affirmative changes to correspond to the Company’s First Amended and Restated Bylaws, confirming that the Company’s shareholders may vote by written consent.
~~On May 26, 2021, the Company issued~~ ~~764,618~~ ~~shares of common stock valued at $1,276,912~~ ~~upon conversion of the Company’s Series B Preferred Stock.~~
~~The Company is authorized to issue~~ ~~30,000,000~~ ~~shares of preferred stock. As of June 30, 2021 and December 31, 2020, there were~~ 0 ~~and~~ ~~764,618~~ ~~shares of Series B Preferred Stock issued and outstanding, respectively.~~
~~Stock-Based Compensation~~
On September 6, 2018, the Company’s board of directors approved an amendment and restatement of the Company’s omnibus incentive plan solely to reflect the Company’s name change to Edison Nation, Inc. Thus, the Edison Nation, Inc. Omnibus Incentive Plan (the “Plan”) which remains effective as of February 9, 2018, provides for the issuance of up to ~~1,764,705~~ (~~287,659~~ remaining as of June 30, 2021) shares of common stock to help align the interests of management and our stockholders and reward our executive officers for improved Company performance. Stock incentive awards under the Plan can be in the form of stock options, restricted stock units, performance awards and restricted stock that are made to employees, directors and service providers. Awards are subject to forfeiture until vesting conditions have been satisfied under the terms of the award. The exercise price of stock options is equal to the fair market value of the underlying Company common stock on the date of grant.

The following table summarizes ~~stock option awards outstanding at June 30, 2021:~~the aggregate purchase price consideration paid for the acquisition of the asset:
~~Schedule~~Summary of ~~Share-based Compensation, Stock Options, Activity~~the Aggregate Purchase Price Consideration Paid
Shares
Weighted
Average
Exercise
Price

Remaining
Contractual
Life in
Years

Aggregate
Intrinsic Value

Balance, December 31, 2020 80,000 $ 7.01 3.2 -
Granted - - - -
Balance, June 30, 2021 80,000 $ 7.01 2.9 -
Exercisable, June 30, 2021 80,000 $ 7.01 2.9 -
April 17, 2021

Fair value of shares reserved for future issuance and earn out shares $ 7,400,000
Fair value of assumed notes payable 151,987
Total $ 7,551,987

AsOn February 25, 2022, Emmersive, certain former shareholders of ~~June 30,~~Emmersive (collectively, the “Emmersive Parties”), the Company and EVNT entered into a Termination and Release Agreement, terminating certain transaction documents dated April 17, 2021, ~~there were no unvested options~~in connection with which the Emmersive Parties and our subsidiary Cryptyde, Inc (“Cryptyde”) also entered into a Milestone Agreement for the earnout shares to ~~purchase shares~~be earned and any remaining consideration to be paid by Cryptyde with an effective date of both the agreements upon the spin- off of Cryptyde being declared effective by the SEC (the “Effective Date”). Upon the Effective Date, the agreements released the Company of the ~~Company’s common stock~~obligation to deliver the additional 4,000,000 earn-out shares provided under the Asset Contribution Agreement. The Cryptyde spin-off occurred on June 29, 2022, and ~~there was no unrecognized equity-based compensation expense that~~therefore the Company ~~expected~~is no longer liable for any contingent consideration to ~~recognize over a remaining weighted-average period.~~Emmersive.

In addition, with the sale of Cryptyde, there was a change in how the Company planned to utilize the EVNT platform from its acquisition. Management made the determination that it was no longer interested in continuing to operate and profit from E-NFT. The developed technology intangible asset for the EVNT platform of $~~Other Stock Awards~~6,607,989 (net of amortization) was fully impaired at September 30, 2022. (See Note 17 – Subsequent Events | Impairment Charges)

~~The Company issued~~ ~~2,861,227~~ ~~shares of common stock to employees for services valued at $7,495,864~~ ~~for the six months ended June 30, 2021.~~Divestitures
~~The Company issued~~ ~~1,457,849~~ ~~shares of common stock to vendors for services valued at $3,365,840~~ ~~for the six months ended June 30, 2021.~~CBAV1, LLC Divestiture
From time to time, the Company grants shares of common stock to consultants and non-employee vendors for services performed. The awards are valued at the market value of the underlying common stock at the date of grant and vest based on the terms of the contract which is usually upon grant.
30
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 14 — Stockholders’ Equity (continued)~~
~~BHP Capital NY Inc. Private Placement – January 2021~~

On January 28, 2021 (the “Effective Date”), the Company consummated the closing of a private placement offering (the “Offering”) whereby pursuant to the Securities Purchase Agreement (the “SPA”) entered into by the Company on January 28, 2021 with BHP Capital NY Inc (the “Investor”), the Company issued ~~1,500,000~~ ~~shares of restricted common stock and a five (~~5~~) year warrant (the “Warrant”) to purchase shares of the Company’s common stock, par value $0.001~~ ~~per share (“Common Stock”).~~
~~Pursuant to the SPA, the Investor received a Warrant in an amount equal to~~ ~~100% of the shares of Common Stock issued to the Investor under the SPA. The Warrant contains an exercise price of $2.20~~ ~~per share. In connection with the closing of the Offering, the Warrant was issued to purchase an aggregate of~~ ~~1,500,000~~ ~~shares of Common Stock (the “Warrant Shares”).~~
The Company also entered into a Registration Rights Agreement with the Investor (the “Registration Rights Agreement”). The Registration Rights Agreement provides that the Company shall (i) file with the Securities and Exchange Commission (the “Commission”) a Registration Statement by 30 days following the Closing Date to register the Conversion Shares and Warrant Shares (the “Registration Statement”); and (ii) use all commercially reasonable efforts to have the Registration Statement declared effective by the Commission within 60 days following the Closing Date or at the earliest possible date, or 75 days following the Closing Date if the Registration Statement receives comments from the Commission.
On January 28, 2021 (the “Effective Date”), the Company consummated the closing of a private placement offering (the “Offering”) whereby pursuant to the Securities Purchase Agreement (the “SPA”) entered into by the Company on January 28, 2021 with BHP Capital NY Inc (the “Investor”), the Company issued ~~1,500,000~~ ~~shares of restricted common stock and a five (~~5~~) year warrant (the “Warrant”) to purchase shares of the Company’s common stock, par value $0.001~~ ~~per share (“Common Stock”).~~
~~Pursuant to the SPA, the Investor received a Warrant in an amount equal to~~ ~~100% of the shares of Common Stock issued to the Investor under the SPA. The Warrant contains an exercise price of $2.20~~ ~~per share. In connection with the closing of the Offering, the Warrant was issued to purchase an aggregate of~~ ~~1,500,000~~ ~~shares of Common Stock (the “Warrant Shares”).~~
On June 4, 2021, the Company entered into a warrant exercise agreement (the “Agreement”) with BHP Capital NY Inc. (“BHP”) who agreed to exercise a portion of the January Warrants and the Company agreed to issue additional warrants, to purchase shares of Common Stock at a per-share exercise price equal to $~~3.20~~ (the “Incentive Warrants”, all pursuant to the terms and conditions set forth in the Agreement. At the Closing (as defined in Section 2(b) of the Agreement), the Parties shall execute and deliver a registration rights agreement (the “Registration Rights Agreement”), pursuant to which the Company will agree to register the shares of Common Stock underlying the Incentive Warrants. Subject to the terms of Agreement, (i) BHP shall pay to the Company an amount equal to the exercise price in effect as of the date of such exercise multiplied by ~~1,500,000~~ shares (as adjusted for any share split or similar transaction after the date hereof) (the “Exercised Warrant Shares”) and (ii) the Company shall issue and deliver Incentive Warrants to BHP to initially purchase an aggregate number of shares equal to the number of Exercised Warrant Shares, which number of shares shall be subject to adjustment upon the exercise of further shares pursuant to the January Warrants. During the six months ended June 30, 2021, the Investor exercised ~~1,500,000~~ ~~warrants and received~~ ~~1,500,000~~ ~~incentive warrants.~~
31
~~Vinco Ventures, Inc. and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~
~~Note 15 —~~ ~~Discontinued Operations~~
Discontinued operations are accounted for in accordance with the provisions of Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Section 360-10-35 Property, Plant and Equipment. In accordance with FASB ASC Section 360-10-35, the net assets of discontinued operations are recorded on our consolidated balance sheets at carrying value. The results of operations of discontinued operations are segregated from continuing operations and reported separately as discontinued operations in our consolidated statements of loss and comprehensive loss.
On March 12, 2021, the bankruptcy court approved the sale of the CBAV1, LLC Assets to BTL Diffusion SARL, the winning bidder, at the auction held on March 10, 2021 and March 11, 2021 for a total sum of $3,000,000, which includes a cash payment at closing in the amount of $2,650,000, less certain closing costs and credits, and additional royalty payments in the amount of $150,000 on April 15, 2022 and in the amount of $200,000 on April 15, 2023 (“CBAV1-BTL Transaction”).

A first closing of the CBAV1-BTL Transaction occurred on April 16, 2021, with the transfer of assets and release of funds completed on April 21, 2021 (“Final Closing”). Contemporaneously with the Final Closing, a certain license agreement between CBAV1 and Edison Nation, LLC (“Edison Nation”) terminated and any remaining operational assets of Edison Nation were transferred to BTL.

The table below shows the assets that the Company transferred to BTL and the components of the loss on discontinued operations:
Schedule of Loss on Income Operations of Discontinued Operations
April 21, 2021
Cash received from buyer $ 2,529,565

Accounts receivable (293,005 )
Inventory (665,522 )
Prepaid expenses (160,666 )
Intangible assets (5,540,952 )
Loss on divestiture 4,130,580
Operating loss of discontinued operations 178,200
Bankruptcy costs 803,320
Loss on discontinued operations $ 5,112,100
15
Spin-Off of Cryptyde, Inc.
On November ~~30, 2020,~~8, 2021, Cryptyde initially filed, and on January 25, 2022, March 18, 2022 and May 13, 2022 amended, a Form 10 registration statement with the ~~Company~~SEC (the ~~“Seller”~~“Form 10”) ~~and its wholly owned subsidiary, SRM Entertainment, LTD (“SRM”) entered into a Stock Exchange Agreement (the “Exchange Agreement”)~~in connection with ~~Jupiter Wellness, Inc. (“Jupiter”)(the “Buyer”). Under the terms~~our planned spin-off of 100% of the ~~Exchange Agreement, the Buyer agreed to purchase all~~ outstanding shares of common stock of Cryptyde to our shareholders, subject to certain conditions as described in the registration statement, including the effectiveness of the registration statement, receipt of an opinion of counsel to the effect that, among other things, the spin-off and related transactions should qualify as tax-free for United States federal income tax purposes under Sections 368(a)(1)(D) and 355 of the Internal Revenue Code, and Nasdaq having approved the listing of Cryptyde’s common stock. Cryptyde, along with our subsidiaries CW Machines LLC and Ferguson Containers (the ~~“Exchange Shares”~~“Cryptyde Businesses”) ~~issued by SRM~~, held our packaging, Bitcoin mining services, and Web3 (decentralized internet) products businesses.
On May 16, 2022, the Form 10 was declared effective. The Record Date for the spin-off was May 18, 2022. Effective June 29, 2022, Cryptyde separated from the ~~Seller. As consideration~~Company and the distribution of its common stock was completed. Upon completion of the spin-off, Cryptyde became an independent, publicly traded company (NasdaqCM: TYDE). The distribution was made in the amount of one share of Cryptyde common stock for every ten shares of our common stock owned by our stockholders at the close of business on the Record Date.
Also, in connection with the spinoff, we entered into definitive agreements with Cryptyde that, among other things, set forth the terms and conditions of the separation and distribution. The agreements set forth the principles and actions taken or to be taken in connection with the separation and the distribution and provide a framework for our relationship with Cryptyde from and after the separation and the distribution. The agreements include a Separation and Distribution Agreement and a Tax Matters Agreement.
On January 26, 2022, Cryptyde entered into a Securities Purchase Agreement with an accredited investor for the issuance of a (i) 1,500,000 shares of Cryptyde Common Stock, and (ii) a warrant to purchase up to 1,500,000 shares of Cryptyde Common Stock with an exercise price of $8.00 per share of Cryptyde Common Stock. In addition, Cryptyde issued a warrant to the placement agent to purchase up to 240,000 shares of Cryptyde Common Stock with an initial exercise price of $8.00 per share of Cryptyde Common Stock. The transaction closed on May 20, 2022.
On June 29, 2022, Vinco Ventures, Inc. distributed 100% of the ~~Exchange Shares, the Buyer agreed to exchange~~ ~~200,000~~shares of ~~its restricted~~Cryptyde’s common stock ~~(the “Consideration Shares”), symbol JUPW~~held by Vinco to holders of shares of Vinco common stock, subject to certain conditions. On the Distribution Date, each holder of Vinco common stock received one share of Cryptyde common stock for every ten shares of Vinco common stock held at the close of business on the Record Date.
The results of our Cryptyde businesses have been reflected as ~~listed~~discontinued operations in the current year period through the date of the spinoff and in the prior year period.
16
Details of assets and liabilities related to the spin-off of Cryptyde are as follows:
Schedule of Divestitures Balance Sheets

June 29,
2022

December 31,
2021

Assets
Current assets:
Cash $ 9,921,084 $ 911,194
Accounts receivable, net 1,092,406 867,027
Inventory 2,075,089 110,664
Prepaid expenses and other current assets 3,247,154 3,359,716
Total current assets 16,335,733 5,248,600
Loan receivable, related party 3,950,053 4,000,000
Loan Interest Receivable, related party
133,187
-
Fixed assets, net 1,193,133 1,007,770
Total Assets $ 21,612,105 $ 10,256,371

Liabilities and Stockholders’ Equity
Current liabilities:
Current liabilities $ 3,178,590 $ 7,285,429
Total Current Liabilities 3,178,590 7,285,429
Other liabilities:
Due company (former parent), net $ 6,750,130 $ 27,644
Other liabilities 46,775 46,775
Net assets of spin-off / discontinued operations:
Net assets of spin-off / discontinued operations $ 11,636,610 $ 2,896,522
The following cash flow supplementary information summarizes the distribution:
June 29, 2022

Cash distributed $ 9,921,084
Other assets distributed 11,691,022
Liabilities distributed (9,975,495 )

Net assets distributed $ 11,636,610
Details of earnings (loss) from discontinued operations included in our condensed consolidated statements of operations are as follows:
Schedule of Divestitures Income Statement
2022 2021 2022 2021
For the Three Months
Ended June 29, For the Six Months
Ended June 29,
2022 2021 2022 2021
Revenues, net $ 7,345,960 $ 2,006,694 $ 11,103,512 $ 3,764,346
Cost of revenues 6,309,956 1,404,289 9,466,949 2,687,447
Gross Profit 1,036,004 602,405 1,636,563 1,076,899

Operating expenses:
Selling, general and administrative 3,100,767 531,419 5,050,186 910,474
Operating Income (2,064,763 ) 70,986 (3,413,623 ) 166,425

Other (Expense) Income
Interest income (expense) 49,792 (65,175 ) 149,311 (32,818 )
Other income (loss) 3,400 28,703 3,400 54,407
Total other (Expense) Income 53,192 (36,472 ) 152,711 21,589
(Loss) Income Before Income Taxes (2,011,571 ) 34,514 (3,260,912 ) 188,014
Income tax expense - - - -
Net (Loss) Income $ (2,011,571 ) $ 34,514 $ (3,260,912 ) $ 188,014
For the six months ended June 29, 2022, the Cryptyde Businesses recognized $303,746 in capital expenditures and $83,603 in depreciation expense.
During the time Cryptyde was under management of the Company, cash advances were made to Cryptyde for management fees, working capital, and financing needs, as well as other operating expenses that were paid for on ~~NASDAQ Capital Markets.~~ behalf of Cryptyde. As of June 30, 2022, net amounts due from Cryptyde total $6,750,130.
Write-off of Best Party Concepts, LLC and Global Clean Solutions, LLC
The Company ~~made~~wrote-off its investment in Best Party Concepts, LLC and Global Clean Solutions, LLC in the period ending June 30, 2022 due to insignificant activity and a decision to ~~divest~~not pursue business in the ~~amusement park business due~~foreseeable future. The write-off attributed to Best Party Concepts equaled $314,319 and the write-off attributed to Global Clean Solutions $608,482.
17
Note 4 — Variable Interest Entities
The Company is involved in the formation of various entities considered to be VIEs. The Company evaluates the consolidation of these entities as required pursuant to ASC Topic 810 relating to the ~~slow re-openings~~consolidation of ~~amusement parks around~~VIEs.
The Company’s determination of whether it is the ~~world~~primary beneficiary of VIE is based in part on an assessment of whether or not the Company and its related parties are exposed to the ~~investment that would have been needed~~majority of the risks and rewards of the entity. Typically, the Company is entitled to ~~remain open and~~substantially all or a portion of the ~~investment required~~economics of these VIEs. The Company is the primary beneficiary of the VIE entities. The assets of the VIEs can be used to ~~relaunch~~settle obligations of the consolidated entities. Conversely, liabilities recognized as a result of consolidating these VIEs do not represent additional claims on the ~~amusement parks begin to get back to full capacity.~~Company’s general assets.

The following table presents the carrying values of the assets and liabilities of ~~our discontinued operations at~~entities that are VIEs and consolidated by the Company as of June 30, ~~2021~~2022 and December 31, ~~2020, respectively:~~2021:
Schedule of ~~Balance Sheets~~Assets and ~~Income Operations~~Liabilities of ~~Discontinued Operations~~Variable Interest Entities
June 30, 2021 December 31, 2020
June 30,
2022

December 31,
2021

Assets
Current assets:
Accounts receivable, net $ - $ 220,964
Inventory - 559,737
Cash and cash equivalents $ 3,136,823 $ 1,856,017
Prepaid expenses and other current assets - 261,980 1,903,505 2,388,893
Due from related party, current - 15,997,803
Loan held-for-investment, related parties, current 10,000,000 -
Total current assets - 1,042,680 15,040,329 20,242,713
Due from related party, non-current 15,125,585 -
Loan Interest Receivable, non-current 516,738 -
Loan held-for-investment 750,000 3,100,000
Loan held-for-investment, related parties - 11,500,000
Investment in Subsidiary 110,509,500 -
Total other assets 126,901,823 14,600,000
Property and equipment, net 400,472 147,519
Intangible assets, net
- 5,739,524 26,145,877 28,150,048
Goodwill 116,188,021 116,188,021
Cost Method Investments 1,000,000 1,000,000
Right of use assets, net 60,000 -
Total assets $ - $ 6,782,204 $
285,736,521
$ 180,328,301

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable $ 120,729 $ 487,454 $ 1,179,833 $ 686,674
Accrued expenses and other current liabilities 2,076,173 1,672,492
Operating Lease Liabilities 58,419 -
Total current liabilities $ 120,729 $ 487,454 3,314,425 2,359,166
Intercompany 60,887,412 -
Notes payable 4,500,000 2,650,000
Due to related party - 315,666
Total liabilities $ 68,701,837 $ 5,324,832

The following table presents the ~~summary results of~~ operations of ~~our discontinued operations for~~entities that are VIEs and consolidated by the ~~three and six months ended~~Company as of June 30, ~~2021~~2022 and ~~2020, respectively:~~2021:
Schedule of Operations of Variable Interest Entities

For the Three Months
Ended June 30,
For the Six Months
Ended June 30,
2021 2020 2021 2020
Revenues, net $
-
$
1,706,044
697,883 3,419,808
Cost of revenues
-

884,848
490,195 1,939,541
Gross profit -
821,196
207,688 1,480,267

Operating expenses:
Selling, general and administrative 99,286
393,077
385,888 1,396,127
Operating income (99,286 )
428,119
178,200 84,140

Other (expense) income:
(Loss) gain on disposal (4,308,780 )
-
(4,308,780 ) 4,911,760
Total other (expense) income
(4,308,780
)
-

(4,308,780
) 4,911,760
(Loss) income before income taxes (4,408,066 )
428,119

(4,486,980
) 4,995,900
Income tax expense - - - -
Net (loss) income $ (4,408,066 ) $
428,119
(4,486,980 ) 4,995,900
2022 2021 2022 2021

For the Three Months
Ended June 30,

For the Six Months
Ended June 30,

2022 2021 2022 2021
Revenues, net $ - $ 92,945 $ - $ 307,339
Cost of revenues - 9,530 - 93,685
Gross Profit - 83,415 - 213,654

Operating Expenses:
Selling, general and administrative 22,135,840 4,320 33,107,809 104,741
Operating (loss) income (22,135,840 ) 79,095 (33,107,809 ) 108,913

Other (Expense) Income:
Interest (expense) income (10,903 ) (34,010 ) (13,115 ) (7,760 )
Other income 263,395 - 351,964 -
Total Other (Expense) Income
(252,492
)
34,010
(338,849 ) 7,760
Loss before income taxes (21,883,348 ) 45,085 (32,768,960 ) 101,153
Income tax expense - - - -
Net (Loss) Income $ (21,883,348 ) $ 45,085 $ (32,768,960 ) $ 101,153
3218

As of June 30, 2022, the Company had no unconsolidated VIEs. The Company has consolidated Magnifi U, ZVV, and Lomotif for which the Company has determined it holds a variable interest. ZVV currently owns an 80% equity interest in Lomotif, a Singapore-based video-sharing and live streaming social networking platform that is committed to democratizing video creation and increasing user reach through our content development, live streaming and cross-platform engagement initiatives. Lomotif owns 100% of Lomotif, Inc. Magnifi U is a free, immersive, online personal and professional development platform that helps people align with their purpose.
~~Vinco Ventures,~~Magnifi U Inc. ~~and Subsidiaries~~
~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

On May 19, 2021, the Audit Committee (i) approved the Company entering into a secured loan to Magnifi U for up to $~~Note 16 —~~ 2.75 million, with $750,000 to be immediately loaned immediately, (ii) determined the loan to be fair, at arms- length and in line with the Company’s business plan, and (iii) upon disclosure of the conflicts of interest inherent in the loan transaction, found the transaction to be fair and consistent with the Company’s Code of Business Conduct and Ethics. Subsequent ~~Events~~cash advances of $694,168 related to employee payroll occurred between December 31, 2021 and June 30, 2022 totaling $1,444,168
.

On ~~July 7,~~October 12, 2021, ZVV Media loaned $1,500,000 to Magnifi U. The interest rate on the note is 3% per annum. The maturity date of the loan is October 12, 2023. The purpose of the loan is to engage in the platform creation and distribution of digital media content. Our director, Vinco employee, and member of the board of managers of ZVV, Lisa King, is the founder of Magnifi U and serves as its chief executive officer. ZASH has an 8% ownership interest in Magnifi U resulting from its equity investment of $2,411,140 in Magnifi U, with an obligation to fund a total of $5,000,000 for a total of 15% equity.
On December 30, 2021 the ~~Company entered into an amendment agreement with Hudson Bay in connection with the January warrants and February warrants which extended the exercise period~~Vinco Ventures, Inc. Board of Directors unanimously approved Vinco Ventures, Inc. to hire all then-current employees of Magnifi U, as part of the ~~warrant exercise agreement dated June 4, 2021 to August 9, 2021.~~strategic investment in the platform.

As of June 30, 2022, Lisa King had one member of her extended family working at Magnifi U with an annual salary in excess of $100,000, and Ted Farnsworth had one member of his extended family working at Vinco Ventures and/or ZASH with an annual salary in excess of $100,000.
As a result of the Board of Directors approval to hire all then-current employees of Magnifi U, and subsequent onboarding of Magnifi U employees in January 2022, the Company reconsidered the relationship as prescribed in ASC 810-10-35-4. The Company concluded consolidation was appropriate.
ZVV Media Partners, LLC and Lomotif Private Limited
On ~~July~~January 19, 2021, Vinco Ventures, ZASH and ZVV entered into a Contribution Agreement pursuant to which each of Vinco Ventures and ZASH contributed to ZVV certain media and entertainment assets in order for ZVV to engage in the development and production of consumer facing content and related activities.
On or around February 23, 2021, ~~Vinco~~ZASH entered into a Securities Purchase Agreement (the ~~“Purchase Agreement”~~“Lomotif SPA”) with ~~BHP Capital NY Inc.~~Lomotif and certain shareholders of Lomotif (the ~~“Purchaser”) whereby Vinco agreed to (i) issue and sell to the Purchaser up to~~ ~~1,007,194~~ ~~shares of Vinco’s common stock, par value $0.001~~ ~~per share (the “Purchased Shares”) at a purchase price of $2.78~~ ~~per share and (ii) issue warrants (the “Warrants”~~“Lomotif Selling Shareholders”) to ~~purchase up to~~ ~~1,007,194~~ ~~shares of Vinco’s Common Stock (the “Warrant Shares”) with an exercise price of $2.78~~ ~~per share, resulting~~acquire a controlling interest in ~~an aggregate of $2,800,000~~ ~~of Purchased Shares and Warrants. The Warrants are immediately exercisable and have a term of exercise equal to three (~~3) years. In connection with the Purchase Agreement, Vinco and the Purchaser also entered into a Registration Rights Agreement, dated as of July 23, 2021, whereby Vinco agree to prepare and file, within 40 days of the closing, with the SEC a registration statement covering the resale of all Purchased Shares and Warrant Shares issued and sold to the Purchaser pursuant to the Purchase Agreement. In the event that such registration statement is not filed within 40 days of the closing, or if such registration statement does not become effective within 80 days of its filing, Vinco shall issue an additional ~~50,360~~ ~~shares of Common Stock and warrants to purchase an additional~~ ~~50,360~~ ~~shares of Common Stock to the Purchaser.~~
Lomotif.

On July 19, 2021, ZASH, Lomotif, the Lomotif Selling Shareholders and ZVV entered into a Deed of Variation and Supplement whereby, among other things, ZASH novated all of its rights and obligations under the Lomotif SPA to ZVV and ZVV assumed all of ZASH’s rights and obligations under the Lomotif SPA.
On July 22, 2021, ZASH and Vinco Ventures entered into a Second Amended and Restated Limited Liability Company Agreement of ZVV, pursuant to which (i) ZASH and Vinco Ventures each acquired a 50% voting membership interest in ZVV; and (ii) ZASH acquired a 75% economic interest in ZVV after return of unreturned capital contributions and Vinco Ventures acquired a 25% economic interest in ZVV after return of unreturned capital contributions.
On July 25, 2021, ZVV completed the acquisition of an 80% equity ownership interest in Lomotif for a total purchase price of $109,765,000.
Note 5 — Short-Term Investments
Investments in equity securities with readily determinable fair values are carried at fair value, and changes in unrealized gains or losses are reported in current period earnings. As of June 30, 2022 and December 31, 2021, short-term investments consisted of the following:
Schedule of Short-Term Investments

June 30,
2022

December 31,
2021

Jupiter Wellness,Inc. (JUPW) $ 1,040,000 $ 1,040,000
Unrealized losses (895,000 ) (862,000 )
Total short-term investments $ 145,000 $ 178,000
Note 6 — Property and Equipment, net
As of June 30, 2022 and December 31, 2021, property and equipment consisted of the following:
Schedule of Property and Equipment

June 30,
2022

December 31,
2021

Software $ 147,792 $ 147,792
Furniture and fixtures 188,559 280,926
Computers 118,351 7,003
Leasehold improvements 432,363 800,746
Equipment 248,743 5,358,997
Construction in progress 184,543 -
Property, plant and equipment,gross 1,320,352 6,595,465
Less: accumulated depreciation (559,360 ) (5,218,714 )
Total property and equipment, net $ 760,992 $ 368,981
Depreciation expense for the six months ended June 30, 2022 and 2021 was $115,712 and $65,623, respectively. Depreciation expense for the three months ended June 30, 2022 and 2021 was $65,984 and $32,811, respectively. As of June 29, 2022 and December 31, 2021, the Cryptyde Businesses had total property and equipment, net of $1,193,133 and $1,007,770, respectively.
19
Note 7 — Loans Held for Investment
As of June 30, 2022 and December 31, 2021, loans held-for-investment consisted of the following:
Summary of Loans Held for Investment

June 30,
2022

December 31,
2021

Loans held-for-investment:
Carlin Haynes, LLC ⁽ⁱ⁾ $ 750,000 $ 250,000
Total loans held-for-investment $ 750,000 $ 250,000
(i) On August 5, 2021, the Company loaned $250,000 to Carlin Haynes, LLC, DBA TMX. On January 18, 2022, the Company loaned an additional $500,000 to Carlin Haynes, LLC. The interest rate on the note is 6% per annum. The maturity date of the loan is August 5, 2023. The purpose of the loan is to engage in the creation and distribution of digital media content. In the event that Carlin Haynes, LLC issues and sells units of preferred equity securities to one or more investors in an arm’s length transaction or series of related transactions with the principal purpose of raising capital that results in aggregate gross proceeds to Carlin Haynes, LLC of at least $1,000,000, excluding the amount represented by the conversion of any simple agreement for future equity or outstanding indebtedness, including all or a portion of the note issued to the Company (the “TMX Note”), in accordance with their respective terms and the TMX Note has not been paid in full, then the outstanding principal balance of the TMX Note and all accrued and unpaid interest thereon shall automatically convert in whole without any further action by the Company into the number of limited liability company membership units/interests of Carlin Haynes LLC equal to the outstanding principal balance of the TMX Note and all accrued and unpaid interest due on the TMX Note on the date of conversion, divided by 80% of the price per unit paid by the investors to purchase the new securities in the qualified financing.
As of June 30, 2022, and December 31, 2021, loans held-for-investment – related parties consisted of the following:
Summary of Related Parties Loans Held for Investment

June 30,
2022

December 31,
2021

Loans held-for-investment – related parties:
PZAJ Holdings, LLC⁽ⁱⁱ⁾ $
5,740,000
$ 3,950,000
ZASH Global Media and Entertainment Corporation ⁽ⁱⁱⁱ⁾ 18,451,250 15,000,000
Total Loans Held-For-Investment – Related Parties $ 24,191,250 $ 18,950,000
20
(ii) PZAJ is an entertainment content development company engaged in the acquisition, financing, development, production, and distribution of films and television projects. The loans each bear an interest rate of 2% per annum, with a one-year maturity (see Note 3).
(iii) ZASH Global Media and Entertainment Corporation is a media and entertainment company involved in the development of consumer facing content.
As of June 30, 2022, the Company has loaned $19,500,250 to ZASH under multiple financings, $18,451,250 of which is outstanding. The interest rates on the notes are 3% or 6% per annum.The loans are due in 2023 with $10,000,000 classified as current and $8,451,250 classified as non-current. The purpose of the loans is to engage in the acquisition, development and production of consumer facing content and related activities.
In the event that ZASH issues and sells preferred equity securities to one or more investors in an arm’s length transaction or series of related transactions with the principal purpose of raising capital that results in aggregate gross proceeds to ZASH of at least $1,000,000, excluding the amount represented by the conversion of any simple agreement for future equity or outstanding indebtedness, including all or a portion of the notes issued to the Company (the ~~“Effective Date”~~“ZASH Notes”), in accordance with their respective terms and the ZASH Notes have not been paid in full, then the outstanding principal balance of the ZASH Notes and all accrued and unpaid interest thereon shall automatically convert in whole without any further action by the Company into the number of preferred equity securities of ZASH equal to the outstanding principal balance of the ZASH Notes and all accrued and unpaid interest due on the ZASH Notes on the date of conversion, divided by 80% of the price per share paid by the investors to purchase the new securities in the qualified financing.
On December 30, 2021 the Vinco Ventures, Inc. ~~(the “Company”~~Board of Directors unanimously approved Vinco Ventures, Inc hiring of then-current employees of ZASH. The founding members of ZASH were not hired by Vinco.
Note 8 — Investments
As of June 30, 2022. And December 31, 2021, our non-current investments consisted of the following:
Schedule of Noncurrent Investments

June 30,
2022

December 31,
2021

Hyperreal Digital, Inc. $ 1,000,000 $ 1,000,000
Total Investments $ 1,000,000 $ 1,000,000
This investment does not have a readily determinable fair value and therefore it is measured at cost less impairment.
Note 9 — Fair Value of Financial Instruments
The Company measures the fair value of financial assets and liabilities based on the guidance of ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”) ~~consummated~~which defines a fair value, establishes a framework for measuring fair value, and expands disclosures about fair value measurements.
ASC 820 defines fair value as the ~~closing~~exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. ASC 820 also establishes a fair value hierarchy, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. ASC 820 describes three levels of inputs that may be used to measure fair value:
Level 1 — quoted prices in active markets for identical assets or liabilities
Level 2 — quoted prices for similar assets and liabilities in active markets or inputs that are observable
Level 3 — inputs that are unobservable (for example, cash flow modeling inputs based on assumptions)
The carrying amounts of the Company’s financial instruments, such as cash, accounts receivable and accounts payable, approximate fair values due to the short-term nature of these instruments. The carrying amount of the Company’s notes payable approximates fair value because the effective yields on these obligations, which include contractual interest rates, taken together with other features such as concurrent issuance of warrants, are comparable to rates of returns for instruments of similar credit risk.
21
The following fair value of financial assets and liabilities and the input level used to determine the fair value as of June 30, 2022 and December 31, 2021 is presented below:
Schedule of Fair Value of Financial Assets and Liabilities

Fair Value Measurements as of
June 30, 2022

Level 1 Level 2 Level 3

Assets:
Short-term investments $ 145,000 $ - $ 1,000,000

Liabilities:
Derivative liability - - 94,300,999
Purchase consideration - - 11,080,000
Total $ 145,000 $ - $ 106,380,999
Fair Value Measurements as of
December 31, 2021
Level 1 Level 2 Level 3
Assets:
Short-term investments $ 178,000 $ - $ 1,000,000

Liabilities:
Warrant Liability - - 198,566,170
Total $ 178,000 $ - $ 199,566,170
The following table presents a reconciliation of the Company’s liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2022 and 2021, respectively:
Schedule of Reconciliation of Liabilities Measured at Fair Value

Warrant
Liability
Purchase Consideration

Balance, January 1, 2022 $ 198,566,170 $ -
Issuance of warrants and contingent shares 243,681,478 23,250,000
Change in fair value of warrants and contingent shares (86,110,179 ) (12,170,000 )
Exercise of warrants (227,949,858 ) -
Balance, June 30, 2022 $ 128,187,611 $ 11,080,000

Warrant
Liability

Balance, January 1, 2021 $ -
Issuance of warrants 228,575,715
Change in fair value of warrants 773,447
Exercise of warrants (89,654,047 )
Balance, June 30, 2021 $ 139,695,115
22
Note 10 — Intangible Assets and Goodwill
As of June 30, 2022, intangible assets consisted of the following:
Schedule of Intangible Assets

Estimated

Remaining
Weighted Average

Gross

Net

Useful Useful Carrying Accumulated Carrying
Life Life Amount Amortization Amount
Finite lived intangible assets:
Customer relationships 7-15 years 6.2 years $ 9,470,000 $ 590,271 $ 8,879,729
Developed technology 7-10 years 5.5 years 65,551,987 7,390,427 58,161,560
Membership network 7 years 3.2 years 1,740,000 952,857 787,143
Digital media platform 7 years 5.4 years 1,552,500 360,402 1,192,098
Influencer network 5 years 4.5 years 2,756,000 275,600 2,480,400
Total finite lived intangible assets 81,070,487 9,569,557 71,500,930

Indefinite lived intangible assets:
Trademarks and tradenames Indefinite 3,440,000 - 3,440,000
Total indefinite lived intangible assets 3,440,000 - 3,440,000
Total intangible assets $ 84,510,487 $ 9,569,557 $ 74,940,930
As of December 31, 2021, intangible assets consisted of the following:

Estimated

Remaining
Weighted Average

Gross

Net

Useful Useful Carrying Accumulated Carrying
Life Life Amount Amortization Amount
Finite lived intangible assets:
Customer relationships 15 years 11.7 years $ 670,000 $ 148,889 $ 521,111
Developed technology 7-10 years 7.0 years 37,251,987 3,458,065 33,793,922
Membership network 7 years 3.7 years 1,740,000 828,571 911,429
Digital media platform 7 years 5.9 years 1,552,500 249,509 1,302,991
Influencer network 5 years 5.0 years 2,756,000 - 2,756,000
Total finite lived intangible assets 43,970,487 4,685,034 39,285,453

Indefinite lived intangible assets:
Trademarks and tradenames Indefinite 1,240,000 - 1,240,000
Total indefinite lived intangible assets 1,240,000 - 1,240,000
Total intangible assets $ 45,210,487 $ 4,685,034 $ 40,525,453
Amortization expense for the six months ended June 30, 2022 and 2021 was $4,784,521 and $1,016,000, respectively. Amortization expense for the three months ended June 30, 2022 and 2021 was $3,268,451 and $603,270, respectively.
The estimated future amortization of intangibles subject to amortization as of June 30, 2022 was as follows:
Schedule of Intangible Assets Future Amortization Expenses

Amount
2022 (excludes amortization through June 30, 2022) $ 5,044,043
2023 10,088,090
2024 10,038,090
2025 9,776,661
2026 9,353,804
Thereafter 27,200,243
Total $ 71,500,930
The changes in the carrying amount of goodwill for the six months ended June 30, 2022, consisted of the following:
Schedule of Goodwill
Amount
Balance, January 1, 2021 $ 5,983,852
Impairment (591,729 )
Acquisition of Lomotif Private Limited 116,188,021
December 31, 2021 121,580,144
Impairment (453,449 )
Acquisition of AdRizer 17,039,788
Balance, June 30, 2022 $ 138,166,483
The Company recorded an impairment charge of $453,449 at June 30, 2022 related to our Pirasta, LLC and Uber Mom, LLC businesses resulting from the Company no longer allocating resources to the businesses.
23
Note 11 — Debt
As of June 30, 2022 and December 31, 2021, debt consisted of the following:
Schedule of Long-term Debt

June 30,
2022

December 31,
2021

Notes payable $ - $ 27,644
Notes payable – related parties 221,758 235,107
Convertible notes payable 112,990,000 113,000,000
Convertible notes payable of Lomotif Private Limited - 150,000
Convertible notes payable of Lomotif Private Limited – related parties 2,500,000 2,500,000
Debt issuance costs (34,290,981 ) (68,925,172 )
Total Debt $ 81,420,777 $ 46,987,579
Convertible Notes Payable – Related Parties
ZASH – February and March 2021
On February 23, 2021, Lomotif Private Limited obtained a loan in the amount of $1,500,000 from ZASH pursuant to a loan agreement with ZASH with a maturity date on February 22, 2028 and an annual interest rate of 2%. Under the terms of the agreement, the loan is convertible at a 20% discount to a $150 million valuation of Lomotif Private Limited. On March 30, 2021, Lomotif Private Limited obtained a loan in the amount of $1,000,000 from ZASH pursuant to a loan agreement with ZASH with a maturity date on March 28, 2028 and an annual interest rate of 2%. Under the terms of the loan agreement, the loan is convertible at a 20% discount to a $150 million valuation of Lomotif Private Limited.
Convertible Notes Payable
Hudson Bay Financing – July 2021
On July 22, 2021 Vinco Ventures consummated a private placement offering (the ~~“Offering”~~“July 2021 Offering”) whereby pursuant to the Securities Purchase Agreement (the ~~“Purchase~~“July 2021 Purchase Agreement”) entered into by the Company on July 22, 2021 with ~~one accredited~~Hudson Bay Master Fund Ltd as investor ~~(the “Investor”),~~ the Company issued a Senior Secured Convertible Note in the amount of $120,000,000 for the purchase price of ~~$100,000,000 ($~~$~~20,000,000~~100,000,000 ~~OID)(the “Note”~~(the “July 2021 Note”) and five (5) year warrants (the ~~“Warrant”~~“July 2021 Warrant”) to purchase shares of the ~~Company’s~~ common stock ~~par value $0.001~~ ~~per share~~of the Company (“Common Stock”). The Company placed $100,000,000 of cash into a restricted bank account under a deposit account control agreement as collateral for the July 2021 Note. The Company recorded a deferred discount of $120,000,000 which consisted of the $20,000,000 original issue discount, $9,300,000 of fees paid to placement agents and lawyers, and $90,700,000 related to the issuance of warrants.

The July 2021 Note, ~~shall carry no~~as amended carries interest ~~unless~~at 6.0% per annum and ~~until an event of default shall occur and matures~~is payable quarterly. The July 2021 Note originally matured on July 22, 2022. The July 2021 Note contains a voluntary conversion mechanism whereby the ~~Noteholder~~noteholder may convert at any time after the ~~Issuance~~Initial Convertibility Date (as defined in the July 2021 Note), in whole or in part, the outstanding principal and interest under the July 2021 Note into shares of ~~the~~ Common Stock of the Company at a conversion price of $4.00 per ~~share (the “Conversion Shares”).~~share. The July 2021 Note ~~shall be~~is guaranteed by the Company’s subsidiaries and certain other guarantors and is a senior secured obligation of the Company and its subsidiaries. The July 2021 Note contains customary events of ~~default (each an “Event of Default”).~~default. If an ~~Event~~event of ~~Default~~default occurs, interest under the July 2021 Note will accrue at a rate of ~~twelve~~eighteen percent (18%) per annum and the outstanding principal amount of the July 2021 Note, plus accrued but unpaid interest, liquidated damages and other amounts owing with respect to the July 2021 Note will become, at the ~~Note holder’s~~noteholder’s election, immediately due and payable in cash. Upon completion of a Change of Control (as defined in the July 2021 Note), the ~~Note’s~~July 2021 Note holder may require the Company to purchase any outstanding portion of the July 2021 Note in cash at a price in accordance with the terms of the July 2021 Note.

24
~~Pursuant to the Purchase Agreement, the Investor received a Warrant in an amount equal to~~ ~~100% of the shares of Common Stock initially issuable to the Investor pursuant to the conversion terms of the Investor’s Note. The Warrant contains an exercise price of $4.00~~ ~~per share, subject to adjustments as provided under the terms of the Warrant. In connection with the closing of the Offering, the Warrant was issued for an aggregate of~~ ~~32,697,548~~ ~~shares of Common Stock (the “Warrant Shares”).~~
The Company also entered into a Registration Rights Agreement with the Investor (the “Registration Rights Agreement”). The Registration Rights Agreement provides that the Company shall (i) file with the Securities and Exchange Commission (the “Commission”) a Registration Statement by 30 days following the Closing Date of the Purchase Agreement to register the Conversion Shares and Warrant Shares (the “Registration Statement”); and (ii) use all commercially reasonable efforts to have the Registration Statement declared effective by the Commission within 60 days following the Closing Date or at the earliest possible date, or 75 days following the Closing Date if the Registration Statement receives comments from the Commission.

Palladium Capital Group, LLC. ~~(the “Placement Agent”)~~ acted as placement agent for the July 2021 Offering. The ~~Placement Agent~~placement agent received $9,000,000 of which $1,000,000 was cash compensation ofand $~~1,000,000~~8,000,000 ~~plus a Note of $8,000,000 which is~~was deferred ~~and only due upon the closing of the merger with Zash (8%~~cash compensation (8% of the gross proceeds to the Company plus an additional 1% of the gross proceeds to the Company for non-accountable expenses). The Company has paid $4,000,000
~~On July 19, 2021, Zash, Lomotif Private Limited (“Lomotif”),~~ of the ~~Lomotif selling shareholders~~deferred cash compensation and ~~ZVV, entered into a Deed~~$4,000,000 remains outstanding in accounts payable as of Variation and Supplement (the “Deed of Variation”) whereby, among other things, Zash novated all of its rights and obligations under the Lomotif SPA to ZVV and ZVV assumed all of Zash’s rights and obligations under the Lomotif SPA as if ZVV had been a party to the Lomotif SPA in place of Zash. On July 23, 2021, ZVV paid as consideration $~~100~~June 30, 2022. ~~million from the Senior Secured Convertible Note that closed on July 22, 2021, which resulted in ZVV acquiring an~~ 80~~% interest in Lomotif.~~

~~On July 1, 2021, the Company issued a total of~~ ~~30,000~~ ~~shares valued at $94,800~~ ~~to an employee for severance.~~
~~On August 18, 2021, the Company entered into a warrant exercise agreement (the “Agreement”) with the Investor whereby the Parties agreed that, subject~~Pursuant to the ~~satisfaction (or waiver) of~~July 2021 Purchase Agreement, the ~~conditions set forth in Sections 4 and 5 of~~investor received the Agreement: (i) the Investor shall pay to the Company an amount equal to the Exercise Price as defined in the January Warrants and February Warrants (the “Existing Warrants”) in effect as of the date of such exercise multiplied by the ExistingJuly 2021 Warrant. The July 2021 Warrant shares as defined in the Agreement; (ii) the Company shall issue and deliver to the Investor the Existing Warrant shares as set forth in Section 1 of the Existing Warrants; (iii) the Company shall issue and deliver to the Investor additional warrants to purchase an aggregate of ~~20,500,000~~ ~~shares of Common Stock at~~contained an exercise price of $2.655 per share, subject to adjustments as provided ~~therein (the “August Series A Warrants”); and (iv)~~under the ~~Company shall issue and deliver to~~terms of the ~~Investor additional warrants to purchase~~July 2021 Warrant. In connection with the closing of the July 2021 Offering, the July 2021 Warrant was issued for an aggregate of ~~2,000,000~~32,697,548 shares of Common Stock. The conversion features on the July 2021 Note and the July 2021 Warrant were approved by the Company’s stockholders on October 14, 2021. On November 9, 2021 the investor converted $7,000,000 of principal under the July 2021 Note in exchange for 1,750,000 shares of Common Stock.
On March 9, 2022, the Company, Cryptyde and the noteholder of the July 2021 Note entered into an Amendment Agreement (the “Amendment Agreement”) whereby the parties agreed to, among other things: (i) amend certain provisions of the July 2021 Note to (a) convert $10,000 of the principal amount of the July 2021 Note at a conversion price of $0.01 into shares of Common Stock, (b) extend the maturity date under the July Note to July 22, 2023, (c) increase the interest rate on the July 2021 Note from zero percent (0%) to six percent (6.0%), (d) reduce the maximum cap of the minimum cash in the control account from $100,000,000 to $80,000,000, and (e) require the Company to redeem $33,000,000 of the principal of the July 2021 Note, together with accrued and unpaid interest and accrued and unpaid late charges on such principal and interest, on July 22, 2022; (ii) to extend certain dates relating to (x) the Company’s registration of certain securities under the Warrant Exercise Agreements dated September 1, 2021, November 11, 2021 and December 20, 2021 to April 30, 2022, (y) the Company’s filing of a proxy statement to April 30, 2022 and (z) the Company holding a stockholder meeting and obtaining a stockholder vote to June 4, 2022 or July 4, 2022 in the event that the Company receives comments from the SEC with respect to the proxy statement; and (iii) to waive any adjustments to convertible securities or options as a result of the Adjusted Conversion Price (as defined in the Amendment Agreement). The Company accounted for the amendment as a modification of debt and as a result, extended the amortization of the deferred financing fees of the original note over the remaining term of the amended agreement. In addition, the Company recorded additional deferred financing fees as a result of the issuance of 1,000,000 shares of common stock with a per share value of $2.18 in conjunction with the amendment.
The scheduled maturities of the debt for the next five years as of June 30, 2022, are as follows:
Schedule of Maturities of Long-term Debt
Amount
2022 $ 33,112,835
2023 82,612,272
2024 -
2025 -
2026 -
Long-term debt, Gross 115,725,107
Less:debt discount (34,304,330 )
Long-term debt $ 81,420,777
25
Note 12 — Warrant Liability
For the six months ended June 30, 2022, the Company issued warrants to purchase shares of the Company’s common stock related to the Warrant Exercise Agreement dated December 20, 2021, with a warrant holder, in which the Company agreed to issue 225% of the number of Exercised Warrant Shares at an exercise price of $~~2.655~~3.265 ~~per share, subject~~ to ~~adjustments provided therein (the “August Series B Warrants,”~~the warrant holder for every warrant the warrant holder exercised from the period commencing December 20, 2021 and ~~together~~ending on February 28, 2022. In conjunction with this agreement (“December 2021 Warrants”), the warrant holder exercised 98,324,692 warrants in the first six months of 2022 which generated $101,081,926 in gross proceeds to the Company. The warrant holder exercised 61,430,123 warrants during the three months ended June 30, 2022 which did not generate proceeds to the Company. In conjunction with the ~~August Series A Warrants,~~agreement, the ~~“August Warrants”)~~Company issued 83,012,781 warrants to the holder and 6,641,022 to the placement agent for the agreement. The warrants have an exercise price of $3.265, a five year term, and provide registration rights to the holder along with other terms that cause the warrants to be accounted for as a liability in accordance with ASC 480 (Liabilities). The ~~terms~~initial fair value of the ~~August Series A~~warrants issued during the six months ended June 30, 2022 was $243,681,478.
Under the May 2022 Warrant Exchange Agreement, dated May 12, 2022, the Company entered into an agreement with the holder of the Company’s July 2021 Notes warrants for the purchase of the Company’s common stock for $4.527 issued on November 10, 2021 (the “November 2021 Warrants”) and the Company’s warrants for the purchase of the Company’s common stock for $3.2653 issued on December 20, 2021 whereby the Company and the holder agreed the holder could exchange its warrants for the Company’s common shares. The exchange ratio agreed to is for each November 2021 Warrant exchanged the holder would receive 77% of a share of the Company’s common stock, and for each December 2021 Warrant exchanged the holder would receive 81% of a share of the Company’s common stock. The holder is entitled to exchange its November 2021 Warrants and its December 2021 Warrants under the ~~August Series B Warrants are substantially identical, except that, upon stockholder~~agreement from May 12, 2022 until the sixtieth (60^th) day immediately following the date on which the Company’s receives approval from its stockholders for the ~~August Series B Warrants will be subject~~increase of its authorized common shares from 250,000,000 to ~~an Alternate Cashless Exercise, as defined therein.~~750,000,000 (the “Shareholder Approval Date”). On May 13, 2022, the Company filed a preliminary proxy statement for a Special Meeting of Stockholder’s to, among other things, seek the approval from its stockholders for such proposed increase of its authorized common shares.
~~In addition,~~ Furthermore, pursuant to the ~~Agreement,~~exchange agreement, on or prior to the ~~Parties also agreed, among other things, that (i) upon entering into~~second business day following the ~~Agreement,~~Shareholder Approval Date, the ~~exercise price~~Company shall deliver to the holder an additional number of shares of Common Stock equal to 7% of the sum of each of the November 2021 Warrants and December 2021 Warrants exchanged by the holder during this period. In addition, the exchange agreement allows the holder for up to 60 days after the Shareholder Approval Date for (i) each November 2021 Warrant may be exchanged for 42% of a November 2021 Exchanged Warrant Share, and (ii) each December 2021 Warrants may from time to time be exchanged for 42% of a December 2021 Exchanged Warrant Share.
Pursuant to the Warrant Exercise Agreement dated May 12, 2022, no shares issued or issuable with respect to the Outstanding Warrants shall in the aggregate exceed 37,591,713 shares of Common Stock (as adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction relating to the Common Stock occurring after May 12, 2022).
On May 19, 2022, the holder exchanged 500,000 November 2021 Warrants for 385,000 shares of the Company’s common stock, 12,000,000 September 2021 Warrants for 6,000,000 shares and 18,090,123 December 2021 Warrants for 14,653,000 shares of the Company’s common stock. On May 12, 2022, the holder exchanged 27,840,000 December 2021 Warrants for 22,550,400 shares of the Company’s common stock. The Company did not receive any proceeds from the cashless exercises.
On July 5, 2022, the Holder submitted Alternate Exercise Notices to the Company with respect to (i) 14,500,000 exercise shares under the November Warrants, ~~is reduced~~and (ii) 67,760,699 exercise shares under the December Warrants, for an aggregate payment equal to $~~2.655~~33,886,612 ~~per share;~~(the “Warrant Payment”). On July 6, 2022, the Company made the Warrant Payment, in cash, to the Holder pursuant to the Alternate Exercise Notices and, ~~(ii) the definition~~as a result, a total of ~~“Initial Exercisability Date” (as defined in the June Incentive Warrant) is amended to mean August 18, 2021.~~
~~On August 18, 2021, the Investor exercised the remaining~~ ~~4,600,000~~82,260,699 warrants ~~under~~held by the ~~February Warrants at a price~~Holder were canceled.
Schedule of $Warrant Liability

For the 3 months ended
June 30, 2022

Series Exercise Price* Initial Grants As of April 1, 2022 Exercises Remaining
June $ 3.3000 29,893,175 115,800 - 115,800
September A $ 9.0000 21,600,000 21,600,000 (15,000,000 ) 6,600,000
November $ 4.5270 16,200,000 16,200,000 (500,000 ) 15,700,000
December $ 3.2653 122,786,087 122,786,087 (45,930,123 ) 76,855,964
190,479,262 160,701,887 (61,430,123 ) 99,271,764
~~3.722~~ ~~for a total amount of $~~

For the 6 months ended
June 30, 2022

Series Exercise Price* Initial Grants As of Jan. 1, 2022 Exercises Remaining
June $ 3.3000 29,893,175 20,386,206 (20,270,406 ) 115,800
July $ 2.6550 35,313,352 16,624,163 (16,624,163 ) -
September A $ 9.0000 21,600,000 21,600,000 (15,000,000 ) 6,600,000
November $ 4.5270 16,200,000 16,200,000 (500,000 ) 15,700,000
December $ 3.2653 122,786,087 122,786,087 (45,930,123 ) 76,855,964
225,792,614 197,596,456 (98,324,692 ) 99,271,764
~~17,121,200~~.
* - Based on Exercise Price as of the initial grant; the above disclosure discusses modifications under specific Warrant Exchange Agreements.

3326

The Company’s outstanding warrants set forth below were valued using the Monte-Carlo simulation pricing model to calculate the June 30, 2022 fair value of the warrants with the following assumptions:
Schedule of Warrant Assumptions
Dividend Yield Expected Volatility
Risk-free Interest
Rate
Expected Life
Hudson Bay Warrant; June 4, 2021 0.00 % 118.40 % 3.00 % 2.9 years
Hudson Bay Series A Warrant; September 1, 2021 0.00 % 118.40 % 3.00 % 2.7 years
Palladium Capital Group Series A Warrant; September 1, 2021 0.00 % 118.40 % 3.01 % 2.7 years
Hudson Bay Warrant; November 10, 2021 0.00 % 118.40 % 3.01 % 3.6 years
Palladium Capital Warrant; November 10, 2021 0.00 % 118.40 % 3.01 % 3.6 years
Hudson Bay Warrant; December 20, 2021 0.00 % 118.40 % 3.01 % 3.6 years
Palladium Capital Warrant; December 20, 2021 0.00 % 118.40 % 3.01 % 3.6 years
Note 13 — Related Party Transaction~~ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.~~
Schedule of Related Party Transaction
Due to/from Related Parties as of June 30, 2022
ZASH Global Media 15,387,276
Other 28,860
Balance, June 30, 2022 $ 15,416,136
As of June 30, 2022, the Company has provided ZASH with cash advances of $15,387,276 for the purposeof funding ZASH Global Media.

~~Overview~~ZASH Global Media and Entertainment Corporation

~~Vinco Ventures: End-to-end product innovation, development~~As of June 30, 2022, Lomotif owed ZASH $2,500,000 in original principal amount under two promissory notes. In addition, ZASH owed the Company $18,451,250 in original principal amount under six promissory notes. Our Executive Chairman, Roderick Vanderbilt, co-founded ZASH on December 14, 2020, and ~~commercialization~~previously served as the President of ZASH. He resigned from ZASH on January 5, 2021, and an amendment was filed with the Secretary of State of the State of Delaware. He has a pre-existing personal and business relationship with the current controlling shareholder of ZASH and ZVV manager, Theodore Farnsworth. On October 1, 2021, ZASH, ZVV, and AdRizer entered into a letter of intent (as amended, the “LOI”), which contemplated the acquisition by ZASH or ZVV of all of the outstanding equity interests of AdRizer. On February 11, 2022, the Company, ZASH and ZVV entered into an Assignment and Assumption Agreement whereby ZASH and ZVV assigned to the Company, and the Company assumed, all of the rights and obligations of ZASH and ZVV under the LOI, in consideration of a cash payment by the Company to ZASH of $6.75 million upon the closing of the acquisition, which occurred on February 11, 2022 (See Note 3- Acquisitions and Divestitures).

~~Our~~On June 29, 2022, the Company ~~was incorporated on July 18, 2017~~and ZVV entered into a Secured Promissory Note (the “Note”) in the ~~State~~original principal amount of ~~Nevada~~$56,955,167 (eliminated in consolidation as a VIE), which original principal amount has previously been loaned by the Company to ZVV to support Lomotif and other ZVV business ventures and projects. Pursuant to the Note, ZVV can borrow up to an aggregate principal amount of $70,000,000 and will use the proceeds from loans drawn under the ~~name~~Note to support the business of ~~Idea Lab X Products, Inc, On September 12, 2017, we filed an Amendment~~Lomotif and other ZVV business ventures and projects. The Note becomes due and payable in full by ZVV on June 30, 2024, and carries interest at a rate per annum equal to our Articles of Incorporation changing the name to Xspand Products Lab, Inc., and then on September 7, 2018 we filed an Amendment to our Articles of Incorporation changing the name to Edison Nation, Inc. On November 5, 2020, the Company (the “Parent”) and its wholly owned subsidiary, Vinco Ventures, Inc. (the “Merger Sub”), entered into an Agreement and Plan of Merger (the “Agreement”five percent (5%). Under the terms of the Agreement, the Merger Sub merged with and into the Parent and the Parent became the surviving corporation of the Merger (the “Surviving Corporation”). The name of the Surviving Corporation became Vinco Ventures, Inc. The transaction closed on November 10, 2020.

In connection with the Note, on the Issue Date, the Company and ZVV entered into that certain Security and Pledge Agreement (the “Security Agreement”). Pursuant to the Security Agreement and to provide security for ZVV’s repayment of all loans under the Note, ZVV granted, among other things, a second priority security interest and lien upon all of ZVV’s property to the Company.
Magnifi U, Inc.
On October 12, 2021, ZVV entered into a promissory note (the “Magnifi U Note”) with Magnifi U, pursuant to which ZVV loaned Magnifi U $1,500,000. The Magnifi U Note bears interest at 3% annually and Magnifi U is obligated to pay the full amount of principal and interest in one balloon payment on October 12, 2023. Our director, Vinco employee, and member of the board of managers of ZVV, Lisa King, is the founder of Magnifi U and serves as its chief executive officer. ZASH has an 8% ownership interest in Magnifi U resulting from its equity investment of $2,411,140 in Magnifi U, with an obligation to fund a total of $5,000,000for a total of 15% equity.
As of June 30, 2022, Lisa King had one member of her extended family working at Magnifi U with an annual salary in excess of $100,000, and Ted Farnsworth had one member of his extended family working at Vinco Ventures ~~Inc. seeks to be involved~~and/or ZASH with ~~every step~~an annual salary in excess of $100,000.
PZAJ Holdings LLC
As of June 30, 2022, Ted Farnsworth held the position of Initial Chairman of the ~~consumer product life cycle – from ideation,~~Board of Managers at PZAJ Holdings, LLC.
Brian Hart
Prior to ~~research and development, manufacturing, sales, packaging and fulfillment. The Company also seeks to raise awareness~~appointment as a member of Board of Directors of the ~~Vinco Ventures brand name~~Company, Mr. Hart previously provided consulting services to the Company earlier in 2022 pursuant to which he received $90,000 in compensation pursuant to which he has been paid in full before September 27, 2022. Mr. Hart is no longer providing consulting services to the Company as ~~a diversified consumer products business through a number~~ of ~~media channels.~~that date and will not provide any such services so long as he serves as director of the Company.
Note 14— Commitments and Contingencies
Operating Leases

The ~~first stage~~Company has entered into non-cancellable operating leases for office, warehouse, and distribution facilities, with original lease periods expiring through 2024. In addition to minimum rent, certain of ~~development for any consumer product is~~ the ~~impetus~~leases require payment of real estate taxes, insurance, common area maintenance charges, and other executory costs. Differences between rent expense and rent paid are recognized as adjustments to ~~turn an idea into a salable commodity. Considered to be~~operating lease right-of-use assets on the “go-to” resource for independent innovators with great consumer product invention ideas, Vinco Ventures through its Edison Nation web portal maintains a consumer-facing online presence whereby innovators can submit ideas for consideration by us. If an idea is successfully chosen, Vinco Ventures will apply its proprietary, web-enabled new product development (“NPD”) and commercialization platform that can take a product from idea through final e-commerce sale. Vinco Ventures presently engages with over 180,000 registered online innovators and entrepreneurs interested in accessing the Company’s NPD platform to bring innovative, new products to market focusing on high-interest, high-velocity consumer categories. The Company generates revenue from its web presence by charging a fee for each idea submission, and also through subscription-based plans for innovators that wish to submit high volumes of ideas.consolidated balance sheets.

~~Since its inception,~~Total rent expense for the ~~Edison Nation web portal has received over 200,000 idea submissions, with products selling~~six months ended June 30, 2022 and 2021 was $365,066 and $59,277, respectively. Rent expense is included in ~~excess~~general and administrative expense on the consolidated statements of ~~$250 million at retail through the management~~operations. As of over 300 client product campaigns with distribution across diverse channels including e-commerce, mass merchandisers, specialty product chains, entertainment venues, national drug chains, and tele-shopping. These clients include many of the largest manufacturers and retailers in the world including Amazon, Bed Bath and Beyond, HSN, Rite Aid, P&G, and Black & Decker. The Company generates revenue from licensing agreements with such manufacturers and retailers. Such agreements are entered into when innovators submit their ideas through Vinco Ventures’ web portal. Occasionally,June 30, 2022, the Company ~~also generates revenue~~had operating lease liabilities of $640,391 and right of use assets for operating leases of $629,521. Excluded from ~~innovators~~the measurement of operating lease liabilities and operating lease right-of-use assets were certain office, warehouse and distribution contracts that ~~wish to use~~qualify for the ~~Company’s product development resources, but license or distribute products themselves.~~short-term lease recognition exception.

Supplemental balance sheet information related to leases are as follows:
Schedule of Operating Lease Liabilities
June 30, 2022
Operating leases - ROU assets $ 629,521

Operating lease liabilities (current) 203,022
Operating lease liabilities (noncurrent) 437,369
Total operating lease liabilities $ 640,391
Future minimum lease payments under operating leases as of June 30, 2022, are as follows:
Schedule of Reconciliation of Future Undiscounted Cash Flows
Operating Lease
2022 (Jul-Dec) $ 119,547
2023 201,121
2024 136,050
2025 120,453
2026 126,475
Thereafter 10,582
Undiscounted Cash Flows 714,228
Less: Implied Interest (73,837 )
Total operating lease liabilities $ 640,391
As of June 30, 2022, the weighted-average remaining lease term for operating leases is 33.46 months, or 2.79 years.
27
Legal Contingencies
The Company is involved in claims and litigation in the ordinary course of business, some of which seek monetary damages, including claims for punitive damages, which are not covered by insurance. For certain pending matters, accruals have not been established because such matters have not progressed sufficiently through discovery, and/or development of important factual information and legal information is insufficient to enable the Company to estimate a range of possible loss, if any. An adverse determination in one or more of these pending matters could have an adverse effect on the Company’s consolidated financial position, results of operations or cash flows.
We are, and may in the future become, subject to various legal proceedings and claims that arise in or outside the ordinary course of business.
Note 15 — Stockholders’ Equity
Common Stock
For the period ending June 30, 2022, the Company reported it was authorized to issue 250,000,000 shares of common stock. As of June 30, 2022 and December 31, 2021, there were 233,140,993 and 150,118,024 shares of common stock issued and outstanding, respectively.
During the six months ended June 30, 2022, warrant shares of 98,324,692 were exercised and the Company received proceeds of $101,081,926. During the three months ended June 30, 2022, warrant shares of 61,430,123 were exercised and did not receive any proceeds.
On October 14, 2022, the Company filed an amendment to its Articles of Incorporation to reallocate its previously authorized 250 million shares of stock as 245 million shares of Common Stock and 5 million shares of Preferred Stock, which Preferred Stock may be issued upon the subsequent filing with the Nevada Secretary of State of one or more certificates of designation for series of preferred stock. It subsequently amended the filing to be 249 million shares of Common Stock and 1 million shares of Preferred Stock.
Preferred Stock
The Company is authorized to issue 1,000,000 shares of preferred stock, with the par value to be established upon issuance.
Stock-Based Compensation
On September 4, 2021, the Company’s board of directors approved the Vinco Ventures, Inc. 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan provides for the issuance of up to 9,000,000 (3,267,040 remaining as of June 30, 2022) shares of Common Stock to help align the interests of management and our stockholders and reward our executive officers for improved Company performance. Stock incentive awards under the 2021 Plan can be in the form of stock options, restricted stock units, performance awards and restricted stock that are made to employees, directors and service providers. Awards are subject to forfeiture until vesting conditions have been satisfied under the terms of the award. The exercise price of stock options is equal to the fair market value of the underlying Common Stock on the date of grant.
28
The following table summarizes stock option awards outstanding as of June 30, 2022:
Schedule of Share-based Compensation, Stock Options, Activity
Shares Weighted
Average
Exercise
Price Remaining
Contractual
Life in
Years
Aggregate Intrinsic
Value

Balance, December 31, 2021 80,000 $ 7.01 1.4 -
Granted - $ - - -
Forfeited 80,000 $
-

-
-
Balance, June 30, 2022 - $ - - -
Exercisable, June 30, 2022 - $ - - -
As of June 30, 2022, there were no unvested options to purchase shares of the Common Stock and there was no unrecognized equity-based compensation expense that the Company expected to recognize over a remaining weighted-average period.
Lomotif has a stock option plan for their employees. The 2021 Equity Incentive Plan is intended to help Lomotif to secure and retain qualified resources. The Plan has 465,827 reserved shares.
Net Earnings or Loss per Share
Basic net (loss) income per common share is computed by dividing net (loss) income by the weighted average number of vested common shares outstanding during the period. Diluted net income per common share is computed by dividing net income by the weighted average number vested of common shares, plus the net impact of common shares (computed using the treasury stock method), if dilutive, resulting from the exercise of dilutive securities. In periods when losses are reported, the weighted-average number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive. As of June 30, 2022 and 2021, the Company excluded the common stock equivalents summarized below, which entitle the holders thereof to ultimately acquire shares of common stock, from its calculation of earnings per share, as their effect would have been anti-dilutive. The potential dilution from common stock equivalents is computed using the treasury stock method based on the average market value of our common stock during the period.
For the period three months ending June 30, 2022, due to a reported net gain of $145,928,165, the calculation of our diluted weighted-average common shares outstanding includes all common stock equivalents as the effect would be dilutive. For the period six months ending June 30, 2022, due to a reported net loss of $227,019,793, the calculation of our diluted weighted-average common shares outstanding excludes all common stock equivalents as the effect would be anti-dilutive.
Schedule of Anti-dilutive Securities Excluded from Computation of Earnings Per Share
June 30, 2022 December 31, 2021
As of
June 30, 2022 December 31, 2021
Shares reserved in exchange for the cancellation of certain non-voting membership interest in EVNT Platform, LLC - 4,000,000
Options - 80,000
Convertible shares under notes payable 28,671,213 28,274,454
Warrants 99,271,764 107,942,653
Total 127,942,977 140,297,107
Note 16 —Customer Concentrations
For the six months ended June 30, 2022 and 2021 the following customers that represented more than 10% of total net revenues:
Schedule of Revenue from Customers
For the six months ended June 30,
2022 2021
Customer:
Customer A -^* 11 %
Customer B 38 % -^*
Customer C 33 % -^*
Customer D 25 % -^*
● Under 10%
29
For the six months ended June 30, 2022 and 2021, the following geographical regions represented more than 10% of total net revenues:
Schedule of Revenue by Geographical Areas
For the Six Months ended
June 30,
2022 2021
Region:
North America 100 % 100 %
Note 17 — Subsequent Events
July 6, 2022 Alternative Exercise of Hudson Bay Warrants and Cash Payment and Postponement of Annual Meeting
On June 30, 2022, the Company postponed its special stockholder meeting from July 1, 2022 to July 26, 2022 which was subsequently postponed again to August 23, 2022 and then postponed indefinitely. This meeting was to be held to approve various proposals including amending the Company’s Amended and Restated Articles of Incorporation to increase the number of its authorized shares of common stock from 250,000,000 to 750,000,000. The postponement of the meeting triggered an alternative exercise notice clause in the Company’s November and December 2021 warrants, as amended, which allows the holder to put the warrants back to the Company in exchange for cash payments of $0.65 and $0.36 per warrant for the November and December 2021 warrants, respectively. The Holder exercised this provision in July 2022 resulting in a cash payment of $33,886,612 and cancelation of 82,260,699 warrants. Additionally, per the terms of the amended July 2021 convertible note the Company made a cash payment of $33,000,000.
On August 18, 2022, the Company entered into a Purchase Agreement, in which it agreed to repurchase $55,000,000 of the principal amount of the note then outstanding for $65,000,000. The Company was permitted to release up to $70,000,000 from Restricted Cash, provided that $65,000,000 of the amount was wired directly from the Control Account to the Holder of the note as payment.
Business Changes
On July 22, 2022, the Company entered into one of two anticipate software license agreements with its strategic partner, AI-Pros Inc. (“AI-Pros”). The license provides Vinco the right to use AI-Pros’ tools and technologies, which could allow Vinco to participate in a social media platform that it believes can significantly enhance its position in the digital advertising markets.
The Company is in the process of terminating the software licensing agreements with AI-Pros.
Litigation and Management Changes
On August 5, 2022, Vinco Ventures, Inc. was subject to a Temporary Restraining Order (“TRO”) filed in the State of Nevada. The TRO outlined various management disputes between existing members of the Board of Directors and members of executive management. On September 28, 2022, the Company entered into a settlement agreement (the “Agreement”) with respect to the litigation entitled “Vinco Ventures, Inc. v. Theodore Farnsworth, Lisa King, Roderick Vanderbilt and Erik Noble” in the Eight Judicial District Court located in Clark County, Nevada. The Agreement set forth the following, among other things (a) Ross Miller is the interim sole CEO and shall run the Company under the oversight of the Company’s Board of Directors, with Lisa King and Rod Vanderbilt remaining as directors, (b) John Colucci, former Co-CEO and Phillip Jones, former CFO, both resigned effective immediately as officers and director (in the case of Colucci) of the Company, (c) Michael Distasio and Elliot Goldstein resigned effective immediately as Directors of the Company, (e) John Colucci received three month’s severance and Phillip Jones received four month’s severance, in addition to any accrued and unpaid payroll, (f) The Company shall pay six months’ worth of COBRA payments for Jones, (g) All directors are to be paid all director fees due to the date of severance, (h) Elliot Goldstein is to be paid $100,000 in lieu to any matters related to his stock options and RSUs, (i) All outgoing directors and officers entered into three year noncompete agreements with the Company, and (j) All parties entered into mutual releases with the Company.
On October 26, 2022, the Company entered into an engagement agreement with Ankura Consulting Group for interim CFO services, with Brendan Bosack, one of its principals, named as Interim CFO of the Company. The agreement calls for services to be rendered at $900 per hour up to $30,000 per week. The agreement is for an indefinite term and cancellable by either party.
Effective December 12, 2022, the Board of Directors of the Company unanimously approved the following:
● Ross Miller no longer as interim Chief Executive Officer of the Company, and Gabe Hunterton no longer as interim President of the Company
● Appointment of its Chairman, Rod Vanderbilt, as Executive Chairman as replacement for Mr. Miller and Mr. Hunterton
From the date of court appointment, August 19, 2022 through December 12, 2022, executive compensation paid to Ross Miller, interim Chief Executive Officer totaled $210,000; executive compensation paid to Gabe Hunterton totaled $135,000, and disbursements totaling $163,525 were made to advisors to Ross Miller.
Impairment Charges
Subsequent to June 30, 2022, the Company determined that a triggering event had occurred due various management disputes between existing members of the Board of Directors and members of executive management and the receipt of an Alternative Exercise from Hudson Bay, and Amendment to the July 2021 Note. Taken in conjunction with the resulting Going Concern, the Company abandoned its product business. Our consumer products business was led by Edison Nation. Edison Nation had a number of internally developed brands (“EN Brands”) ~~which act as a launchpad for new innovative items that have matriculated through the innovation portal.~~. These EN Brands ~~include~~included Cloud B, Pirasta, Uber Mom, Lily and Grey, Trillion Trees, and Barkley Lane. ~~Additionally,~~We impaired the related intangible assets in the third quarter, which included customer relationships, developed technology, membership network and trademarks of $3,747,349 (net of amortization) and goodwill of $4,938,674 associated with this business.
In addition, with the spinoff of Cryptyde, there was a change in how the Company ~~offers~~planned to utilize the EVNT platform from its acquisition. Management made the determination that it was no longer interested in continuing to operate and profit from E-NFT. The developed technology intangible asset for the EVNT platform of $6,607,989 (net of amortization) was fully impaired at September 30, 2022.
Further we performed a ~~partnership model~~quantitative impairment test for ~~entrepreneurs~~both the remaining goodwill and ~~businesses that are seeking to elevate their existing brands. Recent partnerships for~~intangible assets of the remaining business, Lomotif and AdRizer and recorded an estimated impairment charge of $96,901,960 and $16,546,760 respectively in the third quarter.
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ZASH Global Media Equity Transaction
On December 19, 2022, the Vinco Ventures, ~~include 4Keeps Roses~~Inc. entered into a material definitive agreement to complete the purchase of the membership interests (“Membership Interests”) in ZVV Media Partners from ZASH Global Media. The purchase price shall be (a) 10 shares of Vinco Ventures, Inc.’s Series B Preferred Stock (which shall be convertible into 144 million common shares of ZVV Media Partners, for which issuance will be subject to Nasdaq rules) and ~~Mother K. Within~~for which a Certificate of Designation was to be filed in the ~~partnership model,~~State of Nevada before December 21, 2022 (and will be issued in the ~~Company seeks~~near future), was subject to ~~identify new lines~~approval of ~~distribution~~both ZVV Media Partners and ~~provide innovation through development~~ZASH Global Media and compliance with all Nasdaq and SEC compliance (“Purchase Equity”), and (b) the deemed satisfaction of ~~new item that enhance~~all outstanding indebtedness and other obligations owing from ZASH Global Media to ZVV Media Partners or the ~~brands overall image~~ZVV Media Partners, including, without limitation, pursuant to (i) the Promissory Note issued by ZASH Global Media to ZVV Media Partners dated February 18, 2021 in the original principal amount of $5,000,000, and ~~consumer adoption.~~(ii) the Secured Promissory Note issued by ZASH Global Media to Vinco Ventures, Inc. dated June 29, 2022 in the original principal amount of $56,955,168. Vinco Ventures, Inc. shall issue the Purchase Equity to ZASH Global Media at the Closing (as defined herein) or such later time as agreed by the Parties in writing.

~~Once most consumer products are ideated, developed, manufactured, and possibly even licensed, they must be packaged and distributed. Currently, we maintain~~Nasdaq
On August 26, 2022, the Company filed a ~~logistics center~~Current Report on Form 8-K in ~~Clearwater, Florida. The~~which it disclosed that it had received notification from Nasdaq that required the Company ~~generates revenue from the sale~~to submit to Nasdaq, on or before October 17, 2022, a Plan of custom packaging for many of the products that have run through our NPD or in-house product development process. The Company also sells packaging products to a number of other entities that are not relatedCompliance with regard to the ~~Company’s product development process, including pharmaceutical~~filing of its Quarterly Report on Form 10-Q for the period ended June 30, 2022. The Plan of Compliance was submitted as of October 17, 2022. This 10-Q and ~~e-commerce companies. For packaging products,~~ the ~~Company does not have long-term agreements with customers, and instead manufactures and sells its packaging products subject to purchase orders from its customers.~~
~~Once a product is ready for distribution, consumer awareness must be raised in order to sell~~subsequent third quarter 10-Q satisfy the product. Accordingly, the Company has begun to pursue a media strategy. First, the Company is seeking to re-release episodes of the ‘Everyday Edisons’ television program, while simultaneously seeking a distribution partner for forthcoming episodes. The Company intends to generate revenue from the Everyday Edisons brand by entering into a contract with a broadcast network or online streaming service. The Company is seeking to expand its web presence by acquiring or creating other innovator-facing internet media properties. The Company intends to generate revenue from such internet media through the display of paid advertisements on its properties.Plan.
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As a result of a delinquency notice received with respect to the Company’s as yet filed 10-Q for the quarter ended June 30, 2022, the Company submitted a plan of compliance to file the second quarter 10-Q and the third quarter 10-Q no later than February 13, 2023. The Company submitted an update to this plan of compliance to Nasdaq confirming the above referenced timetable. The Company was unable to file the Form 10-Q for period ending September 30, 2022 by February 13, 2023.
On November 17, 2022, the Company received a notice (the “November Notice”) from the Listing Qualifications Department of The Nasdaq Stock Market, ~~Strategy~~LLC (“Nasdaq”) advising the Company that it was not in compliance with Nasdaq’s continued listing requirements under the Nasdaq Listing Rule 5250(c)(1) (“Rule 5250”) as a result of the Company’s failure to file its Quarterly Report on Form 10-Q for the quarter ended September 30, 2022 (“Form 10-Q”) with the United States SEC in a timely manner, which deadline was November 14, 2022. Rule 5250 requires listed companies to timely file all required periodic reports with the SEC.
On December 1, 2022, the Company received a notice (“December Notice”) from the Listing Qualifications Department of Nasdaq advising the Company that it was not in compliance with Nasdaq’s continued listing requirements under the Nasdaq Listing Rule 5550(a)(2) (“Rule 5550”) as a result of requiring listed securities to maintain a minimum bid price of $1 per share. Based upon the closing bid price for the last 30 consecutive business days, the Company no longer meets this requirement. However, Rule 5550 also provides the Company a compliance period of 180 calendar days in which to regain compliance. If at any time during this 180 day period the closing bid price of the Company’s security is at least $1 for a minimum of ten consecutive business days, Nasdaq will provide written confirmation of compliance and this matter will be closed.
On February 14, 2023, the Company received a Staff Determination letter (the “Letter”) from Nasdaq. The Letter states that on August 19 and November 17, 2022, Staff notified the Company that it did not comply with Nasdaq’s filing requirements set forth in Listing Rule 5250(c)(1) (the “Rule”) because it had not filed its Form 10-Q for the period ended June 30, 2022, and its Form 10-Q for the period ended September 30, 2022 (the “Delinquent Filings”). Staff granted the Company an exception until January 31, 2023, to regain compliance with the Rule. Subsequently, on January 26, 2023, the Company requested additional time to file the Delinquent Filings and Staff granted the Company an exception until February 13, 2023, to regain compliance with the Rule.
Upon further review, Staff determined that the Company did not meet the terms of the exception because it had not filed the Delinquent Filings by February 13, 2023. The Company will appeal Staff’s determination to a Hearings Panel (the “Panel”), pursuant to the procedures set forth in the Nasdaq Listing Rule 5800 Series. A hearing request will stay the suspension of the Company’s securities and the filing of the Form 25-NSE pending the Panel’s decision. The Company filed a hearing request and remitted the hearing filing fee prior to February 17, 2023.
Equity Changes

~~The process~~On October 14, 2022, the Company filed an amendment to its Articles of Incorporation to reallocate its previously authorized 250 million shares of stock as 245 million shares of Common Stock and 5 million shares of Preferred Stock, which Preferred Stock may be issued upon the subsequent filing with the Nevada Secretary of State of one or more certificates of designation for developing and launching consumer products has changed significantly in recent years. Previously, Fortune 500 and other companies maintained multimillion-dollar research and development divisions to develop and launch productsseries of preferred stock. It subsequently amended the filing to be ~~sold primarily~~249 million shares of Common Stock and 1 million shares of Preferred Stock.
Acquisition of National Enquirer
On February 6, 2023, the Company entered into a joint venture with ICON Publishing, LLC to acquire in cash the National Enquirer (both U.S. and U.K. editions), the National Examiner, and Globe under an Asset Purchase Agreement from magazine publisher a360 Media, LLC. The transaction includes the acquisition of all print and digital assets and owned intellectual property of the National Enquirer, National Examiner and Globe. The closing of the acquisition is subject to certain consents and customary conditions to closing as described in the Asset Purchase Agreement.
Securities Purchase Agreement
On February 5, 2023, the Company has entered into a Securities Purchase Agreement for the purchase of a $1,500,000 principal amount convertible note, a $10,000,000 principal amount convertible note and shares of Series A perpetual non-convertible preferred stock of the Company designated as Series A Preferred Stock, $0.001 par value. The $10,000,000 proceeds from the purchase of the $10,000,000 note shall be held in a DACA account and is redeemable by the investors when certain conditions are met, and the $1,500,000 note shall be convertible by the investors pursuant to the term set forth therein. The note shall be convertible into Company common stock at an initial conversion price of $0.7831, representing 110% of the closing price of the Common Stock on ~~retail shelves~~February 3, 2023. Each investor herein shall have $2 million of the $10 million note and ~~supported by large television and print advertising investment. The emergence~~$300,000 of ~~e-commerce giants, including Amazon.com, has caused retail shelf space~~the $1.5 million note (for each investor’s portion of both notes, convertible initially into 2,937,046 shares in the aggregate).
Each holder of outstanding share of Series A Preferred Stock will have the voting rights to ~~no longer be~~vote together with the class of stockholders of Common Stock, as a ~~requirement~~single class, upon any matter submitted to ~~launch a new product. Crowdfunding sites like Kickstarter enable solo entrepreneurs to inexpensively produce an advertising video and quickly introduce a new product to millions~~the stockholders of ~~potential customers, and to quickly gain those customers~~Common Stock for a ~~low cost~~vote as of ~~acquisition relative~~a record date established by the Board of Directors of the Company. For so long as any Series A shares remain issued and outstanding, the holders of each share shall have the right to vote, in an amount equal to one percent (1%) of the ~~cost and time required~~total voting power of then-outstanding shares of Common Stock of the Company entitled to vote in ~~prior years~~such class, calculated as ~~expensive traditional advertising investment is no longer required to gain market awareness. For example, according to Statista.com, crowdfunded sales of products will exceed $18.9 billion in 2021.~~ provided herein.
The consumer shift away from brick and mortar retailers toward e-commerce has resulted in the bankruptcy or downsizing of many iconic retailers which sold toys, including Toys R Us, Sears, Kmart, and K-B Toys, with the resultant loss in shelf space and available locations helping to drive our market opportunity. By utilizing the opportunities to market products over the internet, rather than through traditional, commercial channels, we believe we can reach a much broader market for our brands and products.Company closed the transaction on February 10, 2023.
Exchange Agreement

~~Leveraging Evolving Market Opportunities~~On February 5, 2023, the Company entered into an Exchange Agreement with a Holder pursuant to which the Company and the Holder desire: (i) to exchange $250,000 aggregate principal amount of that certain convertible secured Note issued to the Holder on July 22, 2021 (the “July Note”) for ~~Growth~~an aggregate of 26,000,000 shares of Common Stock and (ii) to amend the July Note as set forth herein. On the Initial Closing Date, $105,000 aggregate principal amount of the July Note was exchanged into 10,800,000 shares of Common Stock and on the first (1st) trading day immediately following the date on which the Company amends its Articles of Incorporation to increase the authorized shares of the Company, $145,000 aggregate principal amount of the July Note shall be exchanged into 15,200,000 shares of Common Stock.

The Company ~~believes~~and the Holder agreed that ~~its anticipated growth will~~Section 2 of the July Note is amended and restated to be ~~driven by six macroeconomic factors:~~non interest bearing except if there is an event of default at which time the interest rate shall be 18%
, and the minimum cash on deposit in the Control Account shall not be less than $3,000,000
● ~~The significant growth of ecommerce (Up 32.4% in 2020 versus 2019 (eMarketer 2020));~~
● ~~The increasing velocity of “brick and mortar” retail closures;~~
● Product innovation and immediate delivery gratification driving consumer desire for next-generation products with distinctive sets of features and benefits without a reliance on brand awareness and familiarity;
● ~~The marriage of media-based entertainment and consumer goods~~
● ~~The rapid adoption of crowdsourcing to expedite successful new product launches; and~~
● The opportunity to market products over the internet and television, rather than through traditional, commercial channels, to reach a much broader, higher qualified target market for brands, and products.
~~In addition, we intend~~. The conversion price of the July Note was voluntarily and irrevocably reduced to acquire more small brands that have achieved approximately $1 million in retail sales over the trailing twelve-month period with a track record of generating free cash flow. By leveraging our expertise in helping companies launch thousands of new products and our ability to create unique, customized packaging, we will seek to elevate the value of these acquired brands by improving each part of their launch process, based on our own marketing methodologies.$0.7831
We believe our acquisition strategy will allow us to acquire small brands using a combination of shares of our common stock, cash and other consideration, such as earn-outs. We intend to use our acquisition strategy in order to acquire up to ten or more small brands per year for the next three years. In situations where we deem that a brand is not a “fit” for acquisition or partnership, we may provide the brand with certain manufacturing or consulting services that will assist the brand to achieve its goals..

On ~~November 30, 2020,~~February 10, 2022, the Company and its wholly owned subsidiary, SRM Entertainment, LTD entered into a Stock Exchange Agreement with Jupiter Wellness, Inc. (“Jupiter”). Under the terms of the Exchange Agreement, Jupiter agreed to purchase all outstanding shares of common stock (the “Exchange Shares”) issued by SRMHolder released $4,000,000 from the Company. As consideration for the purchase of the Exchange Shares, Jupiter issued the Company 200,000 shares of its restricted common stock, symbol JUPW as listed on NASDAQ Capital Markets. The Company made the decision to divest the amusement park business dueControl Account to the ~~slow re-openings of amusement parks around the world and the investment that would have been needed~~Company. Up to ~~remain open and the investment required to relaunch as the amusement parks begin to get back to full capacity. Please~~ ~~see~~~~Note 15 — Discontinued Operations~~ ~~for further information.~~another $3 million shall be released over future time periods if certain conditions are met.
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~~One Company Initiative~~
~~During 2020, the Company had three distinct business units, which allows the Company to focus on growing sales and leveraging operations. The units consist of:~~ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
● ~~Innovate~~. The Vinco Ventures New Product Development (“NPD”) platform helps inventors go from idea to reality. This is accomplished by optimizing the Company’s new product election process through deeper analytics to predict success on platforms like crowdfunding and web marketplaces like Amazon. The Company drives brand awareness of the platform by producing content for inventors and innovators on media platforms including our own Everyday Edison’s television show.
● ~~Build and Launch~~. Distributed by geography, industry skillset and expertise in the development process to ensure efficient product build and launch our teams of product designers and developers take the product from the concept to the consumers’ hand. The bulk of the Company’s operations are part of this business unit, and the Company will continue to develop this unit to meet the needs of our product launch schedule.
● ~~Sell~~. Our omni-channel sales effort is divided into three groups: (1) business-to-business revenue opportunities including traditional brick and mortar retailers, (2) online marketplaces and direct-to-consumer revenue opportunities, and (3) our NiTRO Team (Near Term Revenue Opportunities). NiTRO, identifies brands and products lines that would benefit from being part of Vinco Ventures.
In November 2020, in connection with the name change and startup of Honey Badger, the Company set a path for new key fundamentals in their strategy. Vinco Ventures, Inc. plans to leverage the new market opportunity by utilizing their B.I.G. Strategy: Buy. Innovate. Grow.
● ~~Buy.~~ ~~Acquisitions is our model. We will seek to acquire significant brands to continue to add to the Portfolio.~~
● ~~Innovate.~~ – Leverage the internal traffic platforms of Honey Badger, our brands are able to quickly innovate and determine the highest conversion traffic and target accordingly. Once identified, we scale while maintaining conversions for success.
● ~~Grow.~~ ~~More targeted traffic equals more conversions. With our internal engines, we are able to expedite growth of our acquired brands to reach their target numbers quicker.~~
~~Innovate: The Vinco Ventures New Product Development & Commercialization Platform~~
New product ideas have little value without the ability and skill required to commercialize them. The considerable investment and executional “know how” needed to initiate a process – from idea to product distribution – has always been a challenge for the individual innovator. Vinco Ventures’ web presence is designed to take advantage of online marketplace and crowdfunding momentum for our future growth mitigating new product development risk while allowing for optimized product monetization based on a product’s likelihood to succeed. To that end, Vinco Ventures empowers and enables innovators and entrepreneurs to develop and launch products, gain consumer adoption and achieve commercial scale efficiently at little to no cost.
The cornerstone of Vinco Ventures’ competitive advantage is its NPD platform, which is designed to optimize product licensing and commercialization through best-in-class digital technologies, sourcing / manufacturing expertise and one of the largest sets of go-to-market solutions. The NPD platform can take a product from idea through ecommerce final sale in a matter of months versus a year or more for capital intensive and inefficient new product development protocols traditionally used by legacy manufacturers serving “big box” retailers.

~~Product Submission Aggregation~~You should read the following discussion of our financial condition and results of operations in conjunction with our condensed consolidated financial statements and the related notes included elsewhere in this Quarterly Report on Form 10-Q and with our audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the Securities and Exchange Commission. In addition to our historical condensed consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this Quarterly Report on Form 10-Q, as well as in Part I, Item 1A, “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2021.
Interested innovators enter the Vinco Ventures web site to register for a free account by providing their name and email address. The member then creates a username and password to use on the site. Once registered, the member is provided with their own unique, password protected dashboard by which they can begin submitting ideas and join online member forums to learn about industry trends, common questions, engage in member chats, and stay informed of the latest happenings at Vinco Ventures. They can also track the review progress of ideas they submit through their dashboard.Overview

Vinco Ventures ~~accepts ideas through a secure online submission process. Once a member explores the active searches in different product categories being run~~is Focused on the platform for potential licensees seeking new product ideas to be commercialized, the member can submit their new product ideas for processing. Vinco Ventures regularly works with different companiesDigital Media, Advertising and ~~retailers in various product categories to help them find new product ideas.~~
~~Registered members pay $25 to submit an idea. This submission fee covers a portion of the cost to review each idea submitted to the platform. There are no additional fees after the submission fee.~~
~~Although the platform might not have an active search that matches the innovator’s idea, the Vinco Ventures licensing team hosts an ongoing search for new consumer product ideas in all categories.~~
“Insider Membership” is Vinco Ventures’ premium level of membership. Members that are insiders (“Insiders”) receive feedback on all their ideas submitted and gain access to online features that aren’t available to registered members. In addition, Insiders pay $20 for each idea submitted (20% discount vs. a registered member), can opt-in ideas for free, as well as receive other benefits. An annual membership costs $99, or $9.25 / month automatically debited from a credit card each month. Also included online is feedback to the innovator on the status of each stage of the process and notification when ideas are not selected to move forward during any stage in the review process.
Insiders also have access to the Insider Licensing Program (the “ILP”). The primary benefit of the ILP is having the Vinco Ventures licensing team working directly on an innovator’s behalf to help secure a licensing agreement with one of the company’s manufacturing partners. If an idea is selected for commercialization by a retail partner, Vinco Ventures will invest in any necessary patent applications, filings and maintenance. The innovator’s name is included on any patent or patent application that Vinco Ventures files on the member’s behalf after the idea has been selected.
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~~In addition to the above member programs, Vinco Ventures ASOTV (~~~~“As Seen on TV”~~~~) Team hosts a search for new products suitable for marketing via DRTV (~~~~“Direct Response TV”~~~~) and subsequent distribution in national retail chains including mass merchandisers, specialty retail, drug chains and department stores.~~
~~Product Submission Review~~
Led by the Company’s licensing team (which has over 150 years of combined experience in a variety of industries and product categories), all ideas submitted by innovators through the Company’s website are reviewed and assessed through an 8-stage process. Vinco Ventures’ product idea review process is confidential with non-disclosure agreements executed with every participating registered or “Insider” member.
The NPD platform’s database of over 85,000 product ideas helps determine which inventions have a substantial market opportunity quickly through proprietary algorithms that have been developed incorporating continuous learning from marketplace experience and changes in category requirements.
Selected ideas are assessed by the licensing team based on nine key factors: competing products, uniqueness, retail pricing, liability & safety, marketability, manufacturing cost, patentability, consumer relevant features and benefits, and commercialization.
The time required to review ideas depends upon different variables, such as: the number of searches concurrently running on Vinco Ventures platform, idea volume and complexity of the search, how many presentation dates to licensees are pending, the date an idea is submitted.
Presentation dates to potential licensees are usually set a few weeks following the close of the search. After the presentation has been given to a licensing / retail partner, the partner has 45 days to 6 months to select ideas on which they will move forward.
~~The ILP incorporates a four-stage process:~~
● ~~Stage #1 — Preliminary Review:~~ The licensing team performs a preliminary review to ensure an invention meets the program criteria. Factors that might stall an idea from moving forward include: an invention is cost-prohibitive, has engineering challenges, and/or major players in the marketplace have already launched products like it. If none of these apply, an idea will be approved and move on to the preparation phase.
● ~~Stage #2 — Preparation:~~ The licensing team performs a best partner review. Vinco Ventures’ retail and manufacturing contacts are assessed, and the team begins to plan which licensors would be the best fit for an idea. A gap analysis and visits the store shelves are executed to gain greater understanding of marketplace potential.
● ~~Stage #3 — Pitching:~~ At this phase, an idea can become a “Finalist.” The licensing team begins to proactively pitch an idea to potential licensees using a proprietary presentation system. When a company expresses interest, the team proceeds into term sheets and negotiations while staying in constant contact with the prospect until the best possible deal is struck for the innovator.
● ~~Stage #4 — Outcome:~~ In the end, the market decides what products will be successful. There are no guarantees. If for some reason Vinco Ventures is not successful in finding a licensing partner, a complete debrief is given to the Insider.
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Due to the public nature of licensing, Vinco Ventures only accepts ideas from Insiders that are patented or patent-pending. A valid provisional patent application is required. The cost of submitting an idea to the ILP is $100, and a member must be an “Insider” to be considered.
The Vinco Ventures ASOTV new product development process follows a six-stage protocol appropriate for the broadcast-based sales channel. For more information regarding the ASOTV process, the Vinco Ventures NPD platform, its features and member benefits, visit ~~https://app.edisonnation.com/faq~~.
~~Acquisition of Intellectual Property~~
~~Once an innovator’s idea is judged to be a potentially viable, commercial product and selected for potential commercialization, the Company acquires intellectual property rights from the innovator.~~
Once an innovator’s intellectual property is secured, the innovator’s product idea can then either be licensed to a manufacturer or retailer or developed and marketed directly by Vinco Ventures. In either case, Vinco Ventures serves as the point-of-contact with the innovator for term sheets, royalty negotiation and concluding licensing agreements. Vinco Ventures also maintains contact with the innovator to keep them engaged during product development.
In general, innovators are paid a percentage of the Company’s revenue from the commercialization of the innovator’s intellectual property. This percentage varies with the Company’s investment in the development of the intellectual property, including whether the Company decides to license the innovator’s idea for commercialization or instead, to directly develop and market the innovator’s idea.
~~Build and Launch: Product Design and Development~~
With product design, product prototyping and creation of marketing assets all resourced with expert Vinco Ventures in-house capabilities, we have made protracted, high-cost, high-risk research and development models obsolete.Content Technologies

Vinco Ventures, ~~custom designs most~~formerly known as Edison Nation, Inc., Xspand Products Lab, Inc. and Idea Lab Products, Inc., is a Nevada corporation incorporated on July 18, 2017. In connection with the acquisition of an 80% equity interest in Lomotif by ZVV, our joint venture with ZASH in 2021, our recent acquisition of AdRizer which includes 50% of Mind Tank, our investments into entertainment and motion picture company PZAJ, and our strategic investments in the TMX and Magnifi U platforms, we are transitioning from focusing on innovation, development and commercialization of end-to-end consumer products ~~in-house~~to the creation of a content-centric ecosystem with an emphasis on innovation, content development and commercialization of print and digital media, advertising, and distribution platforms. Additionally, with a focus on profitability, future mergers and acquisitions will be considered if they enhance the full ecosystem, provide more exclusive content, and create uniqueexperiences for ~~specific customers~~our active users. We currently operate the platforms and businesses described below through our significant subsidiaries and consolidated variable interest entities:
● Lomotif Social Media Platform
Lomotif and the Lomotif App - ZVV currently owns an 80% equity interest in Lomotif, a Singapore-based video-sharing and live streaming social networking platform that is committed to democratizing video creation and increasing user reach through our content development, live streaming and cross-platform engagement initiatives. The Lomotif app allows its users to create their ~~needs. We utilize~~own music videos by selecting pictures and videos from the camera, mixing them with music and transforming video clips into music videos. Lomotif users can watch videos of other creators on the Lomotif platform and share their videos on the Lomotif platform or on various third-party social media platforms such as TikTok, Instagram, YouTube and Twitch. The Lomotif platform offers LoMoTV, a digital entertainment and lifestyle content network offering original programming. Our strategy includes expanding Lomotif’s reach through our ~~existing tooling~~live-streaming entertainment initiatives involving social media influencers and leading artists and entertainers.
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The Lomotif app is available in the Apple and Google stores and is a grassroots social community with dedicated users spanning from Asia, South America, to ~~produce samples~~the United States. As of the date of this Quarterly Report, Lomotif has not generated significant revenue and ~~prototypes for customer reviews, refinement~~we are developing means to monetize the content creation and ~~approval, as well as~~streaming capabilities of the Lomotif platform including our ~~in-house packaging design~~plan to leverage the AdRizer technologies to enable advertisers to more effectively engage with the Lomotif platform, content and ~~fabrication resources.~~its users.

~~The Company’s design~~As of June 30, 2022, there has been a downward trend in the number of monthly active users and ~~product development professionals are dedicated~~daily active users of the Lomotif technology as a result of the following reasons:
● Overall drop in MAU, DAU and creations is in part due to an update requirement by the Apple Appstore. The update has limited Lomotif’s music library. This muted much of the content.
● Moderation of explicit content.
● New Apple privacy features limit apps abilities to track users, which in turn may limit recommendations and ad revenue.
● With a focus on bugs and fixes and to integrate advertising placement in the app and on the website, Lomotif did not introduce a steady stream of new features, thus potentially impacting Creation, and Retention metrics.
● Some user acquisition tests did not yield the desired conversion rates from views to active users.
As of June 30,2022, there has been an upward trend in the Impressions and Reach across the Lomotif website ecosystem. This cross-platform strategy was implemented in order to test various types of content, promotions and advertising, and intended to mitigate the ~~commercialization~~decline in advertising and ~~marketability~~revenue opportunities. We believe that in 2023, this trend will continue to increase traffic on Lomotif websites by leveraging the entire Lomotif social and website ecosystem. Lomotif measures active users on platform, as well as users on the Lomotif website, Lomotif promotional sites, views of ~~new product concepts advanced~~live events, and views of original Lomotif content shared on other social sites. Key metrics include active users on platform, users on Lomotif sites, site visits, content views, reach and impressions. AdRizer is anticipated to generate advertising revenue through ad placements in the ~~company’s NPD~~Lomotif app and on Lomotif websites based on traffic, views, and impressions.
● End-to-End Fully Integrated Programmatic Advertising Platform
AdRizer and the Cortex Platform – Our wholly-owned subsidiary AdRizer provides technology solutions to automate the use of artificial intelligence for digital advertising analytics and programmatic media buying through its core platform, Cortex. Cortex provides real-time analytics for marketing spend and revenue optimization and delivers ad- campaign creation, optimization and monetization at scale. Cortex integrates with various traffic partners, including Google, MSN, Instagram, Facebook, Twitter, and others, and is able to deliver real-time attribution against a wide range of advertiser and publisher metrics such as revenue by source, author, article, and conversion event. AdRizer targets advertisers, advertising agencies, publishers and other advertising technology companies as its audience for ~~licensors / partners like Disney World and Universal Studios.~~the Cortex platform offerings.

~~No matter~~AdRizer generates revenue from the ~~product, Vinco Ventures’ objective is~~Cortex platform through two major sources: (1) the traffic acquisition of digital advertising spaces to ~~optimize its marketability, function, value~~advertisers from multiple digital advertising technologies, and ~~appearance~~(2) developing marketing campaigns and strategies for ~~the benefit~~some of the ~~consumer end user. From concept~~top direct-to-customers (“DTC”) companies. We believe that AdRizer’s Cortex platform provides small- to medium-sized enterprises with an efficient and ~~prototyping,~~effective end-to-end, fully integrated platform that allows its users to control their marketing and branding campaigns in real-time. We also expect to integrate AdRizer’s technologies with the Lomotif platform and content and the Honey Badger digital commerce company.
● Streaming Music Non-Fungible Token (“NFT”) Platform
E-NFT.com – Our wholly-owned subsidiary EVNT Platform LLC, dba Emmersive Entertainment (“EVNT”) offers a platform for artists and content owners to distribute their intellectual property. EVNT’s proprietary streaming process seeks to make NFTs affordable by seeking to reduce mining fees with the goal of enabling fans to engage with content in new ways with EVNT’s multi-media delivery system. EVNT generates revenue from the development of custom, digital artwork and digital music that is sold in the form of non-fungible tokens through ~~design-for-manufacture, special attention is paid to~~ a ~~product’s utility, ease of use, lowest cost bill of materials, and how it “communicates” its features and benefits through design.~~third-party marketplace.

~~The combined experience~~
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● Full-Service Digital Commerce Company
Honey Badger - Our wholly-owned subsidiary Honey Badger offers a full-service digital commerce strategies solution focused on brand specific messaging and ~~expertise of the Company’s team spans many high-demand categories including household items, small appliances, kitchenware,~~designing comprehensive digital campaigns from creation to monetization for celebrities and ~~toys. The Company’s in-house capabilities are complimented by third-party engineering~~influencers. As a digital commerce company, Honey Badger leverages influencer relationships and ~~prototyping contractors,~~followers in their network to grow advertiser-based revenue as well as Vinco’s brands and ~~category-specific expert resources within select manufacturers.~~holdings. Honey Badger generates revenue from providing digital marketing services for brands and influencers.

~~Manufacturing, Materials, and Logistics~~Corporate Strategy
To provide greater flexibility in the manufacturing and delivery of products, and as part of a continuing effort to reduce manufacturing costs, Vinco Ventures has concentrated production of most of the Company’s products in third-party manufacturers located in China and Hong Kong. The Company maintains a fully staffed Hong Kong office for sourcing, overseeing manufacturing and quality assurance.
Vinco Ventures utilizes a variety of contracted manufacturing facilities to supply a majority of its products. The Company continues to explore more efficient and expert manufacturing partners to gain greater economies of scale, potential consolidation, and cost savings on an on-going basis.
~~Products are also purchased from unrelated enterprises with specific expertise in the design, development, and manufacture those specialty products.~~
We ~~base our production schedules~~are transitioning from focusing on ~~customer orders~~innovation, development and ~~forecasts, considering historical trends, results~~commercialization of market research, and current market information. Actual shipments of ordered products and order cancellation rates are affected by consumer acceptance of product lines, strength of competing products, marketing strategies of retailers, changes in buying patterns of both retailers and consumers, and overall economic conditions. Unexpected changes in these factors could result in a lack of product availability or excess inventory in a product line.
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~~Most of our raw materials are available from numerous suppliers but may be subject to fluctuations in price.~~
~~Sell: Paths to Market~~
~~Vinco Ventures partners with many of the biggest and most well-known online entities,~~end-to-end consumer products ~~companies and retailers. They use~~to the ~~Company’s platform as~~creation of a ~~“think engine” to develop targeted products, significantly reduce research and development expense, and expedite time to market.~~
~~Each potential licensee of~~content-centric ecosystem with an ~~innovator’s idea publishes an exclusive page~~emphasis on ~~the Vinco Ventures web site with~~ innovation, ~~goals and timeline for their search. Appropriate new product ideas are submitted in 100% confidence with all intellectual property safely guarded.~~
~~Once the search concludes, Vinco Ventures presents each potential licensee with the best patent protected, or patentable ideas that can be selected for development.~~
Licensing partners and customers include Amazon, Bed, Bath & Beyond, Church & Dwight, Black & Decker, HSN, Worthington Industries, Pampered Chef, Boston America Corp., Walmart, Target, PetSmart, “As Seen on TV,” Sunbeam, Home Depot, and Apothecary Products.
~~Online Marketplace and Crowdfunding~~
~~Vinco Ventures has established a commercialization path to include the~~content development and ~~management~~commercialization of ~~crowdfunding campaigns. This is evolving~~print and digital media, advertising, and distribution platforms. Additionally, with a focus on profitability, future mergers and acquisitions will be considered if they enhance the full ecosystem, provide more exclusive content, and create unique experiences for our active users. The right content enables brands to ~~be a engine for future growth. The benefits of crowdfunding include increased product testing efficiency, decreased financial risk, and~~rapidly communicate key messages, improving the asset’s ability to ~~get closer to~~capture the ~~end consumer, simultaneously.~~
~~The ability~~attention of target audiences. Video and digital content is also a ready-made resource for ~~consumers to re-order product not only gauges marketplace demand, but it can also be leveraged as~~users who consume content on mobile devices. Additionally, video generates a ~~quantitative “proof point” for potential sales to licensees. Most importantly, the money pledged for orders can be used to finance manufacturing~~much larger number of shares than long-form content, text, or image posts. By investing in Lomotif, our short-form video sharing and ~~ecommerce launch marketing costs as negative working capital.~~
~~Sales, Marketing,~~social media platform, AdRizer and ~~Advertising~~
~~Our Omni-channel sales effort is divided into three groups: (1) business-to-business revenue opportunities including traditional brick~~MindTank, related growth initiatives and mortar retailers, (2) online marketplaces and direct-to-consumer revenue opportunities, and (3) our NiTRO Team (Near Term Revenue Opportunities). NiTRO, identifies brands and products lines that would benefit from being part of Vinco Ventures.
Vinco Ventures’ business to business team sells products through a diverse network of manufacturers, distributors and retailers. New customer prospects are gained through outbound sales calls, trade show participation, web searches, referrals from existing customers.
~~The online team for the company has expertise in selling products on platforms~~investments such as PZAJ, TMX and Magnifi U, we are aiming to grow into an integrated robust social media, content development and digital advertising company, with millions of users around the ~~Amazon marketplace as well as portals like Walmart.com and “crowd-funded” websites such as Kickstarter and Indiegogo.~~
The NiTRO team identifies small, unique brands that could benefit from becoming part of a larger consumer products organization with more resources. The team seeks to negotiate a mutually beneficial agreement whereby the respective branded products become part of Vinco Ventures’ portfolio of consumer products.
~~Media Strategy~~world.

In ~~order~~February 2022 we acquired AdRizer. We continue to integrate AdRizer’s Cortex technologies with the Lomotif platform and content to optimize revenue generation opportunities. We have also invested in activities to generate content for the Lomotif platform and to expand ~~the Company’s universe of registered innovators~~its user base and entrepreneurs submitting ideas on the Vinco Ventures NPD web platform, the Company has entered a global agreement for distribution of two existing 13-episode seasons of the Company’s Everyday Edison TV series with a leading digital media service company. The series will be available in its original English version as well as voiceover adaptations in German, French, and Spanish. Distribution is planned for Europe and the Middle East through digital content providersengagement such as ~~Amazon Prime Video.~~
~~Sources of Revenue~~
~~The Company aggressively pursues six sources of sales volume:~~
● ~~Our branded products sold through traditional retail channels of distribution and other channels of business to business distribution;~~
● ~~Our branded products sold through direct to consumer platforms such as the Amazon marketplace as well as portals like Walmart.com;~~
● ~~Member idea submission and ILP program fees: $25 per submission (registered members); $20 per submission (Insider members); $100 per submission (ILP members);~~
● ~~Licensing agents~~: We match an innovator’s intellectual property with vertical product category leaders in a licensing structure whereby the innovator can earn up to 50% of the contracted licensing fee. Product categories include kitchenware, small appliances, toys, pet care, baby products, health & beauty aids, entertainment venue merchandise, and housewares; and
● ~~Product principals~~: We work with innovators directly, providing such innovators direct access to all of Vinco Ventures’ resources. Depending on case-by-case factors, innovators may receive a range of up to 35% - 50% of profits.
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~~Market Overview~~
~~The process for developing~~launching LoMoTV, hosting and ~~launching consumer products has changed significantly in recent years. Previously, Fortune 500~~live streaming concerts and specialty consumer product companies funded multimillion-dollar NPD divisions to develop and launch products. These products were sold primarily on “big box” retail shelves supported by large marketing investments.
The emergence of ecommerce giants, including Amazon and Walmart.com, has disrupted traditional NPD and commercialization paths and has accelerated a consumer shift away from “brick and mortar” retailers. The result has been the bankruptcy or downsizing of many iconic retailers, including Toys R Us, JC Penney, Macy’s, Sears, Kmart, Office Depot, Family Dollar, and K-B Toys, with a commensurate loss of shelf space and accessible locations.
Moreover, crowdfunding sites, like Kickstarter and Indiegogo, have also disrupted NPD process cycles and are now “mainstream.” In fact, as of October 2018, Kickstarter’s cumulative pledged funding exceeded $3.9 billion according to Kickstarter published data. Statista.com estimates that crowdfunded sales of products will exceed $18.9 billion by 2021.
These crowdfunding sites have enabled individual innovators and entrepreneurs to design, prototype and market unique products to millions of potential customers with significantly lower acquisition costs when compared to the capital and time required by legacy NPD processes.
~~COVID-19~~
COVID-19 has caused and continues to cause significant loss of life and disruption to the global economy, including the curtailment of activities by businesses and consumers in much of the world as governments and others seek to limit the spread of the disease, and through business and transportation shutdowns and restrictions on people’s movement and congregation.
As a result of the pandemic, we have experienced, and continue to experience, weakened demand for our traditional products. Many of our customers have been unable to sell our products in their stores due to government-mandated closures and have deferred or significantly reduced orders for our products.celebrity events. We expect ~~these trends~~ to ~~continue until such closures are significantly curtailed~~further this effort by continuing to invest in acquisitions, joint ventures, and growing our own capacity to create and distribute content. For example, we expect that future joint ventures, licensing, loan financing or ~~lifted. In addition,~~other arrangements with ZASH and PZAJ Holdings, LLC will generate entertainment content that we plan to distribute through the pandemic has reduced foot traffic in the stores where our products are sold that remain open, and the global economic impact of the pandemic has temporarily reduced consumer demand for our products as they focus on purchasing essential goods.Lomotif platform, among other distribution channels.

In ~~the United States and Asia, many of~~connection with our ~~key accounts remain closed or are operating at significantly reduced volumes. As a result,~~transition, we have ~~made~~completed the strategic decision to expand our operations through our Edison Nation Medical (“Ed Med”) division. Through Ed Med, the Company wholesales Personal Protective Equipment (“PPE”) products through an online portal for hospitals, government agencies and distributors.process of spinning off Cryptyde.

Given these factors, the Company anticipates that the greatest impact from the COVID-19 pandemic in fiscal 2020 occurred in the first quarter of 2020 resulting in a significant net sales decline as compared to the first quarter of 2019.Recent Developments
In addition, certain of our suppliers and the manufacturers of certain of our products were adversely impacted by COVID-19. As a result, we faced delays or difficulty sourcing products, which negatively affected our business and financial results. Even if we are able to find alternate sources for such products, they may cost more and cause delays in our supply chain, which could adversely impact our profitability and financial condition.
We have taken actions to protect our employees in response to the pandemic, including closing our corporate offices and requiring our office employees to work from home. At our distribution centers, certain practices are in effect to safeguard workers, including a staggered work schedule, and we are continuing to monitor direction from local and national governments carefully. Additionally, our two retail locations have been closed until further notice.
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As a result of the impact of COVID-19 on our financial results, and the anticipated future impact of the pandemic, we implemented cost control measures and cash management actions during 2020, including:
~~● Furloughing a significant portion of our employees in the first quarter of 2020;~~
~~● Implementing 20% salary reductions across our executive team and other members of upper-level management in the first and second quarter of 2020;~~
~~● Executing reductions in operating expenses, planned inventory levels and non-product development capital expenditures throughout 2020; and~~
~~● Proactively managing working capital, including reducing incoming inventory to align with anticipated sales.~~
~~Leveraging Evolving Market Opportunities for Growth~~

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~~Competition and Industry Background~~
In terms of the Company’s consumer products business, competition is intensifying due to trends towards shorter life cycles for the development, production and marketability of consumer products. Competition is also intensifying due to the availability of online-only distributors, including Amazon.com, which can promote a wide variety of consumer products and represent a wide variety of manufacturers at low cost and limited overhead.
Vinco Ventures’ competitive set includes other online inventor platforms (e.g., InventHelp, Quirky, Mako Design + Invent, Davison, and Invention City). Each of these companies operate different types of business models that combine different consulting, development and service fees, and royalty structures.
Vinco Ventures was originally founded by the creators of the Emmy Award winning PBS television show, Everyday Edisons. One of the original founders, Louis Freeman, is currently a member of the Vinco Ventures board of directors. The Company’s model differs significantly from others in the inventor space in that it assumes the considerable financial risk, manpower and time required to monetize a product, from concept selection through sale. A portion of the commercialized product’s net profit is shared with the inventor through a variety of forms of licensing agreements.
The Company also competes with large manufacturing companies who develop and commercialize their own products in categories in which Vinco Ventures currently participates. However, we also are increasing the Company’s “co-op-etition” footprint with companies, like Black & Decker, who not only compete in product development but also have become active “cooperative” participants on the Vinco Ventures online innovation platform.
~~Customers~~
We sell our products to a diverse network of customers. Domestically, we sell our products to specialty retailers, mass-market retailers and e-commerce sites. Internationally, we sell our products directly to similar retailers and distributors.
One customer represented 11% and 11% of our revenues for the three months ended June 30, 2021 and 2020, respectively. No customers represented more than 10% for the six months ended June 30, 2021 and 2020, respectively.
~~Intellectual Property~~
We believe that Vinco Ventures’ intellectual property rights have significant value in the marketplace, and that in order to maintain a competitive advantage in the marketplace, that we must continue to develop and maintain the proprietary aspects of our technologies. We rely on a combination of patent, trademark, trade secret, copyright and other intellectual property rights and measures to protect our intellectual property.
We seek protection on our products in as many countries as practical, through registered trademarks, copyrights and patents to the extent that such protection is available, cost effective and valuable to our products and brands. We also rely on other forms of intellectual property rights and measures, including trade secrets and nondisclosure agreements, to maintain and protect proprietary aspects of our products and technologies. We require our employees and consultants to execute confidentiality agreements in connection with their employment or consulting relationships with us. We also require our employees and consultants to disclose and assign to us all inventions conceived during the term of their employment or engagement which relate to our business.
Although we believe we are sufficiently protected, the failure to obtain or the loss of some of these intellectual property rights could have an adverse effect on our business, financial condition and results of operations.
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~~Seasonality~~
~~The consumer products business is highly seasonal with consumers making a large percentage of purchases during the traditional holiday season.~~
These seasonal purchasing patterns and requisite production lead times create risk to our business associated with the underproduction of popular consumer products and the overproduction of less popular consumer products that do not match consumer demand.
These factors increase the risk that the Company may not be able to meet demand for certain products at peak demand times or that our own inventory levels may be adversely impacted by the need to pre-build products before orders are placed. Additionally, as retailers manage their inventories, we may experience cyclical ordering patterns for products and product lines that may cause our sales to vary significantly from period to period.
E-commerce has partially reduced traditional seasonality to moderate seasonality. We intend to expand this flattening of traditional seasonality from e-commerce channels to our business as well, including through the continued emergence of crowd-funded “micro brands” that we believe will further delink demand for our products and services from historical demand fluctuation.
~~Government Regulations and Environmental Quality~~
Our products sold in the United States are subject to the provisions of the Consumer Product Safety Act, as amended by the Consumer Product Safety Improvement Act of 2008, the Federal Hazardous Substances Act, and the Consumer Product Safety Improvement Act of 2008, and may also be subject to the requirements of the Flammable Fabrics Act or the Food, Drug, and Cosmetics Act and the regulations promulgated pursuant to such statutes. These statutes and the related regulations ban from the market consumer products that fail to comply with applicable product safety laws, regulations, and standards. The Consumer Product Safety Commission may require the recall, repurchase, replacement, or repair of any such banned products or products that otherwise create a substantial risk of injury and may seek penalties for regulatory noncompliance under certain circumstances. Similar laws exist in some states. We believe that we are in substantial compliance with these laws and regulations. Our products sold worldwide are subject to the provisions of similar laws and regulations in many jurisdictions, including the European Union and Canada. We believe that we are in substantial compliance with these laws and regulations.
We maintain a quality control program to help ensure compliance with applicable product safety requirements. Nonetheless, we may in the future experience, issues in products that result in recalls, withdrawals, or replacements of products. A product recall could have a material adverse effect on our results of operations and financial condition, depending on the product affected by the recall and the extent of the recall efforts required.
Our advertising is subject to the Federal Trade Commission Act, The Children’s Television Act of 1990, the rules and regulations promulgated by the Federal Trade Commission, and the Federal Communications Commission, as well as laws of certain countries that regulate advertising and advertising to children. In addition, our web-based products and services and other online and digital communications activity are or may be subject to US and foreign privacy-related regulations, including the US Children’s Online Privacy Protection Act of 1998 and the EU Data Protection Directive (Directive 95/46/EC) and related national regulations. We believe that we are in substantial compliance with these laws and regulations.
Our worldwide operations are subject to the requirements of various environmental laws and regulations in the jurisdictions where those operations are located. We believe that we are in substantial compliance with these laws and regulations. Our operations are from time to time the subject of investigations, conferences, discussions, and negotiations with various federal, state and local environmental agencies within and outside the United States with respect to the discharge or cleanup of hazardous waste. We are not aware of any material cleanup liabilities.
Furthermore, we are subject to various other federal, state, local and international laws and regulations applicable to its business. We believe that we are in substantial compliance with these laws and regulations.
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~~Factors Which May Influence Future Results of Operations~~
The following is a description of ~~factors which may influence our future results of operations, and~~recent events regarding important developments which we believe are important to an understanding of our business, financial position and results of operations.

~~Warrant Liabilities~~Acquisition of AdRizer
On October 1, 2021, ZVV and ZASH and AdRizer entered into a Letter of Intent (as amended, “LOI”) for ZASH or ZVV to acquire all the outstanding equity interests of AdRizer.

On ~~January 25, 2021,~~February 11, 2022, Vinco Ventures, ZASH and ZVV entered into an Assignment and Assumption Agreement, whereby ZASH and ZVV assigned to Vinco Ventures, and Vinco Ventures assumed, all of the ~~Company consummated~~rights and obligations of ZASH and ZVV under the LOI, in consideration of a cash payment by Vinco Ventures to ZASH of $6.75 million upon the closing of the acquisition.
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On February 11, 2022, Vinco Ventures, AdRizer, the members of AdRizer and the holders of performance units (“Performance Units”) of AdRizer under its phantom equity plan (collectively, “Seller Members”), and Innovative Assets LLC, in its capacity as the sellers’ representative, entered into and consummated the transactions contemplated by a ~~private placement offering (the “Offering”~~definitive Unit Purchase Agreement (“AdRizer Purchase Agreement”), whereby the Company acquired all of the outstanding equity interests of AdRizer (“Purchased Interests”) ~~whereby~~from the Seller Members and canceled the Performance Units, resulting in AdRizer becoming a wholly-owned subsidiary of the Company. The purchase price paid and payable to the Seller Members for the Purchased Interests and in consideration of the cancellation of the Performance Units consists of (i) $38 million in cash paid at closing, of which $10 million was deposited in an escrow account to secure the Seller Members’ indemnification obligations under the AdRizer Purchase Agreement, subject to customary post-closing adjustments for working capital and other items, and (ii) up to 10 million shares of the Company’s common stock to be issued on January 1, 2024 (“Buyer Share Issuance Date”), determined by dividing $50 million by the volume weighted average price of the Company’s common stock reported by Bloomberg LP for the 20 trading days preceding such date, subject to a floor price of $5.00 and maximum price of $8.00 per share (“Purchase Price Equity”). Pursuant to the AdRizer Purchase Agreement, the Company has agreed to file a resale registration statement on form S-1 or S-3 no later than 90 days prior to the Buyer Share Issuance Date if permitted by the SEC, and otherwise no later than 5 business days after the Buyer Share Issuance Date, to register the resale of the Purchase Price Equity and to use commercially reasonable efforts to cause the registration statement to become effective as soon as practicable after filing. In addition, the Company has agreed to furnish AdRizer with working capital in the amount of $1 million by each 3-month anniversary of the closing date until the Company has furnished AdRizer with a total of $5 million in working capital.
Upon the closing of the acquisition, AdRizer entered into a new employment agreement with its chief executive officer, Kenneth Bond. Certain Seller Members including those who are employees, officers, directors or managers of AdRizer and their affiliates also agreed to be bound by three-year post-closing non-competition and non-solicitation restrictive covenants pursuant to the Purchase Agreement.
Spin-Off of Cryptyde, Inc.
On November 8, 2021, our subsidiary Cryptyde initially filed, and on January 25, 2022, March 18, 2022 and May 13, 2022 amended, a Form 10 registration statement with the SEC (“Form 10”) in connection with our planned spin-off of Cryptyde, subject to certain conditions as described in the registration statement, including the effectiveness of the registration statement, receipt of an opinion of counsel to the effect that, among other things, the spin-off and related transactions should qualify as tax-free for United States federal income tax purposes under Sections 368(a)(1)(D) and 355 of the Internal Revenue Code, and Nasdaq having approved the listing of Cryptyde’s common stock. Cryptyde holds our packaging, Bitcoin mining services, and Web3 (decentralized internet) products businesses.
On May 16, 2022, the Form 10 was declared effective. The record date for the spin-off was May 18, 2022. Effective June 29, 2022, Cryptyde separated from the Company and the distribution of its common stock was completed. Upon completion of the spin-off, Cryptyde became an independent, publicly traded company (NasdaqCM: TYDE). The distribution was made in the amount of one share of Cryptyde common stock for every ten shares of our common stock owned by our stockholders at the close of business on the Record Date.
Also, in connection with the spinoff, we entered into definitive agreements with Cryptyde that, among other things, set forth the terms and conditions of the separation and distribution. The agreements set forth the principles and actions taken or to be taken in connection with the separation and the distribution and provide a framework for our relationship with Cryptyde from and after the separation and the distribution. The agreements include a Separation and Distribution Agreement and a Tax Matters Agreement.
The results of our Cryptyde businesses have been reflected as discontinued operations in the current year period through the date of the spinoff and in the prior year period.
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Closing of Cryptyde Financing
On January 26, 2022, Cryptyde entered into a Securities Purchase Agreement ~~(the “Purchase~~(“Note Securities Purchase Agreement”) ~~entered into~~with an accredited investor (“Note Investor”) for the issuance of a (i) 1,500,000 shares of Cryptyde Common Stock, and (ii) a warrant to purchase up to 1,500,000 shares of Cryptyde Common Stock with an exercise price of $8.00 per share of Cryptyde Common Stock. In addition, Cryptyde issued a warrant to the placement agent to purchase up to 240,000 shares of Cryptyde Common Stock with an initial exercise price of $8.00 per share of Cryptyde Common Stock. The transaction closed on May 20, 2022. The consideration paid to Cryptyde was $12,000,000 and was reflected as an increase in noncontrolling interest of the Company’s consolidated financial statements.
On June 29, 2022, Vinco Ventures, Inc. distributed 100% of the shares of Cryptyde’s common stock held by Vinco to holders of shares of Vinco common stock, subject to certain conditions. On the Distribution Date, each holder of Vinco common stock received one share of Cryptyde common stock for every ten shares of Vinco common stock held at the close of business on the Record Date.
Love is Blurred, LLC
The purpose of Love is Blurred, LLC (“LIB LLC”) was to produce audiovisual content for ZASH’s business. Consistent with this purpose, the LIB LLC held the rights to “Love Is Blurred,” a TV reality show in production to be distributed via cable television syndication while also streaming exclusively on Lomotif. No related revenue streams to date as the production is still in development.
The LIB LLC assets consist principally of a single film production asset. Because the LIB LLC is not a business, the acquisition has been accounted for as an asset.
The purchase price was $1,250,000 by which the Company paid ZASH the $1,250,000 purchase price by reducing the outstanding balance on a loan between the Company and ZASH. The acquisition closed on June 21, 2022.
Amendment to the July 2021 Note
On March 9, 2022, the Company, Cryptyde and the noteholder of the Senior Secured Convertible Note issued by the Company on ~~January 21,~~July 22, 2021 (“July 2021 Note”) entered into an Amendment Agreement (“Amendment Agreement”) whereby the parties agreed to, among other things: (i) amend certain provisions of the July 2021 Note to (a) convert $10,000 of the principal amount of the July 2021 Note at a conversion price of $0.01 into shares of the Company’s common stock, (b) extend the maturity date under the July 2021 Note to July 22, 2023, (c) increase the interest rate on the July 2021 Note from zero percent (0%) to six percent (6.0%), (d) reduce the maximum cap of the minimum cash in the control account from $100,000,000 to $80,000,000, and (e) require the Company to redeem $33,000,000 of the principal of the July 2021 Note, together with accrued and unpaid interest and accrued and unpaid late charges on such principal and interest, on July 22, 2022; (ii) to extend certain dates relating to (x) the Company’s registration of certain securities under the Warrant Exercise Agreements dated September 1, 2021, November 11, 2021 and December 20, 2021 to April 30, 2022, (y) the Company’s filing of a proxy statement to April 30, 2022 and (z) Company holding a stockholder meeting and obtaining a stockholder vote to June 4, 2022 or July 4, 2022 in the event that the Company receives comments from the SEC with respect to the proxy statement; and (iii) to waive any adjustments to convertible securities or options as a result of the Adjusted Conversion Price (as defined in the Amendment Agreement).
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On April 29, 2022, the Company, Cryptyde and the Holder entered into a Second Amendment Agreement (“Second Amendment Agreement”) whereby the parties agreed to amend the First Amendment Agreement to replace the date of “April 30, 2022” in Section 7(m) of the First Amendment Agreement to “May 6, 2022.”
On May 6, 2022, the Company and the Holder entered into a Third Amendment Agreement (“Third Amendment Agreement”) whereby the parties agreed to amend the Second Amendment Agreement to replace the date of “May 6, 2022” in Section 7(m) of the Second Amendment Agreement to “May 11, 2022.”
Warrant Exercise and Issuance
For the six months ended June 30, 2022, the Company issued warrants to purchase shares of the Company’s common stock related to the Warrant Exercise Agreement dated December 20, 2021, with ~~Hudson Bay Master Fund, Ltd (the “Investor”~~a warrant holder, in which the Company agreed to issue 225% of the number of Exercised Warrant Shares at an exercise price of $3.265 to the warrant holder for every warrant the warrant holder exercised from the period commencing December 20, 2021 and ending on February 28, 2022. In conjunction with this agreement, the warrant holder exercised 98,324,692 warrants in the first six months of 2022 which generated $101,081,926 in gross proceeds to the Company during the six months ended June 30, 2022. During the three months ended June 30, 2022, warrant shares of 61,430,123 were exercised and did not receive any proceeds.
In conjunction with the agreement, the Company issued 83,012,781 warrants to the holder and 6,641,022 to the placement agent for the agreement. The warrants have an exercise price of $3.265, a five year term, and provide registration rights to the holder along with other terms that cause the warrants to qualify for liability treatment. The initial fair value of the warrants issued during the six months ended June 30, 2022 was $243,681,478. (see Note 12 — Warrant Liability)
Exchange Agreement
On May 12, 2022, the Company entered into an agreement with the holder of the Company’s warrants for the purchase of the Company’s common stock for $4.527 issued on November 10, 2021 (“November 2021 Warrants”) and the Company’s warrants for the purchase of the Company’s common stock for $3.2653 issued on December 20, 2021 (“December 2021 Warrants”) whereby the Company and the holder agreed the holder could exchange its warrants for the Company’s common shares. The exchange ratio agreed to is for each November 2021 Warrant exchanged the holder would receive 77% of a share of the Company’s common stock, and for each December 2021 Warrant exchanged the holder would receive 81% of a share of the Company’s common stock. The holder is entitled to exchange its November 2021 Warrants and its December 2021 Warrants under the agreement from May 19, 2022 until the sixtieth (60^th) day immediately following the date in which the Company’s receives approval from its stockholders for the increase in authorization of common shares from 250,000,000 to 750,000,000 (“Shareholder Approval Date”). On May 13, 2022, the Company filed a preliminary proxy statement for a Special Meeting of Stockholder’s to, among other things, seek the approval from its stockholders for this matter.
Furthermore, pursuant to the exchange agreement, on or prior to the second business day following the Shareholder Approval Date, the Company shall deliver to the holder an additional number of shares of Common Stock equal to 7% of the sum of each of the November 2021 Warrants and December 2021 Warrants exchanged by the holder during this period. In addition, the exchange agreement allows the holder for up to 60 days after the Shareholder Approval Date for (i) each November 2021 Warrant may be exchanged for 42% of a November 2021 Exchanged Warrant Share, and (ii) each December 2021 Warrants may from time to time be exchanged for 42% of a December 2021 Exchanged Warrant Share.
Pursuant to Section 7(n) of the Exchange Agreement, until October 9, 2022, the holder agreed to grant, free of charge, to the Company any reasonable and necessary waivers and extensions solely in connection with the Company’s obligations (i) to file an Initial Registration Statement pursuant to that certain Registration Rights Agreements between the Company and the holder dated as of November 11, 2021, as amended (“November 2021 RRA”), and that certain Registration Rights Agreements between the Company and the holder dated as of December 20, 2021, as amended (“December 2021 RRA” ), and (ii) to file a definitive proxy statement to approve the transactions contemplated by the November WEA and December WEA; provided, however, the holder shall retain the right to deliver an Alternate Exercise Notice (as defined in each of the November Warrant Exercise Agreement and December Warrant Exercise Agreement) to the Company as permitted pursuant to the terms thereof. The exchange agreement also requires the holder to continue to hold the common shares received under the exchange for a certain period of time.
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On May 19, the holder exchanged 500,000 November 2021 Warrants for 385,000 shares of the Company’s common stock, 12,000,000 September 2021 Warrants for 6,000,000 shares and 18,090,123 December 2021 Warrants for 14,653,000 shares of the Company’s common stock. On May 126, 2022, the holder exchanged 27,840,000 December 2021 Warrants for 22,550,400 shares of the Company’s common stock. The Company did not receive any proceeds from the cashless exercises.
Warrant Exercise Agreements
On May 12, 2022, the Company entered into warrant exercise agreement with two holders of the Company’s warrants for the purchase of the Company’s common stock for $9.00 per share issued on September 1, 2022 (“Series A September 2021 Warrants”) whereby the Company and the holders agreed to a cashless exercise whereby each holder would receive 0.50 of a share of the Company’s common stock for each Series A September 2021 Warrant that is exercised by the holder. On May 19, 2022 the holders exchanged 15,000,000 Series A September 2021 Warrants for 7,500,000 shares of the Company’s common stock. The Company did not receive any proceeds from the cashless exercise.
The May WEA and the Exchange Agreement also require the participating holders to continue to hold shares for a certain period of time as set forth in the May WEA and the Exchange Agreement.
Shareholder Proposals for Increase of Authorized Common and Preferred Shares
On May 13, 2022, the Company filed a preliminary proxy statement for a Special Meeting of Stockholders for approval of proposals to increase the number of authorized shares of common stock under the Company’s Amended and Restated Articles of Incorporation from 250,000,000 to 750,000,000 and increase the number of authorized shares of preferred stock under the Company’s Amended and Restated Articles of Incorporation from 0 to 30,000,000.
Letter Agreement
Pursuant to that certain Warrant Exercise Agreement (as amended, “September WEA”) dated as of September 1, 2021 between the Company and an accredited investor (“Holder”), the Company ~~issued a Senior Convertible Note for~~sold warrants to the ~~purchase price of $12,000,000 (the “Note”) and a five (5) year warrant (the “Warrant”)~~Holder representing the right to ~~purchase~~acquire shares of the Company’s common stock, par value $0.001 per share (“Common Stock”)~~. The Investor converted $11,000,000 of principal and $39,190 of interest into 5,519,595 of the Company’s common shares. Pursuant to the Purchase Agreement, the Investor received a Warrant in~~ at an ~~amount equal to 250% of the shares of Common Stock initially issuable to each Investor pursuant to the Investor’s Note. The Warrant contains an~~initial exercise price of ~~$2.00 per share. In connection with the closing of the Offering, the Warrant was issued to purchase an aggregate of 15,000,000 shares of Common Stock (the “Warrant Shares”).~~
On February 23, 2021, the Company consummated the closing of a private placement offering (the “Offering”) whereby pursuant to the Securities Purchase Agreement (the “Purchase Agreement”) entered into by the Company on February 18, 2021 with one accredited investor (the “Investor”), the Company issued a Senior Convertible Note for the purchase price of $10,000,000 (the “Note”) and five (5) year warrants (the “Warrant”) to purchase shares of the Company’s common stock, par value $0.001 per share (“Common Stock”). Pursuant to the Purchase Agreement, the Investor received a Warrant in an amount equal to 900% of the shares of Common Stock initially issuable to the Investor pursuant to the conversion terms of the Investor’s Note. The Warrant contains an exercise price of $3.722$9.00 per share, subject to adjustments as ~~provided under~~set forth in the ~~terms of~~September WEA (“Series A September 2021 Warrants”) and (ii) on May 12, 2022, the ~~Warrant. In connection with the closing of the Offering, the Warrant was exercisable for an aggregate of 18,568,188 shares of Common Stock (the “Warrant Shares”).~~
~~Palladium Capital Group, LLC. acted as placement agent for both Offerings. The Placement Agent received a Warrant granting~~Company and the Holder entered into that certain Warrant Exercise Agreement (“May WEA”) whereby the ~~right to purchase 480,000 and 1,650,346 shares, respectively, of~~parties, among other things, adjusted the ~~Company’s common stock at an~~Holder’s exercise price of ~~$2.00~~its Series A September 2021 Warrant and ~~$3.722, respectively, with an expiration date of January 25, 2026 and February 23, 2026, respectively.~~
On January 29, 2021, the Company consummated the closing of a private placement offering of $3,300,000 whereby pursuant to the Securities Purchase Agreement entered into by the Company on January 28, 2021 with BHP Capital NY Inc, the Company issued 1,500,000 shares of restricted common stock and a five (5) year warrant to purchase 1,500,000 shareseliminated certain provisions of the ~~Company’s common stock.~~Series A September 2021 Warrants as an offer to all of the Series A September 2021 Warrants inducement to fully exercise its Series A September 2021 Warrant on a cashless basis on May 19, 2022.

On May 24, 2021, the Company entered into a warrant exercise agreement (the “May 2021 Warrant Agreement”) with the Investor whereby the Company agreed to issue additional warrants, to purchase shares of Common Stock at a per-share exercise price equal to $3.20 (the “Incentive Warrants”). Subject to the terms of May 2021 Agreement, the Company shall issue and deliver Incentive Warrants to the Investor to initially purchase zero shares of Common Stock, which number of shares shall be subject to adjustment, including the provision of Incentive Warrants on a 1.00-for-one basis for the additional exercise of each Existing Warrant.
On June 4, 2021, the Company entered into a warrant exercise agreement (the “Agreement”) with BHP Capital NY Inc. (“BHP”) who agreed to exercise a portion of the January Warrants and the Company agreed to issue additional warrants, to purchase shares of Common Stock at a per-share exercise price equal to $3.20 (the “Incentive Warrants”). Subject to the terms of Agreement, (i) BHP shall pay to the Company an amount equal to the exercise price in effect as of the date of such exercise multiplied by 1,500,000 shares and (ii) the Company shall issue and deliver Incentive Warrants to BHP to initially purchase an aggregate number of shares equal to the number of Exercised Warrant Shares, which number of shares shall be subject to adjustment upon the exercise of further shares pursuant to the January Warrants.
On June 4, 2021, the Company entered into a warrant exercise agreement (the “June 2021 Warrant Agreement”) with the Investor whereby the Company agreed to issue additional warrants, to purchase shares of Common Stock at a per-share exercise price equal to $3.30 (the “Incentive Warrants”). Subject to the terms of June 2021 Agreement, the Company shall issue and deliver Incentive Warrants to the Investor to initially purchase zero shares of Common Stock, which number of shares shall be subject to adjustment, including the provision of Incentive Warrants on a 1.75-for-one basis for the additional exercise of each Existing Warrant.
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The warrants are subject to anti-dilution adjustments outlined in the Agreement. The warrants may require cash settlement under certain conditions, such as a tender offer. The warrants were classified as a liability with an initial fair value at the time of issuance of $228,575,715 of which $208,855,715 was immediately expensed as a loss on issuance of warrants and $19,720,000 was recorded as a deferred debt discount.
In addition, the warrants must be valued every reporting period and adjusted to market with the increase or decrease being adjusted through earnings. As of June 30, 2021, the fair value of the warrant liability was $139,695,115. For the three and six months ended June 30, 2021, the Company recorded a loss of $208,855,715 and $75,156,534, respectively. The warrants are valued using the Black-Scholes pricing model to calculate the fair value of the warrants.
~~EVNT Platform, LLC Asset Contribution Agreement~~
~~On April 17, 2021,~~18, 2022, the Company and ~~EVNT Platform, LLC, a wholly owned subsidiary of~~ the ~~Company,~~holder entered into ~~(and closed on) a~~that certain ~~Asset Contribution~~Letter Agreement (“~~Asset Contribution~~Letter Agreement”) ~~with Emmersive Entertainment, Inc., pursuant~~whereby the parties further amended the Series A September A Warrants to ~~which Emmersive contributed/transferred~~require that that Company only needs to maintain the Company the assets used for Emmersive’s business, which include digital assets, software and certain physical assets in consideration for, among other things, the Company assuming certain obligations of Emmersive, hiring certain employees, and issuing 1,000,000 preferred membership units (“Preferred Units”)Required Reserve Amount (as defined in the ~~Company to Emmersive and/or its shareholders (“Preferred Members”) pursuant to a First Amended~~Series A September Warrants) on and ~~Restated Operating Agreement for~~after the ~~Company dated as of April 17, 2021). Certain put rights are associated with Preferred Units, which if exercised by~~Shareholder Approval Date (as defined in the Preferred Members, obligates Vinco to purchase the Preferred Units in exchange for 1,000,000 shares of Vinco Venture’s common stock. In addition, the Preferred Members have the opportunity to earn up to 4,000,000 Conditional Preferred Units if certain conditions are satisfied for each of the four earn out targets. The Earn-Out Targets are described below:
~~Earn-Out Target 1~~: In the event that the Company (1) develops a minimally viable product for the NFT Technology to validate the utility of the product/platform with features to attract and transact with customers and (2) is successful on-boarding a minimum of 10 approved influential celebrities on or before December 31, 2021, the Company shall issue to Emmersive and/or Emmersive’s Shareholders, 1,000,000 Conditional Preferred Units, with Put Rights.
~~Earn-Out Target 2~~: In the event that the Company generates a minimum of $7,000,000 in annualized booked revenues inclusive of revenues generated from the celebrities onboarded by the Company (collectively “Attributed Revenue”) in any three-calendar-month period ending on or before March 31, 2022 (i.e. more than $1,750,000 in Attributed Revenue in a period of three consecutive calendar months), the Company shall issue to Emmersive and/or Emmersive’s Shareholders 1,000,000 Conditional Preferred Units, with the Put Rights.
~~Earn-Out Target 3:~~ In the event that the Company generates a minimum of $28,000,000 in annualized Attributed Revenues in any three-calendar-month period ending on or before December 31, 2022 (i.e. more than $7,000,000 in Attributed Revenue in a period of three consecutive calendar months), the Company shall issue to Emmersive and/or Emmersive’s Shareholders 1,000,000 Conditional Preferred Units, with Put Rights.
~~Earn Out Target 4~~: In the event that the Company generates a minimum of $62,000,000 in annualized Attributed Revenues in any three-calendar-month period ending on or before December 31, 2023 (i.e. more than $15,500,000 in Attributed Revenue in a period of three consecutive calendar months), the Company shall issue to Emmersive and/or Emmersive’s Shareholders 1,000,000 Conditional Preferred Units, with Put Rights.
~~On April 17, 2021, the transactions under both the Asset Contribution Agreement and Amended Operating Agreement closed.~~
~~Agreement to Complete a Merger with Zash Global Media and Entertainment Corporation~~
On January 20, 2021, the Company, and its newly formed wholly owned subsidiary, Vinco Acquisition Corporation (the “Merger Sub”), entered into an Agreement to Complete a Plan of Merger (the “Agreement to Complete”) with ZASH Global Media and Entertainment Corporation (“ZASH”)May WEA).
The Agreement contemplates a reverse triangular merger of Merger Sub with and into ZASH in a transaction intended to qualify as a tax-free reorganization under Sections 368(a)(l)(A) and 368(a)(2)I of the Code. Under the terms of the Agreement to Complete, ZASH’s holders of common stock, par value $0.001, shall receive shares of Common Stock of the Company in exchange for all issued and outstanding ZASH shares of common stock. ZASH will then become an indirect wholly-owned subsidiary of the Company. In connection with the foregoing, the Company engaged a third-party valuation firm to perform a valuation of ZASH and to issue a Transaction Fairness Opinion. The valuation report will be relied upon to set the resulting post-closing ownership ratio. Upon completion of the closing, ZASH will be the controlling entity.

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The certificate of incorporation of the Company will be amended and restated at and as of the Effective Time, in substantial conformance with the certificate of incorporation of ZASH immediately prior to the closing, and the name of the Company will be changed to “ZASH Global Media and Entertainment Corporation.” The bylaws of the Company will be amended and restated at and as of the Closing to become the equivalent of the bylaws of ZASH immediately prior to the closing. At the closing, certain officers and directors of the Company and the Merger Sub immediately prior to the Effective Time shall resign and the officers and directors of ZASH immediately prior to the closing will be appointed as officers and directors of the Company and the surviving corporation, in each case until their respective successors are duly elected or appointed and qualified; provided, however that the Company shall have the right to appoint two (2) person to serve as a member of the Board of Directors of the surviving corporation and ZASH shall have the right to appoint three (3) persons to serve as members of the Board of Directors of the surviving company.
On March 30, 2021, the Company, Vinco Acquisition Corporation and ZASH entered into that certain First Amendment to Agreement to Complete a Plan of Merger, which amends the Merger Agreement dated January 20, 2021 to extend the closing date of the merger to on or about May 28, 2021.
On May 28, 2021, the Company, Vinco Acquisition Corporation and ZASH Global Media and Entertainment Corporation (“ZASH”) entered into that certain Second Amendment to the Agreement (the “Second Amendment”) to define certain milestones with dates to be completed to consummate the closing of the Lomotif Private Limited (“Lomotif”) acquisition and the ZASH merger; (i) the Company and ZASH intend to acquire Lomotif through their joint venture, ZVV Media Partners, LLC (the “Joint Venture”); (ii) the Parties have completed an Amended and Restated Limited Liability Company Agreement for the Joint Venture in preparation for the anticipated acquisition of Lomotif through the Joint Venture; (iii) Gemini Valuation Services will complete and present an independent third-party valuation on ZASH on or before June 11, 2021; (iv) sign the final Agreement and Plan of Merger and Reorganization on or before June 24, 2021; (v) issue a formal proxy to shareholders for the approval of the ZASH merger with the Company on or before July 15, 2021; and (vi) extend the closing date to August 31, 2021, but no later than the first business day following the satisfaction or waiver of all conditions to the obligations of the Parties to consummate the transaction.
On July 19, 2021, Zash Global Media and Entertainment Corp. (“Zash”), Lomotif Private Limited (“Lomotif”), the Lomotif selling shareholders identified on the signature page to the Lomotif SPA and ZVV MEDIA PARTNERS, LLC (“ZVV”), entered into that certain Deed of Variation and Supplement (the “Deed of Variation”) whereby, among other things, Zash novated all of its rights and obligations under the Lomotif SPA to ZVV and ZVV assumed all of Zash’s rights and obligations under the Lomotif SPA as if ZVV had been a party to the Lomotif SPA in place of Zash. On July 23, 2021, ZVV closed on the transaction which resulted in ZVV acquiring an 80% interest in Lomotif.
~~Contribution Agreement with Zash Global Media and Entertainment Corporation~~
On January 19, 2021, Vinco Ventures, Inc. (“Vinco Ventures”), ZVV Media Partners, LLC (the “Company”) and Zash Global Media and Entertainment Corporation (“ZASH”) entered into a Contribution Agreement (the “Agreement”). Vinco Ventures and ZASH desire to establish the newly formed Company in order to engage in the development and production of consumer facing content and related activities.
Under the terms of the Agreement, Vinco Ventures and ZASH shall contribute certain assets (the “Contributed Assets”) to the Company. At Closing, Vinco Ventures and ZASH shall enter into a limited liability operating agreement of the Company and a content distribution agreement with American Syndication Media Corporation (“ASMC”). The Company shall not assume any liabilities of either Vinco Ventures or ZASH except those liabilities arising in or specifically relating to periods, events or occurrences happening with respect to the Contributed Assets on or after the Closing Date. In consideration of the Contributed Assets, the Company shall issue to Vinco Ventures and ZASH 5,000 Units. The transaction closed on January 19, 2021.
~~Closing on the Sale of Assets of CBAV1, LLC~~
On October 30, 2020, the Company received a letter of intent from a prospective purchaser dated October 22, 2020 setting forth the terms of an offer to purchase Cloud b assets from CBAV1, LLC (“CBAV1”), the Company’s wholly owned subsidiary (the “LOI”). The Cloud b assets include but are not limited to intellectual property, know how, brand names, trade names, patents, models, internet websites, domains, social network assets, production facilities, including the molds of all products, and inventory (“Cloud b Assets”).
By way of background, the Cloud b Assets were pledged as collateral (“Collateral”) to secure a promissory note from East West Bank dated in or around May 25, 2011, along with amendments and modifications to the loan agreement (“Secured Note”). On June 4, 2018, CBAV1 acquired the Secured Note in accordance with the Cloud B Assignment of Loan and Security Agreement from East West Bank. On October 30, 2018, pursuant to the Stock Purchase Agreement, the Company became the beneficial owner of 72.16% of Cloud b, Inc.’s shares of common stock. CBAV1 provided Notification of Disposition of Collateral (pursuant to its notice of default dated August 7, 2018 to Cloud b, Inc.) and scheduled a Public Sale of the Collateral to the highest qualified bidder for February 11, 2019 (“Public Sale”). CBAV1 submitted the highest bid for the Collateral at the Public Sale and inured to the benefit of the Cloud b Assets. On February 17, 2020, the Company entered into the Agreement for The Purchase and Sale of Common Stock of Cloud b, Inc. and pursuant therewith, sold its ownership interest in Cloud b, Inc. to the buyer.
To effectuate the sale of the Cloud b assets to the prospective purchaser, the Company has determined that it is in the best interests of the company and its shareholders for CBAV1 and the prospective buyer to utilize the jurisdiction and protections of the bankruptcy court to effectuate the sale of the Cloud b Assets free and clear of any obligations.
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~~The current assets of CBAV1 were estimated to be in excess of $2,000,000 and the current liabilities were estimated to be less than $100,000.~~
By utilizing the jurisdiction of the bankruptcy court, the Cloud b Assets can be transferred to the prospective purchaser free and clear of liens and obligations. Any unsecured creditors or minority shareholders of Cloud b, Inc. will have the opportunity to assert any claims or actions within the sale proceeding under the jurisdiction of the bankruptcy court.
On March 12, 2021, the bankruptcy court approved the sale of the CBAV1, LLC Assets to BTL Diffusion SARL, the winning bidder, at the auction held on March 10, 2021 and March 11, 2021 for a total sum of $3,000,000, which includes a cash payment at closing in the amount of $2,650,000, less certain closing costs and credits, and additional royalty payments in the amount of $150,000 on April 15, 2022 and in the amount of $200,000 on April 15, 2023 (“~~CBAV1-BTL Transaction”).~~
~~A dry closing of the CBAV1-BTL Transaction occurred on April 16, 2021, with the transfer of assets and release of funds completed on April 21, 2021 (“Final Closing”). Contemporaneously with the Final Closing, a certain license agreement between CBAV1 and Edison Nation, LLC (“Edison Nation”) terminated and any remaining operational assets of Edison Nation were transferred to BTL.~~
~~Stock Exchange Agreement for Sale of SRM Entertainment, LTD~~
On November 30, 2020, the Company (the “Seller”) and its wholly owned subsidiary, SRM Entertainment, LTD (“SRM”) entered into a Stock Exchange Agreement (the “Exchange Agreement”) with Jupiter Wellness, Inc. (“Jupiter”)(the “Buyer”). Under the terms of the Exchange Agreement, the Buyer agreed to purchase all outstanding shares of common stock (the “Exchange Shares”) issued by SRM from the Seller. As consideration for the purchase of the Exchange Shares, the Buyer agreed to exchange 200,000 shares of its restricted common stock (the “Consideration Shares”), symbol JUPW as listed on NASDAQ Capital Markets.
Upon closing, Jupiter delivered 150,000 of the Consideration Shares and held 50,000 of the Consideration Shares in escrow (“Escrow Shares”). Jupiter shall release the Escrow Shares upon SRM generating $200,000 in cash receipts and revenue prior to January 15, 2021. As of the date of the Registration Statement, the Company has received all Exchange Shares.
As a performance based incentive, the Buyer shall pay to the Seller two percent (2%) of gross sales of Jupiter’s private label sun care products if such gross sales are in excess of twelve million dollars ($12,000,000) earned during the 2021 calendar year.
At Closing, the Company (as “Stockholder”) and Jupiter entered into a Leak Out Agreement, whereby the Company was limited in the sales of the Consideration Shares upon the following terms: (i) As such time as the Stockholder is able to resell the Consideration Shares in accordance with the provisions of Rule 144 of the Securities Act (the “Expiration of the Holding Period”), the Stockholder agrees to limit the resales of such Shares in the public market as follows:
a. No shares in any one day more than ten percent (10%) of the average of the daily trading volume on all trading markets on which the Consideration Shares are then quoted or listed for the five trading days preceding the sale of the Consideration Shares, and;
b. ~~Any permitted resales by the Stockholder shall be at the then current bid price of the Common Stock.~~
~~Honey Badger Media Purchase and Licensing Agreement~~
On November 10, 2020, the Company, through its wholly owned subsidiary, Honey Badger Media, LLC, entered into a series of transactions with Honey Badger Media, LLC, a Delaware limited liability company:
On November 10, 2020, under the terms of the Asset Purchase Agreement (the “Agreement”), the Company (the “Buyer”) agreed to purchase from Honey Badger Media, LLC (the “Seller”) all of the Seller’s rights, title and interest in and to the Internet Websites, Domain Names, and all of the respective content (the “Domains”), and any other rights associated with the domains, including, without limitation, any intellectual property rights, all related Domains, logos, customer lists and agreements, email lists, passwords, usernames and trade names; and all of the related social media accounts including but not limited to, Instagram, Twitter, Facebook, Instagram, and Pinterest at closing (collectively the “~~Purchased Assets”). In consideration for the sale of the Purchased Assets, the Buyer agreed to pay the Seller the amount of Three Hundred Thousand Dollars (US $300,000).~~
On November 10, 2020, under the terms of the Platform License Agreement (the “License Agreement”), Honey Badger Media, LLC (the “Licensor”) granted the Company (the “Licensee”) a perpetual, exclusive, worldwide license (the “~~License~~”) to implement and commercialize the assets connected with the Platform, including, but not limited to, the right to use all of Licensor’s intellectual property rights comprising the Platform, owned by or licensed to Licensor that are utilized as part of the Platform (“~~Licensed Related Assets”). In consideration for the License, the Licensee~~ ~~agreed to~~ pay to the Licensor a fee equal to thirty percent (30%) of the Net Profits generated from Licensee’s clients through the Platform and Licensed Related Assets and the Licensee’s parent company agreed to issue the Licensor 750,000 shares of common stock.
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~~Acquisition of HMNRTH, LLC Assets~~
On March 11, 2020, the Company and its wholly owned subsidiary, Scalematix, LLC (together the “Buyer”), entered into an Asset Purchase Agreement (the “Agreement”) with HMNRTH, LLC (the “Seller”) and TCBM Holdings, LLC (the “Owner”) (together Seller and Owner the “Selling Parties”) for the purchase of certain assets in the health wellness industry and related consumer products industry. Under the terms of the Agreement, Buyer is to remit $70,850 via wire transfer at Closing and shall issue to a representative of the Selling Parties Two Hundred Thirty-Eight Thousand Seven Hundred and Fifty (238,750) shares of restricted common stock. The shares were issued on March 16, 2020 and valued at $477,500.
~~Global Clean Solutions Agreement and Plan of Share Exchange~~
On May 20, 2020 (the “Effective Date”), the “Company entered into an Agreement and Plan of Share Exchange (the “Share Exchange Agreement”) with PPE Brickell Supplies, LLC, a Florida limited liability company (“PPE”), and Graphene Holdings, LLC, a Wyoming limited liability company (“Graphene”, and together with PPE, the “Sellers”), whereby the Company purchased 25 membership units of Global Clean Supplies, LLC, a Nevada limited liability company (“Global”) from each of PPE and Graphene, for a total of fifty (50) units, representing fifty percent (50%) of the issued and outstanding units of Global (the “Purchase Units”). The Company issued 250,000 shares of its restricted common stock, $0.001 par value per share (the “Common Stock”) to PPE, and 50,000 shares of Common Stock to Graphene, in consideration for the Purchase Units.
Pursuant to the terms of the Share Exchange Agreement, the Sellers may earn additional shares of Common Stock upon Global realizing the following revenue targets: (i) In the event that Global’s total orders equal or exceed $1,000,000, Graphene shall receive 200,000 shares of Common Stock; (ii) In the event that Global’s total orders equal or exceed $10,000,000, PPE shall receive 100,000 shares of restricted Common Stock; and (iii) In the event that Global’s total orders equal or exceed $25,000,000, Graphene shall receive 125,000 shares of restricted Common Stock. Additionally, the Company shall be entitled to appoint two managers to the Board of Managers of Global.
~~Acquisition of TBD Safety, LLC~~
On September 29, 2020, the Company entered into a Purchase and Sale Agreement (the “Agreement”) with Graphene Holdings, LLC, Mercury FundingCo, LLC, Ventus Capital, LLC and Jetco Holdings, LLC (together the “Sellers”) to acquire all outstanding Membership Units (the “Units”) of TBD Safety, LLC (“TBD”). Collectively, the Sellers owned all outstanding Units of TBD. Under the terms of the Agreement, the Company issued a total of Two Million Two Hundred Ten Thousand Three Hundred Eighty-Two (2,210,382) shares of the Company’s common stock and a total of Seven Hundred Sixty-Four Thousand Six Hundred Eighteen (764,618) shares of a newly designated Preferred Stock (the “Preferred”). In addition, the Company and Sellers entered into a Registration Rights Agreement (the “Registration Rights Agreement”) in favor of the Sellers obligating the Company to register such common stock and shares of common ctock to be issued upon conversion of the Preferred within 120 days after the Closing. The Sellers also had an Earn Out Consideration, which provides that at such time as the assets purchased in the Agreement achieve cumulative revenue of $10,000,000, the Sellers will earn a total of One Hundred Twenty-Five Thousand (125,000) shares of common stock. The closing of the transaction occurred on October 16, 2020. Please ~~see~~~~Note 3 — Acquisitions and Divestitures~~ ~~for further information.~~
~~Edison Nation Medical Operations~~
~~Edison Nation Holdings, LLC formed Edison Nation Medical (“EN Medical”) in May of 2012 as a partnership with Carolinas Healthcare Systems (now called Atrium). Atrium is the~~ ^2nd largest healthcare system in the US. Carolina Health (Atrium) looked to identify a way to aggregate and commercialize the healthcare related innovations that were coming from their physicians, nurses, and patients, and Edison Nation offered a platform to provide that function.
EN Medical built out a separate platform, leveraging the Edison Nation model to look for ideas that improved patient care and lowered costs. EN collected some great ideas, but the market shifted and EN found that the licensing model was very difficult as big medical device companies wanted to acquire companies with sales versus just buying IP and prototypes.
~~Today, EN Medical operates an online portal granting hospitals, government agencies and distributors access to its catalog of medical supplies and hand sanitizers.~~
~~Executive Compensation Agreements~~
On February 2, 2021, the Company entered into an Employment Agreement (the “Agreement”) with Christopher Ferguson (the “Executive”) for the role of Chief Executive Officer. The Agreement is effective as of November 12, 2020 (the “Effective Date”) and has a term of three (3) years (the “Term”) from the Effective Date. Thereafter, the Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1 year (each a “~~Renewal Term”), unless such renewal is objected to by either the Company or the Executive. The Executive’s initial annual base salary shall be $200,000, less applicable withholdings (the “Base Salary~~”) and 120,000 common shares that shall vest in their entirety on issuance. The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time. The Base Salary due of shares, shall be payable within the first 30 days of the year. On each anniversary of the Agreement, the base salary will increase no less than $15,000 (“minimum”). For 2021, the Executive shall receive a cash bonus in the amount equal to 30% of the annual Base Salary, and an award of 200% shares of the Company’s common stock, which shall vest in their entirety on issuance (the “~~Principal Market~~”), which shall be received by the Executive no later than the first 30 days of the current fiscal year. The Executive shall be entitled to 150,000 shares of the Company’s common stock, due immediately upon an increase of 2.5 times the Enterprise Value on a 5-day closing average from the effectiveness of the Agreement. For clarification, the Enterprise Value as of the Company at the effective date was $25,042,464.
On February 2, 2021, the Company entered into an Employment Agreement (the “Agreement”) with Brett Vroman (the “Executive”) for the role of Chief Financial Officer. The Agreement is effective as of November 12, 2020 (the “Effective Date”) and has a term of three (3) years (the “Term”) from the Effective Date. Thereafter, the Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1 year (each a “~~Renewal Term”), unless such renewal is objected to by either the Company or the Executive. The Executive’s initial annual base salary shall be $200,000, less applicable withholdings (the “Base Salary~~”) and 120,000 common shares that shall vest in their entirety on issuance. The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time. The Base Salary due of shares, shall be payable within the first 30 days of the year. On each anniversary of the Agreement, the base salary will increase no less than $15,000 (“minimum”). For 2021, Executive shall receive a cash bonus in the amount equal to 30% of the annual Base Salary, and an award of 200% shares of the Company’s common stock, which shall vest in their entirety on issuance (the “~~Principal Market~~”), which shall be received by the Executive no later than the first 30 days of the current fiscal year. Upon the execution of this agreement, the Executive is entitled to a one-time past performance bonus for the work completed in fiscal years 2018, 2019 and 2020 of 150,000 shares of the Company’s common stock, which shall vest in their entirety on issuance. The Executive shall be entitled to 100,000 shares of the Company’s common stock, due immediately upon an increase of 2.5 times the Enterprise Value on a 5-day closing average from the effectiveness of the Agreement. For clarification, the Enterprise Value as of the Company at the effective date was $25,042,464.
On February 2, 2021, the Company entered into an Employment Agreement (the “Agreement”) with Brian Mc Fadden (the “Executive”) for the role of Chief Strategy Officer. The Agreement is effective as of November 12, 2020 (the “Effective Date”) and has a term of three (3) years (the “Term”) from the Effective Date. Thereafter, the Agreement shall automatically be renewed and the Term shall be extended for additional consecutive terms of 1 year (each a “~~Renewal Term”), unless such renewal is objected to by either the Company or the Executive. The Executive’s initial annual base salary shall be $200,000, less applicable withholdings (the “Base Salary~~”) and 120,000 common shares that shall vest in their entirety on issuance. The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time. The Base Salary due of shares, shall be payable within the first 30 days of the year. On each anniversary of the Agreement, the base salary will increase no less than $15,000 (“minimum”). For 2021, the Executive shall receive a cash bonus in the amount equal to 30% of the annual Base Salary, and an award of 200% shares of the Company’s common stock, which shall vest in their entirety on issuance (the “~~Principal Market~~”), which shall be received by the Executive no later than the first 30 days of the current fiscal year. Upon the execution of the Agreement, the Executive is entitled to a one-time signing bonus of 150,000 shares of the Company’s common stock, which shall vest in their entirety on issuance. The Executive shall be entitled to 100,000 shares of the Company’s common stock, due immediately upon an increase of 2.5 times the Enterprise Value on a 5-day closing average from the effectiveness of the Agreement. For clarification, the Enterprise Value as of the Company at the effective date was $25,042,464.
48
Critical Accounting Policies and Significant Judgments and Estimates
Our management’s discussion and analysis of our financial condition and results of operations are based on our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. The preparation of these consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements as well as the reported expenses during the reporting periods. The accounting estimates that require our most significant, difficult and subjective judgments have an impact on revenue recognition, the determination of share-based compensation, financial instruments, liabilities associated with the Company’s outstanding warrants, business combinations, and ~~financial instruments.~~asset acquisitions. We evaluate our estimates and judgments on an ongoing basis. Actual results may differ materially from these estimates under different assumptions or conditions.

~~Our significant accounting~~There have been no changes in such policies ~~are more fully described in Note 2 to our consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.~~or the application of such policies during the six months ended June 30, 2022 except as follows:

~~Components~~
Significant Accounting Policies
Significant accounting policies are disclosed in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021. There have been no changes in such policies or the application of ~~our Results~~such policies during the six months ended June 30, 2022. As a result of ~~Operations~~the acquisition of Adrizer, the Company added a new revenue stream, Digital Media Advertising and Licensing, to its Revenue Recognition policy. Additionally, as a result of the Company’s interest in Love is Blurred, the Company has recorded Film and Television Production assets in accordance with Topic 926. As a result of these changes in the first six months of 2022, new Investments have been recognized. The details for each of these topics are as follows:
Revenue Recognition
The Company considers all revenues as arising from contracts with customers. Revenue is recognized based on the five-step process outlined in the Accounting Standards Codification (“ASC”) 606 as disclosed in the Company’s Annual Report on Form 10-K. Additional clarification on the Company’s Digital Media Advertising and Licensing revenue recognition policy is provided below.

~~Revenues~~Digital Media Advertising and Licensing
The Company’s digital media advertising revenues are generated primarily from the posting of original digital content through third-party online platforms which are then delivered to users of the online platform across the customer’s digital advertising platform and becomes monetizable to the Company, which the Company concludes is its performance obligation. The Company recognizes revenue when control of the services are transferred to customers and the transaction price is determined by the third-party online platform. Revenue from the digital media platform is primarily recognized based on impressions delivered to customers. An “impression” is delivered when an advertisement appears on pages viewed by users. For impressions-based digital advertising, revenues are recognized as impressions are delivered over the term of the arrangement, while revenue from non-impressions-based digital advertising is recognized over the period that the advertisements are displayed. Such amounts are recognized net of agency commissions and provisions for estimated sales incentives, including rebates, rate adjustments or discounts.
Licensing revenues are derived from the sale of a licensee’s products that incorporates the Company’s intellectual property. Royalty revenues are recognized during the quarter in which the Company receives a report from the licensee detailing the shipment of products that incorporate the Company’s intellectual property, which receipt is in the quarter following the licensee’s sale of such products to its customers. Royalties are calculated as a percentage of the revenues received by the Company’s licensees on sales of products incorporating the Company’s intellectual property.
39
Identification of a Customer and Gross versus Net Revenue Recognition
In the normal course of business, the Company acts as or uses an intermediary or agent in executing transactions with third parties. When the intermediary or agent is determined to be the Company’s customer, the Company records revenue based on the amount it expects to receive from the agent or intermediary.
In other circumstances, the determination of whether revenue should be reported on a gross or net basis is based on an assessment of whether the Company is acting as the principal or an agent in the transaction. If the Company is acting as a principal in a transaction, the Company reports revenue on a gross basis. If the Company is acting as an agent in a transaction, the Company reports revenue on a net basis. The determination of whether the Company is acting as a principal or an agent in a transaction involves judgment and is based on an evaluation of the terms of the arrangement. The Company serves as the principal in transactions in which it controls the goods or services prior to being transferred to the ultimate customer.
For AdRizer, FASB ASC 606 requires an entity to determine whether it is a principal (recognizes revenue at the gross amount) or an agent (recognizes revenue at the net amount) for each promised good or service. Based on the FASB guidance, the Company has determined that AdRizer is the principal for each promised good or service, thus, revenue is recognized at the gross amount of the transactions. Revenue from traffic sales and traffic management services are generally recognized at the end of each month when the performance obligation is satisfied.

~~We sell consumer products across~~
Film and Television Productions
The Company accounts for the film and television productions in accordance with Topic 926, Entertainment – Films. Production costs qualifying for capitalization, are recorded as film and television productions on the consolidated balance sheet and amortized using forecast methods that match amortization to estimated revenue. Currently all productions are actively under development and, as such, amortization has not commenced.
Investments
Investments in equity securities (excluding equity method investments) with readily determinable fair values are accounted for at fair value. For investments in equity securities without readily determinable fair values, the Company elects the measurement alternative permitted under GAAP to measure these investments at cost, less any impairment, plus or minus changes resulting from observable price changes in orderly transactions for an identical or similar investment of the same issuer.
Investments in which the Company has the ability to exercise significant influence but does not control and is not the primary beneficiary are equity method investments. Significant influence typically exists if the Company has a ~~variety~~20% to 50% ownership interest in a venture unless persuasive evidence to the contrary exists. Under this method of ~~categories~~accounting, the Company records its proportionate share of the net earnings or losses of equity method investees and a corresponding increase or decrease to ~~retailers, distributors~~the investment balances. Cash payments to equity method investees such as additional investments, loans and ~~manufacturers. We also sell consumer products directly~~advances and expenses incurred on behalf of investees as well as payments from equity method investees such as dividends, distributions and repayments of loans and advances are recorded as adjustments to ~~consumers through e-commerce channels. In addition, we generate revenues form media properties through social media monetization.~~investment balances. The Company applies the cumulative earnings approach for determining the cash flow presentation of cash distributions received from equity method investees. Distributions received are included in the consolidated statements of cash flows as operating activities, unless the cumulative distributions exceed the Company’s portion of the cumulative equity in the net earnings of the equity method investment, in which case the excess distributions are deemed to be returns of the investment and are classified as investing activities in the consolidated statements of cash flows. The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may not be recoverable.

~~Cost of Revenues~~
40

~~Our cost~~Results of ~~revenues includes inventory costs, materials and supplies costs, internal labor costs and related benefits, subcontractor costs, depreciation, overhead and shipping and handling costs.~~Operations
~~Selling, General and Administrative Expenses~~
~~Selling, general and administrative expenses consist of selling, marketing, advertising, payroll, administrative, finance and professional expenses.~~
~~Rental Income~~
~~We earn rental income from a month-to-month lease on a portion of the building located in Washington, New Jersey that we own.~~
~~Interest Expense, Net~~
~~Interest expense includes the cost of our borrowings under our debt arrangements.~~
49

~~Results of Operations~~
Three Months Ended June 30, ~~2021~~2022 versus Three Months Ended June 30, ~~2020~~2021
The following ~~table sets~~tables set forth information comparing the components of net income (loss) ~~income~~ for the three months ended June 30, ~~2021~~2022 and ~~2020:~~2021:

Three Months Ended June 30, Period over Period Change
2021 2020 $ %

Revenues, net $ 2,691,811 $ 5,173,982 $ (2,482,171 ) -47.97 %
Cost of revenues 1,721,189 4,004,936 (2,283,747 ) -57.02 %
Gross profit 970,622 1,169,046 (198,424 ) -16.97 %

Operating expenses:
Selling, general and administrative 5,941,652 2,377,853 3,563,799 149.87 %
Operating (loss) (4,971,030 ) (1,208,807 ) (3,762,223 ) -311.23 %

Other (expense) income:
Rental income 28,703 25,703 3,000 11.67 %
Interest (expense) (2,715,481 ) (847,154 ) (1,868,327 ) -220.54 %
Loss on issuance of warrants (133,699,181 ) - (133,699,181 ) -100.00 %
Change in fair value of warrant liability (37,154,989 ) - (37,154,989 ) -100.00 %
Change in fair value of short-term investment (52,000 ) - (52,000 ) -100.00 %
Loss on disposal of assets and interests in joint venture (301,645 ) - (301,645 ) -100.00 %
Total other (expense), net (173,894,593 ) (821,451 ) (173,073,142 ) -21,069.20 %
Loss before income taxes (178,865,623 ) (2,030,258 ) (176,835,365 ) -8,709.99 %
Income tax expense - - - - %
Net loss from continuing operations (178,865,623 ) (2,030,258 ) (176,835,365 ) -8,709.99 %
Net income attributable to noncontrolling interests 22,543 22,241 5,793 26.05 %
Net loss from continuing operations attributable to Vinco Ventures, Inc. (178,888,166 ) (2,052,499 ) (176,841,158 ) -8,615.90 %
Net income (loss) from discontinued operations (4,780,580 ) 428,119 606,319 -141.62 %
Net (loss) income attributable to Vinco Ventures, Inc. $ (183,668,746 ) $ (1,624,380 ) $ (177,447,477 ) -10,924.01 %
For the Three Months
Ended June 30, Period over
Period Change
2022 2021 $ %
Revenues
Total revenue, net 10,365,300 685,117 9,680,183 1412.92 %

Cost of revenues
Total costs of revenue 10,946,367 316,900 10,629,467 3354.20 %
Gross profit (581,066 ) 368,217 (949,283 ) -257.81 %

Operating expenses:
Selling, general and administrative 30,739,339 5,410,233 25,329,106 468.17 %
Impairment Expense 453,449 - 453,449 0.00 %
Total Operating Expenses 31,192,788 5,410,233 25,782,555 476.55 %
Operating loss (31,773,855 ) (5,042,016 ) (26,731,839 ) 530.18 %

Other income (expense):
Interest income (expense) (16,107,800 ) (2,650,306 ) (13,457,494 ) 507.77 %
Loss on issuance of warrants - (133,699,181 ) 133,699,181 -100.00 %
Loss on inventory write down (365,001 ) - (365,001 ) -
Loss on investments (1,641,521 ) - (1,641,521 ) -
Change in fair value of warrant liability 173,059,037 (37,154,989 ) 210,214,026 -565.78 %
Change in fair value of contingent purchase price related to Adrizer, LLC acquisition 12,170,000 - 12,170,000 -
Other income (loss) 66,010 (353,645 ) 419,655 -118.67 %
Total other income (expense) 167,180,725 (173,858,121 ) 341,038,846 -196.16 %
Income (loss) before income taxes 135,406,870 (178,900,137 ) 314,307,007 -175.69 %
Income tax expense - - - 0.00 %
Net income (loss) $ 135,406,870 $ (178,900,137 ) $ 314,307,007 -175.69 %
Net (loss) income attributable to noncontrolling interests $ (12,532,866 ) $ 22,543 $ (12,555,409 ) -55695.38 %
Net income (loss) attributable to Vinco Ventures, Inc. from continuing operations $ 147,939,736 $ (178,922,680 ) $ 326,862,416 -182.68 %
Net Loss from discontinued operations (2,011,571 ) (4,746,066 ) 2,734,495 -57.62 %

Net income (loss) attributable to Vinco Ventures, Inc. 145,928,165 (183,668,746 ) 329,596,911 -179.45 %

41

Revenue
~~Revenue~~
For the three months ended June 30, ~~2021,~~2022, revenues ~~decreased~~from continuing operations increased by ~~$2,482,171~~$9,680,183 or ~~47.97%~~1412.92%, as compared to the three months ended June 30, ~~2020.~~2021. The ~~decrease~~increase was ~~primarily~~due to the ~~result~~impact of ~~a decrease~~the Company’s acquisition of AdRizer in ~~revenues~~February 2022, which generated $10,113,000 of revenue for the Company during the second quarter of 2022. AdRizer’s revenue consists of digital advertising sales and services to advertisers. Revenues of the Company’s Cryptyde subsidiary of approximately $3,758,000 were excluded from these amounts since the ~~Edison Nation Medical division.~~Company spun-off its ownership in Cryptyde on June 29, 2022.

Cost of Revenues
For the three months ended June 30, ~~2021,~~2022, cost of revenues ~~decreased~~from continuing operations increased by ~~$2,283,747~~$10,629,467 or ~~57.02%~~3354.20%, as compared to the three months ended June 30, ~~2020.~~2021. The ~~decrease~~increase was ~~primarily attributable~~due to the ~~decrease~~costs of traffic acquisition and content creation at AdRizer. Cost of revenues of the Company’s Cryptyde subsidiary of approximately $6,310,000 were excluded from these amounts since the Company spun-off its ownership in ~~total consolidated revenues.~~Cryptyde on June 29, 2022.

Gross Profit
For the three months ended June 30, ~~2021,~~2022, gross profit decreased by ~~$198,424,~~$949,283, or ~~16.97%~~-257.81%, as compared to the three months ended June 30, ~~2020.~~2021. The decrease ~~was primarily a result~~reflected the impact of the ~~decrease in revenues.~~Company’s new business lines of digital media and advertising from AdRizer, traffic acquisition and content creation costs of which were higher than expected as that business recently began its operations as a wholly-owned subsidiary of the Company.
Operating Expenses
Selling, general and administrative costs
For the Three Months
Ended June 30, Period over Period Change
Selling, general and administrative costs 2022 2021 $ %
Compensation, benefits and payroll taxes $ 5,694,511 $ 1,399,572 4,294,939 306.9 %
Depreciation and amortization 3,384,435 603,270 2,781,165 461.0 %
Stock based compensation 1,040,882 1,306,267 (265,385 ) -20.3 %
Advertising, marketing and promotions 12,107,252 169,876 11,937,376 7027.1 %
Legal, professional fees, and transaction costs 4,877,386 1,356,823 3,520,563 259.5 %
Selling, general and administrative costs 4,441,923 574,424 3,867,499 673.3 %
Total selling, general and administrative costs 31,546,389 5,410,232 26,136,157 483.1 %
Selling, general and administrative ~~expenses~~costs (“SGA costs”) were ~~$5,941,652~~$31,546,389 in the three months ending June 30, 2022 as compared to $5,410,232 in the three months ending June 30, 2021, an increase of $26,136,157. This large increase was due to a significant expansion of the Company’s activities requiring SGA costs as it transitioned into a digital media and ~~$2,377,853~~entertainment company in 2022. In addition, the increase in SGA costs reflects the impact of costs associated with the Company’s newly acquired subsidiary AdRizer, which was acquired in February 2022. The largest increase was due to the increase in advertising, marketing and promotions cost during the second quarter of 2022, which included the costs the Company spent on its promotions and live-streaming of the Electronic Daisy Carnival music event in Las Vegas in May. In addition, the Company saw large increases in legal and professional fees and compensation costs in both periods as compared to the 2021 periods, as the overall size and scope of the business has increased significantly since 2021, primarily due to the additions of Lomotif and AdRizer since the 2021 periods.
42
Other Income (Expense)
For the Three Months
Ended June 30, Period over Period Change
2022 2021 $ %
Other income (expense):
Interest income (expense) (16,107,800 ) (2,650,306 ) (13,457,494 ) 507.8 %
Loss on issuance of warrants - (133,699,181 ) 133,699,181 -100.0 %
Loss on inventory write down (365,001 ) - (365,001 ) -
Loss on dissolution of investment (1,641,521 ) - (1,641,521 ) -
Change in fair value of warrant liability 173,059,037 (37,154,989 ) 210,214,026 -565.8 %
Change in fair value of contingent purchase price related to Adrizer, LLC acquisition 12,170,000 - 12,170,000 -
Other income (loss) 66,010 (353,645 ) 419,655 -118.7 %
Total other income (expense) 167,180,725 (173,858,121 ) 341,038,846 -196.2 %
Interest expense, net
Interest expense was approximately $16,108,000 for the three months ended June 30, 2021 and 2020, respectively, representing an increase of $3,563,799, or 149.87%. The increase was primarily the result of an increase in stock-based compensation of $1,037,351, profession fees of $897,021, depreciation and amortization of $326,316 and payroll and related benefits of $702,150.
~~Rental Income~~
~~Rental income was $28,703 and $25,703 for~~2022 versus approximately $2,650,000 during the three months ended June 30, ~~2021 and 2020, respectively.~~
50
~~Interest expense~~
~~Interest expense was $2,715,481 for the three months ended June 30, 2021 versus $847,154 in the previous three months ended June 30, 2020.~~2021. The increase in interest expense was related to the ~~two financings~~amortization of financing fees of the convertible note issued to Hudson Bay Master Fund Ltd. (“Hudson Bay”) in ~~the first quarter of $22,000,000 which included the issuance of warrants and beneficial conversion features that were amortized and included as part of interest expense.~~July 2021.

Loss on ~~issuance~~issuances of warrants and change in fair value of ~~warrants~~warrant liability
The Company classifies a warrant to purchase shares of its common stock as a liability on its consolidated balance sheets as such warrant is a free-standing financial instrument that may require the Company to transfer consideration upon exercise. Each warrant is initially recorded at fair value on date of grant using the Monte-Carlo simulation pricing model and subsequently re-measured to fair value at each subsequent balance sheet date. Changes in fair value of the warrant are recognized as a component of other income (expense), net in the consolidated statement of operations and comprehensive loss. The Company will continue to adjust the liability for changes in fair value until the earlier of the exercise or expiration of the warrant.

~~Loss~~
For the three months ended June 30, 2022, the Company had no losses from issuance of warrants as compared to a loss of $133,699,181 during the three months ended June 30, 2021. A loss on issuance of warrants was ~~$133,699,181~~recorded in the first quarter of 2022 only. For the six months ended June 30, 2022, the Company had a loss of $243,681,478 as compared to a loss of $208,855,715 during the six months ended June 30, 2021.
43
Net Loss
For the Three Months
Ended June 30, Period over Period Change
2022 2021 $ %
Loss before income taxes 135,406,870 (178,900,137 ) 314,307,007 -175.7 %
Income tax expense - - - -
Net income (loss) 135,406,870 (178,900,137 ) 314,307,007 -175.7 %

Net (loss) income attributable to noncontrolling
interests (12,532,866 ) 22,543 (12,555,409 ) -55695.4 %
Net income (loss) attributable to Vinco Ventures, Inc. from continuing operations 147,939,736 (178,922,680 ) 326,862,416 -182.7 %
Net Loss from discontinued operations (2,011,571 ) (4,746,066 ) 2,734,495 -57.6 %

Net income (loss) attributable to Vinco Ventures, Inc. 145,928,165 (183,668,746 ) 329,596,911 -179.5 %
Net income (loss) per share - Basic
Net income (loss) per share - Continuing operations 0.62 (9.39 ) 10.01 -106.6 %
Net income (loss) per share - Noncontrolling interests (0.06 ) 0.00 (0.06 ) -4979.0 %
Net loss per share – Vinco Ventures, Inc. 0.68 (9.39 ) 10.07 -107.3 %
Net loss per share - Discontinued operations (0.01 ) (0.25 ) 0.24 -96.3 %
Net loss per share 0.67 (9.64 ) 10.31 -107.0 %
Net income (loss) per share - Diluted
Net income (loss) per share - Continuing operations 0.56 (9.39 ) 9.95 -105.9 %
Net income (loss) per share - Noncontrolling interests (0.06 ) 0.00 (0.06 ) -4979.0 %
Net loss per share – Vinco Ventures, Inc. 0.61 (9.39 ) 10.00 -106.5 %
Net loss per share - Discontinued operations (0.01 ) (0.25 ) 0.24 -96.3 %
Net loss per share 0.60 (9.64 ) 10.24 -106.2 %

Weighted Average Number of Common Shares Outstanding - Basic 217,127,978 19,055,006 198,072,972 1,039.5 %
Weighted Average Number of Common Shares Outstanding – Diluted 245,799,190 19,055,006 226,744,184 1,189.9 %
For the three months ended June 30, 2022, the Company had net income from continuing operations of $147,939,736 as compared to a net loss of $178,922,680 during the three months ended June 30, 2021, an increase of $326,862,416 or 182.7%. The significant change from a net loss to a net income for the two periods was primarily triggered by the impact of the Company’s requirement to recognize the fair value of warrants that the Company issued and $0the change in fair values of exercised and outstanding warrants during each reporting period. The total impact of warrant liability accounting during the three months ended June 30, 2022 was a net other income of $173,059,037 as compared to a net other expense of $330,630,336 in the same three months of 2021. The warrant liability amounts are affected by the fair value of the Company’s stock which is the market price of the Company’s common stock as traded on the Nasdaq Capital Market. During the first six months of 2022, the Company’s stock price ranged from a low of $1.34 and a high of $5.19 per share, which had significant impact on the fair market value of the Company’s warrants on their grant and exercise dates. The other expense due to warrant liability constituted 65% of the Company’s net loss for the six months ended June 30, 2022 and 126% of the Company’s net income for the three months ended June 30, 2021 and 2020, respectively. The issuance of warrants was related to the issuance of warrants in connection with the three private placements completed in the second quarter of 2021. Change in fair value of warrants was a loss of $37,154,989 and $0 for the three months ended June 30, 2021 and 2020, respectively. The change in fair value of warrants was related to a reduction in the warrant liability due to a change in the underlying assumptions of the Black-Scholes model, mostly related to a decrease in the Company’s share price.2022.

~~Income tax expense~~
44
~~Income tax expense was $0 and $0 for the three months ended June 30, 2021 and 2020, respectively.~~

Six Months Ended June 30, ~~2021~~2022 versus Six Months Ended June 30, ~~2020~~2021
The following ~~table sets~~tables set forth information comparing the components of net income (loss) ~~income~~ for the six months ended June 30, ~~2021~~2022 and ~~2020:~~2021:

Six Months Ended June 30, Period over Period Change
2021 2020 $ %

Revenues, net $ 5,256,973 $ 7,127,328 $ (1,870,355 ) -26.24 %
Cost of revenues 3,374,570 5,368,655 (1,994,085 ) -37.14 %
Gross profit 1,882,403 1,758,673 123,730 7.04 %

Operating expenses:
Selling, general and administrative 17,602,532 5,567,516 12,035,016 216.16 %
Operating (loss) (15,720,129 ) (3,808,843 ) (11,911,286 ) -312.73 %

Other (expense) income:
Rental income 54,407 51,407 3,000 5.84 %
Interest (expense) (15,410,414 ) (1,571,111 ) (13,839,303 ) -880.86 %
Loss on issuance of warrants (208,855,715 ) - (208,855,715 ) -100.00 %
Change in fair value of warrant liability (773,447 ) - (773,447 ) -100.00 %
Change in fair value of short-term investment (122,000 ) - (122,000 ) -100.00 %
Loss on disposal of assets and interest in joint venture (301,645 ) - (301,645 ) -100.00 %
Gain on divestirure - - - - %
Total other (expense), net (225,408,814 ) (1,519,704 ) (223,889,110 ) -14,732.42 %
Loss before income taxes (241,128,943 ) (5,328,547 ) (236,279,596 ) -4,434.22 %
Income tax expense - - - - %
Net loss from continuing operations (241,608,143 ) (5,328,547 ) (236,279,596 ) -4,434.22 %
Net income attributable to noncontrolling interests 50,577 22,241 28,366 127.40 %
Net loss from continuing operations attributable to Vinco Ventures, Inc. (241,179,520 ) (5,350,788 ) (235,828,732 ) -4,407.36 %
Net income (loss) from discontinued operations attributable to Vinco Ventures, Inc. (4,958,780 ) 4,995,900 (9,914,680 ) -200.06 %
Net (loss) income attributable to Vinco Ventures, Inc. $ (246,138,300 ) $ (354,888 ) $ (245,783,412 ) -69,256.61 %
For the Six Months
Ended June 30, Period over
Period Change
2022 2021 $ %
Revenues
Total revenue, net 18,142,566 1,492,627 16,649,939 1115.48 %

Cost of revenues
Total costs of revenue 18,723,030 687,123 18,035,907 2624.84 %
Gross profit (580,464 ) 805,504 (1,385,968 ) -172.06 %

Operating expenses:
Selling, general and administrative 55,588,027 16,692,058 38,895,969 233.02 %
Impairment Expense 453,449 - 453,449 0.00 %
Total Operating Expenses 56,041,476 16,692,058 39,349,418 235.74 %
Operating loss (56,621,939 ) (15,886,554 ) (40,735,385 ) 256.41 %

Other income (expense):
Interest income (expense) (38,634,780 ) (15,377,596 ) (23,257,184 ) 151.24 %
Loss on issuance of warrants (243,681,478 ) (208,855,715 ) (34,825,763 ) 16.67 %
Loss on inventory write down (365,001 ) - (365,001 ) 0.00 %
Loss on investments (1,641,521 ) - (1,641,521 ) 0.00 %
Change in fair value of warrant liability 86,110,179 (773,447 ) 86,883,626 -11233.30 %
Change in fair value of contingent purchase price related to Adrizer, LLC acquisition 12,170,000 - 12,170,000 0.00 %
Other income (loss) 215,604 (423,645 ) 639,249 -150.89 %
Total other income (expense) (185,826,997 ) (225,430,403 ) 39,603,406 -17.57 %
Income (loss) before income taxes (242,448,937 ) (241,316,957 ) (1,131,980 ) 0.47 %
Income tax expense - - - 0.00 %
Net income (loss) $ (242,448,937 ) $ (241,316,957 ) $ (1,131,980 ) 0.47 %
Net (loss) income attributable to noncontrolling interests $ (18,690,055 ) $ 50,577 $ (18,740,632 ) -37053.67 %
Net income (loss) attributable to Vinco Ventures, Inc. from continuing operations $ (223,758,881 ) $ (241,367,534 ) $ 17,608,653 -7.30 %
Net Loss from discontinued operations (3,260,912 ) (4,770,766 ) 1,509,854 -31.65 %

Net income (loss) attributable to Vinco Ventures, Inc. (227,019,793 ) (246,138,300 ) 19,118,507 -7.77 %

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Revenue
~~Revenue~~
For the six months ended June 30, ~~2021,~~2022, revenues ~~decreased~~from continuing operations increased by ~~$1,870,355~~$16,649,939 or ~~26.24%~~1115.48%, as compared to the six months ended June 30, ~~2020.~~2021. The ~~decrease~~increase was ~~primarily~~due to the ~~result~~impact of ~~a decrease~~the Company’s acquisition of AdRizer in ~~business operations~~February 2022, which generated $17,940,000 of revenue for the Company from the ~~Edison Nation Medical division.~~date of acquisition through June 30, 2022.

Cost of Revenues
For the six months ended June 30, ~~2021,~~2022, cost of revenues ~~decreased~~from continuing operations increased by ~~$1,994,085~~$18,035,907 or ~~37.14%~~2624.84%, as compared to the six months ended June 30, ~~2020.~~2021. The ~~decrease~~increase was ~~primarily attributable~~due to the ~~decrease~~costs of traffic acquisition and content creation at AdRizer. Cost of revenues of the Company’s Cryptyde subsidiary of approximately $11,104,000 were excluded from these amounts since the Company spun-off its ownership in ~~total consolidated revenues.~~Cryptyde on June 29, 2022.
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Gross Profit
For the six months ended June 30, ~~2021,~~2022, gross profit ~~increased~~decreased by ~~$123,730,~~$1,385,968, or ~~7.04%~~172%, as compared to the six months ended June 30, ~~2020.~~2021. The ~~increase was primarily~~decrease reflected the impact of the Company’s new business lines of digital media and advertising from AdRizer, traffic acquisition and content creation costs of which were higher than expected as that business recently began its operations as a ~~result~~wholly-owned subsidiary of ~~higher margin revenues in 2021 due to less revenues from~~ the ~~Edison Nation Medical division.~~Company.
Operating Expenses
Selling, general and administrative ~~expenses~~costs
Six Months Ended
June 30, Period over Period Change
2022 2021 $ %
Selling, general and administrative costs
Compensation, benefits and payroll taxes $ 10,580,492 $ 1,582,840 $ 8,997,652 568.4 %
Depreciation and amortization 4,925,233 1,016,000 3,909,233 384.8 %
Stock based compensation 2,184,327 10,003,769 (7,819,442 ) -78.2 %
Advertising, marketing and promotions 15,969,087 452,093 15,516,994 3432.3 %
Legal, professional fees, and transaction costs 16,053,890 2,766,292 13,287,598 480.3 %
Selling, general and administrative costs 5,874,999 871,064 5,003,935 574.5 %
Total selling, general and administrative costs $ 55,588,027 $ 16,692,058 $ 38,895,969 233.0 %
SGA costs from continuing operations increased significantly during the three and six months ended June 30, 2022 as compared to the three and six months ended June 30, 2021 due to a significant expansion of the Company’s activities requiring SGA costs as it transitioned into a digital media and entertainment company in 2022. In addition, the increase in SGA costs reflect the impact of costs associated with the Company’s newly acquired subsidiary AdRizer, which was acquired in February 2022. Total SGA costs from continuing operations were ~~$17,602,532~~$31,546,389 in the three months ending June 30, 2022 as compared to $5,410,232 in the three months ending June 30, 2021, an increase of $26,136,157. Total SGA costs from continuing operations were $55,588,027 in the six months ending June 30, 2022, as compared to $16,692,058 in the six months ending June 30, 2021. The largest increase was due to the increase in advertising, marketing and ~~$5,567,516~~promotions cost during the second quarter of 2022, which included the costs the Company spent on its promotions and live-streaming of the Electronic Daisy Carnival music event in Las Vegas in May. In addition, the Company saw large increases in legal and professional fees and compensation costs in both periods as compared to the 2021 periods, as the overall size and scope of the business has increased significantly since 2021, primarily due to the additions of Lomotif and AdRizer since the 2021 periods.
Other Income (Expense)
For the Six Months
Ended June 30, Period over Period Change
2022 2021 $ %
Other income (expense):
Interest income (expense) (38,634,780 ) (15,377,596 ) (23,257,184 ) 151.2 %
Loss on issuance of warrants (243,681,478 ) (208,855,715 ) (34,825,763 ) 16.7 %
Loss on inventory write down (365,001 ) - (365,001 ) 0.0 %
Loss on dissolution of investment (1,641,521 ) - (1,641,521 ) 0.0 %
Change in fair value of warrant liability 86,110,179 (773,447 ) 86,883,626 -11233.3 %
Change in fair value of contingent purchase price related to Adrizer, LLC acquisition 12,170,000 - 12,170,000 0.0 %
Other income (loss) 215,604 (423,645 ) 639,249 -150.9 %
Total other income (expense) (185,826,997 ) (225,430,403 ) 39,603,406 -17.6 %
Interest expense, net
Interest expense was approximately $38,600,000 for the six months ended June 30, 2021 and 2020, respectively, representing an increase of $12,035,016, or 216.16%. The increase was primarily the result of an increase in stock-based compensation of $8,415,342, professional fees of $1,452,916, depreciation and amortization of $452,458 and payroll and related benefits of $412,367.
~~Rental Income~~
~~Rental income was $54,407 and $51,407 for~~2022 versus approximately $15,378,000 during the six months ended June 30, ~~2021 and 2020, respectively.~~
~~Interest expense~~
~~Interest expense was $15,410,414 for the six months ended June 30, 2021 versus $1,571,111 in the previous six months ended June 30, 2020.~~2021. The increase in interest expense was related to the ~~two financings~~amortization of financing fees of the convertible note issued to Hudson Bay in ~~the first quarter of $22,000,000 which included the issuance of warrants and beneficial conversion features that were amortized and included as part of interest expense.~~July 2021.
46

Loss on ~~issuance~~issuances of warrants and change in fair value of ~~warrants~~warrant liability

~~Loss~~For the six months ended June 30, 2022, loss on ~~issuance~~issuances of warrants was ~~$208,855,715 and $0~~approximately $243,681,000, due to 89,653,803 warrants issued during the first quarter of 2022, while the aggregated change in fair value of warrant liability for the 99,271,764 warrants outstanding as of June 30, 2022 was an increase of approximately $86,110,000, for a net other expense of approximately $157,571,000 due to warrants recognized by the Company for the six months ended June 30, ~~2021 and 2020, respectively. The issuance of warrants was related to~~2022.
Net Loss
For the Six Months
Ended June 30, Period over Period Change
2022 2021 $ %
Loss before income taxes (242,448,937 ) (241,316,957 ) (1,131,980 ) 0.5 %
Income tax expense - - - 0.0 %
Net income (loss) (242,448,937 ) (241,316,957 ) (1,131,980 ) 0.5 %
Net (loss) income attributable to noncontrolling interests (18,690,055 ) 50,577 (18,740,632 ) -37053.7 %
Net income (loss) attributable to Vinco Ventures, Inc. from continuing operations (223,758,881 ) (241,367,534 ) 17,608,653 -7.3 %
Net Loss from discontinued operations (3,260,912 ) (4,770,766 ) 1,509,854 -31.6 %

Net income (loss) attributable to Vinco Ventures, Inc. (227,019,793 ) (246,138,300 ) 19,118,507 -7.8 %
Net income (loss) per share - Basic
Net income (loss) per share- Continuing operations (1.22 ) (8.78 ) 7.56 -86.1 %
Net income (loss) per share- Noncontrolling interests (0.09 ) 0.00 (0.10 ) -5210.4 %
Net loss per share – Vinco Ventures, Inc. (1.13 ) (8.78 ) 7.65 -87.2 %
Net loss per share - Discontinued operations (0.02 ) (0.17 ) 0.16 -90.5 %
Net loss per share (1.14 ) (8.95 ) 7.81 -87.2 %
Net income (loss) per share - Diluted
Net income (loss) per share - Continuing operations (1.22 ) (8.78 ) 7.56 -86.1 %
Net income (loss) per share - Noncontrolling interests (0.09 ) 0.00 (0.10 ) -5210.4 %
Net loss per share – Vinco Ventures, Inc. (1.13 ) (8.78 ) 7.65 -87.2 %
Net loss per share - Discontinued operations (0.02 ) (0.17 ) 0.16 -90.5 %
Net loss per share (1.14 ) (8.95 ) 7.81 -87.2 %

Weighted Average Number of Common Shares Outstanding - Basic 198,777,747 27,489,580 171,288,167 623.1 %
Weighted Average Number of Common Shares Outstanding - Diluted 198,777,747 27,489,580 171,288,167 623.1 %
For the ~~issuance of warrants in connection with the three private placements completed in the first~~ six months ended June 30, 2022, the Company had a net loss from continuing operations of ~~2021. Change in fair value of warrants was~~$223,758,881 as compared to a net loss of ~~$773,447 and $0 for~~$241,367,534 during the six months ended June 30, 2021, ~~and 2020, respectively.~~an increase of $17,608,653 or 7.3%. The change ~~in fair value of warrants~~for the two periods was ~~related to a reduction in~~primarily triggered by the ~~warrant liability due to a change in the underlying assumptions~~impact of the ~~Black-Scholes model, mostly related~~Company’s acquisition of Lomotif. On July 25, 2021, ZVV, a joint venture of the Company and ZASH, completed the acquisition of 80% of the outstanding equity interests of Lomotif for a total purchase price of $109,765,000. The Company, therefore, has a 40% ownership interest in Lomotif. As the transaction occurred subsequent to ~~a decrease in the Company’s share price.~~
~~Income tax expense~~
~~Income tax expense was $0 and $0 for the six months ended~~ June 30, 2021, ~~and 2020, respectively.~~
~~Non-GAAP Measures~~
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~~EBITDA and Adjusted EBITDA~~
~~The Company defines EBITDA as net loss before interest, taxes and depreciation and amortization. The Company defines Adjusted EBITDA as EBITDA, further adjusted to eliminate~~ the impact of certain non-recurring items and other items that we do not consider in our evaluation of our ongoing operating performance from period to period. These items will include stock-based compensation, restructuring and severance costs, transaction costs, acquisition costs, certain other non-recurring charges and gains that the Company does not believe reflects the underlying business performance.
~~For the three and six months ended June 30, 2021 and 2020, EBITDA and Adjusted EBITDA consisted of the following:~~
Three Months
Ended June 30, Six Months
Ended June 30,
2021 2020 2021 2020
Net income (loss) from continuing operations $ (178,865,623 ) $ (1,602,139 ) $ (241,128,943 ) $ (332,647 )
Net income (loss) from discontinued operations (4,780,580 ) (4,958,780 )
Interest expense, net 2,715,481 841,529 15,410,414 1,571,111
Income tax expense - - - -
Depreciation and amortization 636,082 296,108 1,081,623 612,406
EBITDA (180,294,640 ) (464,502 ) (229,595,686 ) 1,850,870
Stock-based compensation 1,306,267 268,916 10,003,769 1,588,427
Loss on issuance of warrant liability 133,699,181 - 208,855,715 -
Change in fair value of warrant liability 37,154,989 - 773,447 -
Restructuring and severance costs - 189,009 - 431,145
Transaction and acquisition costs 723,760 - 1,428,325 82,736
Other non-recurring costs - - - 40,860
Loss (gain) on divestiture
4,130,580
-
4,130,580
(4,911,760 )
Adjusted EBITDA (1) $ (3,279,863 ) $ (6,577 ) $ (4,403,850 ) $ (917,722 )
EBITDA and Adjusted EBITDA is a financial measure that is not calculated in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Management believes that because Adjusted EBITDA excludes (a) certain non-cash expenses (such as depreciation, amortization and stock-based compensation) and (b) expenses that are not reflective of the Company’s core operating results over time (such as restructuring costs, litigation or dispute settlement charges or gains, and transaction-related costs), this measure provides investors with additional useful information to measure the Company’s financial performance, particularly with respect to changes in performance from period to period. The Company’s management uses EBITDA and Adjusted EBITDA (a) as a measure of operating performance, (b) for planning and forecasting in future periods, and (c) in communications with the Company’s board of directors concerning the Company’s financial performance. The Company’s presentation of EBITDA and Adjusted EBITDA are not necessarily comparable to other similarly titled captions of other companies due to different methods of calculation and should not be used by investors as a substitute or alternative to net income or any measure of financial performance calculated and presented in accordance with U.S. GAAP. Instead, management believes EBITDA and Adjusted EBITDA should be used to supplement the Company’s financial measures derived in accordance with U.S. GAAP to provide a more complete understanding of the trends affecting the business.
Although Adjusted EBITDA is frequently used by investors and securities analysts in their evaluations of companies, Adjusted EBITDA has limitations as an analytical tool, and investors should not consider it in isolation or as a substitute for, or more meaningful than, amounts determined in accordance with U.S. GAAP. Some of the limitations to using non-GAAP measures as an analytical tool are (a) they do not reflect the Company’s interest income and expense, or the requirements necessary to service interest or principal paymentsnoncontrolling interests on the Company’s debt, (b) they do not reflect future requirements for capital expenditures or contractual commitments, and (c) although depreciation and amortization charges are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and non-GAAP measures do not reflect any cash requirements for such replacements.
53
~~Liquidity and Capital Resources~~
net loss from continuing operations was minimal. For the six months ended June 30, ~~2021, our operations lost approximately $15,720,129,~~2022, the Company had a net loss attributable to noncontrolling interests of ~~which approximately $11,085,000 was non-cash and approximately $1,428,000 was related~~$18,690,055 as compared to ~~transaction costs and other non-recurring items.~~a net income of $50,577 attributable to noncontrolling interests during the six months ended June 30, 2021.

At June 30, 2021, we had total current assets of approximately $80,620,757 and current liabilities of approximately $8,829,464 resulting in working capital of approximately $71,791,293, of which $3,333,333 was convertible notes payable. At June 30, 2021, we had total assets of $121,276,499 and total liabilities of $148,820,211, of which 139,695,115 related to the warrant liabilities, resulting in stockholders’ deficit of $27,543,712.
47

The Company believes it has sufficient cash for at least the next twelve months from the date of issuance of these condensed financial statements. The ability to continue as a going concern is dependent upon the Company’s ability to attract significant new sources of capital, attain a reasonable threshold of operating efficiencies and achieve profitable operations from the sale of its products.Cash Flows
Our operating needs include the planned costs to operate our business, including amounts required to fund working capital and capital expenditures. Our future capital requirements and the adequacy of our available funds will depend on many factors, including our ability to successfully commercialize our products and services, competing technological and market developments, and the need to enter into collaborations with other companies or acquire other companies or technologies to enhance or complement our product and service offerings.
54
~~Cash Flows~~
During the six months ended June 30, ~~2021~~2022 and ~~2020,~~2021, our sources and uses of cash were as follows:
Six Months Ended June 30, Period over Period Change
2022 2021 $ %

Net Cash used in Operating Activities $ (72,000,827 ) $ (9,791,988 ) $ (62,208,839 ) 635.3 %
Net Cash Used in Investing Activities (39,383,544 ) (14,559,069 ) (24,824,475 ) 170.5 %
Net Cash provided by Financing Activities 102,989,059 98,858,274 4,130,785 4.2 %
Net Increase in Cash and Cash Equivalents (8,395,313 ) 74,507,217 (82,902,530 ) -111.3 %
Cash, Cash Equivalents, and Restricted Cash - Beginning of Period 187,612,176 249,356 187,362,820 75138.7 %
Cash, Cash Equivalents, and Restricted Cash - End of Period $ 179,216,863 $ 74,756,573 $ 104,460,290 139.7 %

Cash Flows from Operating Activities
Net cash used in operating activities from continuing operations for the six months ended June 30, 2022 was $72,000,827, which included a net loss of $242,448,937 that included $320,218,107 of non-cash expense items. The use of cash for operations during the first six months of 2022 reflected the costs incurred by the business, including the costs associated with the operation, marketing and promotion of Lomotif, along with the amount of professional fees incurred by the Company during the period. In addition, the Company paid approximately $16,774,000 of net working capital outflows for prepayments and payments of accounts payables, accrued expenses and other liabilities during the first six months of 2022. Net cash used in operating activities from continuing operations for the six months ended June 30, 2021 was $9,791,988, which included net loss from continuing operations of $241,128,943 that included $3,465,708 of cash used by changes in operating assets and liabilities, stock-based compensation of $10,003,767, loss on issuance of warrants of $208,855,715, depreciation and amortization of $1,081,623, amortization of financing costs of $15,597,936, gain on debt extinguishment of $852,352 and amortization of right of use assets of $48,327. Net cash used in operating activities for the six months ended June 30, 2020 was $2,487,898 which included a net loss of ~~$332,647~~$241,316,957 that included ~~$825,190~~$228,926,894 of cash used by changes in operating assets and liabilities, stock-based compensation of $1,588,427, depreciation and amortization of $612,406, amortization of financing costs of $1,227,046 and amortization of right of use assets of $153,820 which was offset by a gain on divestiture of a subsidiary of $4,911,760.non-cash expense items.

Cash Flows from Investing Activities
Net cash used in investing activities was ~~$14,559,069 and $61,917~~$39,383,544 during the first six months of 2022, which was primarily due to the net cash paid for the acquisition of AdRizer by the Company in February. Net cash used in investing activities from continuing operations for the six months ended June 30, 2021 ~~and 2020, respectively.~~ ~~Net cash used in investing activities~~ was ~~largely attributable to the Company’s equity method investment and funding of loan receivable offset by the receipt of funds related to the sale of the assets of CBAV 1, LLC.~~$14,559,069.

Cash Flows from Financing Activities
~~Net cash~~Cash provided by financing activities for the six months ended June 30, ~~2021~~2022 totaled ~~$98,858,274~~$102,989,059, which related ~~mostly~~primarily to ~~borrowings under convertible notes and~~net proceeds from the exercise of warrants. Net cash provided by financing activities from continuing operations for the ~~three~~six months ended June 30, ~~2020 totaled $3,899,433 which related mostly to borrowings under convertible notes and borrowings under notes payable.~~2021 was $98,858,274.

~~Off-Balance Sheet Arrangements~~Net Increase (Decrease) in Cash and Cash Equivalents
As a result of the cash activities described above, during the six months ended June 30, 2022, the Company’s cash decreased by $8,395,313 and as of June 30, 2022, the Company had $179,216,863 in cash and cash equivalents, which included $80,000,000 held in a restricted cash account.
48
Liquidity and Capital Resources
This should be read together with the Going Concern and Liquidity section under Note 1 — Basis of Presentation and Nature of Operations.
As of June 30, Period over Period Change
2022 2021 $ %
Assets
Cash and cash equivalents $ 99,216,863 $ 74,756,573 $ 24,460,290 32.7 %
Restricted cash - - - 0.0 %
Other current assets 25,768,690 5,864,184 19,904,506 339.4 %
Total current assets 124,985,553 80,620,757 44,364,796 55.0 %

Intangible assets, including goodwill 213,107,415 22,517,225 190,590,190 846.4 %
Other long term assets 120,416,886 18,138,517 102,278,369 563.9 %
Total non-current assets 333,524,301 40,655,742 292,868,559 720.4 %

Total Assets $ 458,509,854 $ 121,276,499 $ 337,233,355 278.1 %

Liabilities
Accounts payables and accrued expenses 14,790,205 3,076,150 11,714,055 380.8 %
Current portion of long-term debt and warrant liability 63,045,692 5,358,670 57,687,022 1076.5 %
Other current liabilities 203,022 394,644 (191,622 ) -48.6 %
Total current liabilities 78,038,919 8,829,464 69,209,455 783.8 %

Long -term debt 63,341,696 269,149 63,072,547 23434.1 %
Warrant liability 94,300,999 139,695,115 (45,394,116 ) -32.5 %
Other long term liabilities 499,014 8,483 490,531 5782.5 %

Total Liabilities 236,180,629 148,802,211 87,378,418 58.7 %
As discussed above, the Company incurred significant losses during the first six months of 2022, and has a history of losses since inception. Since 2021, a significant percentage of its losses has been driven by non-cash expenses items, especially losses caused by liability accounting for its investor warrants. The Company used approximately $72 million in cash for operations during the first six months of 2022. This amount included approximately $8.2 million for transaction related costs associated with its acquisition of AdRizer in February 2022, and a $10 million payment of accrued registration rights penalties owed to Hudson Bay. This amount also included significant investments in sales, marketing and promotional activities which the Company engaged in during the first quarter to drive awareness and interest in the Lomotif application and Lomotif branded websites, especially for events livestreamed on the Lomotif platform. During the first six months of the year, the Company live streamed and promoted the Shaq Fun House event in January, the Okeechobee Music Festival in February, and the Electronic Daisy Carnival (“EDC”) in May. These expenses were intended to create traffic and interactions with the Lomotif digital properties with the goal of generating advertising revenue opportunities utilizing the capabilities of AdRizer, which the Company expects will reduce its operating cash needs during the rest of 2022. To date, these efforts have not led to any meaningful revenue and there is no guarantee that the Company will successfully do so. If additional advertising revenues are not generated as quickly, or in sufficient amount, the Company will need to utilize its unrestricted cash on hand to fund its operations.
49
As a result of the Company’s repayments to Hudson Bay (see Note 17 - Subsequent Events) and a lack of issuable stock, it has been unable to raise significant proceeds with which to increase its liquidity. As it looks forward into early 2023, it now has preferred shares authorized with which to begin the capital raising process, should market conditions permit.
Furthermore, the Company may determine it is in the best interests of the Company to pursue additional investments, acquisitions, or funding of marketing and promotional efforts as the Company expands its presence and capabilities within the digital media marketplace. To do so, the Company may require additional cash resources that the Company could generate through the sale of common stock, the exercise of outstanding warrants, and the issuance of convertible debt, each of which the Company has utilized to raise capital since 2021. As of the date of this report, the Company’s ability to raise additional capital is restricted by its lack of available, authorized but not outstanding common shares. The Company is currently seeking authorization from its shareholders to increase the number of shares it is authorized to issue under its Articles of Incorporation, but has not received the requisite vote needed to pass the proposal. Therefore, as discussed in Note 1 to the Company’s financial statements attached herein, these conditions raise substantial doubt about the Company’s ability to continue as a going concern and meet its obligations through twelve months following the date the condensed consolidated financial statements are issued. As a result, until the Company is able to raise additional capital, the Company has begun implement steps to conserve its unrestricted cash on hand and address any going concern issues, including but not limited to the following steps:
● Reduce headcount,
● Reduce marketing, promotional and content development and production activities,
● Evaluate the sales of assets or subsidiaries.
Off-Balance Sheet Arrangements
We did not have, during the periods presented, and we do not currently have, any relationships with any organizations or financial partnerships, such as structured finance or special purpose entities, that would have been established for the purpose of facilitating off-balance sheet arrangements or other contractually narrow or limited purposes.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not Applicable.

~~Not Applicable.~~
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ITEM 4. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
The Company’s management, with the participation of the Company’s Principal Executive Officer and Principal Financial and Accounting Officer has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly ~~report.~~Report. Based on such evaluation, the Company’s Principal Executive Officer and Principal Financial and Accounting Officer have concluded that, as of the end of such period covered by this Quarterly Report, the Company’s disclosure controls and procedures were not effective to provide reasonable assurance that information that it is required to disclose in reports that the Company files with the SEC is recorded, processed, summarized and reported within the time periods specified by the Exchange Act rules and regulations.

~~Changes in~~
50
Management’s Report on Internal Control over Financial Reporting
During the three months ended June 30, 2021, there were no changes in our internal control over financial reporting that materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) under the ~~Securities~~ Exchange ~~Act of 1934.~~Act. Under the supervision and with the participation of management, including our principal executive officer, we have ~~not~~ completed an evaluation of the effectiveness of our internal control over financial reporting based on the ~~COSO Framework.~~2013 Committee of Sponsoring Organizations (COSO) framework. Based on this evaluation under the COSO ~~Framework,~~framework, management concluded that our internal control over financial reporting was not effective as of June 30, ~~2021.~~2022.
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Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Because of the inherent limitations of internal control, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting.
However, these inherent limitations are known features of the financial reporting process. Therefore, it is possible to design into the process safeguards to reduce, though not eliminate, this risk.

As of December 31, ~~2020,~~2021, and June 30, 2022, management completed an ~~effective~~ assessment of the Company’s internal control over financial reporting based on the ~~2013 Committee of Sponsoring Organizations (COSO)~~COSO framework. Management has concluded that as of December 31, 2021, and June 30,2022, our internal control over financial reporting was not effective to detect the inappropriate application of ~~U.S.~~ GAAP. ~~There have not been any changes to internal controls during the three months ended June 30, 2021.~~ Management identified the following material ~~weaknesses~~weakness set forth below in our internal control over financial reporting.
The Company was unable to provide a timely financial reporting package in connection with its December 31, 2021 Form 10-K year end audit. This was primarily the result of the Company’s limited accounting personnel. This also limits the extent to which the Company can segregate incompatible duties and has a lack of controls in place to ensure that all material transactions, related party transactions, and developments or significant unusual transactions impacting the financial statements are reflected. There is a risk under the current circumstances that intentional or unintentional errors could occur and not be detected.
Subsequent to December 31, 2021, the Company was unable to provide timely financing reporting packages for periods ending June 30, 2022 and September 30, 2022 Form 10-Q. The Company was subject to circumstances which included:

1.● On July 21, 2022, the Board duly appointed John Colucci as interim co-Chief Executive Officer of the Company and ratified the appointment of Theodore Farnsworth as co-Chief Executive Officer to serve together with Mr. Colucci in lieu of Lisa King in such capacity. Mr. Farnsworth’s appointment as co-Chief Executive Officer was previously reported in a Form 8-K filed by the Company on July 14, 2022. [Prior to Mr. Colucci’s appointment as interim co-Chief Executive Officer and prior to his appointment as a director, Mr. Colucci had been determined by the Board to be an independent director within the meaning of Nasdaq Listing Rule 5605(a)(2).] The ~~Company was unable~~board unanimously agreed to ~~provide~~replace the vacant independent board seat with a ~~timely financial reporting package in connection with~~qualified independent director within the ~~year end audit. This was primarily the~~next 30 days.
● As a result of the ~~Company’s limited accounting personnel. This also limits the extent to which~~appointment of John Colucci as interim co-Chief Executive Officer the Company ~~can segregate incompatible duties~~was found to be not in compliance with the Nasdaq continued listing requirements that the Board be comprised of a majority of independent directors and ~~has~~that the audit committee of the Board be comprised of at least three independent directors. On July 22, 2022, the Company was notified by Nasdaq of the foregoing noncompliance. The Company and the Nominating and Corporate Governance Committee of the Board commenced a search for an additional independent director to replace Mr. Colucci as a director and enable the Company to cure such noncompliance as soon as practicable.
51
● Based on the discovery of the lack of ~~controls in place to ensure that all material~~disclosure of 3rd-party related transactions and ~~developments impacting~~information that brought into question whether Mr. Colucci met the ~~financial statements are reflected. There~~requirements of independence for NASDAQ listing when he became an independent director, the company hired independent counsel to determine whether Mr. Colucci met these requirements. The Chairman recommended to the board that Mr. Colucci step down immediately as an independent director for the next sixty days until the determination of whether independence was met.
● On August 3, 2022, the Company filed a lawsuit against each of Ted Farnsworth, Lisa King, Rod Vanderbilt and Erik Noble, alleging four causes of action, including: (i) breach of fiduciary duty, (ii) aiding and abetting breach of fiduciary duty, (iii) civil conspiracy and (iv) declaratory and injunctive relief in the event that no other legal remedy is available to the Company.
● On September 28, 2022, the Company entered into a ~~risk under~~settlement agreement with respect to the ~~current circumstances that intentional or unintentional errors could occur~~litigation, in which it appointed Ross Miller the sole CEO of the Company. John Colucci and ~~not be detected.~~Phillip Jones, former CFO, both resigned effectively immediately as executives of the Company. Michael DiStasio and Elliot Goldstein resigned effective immediately as Directors of the Company. No CFO was immediately appointed following Mr. Jones’ resignation.
● On October 26, 2022, Brendan Bosack was appointed interim CFO of the Company.
● On November 11, 2022, the management of the Company executed a reduction-in-force plan to reduce operating costs and better align its workforce expenses with the needs of its business. Under this Plan, the Company reduced its workforce by 39 employees (approximately 65%).

These circumstances may have impacted our internal control over financial reporting which may include additional material weaknesses such as: (a) the absence of controls designed to validate the completeness and accuracy of underlying data used in the determination of accounting transactions; (b) lack of written documentation of our internal control policies and procedures (c) insufficient segregation of duties within accounting functions and (d) inadequacy of the number of personnel with requisite expertise in the key functional areas of finance and accounting.
In addition, in June 2022, the Company was a victim of an email spoofing attack where the intruder was able to obtain access to the Company’s email system and send emails internally that had fake invoices that were presented and appeared to be approved for payment in accordance with the Company’s standard wire approval process. As a result of this email intrusion, the Company incorrectly wired funds to two vendors in error in the aggregate of $4,010,000. Fortunately, the fraudulent wires were detected quickly, and the Company was able to recover approximately 95% of the fraudulently wire funds.
Remediation Plan to Address Material Weaknesses in Internal Control Over Financial Reporting
Our management is committed to improving its internal controls. Due to the nature of these material weaknesses, it is reasonably possible that misstatements which could be material to the interim consolidated financial statements could occur that would not be prevented or detected during our financial close and reporting process.
Our company plans to take steps to enhance and improve the design of our internal controls over financial reporting. During the period covered by this quarterly report on Form 10-Q, we have not been able to remediate the material weaknesses identified above. To remediate such weaknesses, we plan to develop a comprehensive plan and implement the changes during our fiscal year ending December 31, 2023. The plan will include: (i) appointing additional qualified personnel to address inadequate segregation of duties and ineffective risk management; and (ii) adopting sufficient written policies and procedures for accounting and financial reporting. The remediation efforts set out are largely dependent upon our securing additional financing to cover the costs of implementing the changes required. If we are unsuccessful in securing such funds, remediation efforts may be adversely affected in a material manner.
We are not required by current SEC rules to include, and do not include an auditor’s attestation report regarding our internal controls over financial reporting. Accordingly, our registered public accounting firm has not attested to management’s reports on our internal control over financial reporting.
57

~~PART II~~
52

PART II
ITEM 1. LEGAL PROCEEDINGS
From time to time, the Company is party to legal actions that are routine and incidental to its business. However, based upon available information and in consultation with legal counsel, except as otherwise disclosed in our financial statements in Item 1 of Part I of this Quarterly Report, management does not expect the ultimate disposition of any or a combination of these actions to have a material adverse effect on the Company’s assets, business, cash flow, condition (financial or otherwise), liquidity, prospects and\or results of operations.
ITEM 1A. RISK FACTORS

The below risk factors are intended to supplement and not replace, the risk factors set forth in the Company’s Annual Report on 10-K for the year ended December 31, 2021. Please read these risk factors in conjunction with those set forth in the aforementioned 10-K.
~~ITEM 1A. RISK FACTORS~~
The loss of one or more of Vinco’s key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm our business.

~~Not applicable~~In order to ~~smaller reporting companies.~~be successful, Vinco must continue to attract, retain and motivate executives and other key employees across the Company. Hiring and retaining qualified executives is critical to our future. The impact of the COVID-19 pandemic has resulted in increased attrition and significant shifts in the labor market and employee expectations.
Vinco may be unable to attract and retain highly qualified management and employees, particularly if we do not offer employment terms competitive with the rest of the market. Failure to attract and retain qualified individuals, key leaders, executives and employees, or failure to develop and implement a viable succession plan, could result in inadequate depth of institutional knowledge or skill sets, which could adversely affect Vinco’s business and results of operations.
There is substantial doubt about our ability to continue as a going concern. We will need substantial additional funding and may be unable to raise capital when needed.
There is substantial doubt about our ability to continue as a going concern. If we are unable to raise funding through equity markets as and when needed, our business, financial condition and results of operations will be materially and adversely affected. If we are unable to continue as a going concern, we may have to liquidate our assets, and the values we receive for our assets in liquidation or dissolution could be significantly lower than the values reflected in our financial statements. Our lack of cash resources and our potential inability to continue as a going concern may materially adversely affect the price of our Common Stock and our ability to raise new capital, enter into critical contractual relations with third parties, meet our obligations as they become due and otherwise execute our business strategy.

Additionally, the Company may have the inability to raise additional equity capital due to lack of authorized common stock.
53
We are not currently in compliance with Nasdaq’s continued listing requirements. If we are unable to comply with Nasdaq’s continued listing requirements, our Common Stock could be delisted, which could affect the price of our Common Stock and liquidity and reduce our ability to raise capital.
On December 1, 2022, Vinco Ventures, Inc. received a notice from the Listing Qualifications Department of The Nasdaq Stock Market, LLC advising the Company that it was not in compliance with Nasdaq’s continued listing requirements under the Nasdaq Listing Rule 5550(a)(2) (the “Rule”) as a result of requiring listed securities to maintain a minimum bid price of $1 per share. Based upon the closing bid price for the last 30 consecutive business days, the Company no longer meets this requirement. However, the Rules also provide the Company a compliance period of 180 calendar days in which to regain compliance.
On January 4, 2023, the Company received a notification from Nasdaq that since it had not held an annual meeting of shareholders within twelve months of the end of the Company’s fiscal year end ended December 31, 2021, it no longer complies with Nasdaq’s Rules for continued listing.
Under the Rules the Company has 45 calendar days to submit a plan to regain compliance and if the plan is accepted, Nasdaq can grant an exception of up to 180 calendar days from the fiscal year end, or until June 29, 2023, to regain compliance. The Company plans to submit a plan which is to hold an annual meeting no later than March 31, 2023.
We have experienced a delay of stockholder meeting and may receive alternate exercise notices from our investors.
The Company entered into a May Exchange Agreement which requires the Company to hold a stockholder meeting no later than July 4, 2022 under Section 7(q). As previously reported in the Company’s Current Report on Form 8-K filed with the SEC on June 30, 2022, the Company postponed the Special Meeting from July 1, 2022 until July 26, 2022, in order to provide additional time for the Company’s stockholders to consider and vote on the proposals to be acted upon at the Special Meeting.
On July 5, 2022, the Holder submitted Alternate Exercise Notices to the Company with respect to (i) 14,500,000 exercise shares under the November Warrants, and (ii) 67,760,699 exercise shares under the December Warrants, for an aggregate payment equal to $33,886,612 (the “Warrant Payment”). On July 6, 2022, the Company made the Warrant Payment, in cash, to the Holder pursuant to the Alternate Exercise Notices and, as a result, a total of 82,260,699 warrants held by the Holder were canceled.
54
We may incur liability as a result of content published using our Platform or as a result of claims related to content generated by our developers, creators, and users, including copyright infringement, and legislation regulating content on our Platform may require us to change our Platform or business practices.
Our success relies in part on the ability of Lomotif to drive engagement with content. Content creators generate content they upload to our service, but some creators may upload content that infringes the terms and rights of third parties or violates our terms of use. If we should fail to qualify for statutory or other legal protections that immunize us from monetary damages for intellectual property infringement, the damages could be significant and have a material impact on our business. While we have implemented measures designed to limit our exposure to claims of intellectual property infringement, intellectual property owners may allege that we failed to take appropriate measures to prevent infringing activities on our systems, that we turned a blind eye to infringement, or that we facilitated, induced or contributed to infringement.
A number of entities who are members of the National Music Publishers Association, or NMPA, have threatened litigation against us where they alleged that we engaged in copyright infringement by having used certain musical compositions owned or controlled by them on our Lomotif platform without necessary licenses. We vigorously dispute and have disputed claims of infringement by such publishers but could be subject to additional claims in the future. An adverse judgment against us in any such lawsuit could require us to settle any claims for an undetermined amount which could have a material impact on our business, financial condition, or results of operations.
We may also be required to enter into license agreements with various licensors, including record labels, music publishers, performing rights organizations, and collective management organizations, to obtain licenses that authorize the storage and use of content uploaded by our users. We may not be able to develop technological solutions to comply with these laws on economically reasonable terms and there is no guarantee that we will be able to enter into agreements with all relevant rights holders on terms that we deem reasonable. Compliance may therefore negatively impact our financial prospects.
We are increasingly dependent on information technology, and potential cyberattacks, security problems, or other disruption and expanding social media vehicles present new risks.
We rely on information technology networks and systems, including the internet, to process, transmit, and store electronic information, and to manage or support a variety of business processes, including financial transactions and records, billing, and operating data. We may purchase some of our information technology from vendors, on whom our systems will depend, and we rely on commercially available systems, software, tools, and monitoring to provide security for processing, transmission, and storage of confidential operator and other customer information. We depend upon the secure transmission of this information over public networks. Our networks and storage applications could be subject to unauthorized access by hackers or others through cyberattacks, which are rapidly evolving and becoming increasingly sophisticated, or by other means, or may be breached due to operator error, malfeasance or other system disruptions. In fact, in June 2022, the Company was a victim of an email spoofing attack where the intruder was able to obtain access to the Company’s email system and send emails internally that had fake invoices that were presented and appeared to be approved for payment in accordance with the Company’s standard wire approval process. As a result of this email intrusion, the Company incorrectly wired funds to two vendors in error in the aggregate of $4,010,000. Fortunately, the fraudulent wires were detected quickly, and the Company was able to recover approximately 95% of the fraudulently wired funds. In some cases, it will be difficult to anticipate or immediately detect such incidents and the damage they cause. Any significant breakdown, invasion, destruction, interruption, or leakage of information from our systems could harm our reputation and business.
55
Hostile takeover attempt and subsequent litigation.
Prior to filing of this second quarter report, which was submitted within the agreed upon compliance plan agree to with Nasdaq, but substantially delayed, the Company was engaged in litigation in Q3 due to a hostile takeover attempt by a newly appointed independent director. The disruption to the Company due to a drastic and immediate departure for the Company business plan, which resulted in SEC filings that were substantially inaccurate, along with the subsequent litigation, which ultimately resulted in the departure of the independent board members along with senior management, was a significant risk factor for the Company and will continue to be so moving forward. Further detail will be provided in our third quarter filing along with our annual filing.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Recent Sales of Unregistered Securities; Uses of Proceeds from Registered Securities
~~In connection with the foregoing, the Company relied upon the exemptions from registration provided by Rule 701 and Section 4(a)(2) under the Securities Exchange Act of 1933, as amended:~~
~~Issuance of common stock – Year ended December 31, 2021~~
58
~~On April 7, 2021, the Company issued 150,000 shares of common stock valued at $382,500 for consulting services as per the Consulting Agreements entered into on March 31, 2021.~~
~~On April 7, 2021, the Company issued 525,541 shares of common stock valued at $924,952 to an employee as per the terms of an employment agreement.~~
~~On April 7, 2021, the Company issued 475,541 shares of common stock valued at $836,794 to an employee as per the terms of an employment agreement.~~
~~On April 7, 2021, the Company issued 597,273 shares of common stock valued at $1,051,200 to an employee as per the terms of an employment agreement.~~
~~On May 19, 2021, the Company issued 501,250 shares of common stock to a noteholder in satisfaction of $1,000,000 principal and $2,500 in accrued interest.~~
~~During May and June 2021, the Company issued a total of 13,070,000 shares of common stock valued at $26,140,000 upon exercise of a warrant.~~
~~On June 7, 2021, the Company issued a total of 10,000 shares of common stock valued at $44,100 as compensation for inventor advisory services for Edison Nation, LLC.~~
~~On June 7, 2021, the Company issued 384,000 shares of common stock valued at $768,000 upon exercise of a warrant.~~
~~On June 9, 2021, the Company issued 1,930,000 shares of common stock valued at $3,860,000 upon exercise of a warrant.~~
~~On June 9, 2021, the Company issued 1,200,000 shares of common stock valued at $4,466,400 upon exercise of a warrant.~~
~~On June 9, 2021, the Company issued a total of 150,000 shares of common stock valued at $382,500 for consulting services.~~
On June 9, 2021, the Company issued a total of 63,577 shares of common stock valued at $151,987 for the conversion of debt assumed as per the terms of the Asset Contribution Agreement with Emmersive Entertainment, Inc.
~~On June 9, 2021, the Company issued 10,000 shares of common stock valued at $20,000 upon exercise of a warrant.~~
~~On June 9, 2021, the Company issued 1,500,000 shares of common stock valued at $3,300,000 upon exercise of a warrant.~~
~~On June 10, 2021, the Company issued 3,000,000 shares of common stock valued at $11,166,000 upon exercise of a warrant.~~
~~On June 11, 2021, the Company issued 3,500,000 shares of common stock valued at $13,027,000 upon exercise of a warrant.~~
~~On June 11, 2021, the Company issued 100,000 shares of common stock valued at $246,000 for consulting services.~~
~~On June 15, 2021, the Company issued 2,368,188 shares of common stock valued at $8,814,396 upon exercise of a warrant.~~
~~On June 15, 2021, the Company issued 2,868,188 shares of common stock valued at $10,675,396 upon exercise of a warrant.~~
~~On June 16, 2021, the Company issued 1,000,000 shares of common stock valued at $3,722,000 upon exercise of a warrant.~~
~~On June 18, 2021, the Company issued 1,400,000 shares of common stock valued at $5,210,800 upon exercise of a warrant.~~
~~On June 21, 2021, the Company issued 1,000,000 shares of common stock valued at $3,722,000 upon exercise of a warrant.~~
~~On June 30, 2021, the Company issued a total of 41,272 shares of common stock valued at $127,943 for consulting services.~~
~~Use of Proceeds~~
~~None.~~
59
~~ITEM 3. DEFAULTS UPON SENIOR SECURITIES~~
None.

ITEM ~~4. MINE SAFETY DISCLOSURES~~3. DEFAULTS UPON SENIOR SECURITIES
~~Not Applicable.~~
~~ITEM 5. OTHER INFORMATION~~
None.

ITEM 4. MINE SAFETY DISCLOSURES
Not Applicable.
ITEM 5. OTHER INFORMATION
ITEM 6. EXHIBITS

Exhibit
Incorporated By Reference to
Filed
Number Description Form Exhibit Filing Date Herewith

3.1 Articles of Merger, filed with the Secretary of State of Nevada effective September 7, 2018 8-K 3.1 September 12, 2018
3.2 Second Amended and Restated Bylaws of Edison Nation, Inc. 8-K 3.2 September 12, 2018
3.3 Second Amended and Restated Articles of Incorporation of Edison Nation, Inc. 8-K 3.1 March 26, 2020
10.5+ Amended and Restated Edison Nation, Inc. Omnibus Incentive Plan 8-K 3.3 September 12, 2018
10.21 10% Senior Secured Note with 32 Entertainment LLC, dated December 4, 2019 S-1 10.26 February 12, 2020
10.22 Common Stock Purchase Warrant with 32 Entertainment LLC, dated December 4, 2019 S-1 10.27 February 12, 2020
Exhibit Incorporated By Reference to Filed
Number Description Form Exhibit Filing Date Herewith
31.1 Chief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
31.2 Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
32.1 Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **

60101.INS* Inline XBRL Instance Document *
101.SCH* Inline XBRL Taxonomy Extension Schema Document *
101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document *
101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document *
101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document *
101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document *
104* Cover Page Interactive Data File (embedded within the Inline XBRL document) *
Exhibit
Incorporated By Reference to
Filed
Number Description Form Exhibit Filing Date Herewith
10.23 Registration Rights Agreement with 32 Entertainment LLC, dated December 4, 2019 S-1 10.28 February 12, 2020
10.24 Loan Agreement with Tiburon Opportunity Fund, dated January 2, 2020 S-1 10.29 February 12, 2020
10.25 5% Note Agreement with Equity Trust Company, Custodian FBO: Rawleigh H. Ralls, dated January 10, 2020 S-1 10.30 February 12, 2020
10.26 Common Stock Purchase Warrant with Equity Trust Company, Custodian FBO: Rawleigh H. Ralls, dated January 10, 2020 S-1 10.31 February 12, 2020
10.27 5% Note Agreement with Paul J. Solit and Julie B. Solit, dated January 15, 2020 S-1 10.32 February 12, 2020
10.28 Common Stock Purchase Warrant with Paul J. Solit and Julie B. Solit, dated January 15, 2020 S-1 10.33 February 12, 2020
10.29 5% Note Agreement with Richard O’Leary, dated January 17, 2020 S-1 10.34 February 12, 2020
10.30 Common Stock Purchase Warrant with Richard O’Leary, dated January 15, 2020 S-1 10.35 February 12, 2020
10.31 Loan Agreement with Greentree Financial Group, Inc., dated January 23, 2020 8-K 10.1 January 29, 2020
10.32 10% Convertible Promissory Note with Greentree Financial Group, Inc., dated January 23, 2020 8-K 10.2 January 29, 2020
10.33 Common Stock Purchase Warrant with Greentree Financial Group, Inc., dated January 23, 2020 8-K 10.3 January 29, 2020
10.34 Amendment Agreement with Greentree Financial Group, Inc., dated January 29, 2020 8-K 10.4 January 29, 2020
10.35 Asset Purchase Agreement between HMNRTH, LLC, TCBM Holdings, LLC and Edison Nation, Inc. and Scalematix, LLC dated March 11, 2020 8-K 10.1 March 12, 2020
10.36 Securities Purchase Agreement between Edison Nation, Inc. and Jefferson Street Capital, LLC dated April 7, 2020 8-K 10.3 April 27, 2020
10.37 Convertible Promissory Note between Edison Nation, Inc. and Jefferson Street Capital, LLC dated April 7, 2020 8-K 10.4 April 27, 2020
10.38 Securities Purchase Agreement between Edison Nation, Inc. and BHP Capital NY Inc. dated April 7, 2020 8-K 10.1 April 27, 2020
10.39 Convertible Promissory Note between Edison Nation, Inc. and BHP Capital NY Inc dated April 7, 2020 8-K 10.2 April 27, 2020
10.40 Promissory Note Small Business Administration-Paycheck Protection Program dated April 15, 2020 8-K 10.8 April 27, 2020
10.41 Consulting Agreement between Edison Nation, Inc. and Tiburon dated April 24, 2020 8-K 10.5 April 27, 2020
10.42 Debt Conversion Agreement between Edison Nation, Inc. and Tiburon Opportunity Fund dated April 24, 2020 8-K 10.6 April 27, 2020
10.43 Distributor Agreement between Edison Nation Holdings, LLC and Marrone Bio Innovations, Inc. dated May 13, 2020 10-K
10.45

May 29, 2020

10.44 Secured Line of Credit Agreement between Global Solutions, LLC, Edison Nation, Inc. and PPE Brickell Supplies, LLC dated May 20, 2020 8-K 10.1 May 26, 2020
10.45 Security Agreement between Global Solutions, LLC, Edison Nation, Inc. and PPE Brickell Supplies, LLC dated May 20, 2020 8-K 10.2 May 26, 2020
10.46 Agreement and Plan of Share Exchange Agreement between Edison Nation, Inc. PPE Brickell Supplies, LLC and Graphene Holdings, LLC dated May 20, 2020 8-K 10.3 May 26, 2020
10.47 Amended Limited Liability Company Agreement of Global Clean Solutions, LLC dated May 20, 2020 8-K 10.4 May 26, 2020
10.48 Purchase of Inventory and Repurchase Agreement between Edison Nation, Inc. and Fergco Bros, LLC dated May 7, 2020 10-K 10.50 May 29, 2020
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Exhibit
Incorporated By Reference to
Filed
Number Description Form Exhibit Filing Date Herewith
10.49 Amendment to Purchase of Inventory and Repurchase Agreement between Edison Nation, Inc. and Fergco Bros, LLC dated May 15, 2020 10-K 10.51 May 29, 2020
10.50 Amendment to Senior Secured Note between Edison Nation, Inc. and 32 Entertainment, LLC dated May 19, 2020 10-K
10.52
May 29, 2020
10.51 Amended Subordinate Secured Note between Edison Nation, Inc and 32 Entertainment, LLC dated May 19, 2020 10-K 10.53 May 29, 2020
10.52 Agreement for the Purchase and Sale of Common Stock of Cloud B, Inc. dated February 17, 2020 8-K 10.1 February 21, 2020
10.53 Amendment to Note Agreement and Common Stock Purchase Warrant between Edison Nation, Inc. and Richard O’Leary dated July 10, 2020 S-1 10.55 July 16, 2020
10.54 Amendment to Note Agreement and Common Stock Purchase Warrant between Edison Nation, Inc. and Equity Trust Company, a Custodian FBO: Rawleigh H. Ralls IRA dated July 10, 2020 S-1 10.56 July 16, 2020
10.55 Amendment to Note Agreement and Common Stock Purchase Warrant between Edison Nation, Inc. and Paul J. Solit and Julie B. Solit dated July 10, 2020 S-1 10.57 July 16, 2020
10.56 Convertible Promissory Note between Edison Nation, Inc. and Jefferson Street Capital, LLC dated July 29, 2020 10-Q 10.30 August 18, 2020
10.57 Memorandum of Understanding between the Global Clean Solutions, LLC, Office Mart, Inc. and ZAAZ Medical, Inc. dated June 8, 2020 10-Q 10.31 August 18, 2020
10.58 Amendment to Memorandum of Understanding dated August 6, 2020 10-Q 10.32 August 18, 2020
10.59 Forbearance Agreement between the Company and Jefferson Street Capital, LLC dated October 7, 2020 10-Q 10.33 November 23, 2020
10.60 Asset Purchase Agreement between Honey Badger Media, LLC and Honey Badger, LLC dated November 10, 2020 8-K 10.1 November 12, 2020
10.61 Platform License Agreement between Honey Badger Media, LLC and Honey Badger Media, LLC dated November 10, 2020 8-K 10.2 November 12, 2020
10.62 Inventory Management Agreement between Edison Nation, LLC and Forever 8 Fund, LLC dated November 17, 2020 10-Q 10.36 November 23, 2020
10.63 Stock Exchange Agreement dated between Jupiter Wellness, Inc, SRM Entertainment, Ltd and Vinco Ventures, Inc. dated November 30, 2020 8-K 1.1 December 3, 2020
10.64 Agreement to Complete a Plan of Merger between Vinco Ventures, Inc., Vinco Acquisition Corporation and ZASH Global Media and Entertainment Corporation dated January 20, 2021 8-K 10.1 January 21, 2021
10.65 Contribution Agreement by and among ZVV Media Partners, LLC, Vinco Ventures, Inc. and Zash Global Media and Entertainment Corporation dated January 19, 2021 8-K 10.1 January 21, 2021
10.66 Senior Convertible Note between Vinco Ventures, Inc. and Hudson Bay Master Fund, Ltd dated January 25, 2021 8-K 4.1 January 25, 2021
10.67 Securities Purchase Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund, Ltd dated January 25, 2021 8-K 10.1 January 25, 2021
10.68 Common Stock Purchase Warrant Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund, Ltd dated January 25, 2021 8-K 10.2 January 25, 2021
10.69 Registration Rights Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund, Ltd dated January 25, 2021 8-K 10.3 January 25, 2021
10.70 Securities Purchase Agreement between Vinco Ventures, Inc. and BHP Capital NY Inc. dated January 29, 20201 8-K 10.1 February 4, 2021
62
Exhibit
Incorporated By Reference to
Filed
Number Description Form Exhibit Filing Date Herewith
10.71 Common Stock Purchase Warrant Agreement between Vinco Ventures, Inc. and BHP Capital NY Inc. dated January 29, 2021 8-K 10.2 February 4, 2021
10.72 Registration Rights Agreement between Vinco Ventures, Inc. and BHP Capital NY Inc. dated January 29, 2021 8-K 10.3 February 4, 2021
10.73+ Employment Agreement between Vinco Ventures, Inc. and Christopher Ferguson dated February 2, 2021 8-K 10.1 February 8, 2021
10.74+ Employment Agreement between Vinco Ventures, Inc. and Brett Vroman dated February 2, 2021 8-K
10.2
February 8, 2021
10.75+ Employment Agreement between Vinco Ventures, Inc. and Brian McFadden dated February 2, 2021 8-K 10.3 February 8, 2021
10.76 Form of Senior Convertible Note 8-K 4.1 February 23, 2021
10.77 Form of Securities Purchase Agreement 8-K 10.1 February 23, 2021
10.78 Form of Warrant 8-K 10.2 February 23, 2021
10.79 Form of Registration Rights Agreement 8-K 10.3 February 23, 2021
10.80 Placement Agent Agreement 8-K 10.4 February 23, 2021
10.81 Common Stock Purchase Warrant Agreement between Vinco Ventures, Inc. and Palladium Holdings, LLC dated February 23, 2021 S-1 10.81 April 30, 2021
10.82 Amended and Restated Asset Purchase Agreement between CBAV1, LLC and BTL Diffusion SARL 10-K 10.81 April 15, 2021
10.83 First Amendment to Agreement to Complete a Plan of Merger, dated March 30, 2021, by and among Vinco Ventures, Inc., Vinco Acquisition Corporation and ZASH Global Media and Entertainment Corporation 8-K 10.1 April 9, 2021
10.84 Asset Contribution Agreement among Emmersive Entertainment, Inc. (“Seller”), Seller’s Shareholders, EVNT Platform, LLC (“Buyer”) a wholly owned subsidiary of Vinco Ventures, Inc. and Vinco Ventures, Inc. (“Buyer’s Owner”), dated as of April 17, 2021. 8-K 2.1 April 21, 2021
10.85 First Amended and Restated Operating Agreement for EVNT Platform, LLC among Vinco Ventures, Inc., its sole common member, and certain preferred members, dated as of April 17, 2021. 8-K 2.2 April 21, 2021
10.86 Promissory Note between Zash Global Media and Entertainment Corporation and Vinco Ventures, Inc. dated February 18, 2021 10-Q 10.86 May 24, 2021
10.87 Warrant Exercise Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund Ltd dated May 24, 2021 8-K 10.1 May 25, 2021
10.88 Common Stock Purchase Warrant Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund Ltd dated May 24, 2021 8-K 10.2 May 25, 2021
10.89 Registration Rights Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund Ltd dated May 24, 2021 8-K 10.3 May 25, 2021
10.90 Second Amendment to Agreement to Complete a Plan of Merger dated May 28, 2021 8-K 10.1 May 28, 2021
10.91 Warrant Exercise Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund Ltd dated June 4, 2021 8-K 10.1 June 7, 2021
10.92 Common Stock Purchase Warrant Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund Ltd dated June 4, 2021 8-K 10.2 June 7, 2021
10.93 Registration Rights Agreement between Vinco Ventures, Inc. and Hudson Bay Master Fund Ltd dated June 4, 2021 8-K 10.3 June 7, 2021
10.94 Convertible Note Subscription Agreement dated June 4, 2021 8-K 10.1 June 10, 2021
10.95 Form of Senior Secured Convertible Note 8-K 4.1 July 23, 2021
10.96 Form of Securities Purchase Agreement 8-K 10.1 July 23, 2021
10.97 Form of Warrant 8-K 10.2 July 23, 2021
10.98 Form of Registration Rights Agreement 8-K 10.3 July 23, 2021
10.99 Form of Amendment Agreement 8-K 10.4 July 23, 2021
10.100 Form of Guaranty 8-K 10.5 July 23, 2021
10.101 Form of Pledge and Security Agreement 8-K 10.6 July 23, 2021
10.102 Second Amended and Restated Limited Liability Company Agreement of ZVV Media Partners, LLC 8-K
10.7
July 23, 2021
10.103 Securities Purchase Agreement between ZASH Global Media and Entertainment Corporation and Lomotif Private Limited
8-K

10.1

July 29, 2021

10.104 Deed of Variation and Supplement among ZASH Global Media and Entertainment Corporation, Lomotif Private Limited and ZVV Media Partners, LLC
8-K
10.2
July 29, 2021

10.105 Securities Purchase Agreement between Vinco Ventures, Inc. and the purchaser identified on the signature page thereto dated July 23, 2021
8-K

10.3
July 29, 2021
10.106 Form of Warrant dated July 23, 2021 8-K 10.4 July 29, 2021
10.107 Registration Rights Agreement dated July 23, 2021 8-K 10.5 July 29, 2021
10.108 Warrant Exercise Agreement between the Company and the Investor 8-K 10.1 August 19, 2021
10.109 Form of Warrant August Series A Warrant 8-K 10.2 August 19, 2021
10.110 Form of Warrant August Series B Warrant 8-K 10.3 August 19, 2021
10.111 Form of Registration Rights Agreement 8-K 10.4 August 19, 2021
21.1 List of Significant Subsidiaries S-1 21.1 February 12, 2020
31.1 Chief Executive Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
31.2 Chief Financial Officer Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 *
32.1 Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 **

101.INS* Inline XBRL Instance Document *
101.SCH* Inline XBRL Taxonomy Extension Schema Document *
101.CAL* Inline XBRL Taxonomy Extension Calculation Linkbase Document *
101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document *
101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document *
101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document *
104*
Cover Page Interactive Data File (embedded within the Inline XBRL document)
*

* Filed herewith.
** Furnished herewith.
6356

SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: ~~August 23, 2021~~February 21, 2023

VINCO VENTURES, INC.

By: /s/ ~~Christopher B. Ferguson~~Roderick Vanderbilt
~~Christopher B. Ferguson~~Roderick Vanderbilt
~~Chairman and Chief~~ Executive ~~Officer~~Chairman
(Principal Executive Officer)

6457

	June 30, 2021			December 31, 2020
		(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	74,756,573		$	249,356
Accounts receivable, net		2,907,002			1,382,163
Short-term investments		895,600			1,018,000
Inventory		852,147			1,127,725
Prepaid expenses and other current assets		1,209,435			522,259
Current assets of discontinued operations		-			1,042,680
Total current assets		80,620,757			5,342,183
Property and equipment, net		1,033,810			1,010,801
Right of use assets, net		104,707			153,034
Loan receivable		5,000,000			-
Equity method investment		12,000,000			-
Intangible assets, net		16,533,373			9,798,813
Goodwill		5,983,852			5,983,852
Non-current assets of discontinued operations		-			5,739,524
Total assets	$	121,276,499		$	28,028,207

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	1,791,982		$	3,618,339
Accrued expenses and other current liabilities		1,284,168			2,101,610
Deferred revenues		131,578			152,040
Current portion of operating leases liabilities		99,293			96,777
Income tax payable		27,643			27,643
Line of credit, net of debt issuance costs of $0 and $15,573, respectively		1,133,652			1,500,953
Current portion of convertible notes payable, net of debt issuance costs of $6,666,667 and $0, respectively		3,333,333			577,260
Current portion of notes payable, net of debt issuance costs of $0 and $212,848, respectively		15,185			1,301,212
Current portion of notes payable – related parties		876,500			1,389,923
Due to related party		15,401			32,452
Current liabilities of discontinued operations		120,729			487,454
Total current liabilities		8,829,464			11,285,663
Operating leases liabilities –net of current portion		8,483			58,713
Convertible notes payable – related parties, net of current portion, net of debt discount of $172,984 and $366,666, respectively		267,183			1,161,495
Notes payable, net of current portion		19,966			595,879
Notes payable – related parties, net of current portion		-			1,403,756
Warrant liability		139,695,115			-
Total liabilities	$	148,820,211		$	14,505,506
Commitments and Contingencies (Note 12)		-			-

Stockholders’ equity
Preferred stock, $0.001 par value, 30,000,000 shares authorized as of June 30, 2021 and December 31, 2020, respectively	$	-		$	-
Series B Preferred Stock, $0.001 par value, 1,000,000 shares authorized; 0 and 764,618 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively		-			765
Preferred stock., value		-			-
Common stock, $0.001 par value, 250,000,000 shares authorized 59,927,241 and 14,471,403 shares issued and outstanding as of June 30, 2021 and December 31, 2020, respectively		59,927			14,471
Additional paid-in-capital		244,026,879			39,050,260
Accumulated deficit		(269,787,198	)		(23,648,898	)
Total stockholders’ (deficit) equity attributable to Vinco Ventures, Inc.		(25,700,392	)		15,416,598
Noncontrolling interests		(1,843,320	)		(1,893,897	)
Total stockholders’ equity		(27,543,712	)		13,522,701
Total liabilities and stockholders’ equity	$	121,276,499		$	28,028,207


	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2021 (Unaudited)			2020 (Unaudited)			2021 (Unaudited)			2020 (Unaudited)
Revenues, net	$	2,691,811		$	5,173,982		$	5,256,973		$	7,127,328
Cost of revenues		1,721,189			4,004,936			3,374,570			5,368,655
Gross profit		970,622			1,169,046			1,882,403			1,758,673

Operating expenses:
Selling, general and administrative		5,941,652			2,377,853			17,602,532			5,567,516
Operating loss		(4,971,030	)		(1,208,807	)		(15,720,129	)		(3,808,843	)

Other (expense) income:
Rental income		28,703			25,703			54,407			51,407
Interest expense		(2,715,481	)		(847,154	)		(15,410,414	)		(1,571,111	)
Loss on issuance of warrants		(133,699,181	)		-			(208,855,715	)		-
Change in fair value of warrant liability		(37,154,989	)		-			(773,447	)		-
Change in fair value of short-term investment		(52,000	)		-			(122,000	)		-
Loss on disposal of interest in joint venture		(301,645	)		-			(301,645	)		-
Gain on divestiture		-			-			-			-
Total other (expense) income		(173,894,593	)		(821,451	)		(225,408,814	)		(1,519,704	)
Loss before income taxes		(178,865,623	)		(2,030,258	)		(241,128,943	)		(5,328,547	)
Income tax expense		-			-			-			-
Net loss from continuing operations	$	(178,865,623	)	$	(2,030,258	)	$	(241,128,943	)	$	(5,328,547	)
Net income (loss) attributable to noncontrolling interests		22,543			22,241			50,577			22,241
Net loss from continuing operations attributable to Vinco Ventures, Inc.		(178,888,166	)		(2,052,499	)		(241,179,520	)		(5,350,788	)
Net loss from discontinued operations		(4,780,580	)		428,119			(4,958,780	)		4,995,900
Provision for income taxes for discontinued operations		-			-			-			-
Net loss attributable to Vinco Ventures, Inc.	$	(183,668,746	)	$	(1,624,380	)	$	(246,138,300	)	$	(354,888	)
Net loss per share:
Net (loss) income per share - basic	$	(5.13	)	$	(0.18	)	$	(8.95	)	$	(0.04	)
Net (loss) income per share - diluted	$	(5.13	)	$	(0.18	)	$	(8.95	)	$	(0.04	)
Weighted average number of common shares outstanding – basic and diluted		35,831,466			8,920,554			27,489,580			8,551,012


														Retained
	Preferred Stock						Common Stock				Additional Paid in			Earnings Accumulated			Non- controlling			Total Stockholders’
	Shares			Amount			Share		Amount		Capital			(Deficit)			Interest			Equity

Balance, January 1, 2021		764,618		$	765			14,471,403	$	14,471	$	39,050,260		$	(23,648,898	)	$	(1,893,897	)	$	13,522,701
Sale of common stock – investors		-			-			1,500,000		1,500		3,253,500			-			-			3,255,000
Issuance of common stock - note holders		-			-			303,483		304		422,368			-			-			422,672
Issuance of common stock - consultants		-			-			1,394,272		1,394		2,034,941			-			-			2,036,335
Issuance of common stock - employees		-			-			2,861,227		2,861		3,289,329			-			-			3,292,190
Issuance of common stock upon exercise of warrants		-			-			31,742,986		31,743		87,753,676			-			-			87,785,419
Offering costs -exercise of warrants		-			-			-		-		(7,379,064	)		-			-			(7,379,064	)
Issuance of common stock for acquisition		-			-			750,000		750		1,251,750			-			-			1,252,500
Share-based compensation		-			-			-		-		5,053,704			-			-			5,053,704
Conversion under notes payable		-			-			6,139,252		6,139		12,242,368			-			-			12,248,507
Exercise of warrant liabilities		-			-			-		-		89,654,047			-			-			89,654,047
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition		-			-			-		-		7,400,000			-			-			7,400,000
Conversion of preferred stock to common		(764,618	)		(765	)		764,619		765		-			-			-			-
Net (loss) income		-			-			-		-		-			(246,138,300	)		50,577			(246,087,723	)
Balance, June 30, 2021		-			-			59,927,242	$	59,927	$	244,026,879		$	(269,787,198	)	$	(1,843,320	)	$	(27,543,712	)

Balance, January 1, 2022		-			-			150,118,024	$	150,118	$	850,096,635		$	(736,821,840	)	$	20,262,129		$	133,687,042
Issuance of common stock – note holders		-			-			1,000,000		1,000		2,189,000			-			-			2,190,000
Issuance of common stock - consultants		-			-			40,000		40		102,523			-			-			102,563
Warrants exercised, net of offering costs		-			-			81,982,969		81,983		100,954,855			-			-			101,036,838
Share-based compensation		-			-			-		-		-			-			2,081,764			2,081,764
Exercise of warrant liabilities		-			-			-		-		227,949,858			-			-			227,949,858
Write off of investments		-			-			-		-		-			-			927,875			927,875
Investment in Magnifi U		-			-			-		-		-			-			(301,256	)		(301,256	)
Common stock issued by Cryptyde, Inc.		-			-			-		-		-			12,001,000			-			12,001,000
Spin-off of Cryptyde, Inc.		-			-			-		-		-			(11,936,218	)		299,608			(11,636,610	)
Net loss		-			-			-		-		-			(227,019,793	)		(18,690,055	)		(245,709,849	)
Net (loss) loss		-			-			-		-		-			(227,019,793	)		(18,690,055	)		(245,709,849	)
Balance, June 30, 2022		-		$	-			233,140,993	$	233,141	$	1,181,292,871		$	(963,776,852	)	$	4,580,064		$	222,329,225


	For the six months ended June 30, 2021 and 2020:
	Preferred stock						Common Stock						Additional Paid-in			Accumulated			Noncontrolling			Total Stockholders’
	Shares			Amount			Shares			Amount			Capital			Deficit			Interest			Equity

Balance, January 1, 2021		764,618			765			14,471,403		$	14,471		$	39,050,260		$	(23,648,898	)	$	(1,893,897	)	$	13,522,701
Issuance of common stock to noteholders		-			-			303,483			304			422,368			-			-			422,672
Returned common stock from note holder
Returned common stock from note holder, shares
Issuance of common stock to investors		-			-			1,500,000			1,500			3,253,500			-			-			3,255,000
Offering costs
Issuance of common stock to noteholders
Issuance of common stock for divestiture, shares
Returned common stock from noteholder
Returned common stock from noteholder, shares
Issuance of common stock to consultants		-			-			1,394,272			1,394			2,034,941			-			-			2,036,335
Issuance of warrants to noteholders and beneficial conversion option
Issuance of common stock to employees		-			-			2,861,227			2,861			3,289,329			-			-			3,292,190
Issuance of common stock upon exercise of warrants		-			-			31,742,986			31,743			87,753,676			-			-			87,785,419
Offering costs – exercise of warrants		-			-			-			-			(7,379,064	)		-			-			(7,379,064	)
Conversion under notes payable		-			-			6,139,252			6,139			12,242,368			-			-			12,248,507
Exercise of warrant liabilities		-			-			-			-			89,654,047			-			-			89,654,047
Stock-based compensation								-			-			5,053,704			-			-			5,053,704
Issuance of common stock acquisitions		-			-			750,000			750			1,251,750			-			-			1,252,500
Conversion of preferred stock to common		(764,618	)		(765	)		764,618			765			-			-			-			-
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition		-			-			-			-			7,400,000			-			-			7,400,000
Issuance of common stock for Global Clean Solutions, LLC acquisition
Issuance of common stock for Global Clean Solutions, LLC acquisition, shares
Divestiture of Cloud B
Common stock reserved for future issuance to Emmersive sellers
Distributions
Net income		-			-			-			-			-			(246,138,300	)		50,577			(246,087,723	)
Balance, June 30, 2021 (Unaudited)		-		$	-			59,927,241		$	59,927		$	244,026,879		$	(269,787,198	)	$	(1,843,320	)	$	(27,543,712	)

Balance, January 1, 2020		-			-			8,015,756		$	8,016		$	26,259,576		$	(18,495,462	)	$	(317,698	)	$	7,454,432
Issuance of common stock to note holders		-			-			439,400			439			789,575			-			-			790,014
Returned common stock from noteholder		-			-			(153,005	)		(153	)		153			-			-			-
Issuance of common stock to consultants		-			-			866,250			866			561,896			-			-			562,762
Issuance of warrants to noteholders and beneficial conversion option		-			-			-			-			1,018,953			-			-			1,018,953
Divestiture of Cloud B		-			-			-			-			-			-			(26,392	)		(26,392	)
Issuance of common stock for divestiture		-			-			150,000			150			404,850			-			-			405,000
Stock-based compensation		-			-			-			-			1,068,380			-			-			1,068,380
Issuance of common stock for Global Clean Solutions, LLC acquisition		0			-			300,000			300			698,700			-			-			699,000
Distributions		-			-			-			-			-			-			(699,000	)		(699,000	)
Net (loss) income		-			-			-			-			-			(354,888	)		22,241			(332,647	)
Balance, June 30, 2020 (Unaudited)		-		$	-			9,618,401		$	9,618		$	30,802,083		$	(18,850,350	)	$	(1,020,849	)	$	10,940,502

	For the three months ended June 30, 2021 and 2020:
	Preferred stock						Common Stock				Additional Paid-in			Accumulated			Noncontrolling			Total Stockholders’
	Shares			Amount			Shares		Amount		Capital			Deficit			Interest			Equity

Balance, March 31, 2021 (Unaudited)		764,618			765			25,685,981	$	25,686	$	66,002,229		$	(86,118,452	)	$	(1,865,863	)	$	(21,955,635	)
Issuance of common stock to consultants		-			-			451,272		451		(451	)		-			-			-
Issuance of common stock to employees		-			-			1,598,355		1,598		(1,598	)		-			-			-
Issuance of common stock upon exercise of warrants		-			-			30,862,188		30,862		86,063,953			-			-			86,094,815
Offering costs – exercise of warrants		-			-			-		-		(7,379,064	)		-			-			(7,379,064	)
Conversions under notes payable		-			-			564,827		565		1,153,922			-			-			1,154,487
Conversion of preferred stock into common stock		(764,618	)		(765	)		764,618		765		-			-			-			-
Exercise of warrant liabilities		-			-			-		-		89,394,620			-			-			89,394,620
Stock-based compensation		-			-			-		-		1,393,268			-			-			1,393,268
Shares reserved for future issuance of common stock as consideration for the Emmersive asset acquisition		-			-			-		-		7,400,000			-			-			7,400,000
Net income (loss)		-			-			-		-		-			(183,668,746	)		22,543			(183,646,203	)
Balance, June 30, 2021 (Unaudited)		-		$	-			59,927,241	$	59,927	$	244,026,879		$	(269,787,198	)	$	(1,843,320	)	$	(27,543,712	)

Balance, March 31, 2020 (Unaudited)		-		$	-			8,676,501	$	8,677	$	28,790,704		$	(17,225,970	)	$	(344,090	)	$	11,229,321
Issuance of common stock to note holders		-			-			279,400		279		588,411			-			-			588,690
Issuance of common stock for divestiture		-			-			150,00		150		404,850			-			-			405,000
Issuance of common stock to consultants		-			-			212,500		212		(212	)		-			-			-
Stock-based compensation		-			-			-		-		319,630			-			-			319,630
Issuance of common stock for Global Clean Solutions, LLC acquisition		-			-			300,000		300		698,700			-			-			699,000
Distributions		-			-			-		-		-			-			(699,000	)		(699,000	)
Net (loss) income		-			-			-		-		-			(1,624,380	)		22,241			(1,602,139	)
Balance, June 30, 2020 (Unaudited)		-			-			9,618,401		9,618		30,802,083			(18,850,350	)		(1,020,849	)		10,940,502

	2021 (Unaudited)			2020 (Unaudited)
	Six Months Ended June 30,
	2021 (Unaudited)			2020 (Unaudited)
Cash Flow from Operating Activities
Net loss from continuing operations attributable to Vinco Ventures, Inc.	$	(241,179,520	)	$	(5,350,788	)
Net income attributable to noncontrolling interests		50,577			22,241
Net loss from continuing operations		(241,128,943	)		(5,328,547	)
Adjustments to reconcile net (income) loss to net cash used in operating activities:
Discontinued operations		(4,958,780	)		4,995,900
Depreciation and amortization		1,081,623			612,406
Amortization of financing costs		15,597,936			1,227,046
Stock-based compensation		10,003,767			1,588,427
Amortization of right of use asset		48,327			153,820
Gain on debt extinguishment		(852,352	)		-
Loss on disposal of discontinued operations		4,130,580			(4,911,760	)
Change in fair value of short-term investments		122,400			-
Loss on issuance of warrants		208,855,715			-
Change in fair value of warrant liability		773,447			-
Changes in assets and liabilities:
Accounts receivable		(1,596,881	)		(978,097	)
Inventory		169,793			178,227
Prepaid expenses and other current assets		(378,831	)		(967,109	)
Accounts payable		(819,943	)		(344,847	)
Accrued expenses and other current liabilities		(775,082	)		1,425,622
Operating lease liabilities		(47,714	)		(148,518	)
Due from related party		(17,050	)		9,532
Net cash used in operating activities		(9,791,988	)		(2,487,898	)

Cash Flows from Investing Activities
Purchase of property and equipment		(88,633	)		(61,917	)
Cash received from sale of assets of CBAV 1, LLC		2,529,564			-
Equity method investment		(12,000,000	)		-
Funding of loan receivable		(5,000,000	)		-
Net cash used in investing activities		(14,559,069	)		(61,917	)

Cash Flows from Financing Activities
(Repayments) borrowings under line of credit		(379,333	)		1,678,540
Borrowings under convertible notes payable		19,720,000			1,436,000
Borrowings under notes payable		73,000			1,767,352
Repayments under notes payable		(2,145,475	)		(824,472	)
Repayments under notes payable- related parties		(1,951,012	)		(14,508	)
Fees paid for financing costs		(120,261	)		(143,479	)
Net proceeds from issuance of common stock		3,255,000			-
Net proceeds from exercise of warrants		80,406,355			-
Net cash provided by financing activities		98,858,274			3,899,433
Net increase (decrease) in cash and cash equivalents		74,507,217			1,349,618
Cash and cash equivalents - beginning of period		249,356			412,719
Cash and cash equivalents - end of period	$	74,756,573			1,762,337

Supplemental Disclosures of Cash Flow Information
Cash paid during the period for:
Interest	$	858,388		$	144,740
Income taxes	$	(14,738	)	$	235,725
Noncash investing and financing activity:
Shares issued to note holders	$	422,672		$	-
Conversions under notes payable	$	12,248,507		$	424,000
Issuance of warrants to note holders	$	208,855,715		$	-
Shares reserved for EVNT, LLC	$	7,400,000		$	-


		For the Six Months Ended June 30,
		2022			2021
Cash Flow from Operating Activities
Net loss attributable to Vinco Ventures, Inc.		$	(223,758,881	)	$	(241,367,534	)
Net (loss) income attributable to noncontrolling interest			(18,690,055	)		50,577
Net income (loss)			(242,448,937	)		(241,316,957	)
Adjustments to reconcile net loss to net cash used in operating activities:
Discontinued operations			(3,260,912	)		(4,770,766	)
Amortization of financing costs			36,873,397			15,597,936
Share-based compensation			2,184,327			10,003,767
Depreciation and amortization			4,974,199			1,081,623
Amortization of right of use asset			35,604			48,327
Change in fair value of short-term investment			33,000			122,400
Loss on disposal of discontinued operations			-			4,130,580
Gain on debt extinguishment			-			(852,352	)
Loss on issuance of warrants			243,681,478			208,855,715
Change in fair value of warrant liability			(86,110,179	)		773,447
Inventory write-off			(365,001	)		-
Write off of investments and Impairment Expense			2,100,045			-
Equity method investment - Income share of Mind Tank LLC			(293,926	)		-
Change in fair value of deferred acquisition			(12,170,000	)		-

Changes in assets and liabilities:	��
Accounts receivable			(674,375	)		(1,596,881	)
Inventory			(1,234,422	)		169,793
Prepaid expenses and other assets			993,247			(378,831	)
Accounts payable			(3,366,760	)		(819,943	)
Related party, net			(862,501	)		(17,050	)
Accrued expenses and other liabilities			(12,053,808	)		(775,082	)
Operating lease liabilities			(35,303	)		(47,714	)

Net Cash Used in Operating Activities			(72,000,827	)		(9,791,988	)

Cash Flows from Investing Activities
Issuance of loans held-for-investment-related parties			(6,290,000	)		-
Repayments of loans held-for-investment-related parties			1,048,750			-
Issuance of loans held-for-investment			(500,000	)		-
Purchases of property and equipment			(544,653	)		(88,633	)
Cash received from sale of assets of CBAV 1, LLC			-			2,529,564
Equity method investment			-			(12,000,000	)
Funding of loan receivable			-			(5,000,000	)
Consolidation of Magnifi U (VIE)			1,752,935			-
Acquisition of business, net of cash acquired			(34,850,577	)		-
Net Cash Used in Investing Activities			(39,383,544	)		(14,559,069	)

Cash Flows from Financing Activities
Net repayments under line of credit			-			(379,333	)
Net (repayments) borrowings under convertible notes payable			-			19,720,000
Net (repayments) borrowings under notes payable			(165,530	)		(2,072,475	)
Net (repayments) borrowings under notes payable - related parties			37,833			(1,951,012	)
Fees paid for financing costs			-			(120,261	)
Net proceeds from exercise of warrants			101,036,839			80,406,355
Net proceeds from issuance of common stock			-			3,255,000
Common stock issued by Cryptyde, Inc.			12,001,000			-
Cash paid with Cryptyde, Inc. spinoff			(9,921,084	)		-
Net Cash Provided by Financing Activities			102,989,059			98,858,274

Net Increase (Decrease) in Cash and Cash Equivalents and Restricted Cash			(8,395,313	)		74,507,217
Cash and Cash Equivalents and Restricted Cash - Beginning of Period			187,612,176			249,356
Cash and Cash Equivalents and Restricted Cash - End of Period		$	179,216,863		$	74,756,573

Supplemental Disclosures of Cash Flow Information:
Cash paid during the year for:
Interest		$	414,297		$	858,388
Income taxes		$	-		$	(14,738	)
Noncash investing and financing activity:
Issuance of warrants to note holders		$	243,681,478		$	208,855,715
Deferred acquisition purchase price		$	11,080,000		$	-
Shares issued to note holders		$	2,190,000		$	422,672
Conversions under notes payable		$	-		$	12,248,507
Shares reserved for EVNT, LLC		$	-		$	7,400,000
Asset acquisition of Love is Blurred, LLC - Repayment of held-for-investment-related parties		$	1,048,750		$	-
Consolidation of Magnifi U (VIE), net of cash		$	(2,054,191	)	$	-
Acquisition of business, net of cash acquired		$	64,272,070		$	-


	AdRizer
Cash paid	$	37,936,323
Fair value of deferred acquisition price		23,250,000
Purchase consideration	$	61,186,323


	AdRizer
Cash and cash equivalents	$	3,085,747
Accounts receivable		5,564,539
Other current assets		847,273
Property and equipment		191,654
Investment in Mind Tank, LLC		2,800,000
Customer relationships		8,800,000
Developed technology		28,000,000
Trade Name		2,200,000
Goodwill		17,039,788
Total assets acquired		68,529,001

Accounts payable and accrued expenses		7,342,678
Total liabilities assumed		7,342,678
	$	61,186,323

	2021		2020		2021		2020
	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2021		2020		2021		2020
Revenues:
Product sales	$	2,626,689	$	5,123,067	$	5,114,558	$	7,036,204
Service		-		-		-		-
Licensing		65,122		50,915		142,415		91,124
Total revenues, net	$	2,691,811	$	5,173,982	$	5,256,973	$	7,127,328

	Fair Value Measurements as of June 30, 2021
	Level 1		Level 2		Level 3

Assets:
Short-term investments	$	895,600	$	-	$	-

Liabilities:
Warrant liability		-		-		139,695,115
Total		895,600		-		139,695,115

	Fair Value Measurements as of December 31, 2021
	Level 1		Level 2		Level 3

Assets:
Short-term investments	$	1,018,000	$	-	$	-

Liabilities:
Warrant liability		-		-		-
Total		1,018,000		-		-

	Warrant Liability (Level 3)
Balance, December 31, 2020	$	-
Issuance of warrants		228,575,715
Change in fair value		773,447
Exercise of warrants		(89,654,047	)
Balance, June 30, 2021	$	139,695,115

	June 30,		June 30,
	2021		2020
Selling Agent Warrants		-		160,492
Shares reserved in exchange for the cancellation of certain non-voting membership interest in Edison Nation Holdings, LLC		-		990,000
Shares reserved in exchange for the cancellation of certain non-voting membership interest in EVNT, LLC		1,000,000		-
Placement Agent Warrants		4,911,692		-
Options		80,000		80,000
Convertible shares under notes payable		2,700,587		999,536
Warrants for noteholders		45,491,829		750,000
Warrants for investors		1,500,000		-
Restricted stock units		-		270,000
Series B Convertible Stock		-		-
Shares to be issued		-		46,500
Total	$	55,684,108	$	3,296,528

	~~June 30, 2021~~
~~Cash received from buyer~~		~~2,529,565~~

~~Accounts receivable~~Revenue	$	~~(293,005~~17,940,338	)
~~Inventory~~Net income	$	(~~665,522~~1,533,041	)
~~Prepaid expenses~~		~~(160,666~~	)
~~Intangible assets~~		~~(5,540,952~~	)
~~Loss on divestiture~~		~~4,130,580~~
~~Operating loss of discontinued operations~~		~~178,200~~
~~Bankruptcy costs~~		~~650,000~~
~~Loss on discontinued operations~~		~~4,958,780~~


	For the Three Months Ended June 30,					For the Six Months Ended June 30,
	2022 (Unaudited)		2021 (Unaudited)			2022 (Unaudited)			2021 (Unaudited)
Revenues, net	$	6,607,748	$	10,361,492		$	21,340,746		$	22,128,846
Net loss attributable to Vinco Ventures, Inc.	$	145,816,018	$	(178,799,924	)	$	(227,149,675	)	$	(241,174,878	)

	February 17, 2020
Accounts payable		4,005,605
Accrued Expenses		370,289
Income Tax Payable		14,473
Notes Payable		900,000
Non-Controlling Interest		26,393
Shares to be issued to Buyer		(405,000	)
Gain on divestiture	$	4,911,760

	June 30, 2021		December 31, 2020

Assets
Current assets:
Cash and cash equivalents	$	3,845	$	10,481
Accounts receivable, net		-		94,195
Inventory		-		240,158
Prepaid expenses and other current assets		-		-
Total current assets		3,845		344,834
Property and equipment, net		-		-
Total assets	$	3,845	$	344,834

Liabilities and stockholders’ equity
Current liabilities:
Accounts payable	$	29,164	$	217,558
Accrued expenses and other current liabilities		43,473		113,576
Line of credit, net of debt issuance costs of $0 and $15,573, respectively		1,133,652		1,133,652
Notes payable, current		-		150,000
Due to related party		315,666		315,666
Total current liabilities		1,521,955		1,930,452

	June 30,			December 31,
	2021			2020
Jupiter Wellness, Inc. (JUPW) ⁽ⁱ⁾	$	1,040,000		$	1,040,000
Unrealized losses		(144,400	)		(22,000	)
Total short-term investments	$	895,600		$	1,018,000

For the Years Ended December 31,	Amount
2021 (excluding the six months ended June 30, 2021)		2,017,659
2022		10,015,530
2023		434,386
2024		-
2025		-
Thereafter		-
Long-term Debt, Gross		12,467,575
Less: debt discount		(6,821,756	)
Long-term Debt	$	5,645,819

	Warrant Shares		Exercise Price
Hudson Bay Warrant; January 25, 2021		15,000,000	$	2.000
Palladium Capital Warrant; January 25, 2021		480,000	$	2.000
BHP Capital NY Warrant; January 28, 2021		1,500,000	$	2.200
Hudson Bay Warrant; February 23, 2021		18,568,188	$	3.722
Palladium Capital Warrant; February 23, 2021		1,650,346	$	3.722
Hudson Bay Warrant; May 24, 2021		13,070,000	$	3.200
Palladium Capital Warrant; May 24, 2021		1,200,000	$	3.200
BHP Capital Warrant; June 4, 2021		1,500,000	$	3.200
Hudson Bay Warrant; June 4, 2021		27,821,829	$	3.300
Palladium Capital Warrant; June 4, 2021		2,071,346	$	3.300

	Dividend Yield			Expected Volatility			Risk-free Interest Rate			Expected Life
Hudson Bay Warrant; January 25, 2021		0.00	%		109.95	%		0.13	%		2.5 years
Palladium Capital Warrant; January 25, 2021		0.00	%		109.95	%		0.13	%		2.5 years
BHP Capital NY Warrant; January 28, 2021		0.00	%		110.00	%		0.12	%		2.5 years
Hudson Bay Warrant; February 23, 2021		0.00	%		110.94	%		0.11	%		2.5 years
Palladium Capital Warrant; February 23, 2021		0.00	%		110.94	%		0.11	%		2.5 years
Hudson Bay Warrant; May 24, 2021		0.00	%		115.38	%		0.14	%		2.5 years
Palladium Capital Warrant; May 24, 2021		0.00	%		115.38	%		0.14	%		2.5 years
BHP Capital Warrant; June 4, 2021		0.00	%		117.11	%		0.16	%		2.5 years
Hudson Bay Warrant; June 4, 2021		0.00	%		117.14	%		0.16	%		2.5 years
Palladium Capital Warrant; June 4, 2021		0.00	%		117.14	%		0.16	%

	Shares		Weighted Average Exercise Price		Remaining Contractual Life in Years		Aggregate Intrinsic Value
Balance, December 31, 2020		80,000	$	7.01		3.2		-
Granted		-		-		-		-
Balance, June 30, 2021		80,000	$	7.01		2.9		-
Exercisable, June 30, 2021		80,000	$	7.01		2.9		-

	April 17, 2021

Fair value of shares reserved for future issuance and earn out shares	$	7,400,000
Fair value of assumed notes payable		151,987
Total	$	7,551,987

	April 21, 2021
Cash received from buyer	$	2,529,565

Accounts receivable		(293,005	)
Inventory		(665,522	)
Prepaid expenses		(160,666	)
Intangible assets		(5,540,952	)
Loss on divestiture		4,130,580
Operating loss of discontinued operations		178,200
Bankruptcy costs		803,320
Loss on discontinued operations	$	5,112,100

	June 29, 2022		December 31, 2021

Assets
Current assets:
Cash	$	9,921,084	$	911,194
Accounts receivable, net		1,092,406		867,027
Inventory		2,075,089		110,664
Prepaid expenses and other current assets		3,247,154		3,359,716
Total current assets		16,335,733		5,248,600
Loan receivable, related party		3,950,053		4,000,000
Loan Interest Receivable, related party		133,187		-
Fixed assets, net		1,193,133		1,007,770
Total Assets	$	21,612,105	$	10,256,371

Liabilities and Stockholders’ Equity
Current liabilities:
Current liabilities	$	3,178,590	$	7,285,429
Total Current Liabilities		3,178,590		7,285,429
Other liabilities:
Due company (former parent), net	$	6,750,130	$	27,644
Other liabilities		46,775		46,775
Net assets of spin-off / discontinued operations:
Net assets of spin-off / discontinued operations	$	11,636,610	$	2,896,522

	June 29, 2022

Cash distributed	$	9,921,084
Other assets distributed		11,691,022
Liabilities distributed		(9,975,495	)

Net assets distributed	$	11,636,610

	June 30, 2022			December 31, 2021
Jupiter Wellness,Inc. (JUPW)	$	1,040,000		$	1,040,000
Unrealized losses		(895,000	)		(862,000	)
Total short-term investments	$	145,000		$	178,000

	June 30, 2022			December 31, 2021
Software	$	147,792		$	147,792
Furniture and fixtures		188,559			280,926
Computers		118,351			7,003
Leasehold improvements		432,363			800,746
Equipment		248,743			5,358,997
Construction in progress		184,543			-
Property, plant and equipment,gross		1,320,352			6,595,465
Less: accumulated depreciation		(559,360	)		(5,218,714	)
Total property and equipment, net	$	760,992		$	368,981

	June 30, 2022		December 31, 2021
Loans held-for-investment:
Carlin Haynes, LLC ⁽ⁱ⁾	$	750,000	$	250,000
Total loans held-for-investment	$	750,000	$	250,000