Letter agreement, dated May 12, 2021 between the Company and Joseph Cannata

Exhibit 10.1

AGREEMENT

This Agreement (this “Agreement”) is entered into as of May 12, 2021 (the “Effective Date”) by MusclePharm Corporation, a Nevada corporation (the “Company”), and Joseph Cannata, a California resident (“Service Provider”). The Company and the Service Provider are referred to in this Agreement individually as a “party” and collectively as the “parties.”

Recitals

WHEREAS, The Company is, among other things, in the business of developing and selling athletic performance powders, capsules, tablets and gels;

WHEREAS, In connection with the Company’s strategy to grow sales of its MP Energy drinks and other beverage products (collectively, the “Products”), the Company desires to engage the Service Provider upon the terms and subject to the conditions in this Agreement; and

WHEREAS, The Service Provider desires to provide such services to the Company upon the terms and subject to the conditions in this Agreement.

NOW, THEREFORE, the parties hereby agree as follows:

Notwithstanding the foregoing, if a Sale of the Company is consummated after the achievement of the event set forth in Section 2.3.1 and prior to the second anniversary of the Effective Date, vesting of the Second Tranche Grant shall accelerate effective and conditioned upon the consummation of the Sale of the Company. “Sale of the Company” shall mean (i) a merger, tender offer, consolidation or other similar transaction resulting in the sale of the Company to an unaffiliated third party in which the holders of the Company’s outstanding common stock immediately prior to such transaction do not hold a majority of the common stock of the combined entity immediately following such transaction, or (ii) the sale of all or substantially all of the Company’s assets to an unaffiliated third party. Sales of stock by Ryan Drexler in one or more transactions in the open market or in which all stockholders do not have the right to participate shall not constitute a Sale of the Company.

[Signature page follows]

IN WITNESS WHEREOF, the parties execute this Agreement as of the Effective Date.

Schedule A

Excluded Channels

Exhibit 1

Option Agreement

(attached)

MUSCLEPHARM CORPORATION

This STOCK OPTION AGREEMENT (this “Agreement”) dated as of May 12, 2021, is entered into by and between MusclePharm Corp., a Nevada corporation (the “Company”), and Joseph Cannata, a California resident (the “Grantee”).

This Agreement incorporates by reference the Transaction Agreement, dated May 12, 2021 by and between the Company and the Grantee, a copy of which is attached in Appendix A (the “Transaction Agreement”). Capitalized terms that are not defined in this Agreement shall have the same meaning as defined in the Transaction Agreement.

(a) Stock Option Grant. Subject to the terms and conditions provided in this Agreement, the Company hereby grants to the Grantee, on the Effective Date, an option (the “Stock Option”) to purchase up to 1,673,994Shares of the Company’s common stock, par value $0.001 (the “Common Stock”). As used in this Agreement, a “Share” shall mean a share of Common Stock. The Stock Options are free standing stock options and therefore not granted under an equity plan, and are non-statutory options (that is, an option that is not intended to qualify as an incentive stock option as defined in Section 422 of the Internal Revenue Code of 1986, as amended). The Stock Option is granted to the Grantee in respect of the Grantee’s Service. As used in this Agreement, “Service” shall mean the services that Grantee provides to the Company or any subsidiary in a capacity as a consultant, advisor or independent contractor.

(b) Exercise Price. The exercise price per Share for the Stock Options is $1.12 (the “Exercise Price”), which shall be the closing bid price of a Share on the Effective Date.

(a) Vesting. The term “vest” as used herein with respect to the Stock Option or any portion thereof means to become exercisable and the term “vested” with respect to the Stock Option (or any portion thereof) means that the Stock Option (or portion thereof) is then exercisable. Unless earlier terminated, forfeited, relinquished, or expired, the Stock Option will vest as follows, subject to the term of the Transaction Agreement (the “Term”) being in effect from the Effective Date through such vesting date; provided, however, this Agreement and the Stock Options granted hereunder will terminate no later than on the 10th anniversary of the Effective Date and will not vest thereafter. The vesting of the Grantee’s rights and interest in the Stock Options shall be determined in accordance with this Section 3.

(i) First Tranche Vesting. 836,997 Shares issuable pursuant to the Stock Option (the “First Tranche Grant”) shall be exercisable from and after the achievement of the following milestones:

(A) Net Revenue solely from distributors and Retailers, excluding (1) the channels listed on Schedule A and (2) sales originated by Company personnel from distributors and Retailers, shall equal or exceed $12.5 million for any consecutive twelve (12) month period following the Effective Date; and

(B) Net Revenue solely from distributors and Retailers, excluding (1) the channels listed on Schedule A and (2) sales originated by Company personnel from distributors and Retailers, shall be $12.5 million for the twelve (12) months subsequent to the period in Section 3(a)(i)(A).

(ii) Second Tranche Vesting. 836,997 additional Shares issuable pursuant to the Stock Option (the “Second Tranche Grant”) shall be exercisable from and after the achievement of the following milestones:

(A) Net Revenue from all sources shall equal or exceed $25.0 million for any consecutive twelve (12) month period following the Effective Date; and

(B) Net Revenue from all sources shall be $25.0 million for the twelve (12) months subsequent to the period in Section 3(a)(ii)(A).

(C) Notwithstanding the foregoing, if a Sale of the Company is consummated after the achievement of the event set forth in Section 3(a)(ii)(A) and prior to the second anniversary of the Effective Date, vesting of the Second Tranche Grant shall accelerate effective and conditioned upon the consummation of the Sale of the Company.

(iii) Additional Vesting Conditions. Notwithstanding anything to the contrary herein, vesting of the Stock Options (both the First Tranche Grant and the Second Tranche Grant) shall be subject to the following: if, after the first anniversary of the Effective Date and prior to the achievement of the milestones set forth in Sections 3(a)(i) and 3(a)(ii), the Company enters into a binding agreement for a Sale of the Company that provides for total net consideration payable on the closing date of the transaction of at least $100.0 million, the Stock Option shall not be exercisable and, in lieu of the ability to exercise any portion of the Stock Option, the Company shall make a one-time payment to the Grantee as and subject to the applicable terms set forth in the Transaction Agreement.

(iv) Exercise of the Stock Option.

(A) No portion of the Stock Option may be exercised until such portion vests. Each election to exercise any vested portion of the Stock Option will be pursuant to the terms of this Agreement and must be in written or electronic form acceptable to the Company, signed (including by electronic signature) by the Grantee or, if at the relevant time the Stock Option has passed to a permitted transferee, the permitted transferee. Each such written or electronic exercise election must be received by the Company at its principal office and be accompanied by payment in full.

(B) The Stock Option shall not be exercisable and shall terminate upon the earliest of any of the following events occurring, prior to the achievement of the milestones set forth in Sections 3(a)(i) and 3(a)(ii): (A) this Agreement is terminated pursuant to Section 3(a)(iv)(C), (B) the Term ends, or (C) except as provided in Section 3(a)(ii)(C), the Company enters into a binding agreement for the Sale of the Company.

(C) Notwithstanding anything to the contrary in this Agreement, in no event shall the Stock Option be exercisable beyond the Term. If this Stock Option is not exercised by the Term, the Stock Option or any remaining portion thereof will thereupon immediately terminate.

(b) Cessation of Service. Automatically and immediately upon the Term of the Transaction Agreement ceasing to be in effect (the “Termination of Services”), the Stock Option, to the extent not already vested, will terminate and be forfeited for no consideration, and the vested portion of the Stock Option that is then outstanding will be treated as follows:

(i) Subject to clause (ii) below, the Stock Option, to the extent vested immediately prior to the Termination of Services, will remain exercisable until the expiration of the Term.

(ii) The Stock Option (whether or not vested) will immediately terminate and be forfeited immediately prior to the Termination of Services if such termination is for Cause. As used in this Agreement, “Cause” shall mean any event or occurrence that is a termination for cause under the Transaction Agreement.

Payment of the Exercise Price shall be by any of the following, or a combination thereof, at the election of the Grantee: (a) cash; (b) check; (c) with Shares owned by the Grantee, or the withholding of Shares that otherwise would be delivered to the Grantee as a result of the exercise of the Stock Options; or (d) such other consideration or in such other manner as may be determined by the Board in its absolute discretion.

The Stock Options granted hereby are not transferable and shall be exercisable only by the Grantee. In addition, the Stock Options shall not be assigned, negotiated, pledged or hypothecated in any way (whether by operation of law or otherwise), and the Stock Options shall not be subject to execution, attachment or similar process. Upon any attempt to transfer, assign, negotiate, pledge or hypothecate the Stock Options, or in the event of any levy upon the Stock Options by reason of any execution, attachment or similar process contrary to the provisions hereof, the Option shall immediately become null and void. The terms of these Stock Options shall be binding upon the executors, administrators, successors and assigns of the Grantee.

Neither the Grantee nor any other person shall be, or shall have any of the rights and privileges of, a stockholder of the Company with respect to any shares purchasable or issuable upon the exercise of the Stock Options, in whole or in part, prior to the date on which the Shares are issued. Upon exercise of the Stock Options and payment of the Exercise Price, the Company shall issue to the Grantee the number of Shares so paid for, in the form of fully paid and nonassessable Common Stock.

The Grantee is responsible for satisfying and paying all taxes arising from or due in connection with the Option, its exercise or a disposition of Shares acquired upon exercise of the Option. The Company will have no liability or obligation related to the foregoing.

Neither the grant of the Stock Option, nor the issuance of Shares upon exercise of the Stock Option, will give the Grantee any right to be retained in the service of the Company or any of its subsidiaries, affect the right of the Company or any of its subsidiaries to discharge the Grantee at any time, or affect any right of the Grantee to terminate the Grantee’s Service at any time.

This Agreement shall be construed and enforced in accordance with the laws of the State of Nevada (excluding the choice of law provisions thereof).

This Agreement shall inure to the benefit of, and be binding upon, the Company and the Grantee and its legal representatives, successors and permitted assigns.

In the event that any one or more of the provisions or portion thereof contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, the same shall not invalidate or otherwise affect any other provisions of this Agreement, and this Agreement shall be construed as if the invalid, illegal or unenforceable provision or portion thereof had never been contained in this Agreement.

This Agreement, and the Transaction Agreement, express the entire understanding and agreement of the parties hereto with respect to such terms, restrictions and limitations.

Section headings used herein are for convenience of reference only and shall not be considered in construing this Agreement.

By their signatures below (including electronic signatures), the Grantee and the Company agree that the Stock Options are granted under and governed by the terms and conditions of this Agreement.

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The Company, by its duly authorized officer, and the Grantee have executed this Agreement as of the date first above written.

APPENDIX A

[TRANSACTION AGREEMENT]

Schedule A

Excluded Channels