GlassBridge Enterprises, Inc. (Form: 10-Q, Received: 11/08/2019 16:09:14)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

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

For the quarterly period ended September 30, 2019

[ ] 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: 1-14310

GLASSBRIDGE ENTERPRISES, INC.

(Exact name of registrant as specified in its charter)

Delaware		41-1838504
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

510 Madison Ave, 9^th Floor New York, New York		10022
(Address of principal executive offices)		(Zip Code)

(212) 825-0400

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

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

Title of Each Class		Trading Symbol(s)		Name of Each Exchange on Which Registered
None		None		None

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 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.[X] Yes [ ] 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). [X] 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 [X]

Smaller reporting
company [X]

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 [X] No

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date: 25,170 shares of Common Stock, par value $0.01 per share, were outstanding as of November 8, 2019.

GLASSBRIDGE ENTERPRISES, INC.

TABLE OF CONTENTS

	PAGE
PART I. FINANCIAL INFORMATION	3
ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)
Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2019 and 2018	3
Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2019 and 2018	4
Condensed Consolidated Balance Sheets as of September 30, 2019 and December 31, 2018	5
Condensed Consolidated Statements of Shareholders’ Equity (Deficit)	6
Condensed Consolidated Statements of Cash Flows for the Three Months and Nine Months Ended September 30, 2019 and 2018	7
Notes to Condensed Consolidated Financial Statements	8
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	22
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	29
ITEM 4. CONTROLS AND PROCEDURES	29
PART II. OTHER INFORMATION	30
ITEM 1. LEGAL PROCEEDINGS	30
ITEM 1A. RISK FACTORS	30
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	30
ITEM 3. DEFAULTS UPON SENIOR SECURITIES	30
ITEM 4. MINE SAFETY DISCLOSURES	30
ITEM 5. OTHER INFORMATION	30
ITEM 6. EXHIBITS	30
SIGNATURE	31
EX-31.1
EX-31.2
EX-32.1
EX-32.2

Table of Contents

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

GLASSBRIDGE ENTERPRISES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except for share and per share amounts)

(Unaudited)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2019			2018			2019			2018
Net revenue	$	—		$	—		$	0.1		$	—
Cost of goods sold		—			—			—			—
Gross profit		—			—			0.1			—
Operating expenses:
Selling, general and administrative		0.5			1.9			2.5			5.1
GBAM Fund expenses		—			0.1			—			0.3
Restructuring and other		—			—			0.1			0.1
Total operating expenses		0.5			2.0			2.6			5.5
Operating loss from continuing operations		(0.5	)		(2.0	)		(2.5	)		(5.5	)
Other income (expense):
Interest expense		—			—			—			(0.1	)
Net loss from GBAM Fund activities		—			(0.2	)		—			(0.7	)
Other income, net		—			0.1			—			0.4
Total other income (expense)		—			(0.1	)		—			(0.4	)
Loss from continuing operations before income taxes		(0.5	)		(2.1	)		(2.5	)		(5.9	)
Income tax benefit		—			—			—			—
Income (loss) from continuing operations		(0.5	)		(2.1	)		(2.5	)		(5.9	)
Discontinued Operations:
Income on sale of discontinued businesses, net of income taxes		—			6.1			10.5			6.1
Income from discontinued operations, net of income taxes		(0.2	)		2.9			0.3			3.7
Income from discontinued businesses, net of income taxes		(0.2	)		9.0			10.8			9.8
Net income (loss)	$	(0.7	)	$	6.9		$	8.3		$	3.9

Income (loss) per common share — basic and diluted:
Continuing operations	$	(19.86	)	$	(82.62	)	$	(99.44	)	$	(233.75	)
Discontinued operations		(7.95	)		354.08			421.67			388.26
Net income (loss)	$	(27.81	)	$	271.46		$	322.23		$	154.51

Weighted average common shares outstanding:
Basic and diluted (in thousands)		25.1			25.4			25.6			25.2

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

Table of Contents

GLASSBRIDGE ENTERPRISES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(In millions)

(Unaudited)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2019			2018		2019		2018
Net income (loss)	$	(0.7	)	$	6.9	$	8.3	$	3.9

Other comprehensive income, net of tax:

Net pension adjustments, net of tax:
Reclassification of adjustment for defined benefit plans recorded in net loss		—			0.1		0.1		0.3
Total net pension adjustments		—			0.1		0.1		0.3

Net foreign currency translation:
Unrealized foreign currency translation gains (losses)		—			0.9		—		0.7
Total net foreign currency translation		—			0.9		—		0.7

Total other comprehensive income, net of tax		—			1.0		0.1		1.0

Comprehensive income (loss)	$	(0.7	)	$	7.9	$	8.4	$	4.9

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

Table of Contents

GLASSBRIDGE ENTERPRISES, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions, except per share amounts)

	September 30, 2019			December 31,2018
	(unaudited)
Assets
Current assets:
Cash and cash equivalents	$	0.6		$	4.1
Accounts receivable		0.1			—
Other current assets		1.5			1.2
Current assets of discontinued operations		—			3.2
Total current assets		2.2			8.5
Other assets		6.0			6.1
Non-current assets of discontinued operations		—			0.4
Total assets	$	8.2		$	15.0
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	0.1		$	0.4
Other current liabilities		2.6			3.1
Current liabilities of discontinued operations		0.9			4.9
Total current liabilities		3.6			8.4
Other liabilities		15.2			23.7
Other liabilities of discontinued operations		0.2			2.2
Total liabilities		19.0			34.3
Shareholders’ deficit:
Preferred stock, $.01 par value, authorized 25 million shares, none issued and outstanding		—			—
Common stock, $.01 par value, authorized 50,000, 28,097 issued at September 30, 2019; 28,097 issued at December 31, 2018		0.1			0.1
Additional paid-in capital		1,049.2			1,048.9
Accumulated deficit		(1,014.6	)		(1,022.9	)
Accumulated other comprehensive loss		(20.6	)		(20.7	)
Treasury stock, at cost: 2,927 shares at September 30, 2019; 2,402 shares at December 31, 2018		(24.9	)		(24.7	)
Total GlassBridge Enterprises, Inc. shareholders’ deficit		(10.8	)		(19.3	)
Total liabilities and shareholders’ deficit	$	8.2		$	15.0

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

Table of Contents

GLASSBRIDGE ENTERPRISES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (DEFICIT)

(In millions)

(Unaudited)

	Common Stock				Additional Paid-in		Accumulated			Accumulated Other Comprehensive			Treasury Stock					Total Shareholders’ Equity
	Shares		Amount		Capital		Deficit			Loss			Shares		Amount			(Deficit)

Balance as of December 31, 2018		28,097	$	0.1	$	1,048.9	$	(1,022.9	)	$	(20.7	)		2,402	$	(24.7	)	$	(19.3	)
Net income								8.3											8.3
Pension adjustments, net of tax											0.1								0.1
Purchase of treasury stock														450		(0.0	)		(0.0	)
Restricted stock grants and other						0.2								75		(0.2	)		0.0
Rounding						0.1													0.1
Balance as of September 30, 2019		28,097	$	0.1	$	1,049.2	$	(1,014.6	)	$	(20.6	)		2,927	$	(24.9	)	$	(10.8	)

	Common Stock				Additional Paid-in			Accumulated			Accumulated Other Comprehensive			Treasury Stock						Non-controlling			Total Shareholders’ Equity
	Shares		Amount		Capital			Deficit			Loss			Shares			Amount			Interest			(Deficit)
	(In millions, except per share amounts)
Balance as of December 31, 2017		28,097	$	0.1	$	1,050.8		$	(1,027.5	)	$	(18.9	)		3,169		$	(26.6	)	$	(4.7	)	$	(26.8	)
Net loss									3.9												4.7			8.6
Purchase of treasury stock															69			0.0						0.0
Restricted stock grants and other						(1.9	)								(487	)		1.9						—
Net change in cumulative translation adjustment												0.7												0.7
Pension adjustments, net of tax												0.3												0.3
ASC 606 adjustment									0.3															0.3
Reclassification adjustment									0.1															0.1
Balance as of September 30, 2018		28,097	$	0.1	$	1,048.9		$	(1,023.2	)	$	(17.9	)		2,751		$	(24.7	)	$	—		$	(16.8	)

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

Table of Contents

GLASSBRIDGE ENTERPRISES, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

	Nine Months Ended
	September 30,
	2019			2018
Cash Flows from Operating Activities:
Net income (loss) attributable to GlassBridge	$	8.3		$	3.9
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		—			1.7
Stock-based compensation		—			(0.3	)
Pension settlement and curtailments		—			0.3
Gain on sale of assets		(9.9	)		(6.1	)
Short term investment		—			0.7
Other, net		(0.2	)		0.1
Changes in operating assets and liabilities		(2.7	)		(9.1	)
Net cash used in operating activities		(4.5	)		(8.8	)
Cash Flows from Investing Activities:
Investment in securities		(0.6	)		—
Capital expenditures		—			(0.2	)
Disbursement related to disposal group		(0.8	)		—
Proceeds from sale of disposal group		1.2			5.0
Net cash used in investing activities		(0.2	)		4.8
Cash Flows from Financing Activities:
Net cash provided by financing activities		—			—

Net change in cash and cash equivalents		(4.7	)		(4.0	)
Cash, cash equivalents and restricted cash — beginning of period		5.3			10.7
Cash, cash equivalents and restricted cash — end of period (a)	$	0.6		$	6.7

Supplemental disclosures of cash paid during the period:
Income taxes (net of refunds received)	$	—		$	0.2

(a) The following table provides a reconciliation of cash, cash equivalents and restricted cash to amounts reported within the condensed consolidated balance sheets
Current assets:
Cash and cash equivalents	$	0.6		$	5.3
Restricted cash included in other current assets		—			0.2
Non-current assets:
Restricted cash included in non-current assets of discontinued operations		—			0.4
Total cash, cash equivalents and restricted cash	$	0.6		$	5.9

Total cash, cash equivalents and restricted cash as of December 31, 2018 includes $4.1 million cash and cash equivalents, $0.8 million cash and cash equivalents included in current assets of discontinued operations and $0.4 million of restricted cash included in non-current assets of discontinued operations.

The accompanying Notes to Condensed Consolidated Financial Statements are an integral part of these statements.

Table of Contents

GLASSBRIDGE ENTERPRISES, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 — Basis of Presentation

GlassBridge Enterprises, Inc. (“GlassBridge”, the “Company”, “we”, “us” or “our”) is a holding company. We actively explore a diverse range of new, strategic asset management business opportunities for our portfolio. The company’s wholly-owned subsidiary GlassBridge Asset Management, LLC (“GBAM”) is an investment advisor focused on technology-driven quantitative strategies and other alternative investment strategies.

The interim Condensed Consolidated Financial Statements of GlassBridge are unaudited but, in the opinion of management, reflect all adjustments necessary for a fair statement of financial position, results of operations, comprehensive loss and cash flows for the periods presented. Except as otherwise disclosed herein, these adjustments consist of normal and recurring items. The results of operations for any interim period are not necessarily indicative of full year results. The Condensed Consolidated Financial Statements and Notes are presented in accordance with the requirements for Quarterly Reports on Form 10-Q and do not contain certain information included in our annual Consolidated Financial Statements and Notes presented in accordance with the requirements of Annual Reports on Form 10-K.

The unaudited Condensed Consolidated Financial Statements include the accounts of the Company, its wholly-owned subsidiaries, and entities in which the Company owns or controls fifty percent or more of the voting shares and has the right to control. The results of entities disposed of are included in the unaudited Condensed Consolidated Financial Statements up to the date of the disposal and, where appropriate, these operations have been reflected as discontinued operations. All inter-company balances and transactions have been eliminated in consolidation and, in the opinion of management, all normal recurring adjustments necessary for a fair presentation have been included in the interim results reported.

The preparation of the interim Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim Condensed Consolidated Financial Statements and the reported amounts of revenue and expenses for the reporting periods. Despite our intention to establish accurate estimates and use reasonable assumptions, actual results may differ from our estimates.

The December 31, 2018 Condensed Consolidated Balance Sheet data was derived from the audited Consolidated Financial Statements but does not include all disclosures required by GAAP. This Form 10-Q should be read in conjunction with our Consolidated Financial Statements and Notes included in our Annual Report on Form 10-K for the year ended December 31, 2018 as filed with the U.S. Securities and Exchange Commission on April 1, 2019.

The operating results of our legacy business segments, Consumer Storage and Accessories and Tiered Storage and Security Solutions (the “Legacy Businesses”) and the Nexsan Business (which includes the “Nexsan Group” as defined below), are presented in our Condensed Consolidated Statements of Operations as discontinued operations for all periods presented. Our continuing operations in each period presented represents our “Asset Management Business,” which consists of our investment advisory business conducted through GBAM, as well as corporate expenses and activities not directly attributable to our Legacy Businesses or the Nexsan Business. Assets and liabilities directly associated with our Legacy Businesses and Nexsan Business and that are not part of our ongoing operations have been separately presented on the face of our Condensed Consolidated Balance Sheet as of both September 30, 2019 and December 31, 2018. See Note 4 - Discontinued Operations for further information.

Sale of international subsidiaries and Imation Latin America Corp.

As previously disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) as of April 2, 2019, on March 31, 2019, the Company entered into a securities purchase agreement (the “IMN Capital Agreement”) with IMN Capital Holdings, Inc., a Delaware corporation (“IMN Capital”) whereby the Company sold its entire ownership of its international subsidiaries together with its entire ownership in Imation Latin America Corp., a Delaware corporation (the “Imation Subsidiaries”). As previously disclosed, certain subsidiaries of the Company, including the Imation Subsidiaries, are parties to certain lawsuits, claims, and other legal proceedings concerning claims and counterclaims relating to excess payments made by the Imation Subsidiaries relating to copyright levies in European Union (“EU”) member states (the “Subsidiary Litigation”). Pursuant to the terms and subject to the conditions of the IMN Capital Agreement, IMN Capital acquired from the Company the Company’s shares representing the Company’s ownership interests in each of the Imation Subsidiaries (the “Subsidiary Sale”). Following the Subsidiary Sale, the Imation Subsidiaries are no longer affiliates of the Company, and the Company has no interest in or to the Imation Subsidiaries except as explicitly described in the IMN Capital Agreement. In consideration for the Subsidiary Sale, the Company shall receive certain compensation from IMN Capital. As defined in the IMN Capital Agreement, a payment occurrence is the settlement or final adjudication as to all demands, claims, counter-claims, cross-claims, third-party claims, damages, fees, costs and expenses, brought and raised on any matters arising from or related to the Subsidiary Litigation (a “Payment Occurrence”). In connection with the Subsidiary Sale, the purchase price furnished by IMN Capital to the Company (the “Purchase Price”) shall consist of (i) $277,900 payable upon the execution of the IMN Capital Agreement and (ii) 75% of all net proceeds from Subsidiary Litigation (which, for the avoidance of doubt, shall be calculated after the payment of (i) the retirement of the Germany pension liability; (ii) contingency fees payable to attorneys engaged in connection with the Subsidiary Litigation; (iii) fees payable to Mach 5, the litigation financing company and (iv) the payment of all applicable taxes including income taxes in connection with the Subsidiary Litigation) (such payment, the “Contingent Payment”). The Company recorded a one-time non-cash gain of approximately $10 million in connection with IMN Capital Agreement transaction.

Table of Contents

Reverse Stock Split

As previously disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) as of August 22, 2019, on August 20, 2019, the Company effected a reverse split of our common stock, par value $0.01 per share at a ratio of 1:200 (the “Reverse Stock Split”). On August 21, 2019 (the “Effective Date”), our common stock began trading on the Reverse Stock Split-adjusted basis on the OTCQB at the opening of trading. In connection with the Reverse Stock Split, our common stock began trading with a new CUSIP number at such time. There was no change to the Company’s stock symbol. All prior periods have been retroactively adjusted to give effect to the reverse stock split. See Note 10 - Shareholders’ Equity for further information.

Liquidity and Management Plan

The Company incurred operating and cash flow losses for several reporting periods and had a working capital deficit of $1.4 million as of September 30, 2019. These losses raised substantial doubt about our ability to continue as a going concern. Although the working capital deficit is $1.4 million, it included $0.6 million of cash as of September 30, 2019, which in addition to proceeds of $17,562,700 from the Orix transaction on October 1, 2019, are expected to fund our operations for the next twelve months and beyond. See Note 14 – Subsequent Events for further information on the Orix transaction.

Table of Contents

Note 2 — New Accounting Pronouncements

Adoption of New Accounting Pronouncements

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU No. 2016-02 is effective for the Company beginning January 1, 2019, and does not have a material impact on its consolidated results of operations or financial condition.

In February 2018, the FASB issued ASU No. 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This ASU seeks to help entities reclassify certain stranded income tax effects in accumulated other comprehensive income resulting from the Tax Cuts and Jobs Act of 2017 (the “Tax Reform Act”), enacted on December 22, 2017. ASU 2018-02 was issued in response to concerns regarding current guidance in GAAP that requires deferred tax liabilities and assets to be adjusted for the effect of a change in tax laws or rates with the effect included in income from continuing operations in the reporting period that includes the enactment date, even in situations in which the related income tax effects of items in accumulated other comprehensive income were originally recognized in other comprehensive income, rather than net income, and as a result the stranded tax effects would not reflect the appropriate tax rate. The amendments of this ASU allow an entity to make a reclassification from accumulated other comprehensive income to retained earnings for the stranded tax effects, which is the difference between the historical corporate income tax rate of 35.0% and the newly enacted corporate income tax rate of 21.0%. The amendments in this ASU are effective for the Company beginning January 1, 2019, and do not have a material impact on its consolidated results of operations or financial condition.

In June 2018, the FASB issued ASU No. 2018-07, Improvements to Nonemployee Share-Based Payment Accounting, which largely aligns the measurement and classification guidance for share-based payments to nonemployees with the guidance for share-based payments to employees. The ASU also clarifies that any share-based payment issued to a customer should be evaluated under ASC 606, Revenue from Contracts with Customers. The ASU requires a modified retrospective transition approach. For the Company, the ASU is effective as of January 1, 2019 and does not have a material impact on its consolidated results of operations or financial condition.

In July 2018, the FASB issued ASU No. 2018-10, Codification Improvements to Topic 842, Leases, which amends ASU No. 2016-02, Leases. The new ASU includes certain clarifications to address potential narrow-scope implementation issues which the Company is incorporating into its assessment and adoption of ASU No. 2016-02. This ASU has the same transition requirements and effective date as ASU No. 2016-02, which for the Company is January 1, 2019. This standard does not have a material impact on the Company’s consolidated results of operations or financial condition.

In July 2018, the FASB issued ASU No. 2018-11, Leases (Topic 842): Targeted Improvements, which amends ASU No. 2016-02, Leases. The new ASU offers an additional transition method by which entities may elect not to recast the comparative periods presented in financial statements in the period of adoption and allows lessors to elect a practical expedient to not separate lease and nonlease components when certain conditions are met. This ASU has the same transition requirements and effective date as ASU No. 2016-02, which for the Company is January 1, 2019. This standard does not have a material impact on the Company’s consolidated results of operations or financial condition.

New Accounting Pronouncements To Be Adopted

In August 2018, the FASB issued ASU No. 2018-13, Changes to the Disclosure Requirements for Fair Value Measurement, which eliminates, amends, and adds disclosure requirements for fair value measurements. The amended and new disclosure requirements primarily relate to Level 3 fair value measurements. For the Company, the ASU is effective as of January 1, 2020. The removal and amendment of certain disclosures may be early adopted with retrospective application while the new disclosure requirements are to be applied prospectively. As this ASU relates only to disclosures, there will be no impact to the Company’s consolidated results of operations and financial condition.

In August 2018, the FASB issued ASU No. 2018-14, Changes to the Disclosure Requirements for Defined Benefit Plans, which makes minor changes to the disclosure requirements related to defined benefit pension and other postretirement plans. The ASU requires a retrospective transition approach. For the Company, the ASU is effective as of January 1, 2021. As this ASU relates only to disclosures, there will be no impact to the Company’s consolidated results of operations and financial condition.

Table of Contents

Note 3 — Income (Loss) per Common Share

Basic income (loss) per common share is calculated using the weighted average number of shares outstanding for the period. Unvested restricted stock and treasury shares are excluded from the calculation of basic weighted average number of common shares outstanding. Once restricted stock vests, it is included in our common shares outstanding.

Diluted income (loss) per common share is computed on the basis of the weighted average shares outstanding plus the dilutive effect of our stock-based compensation plans using the “treasury stock” method. Since the exercise price of our stock options is greater than the average market price of the Company’s common stock for the period, we did not include dilutive common equivalent shares for these instruments in the computation of diluted net income (loss) per share because the effect would have been anti-dilutive.

The following table sets forth the computation of the weighted average basic and diluted income (loss) per share:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(In millions, except for share and per share amounts)	2019			2018			2019			2018
Numerator:
Income (loss) from continuing operations	$	(0.5	)	$	(2.1	)	$	(2.5	)	$	(5.9	)
Income (loss) from discontinued operations, net of income taxes		(0.2	)		9.0			10.8			9.8
Net income (loss)	$	(0.7	)	$	6.9		$	8.3		$	3.9
Denominator:
Weighted average number of common shares outstanding during the period - basic and diluted (in thousands)		25.1			25.4			25.6			25.2

Income (loss) per common share— basic and diluted:
Continuing operations	$	(19.86	)	$	(82.62	)	$	(99.44	)	$	(233.75	)
Discontinued operations		(7.95	)		354.08			421.67			388.26
Net income (loss)	$	(27.81	)	$	271.46		$	322.23		$	154.51

Anti-dilutive shares excluded from calculation		0.0			0.0			0.0			0.0

Table of Contents

Note 4 — Discontinued Operations

On March 31, 2019, the Company entered into a securities purchase agreement with IMN Capital Holdings, Inc., a Delaware company (“IMN Capital”) to sell its entire ownership of its international subsidiaries and Imation Latin America Corp., a Delaware corporation (the “Imation Subsidiaries”) (the “Subsidiary Sale”). In connection with the sale, the purchase price furnished by IMN Capital to the Company consisted of (i) $277,900 payable upon the execution of the IMN Capital Agreement and (ii) 75% of all net proceeds from subsidiary litigation (which, for the avoidance of doubt, shall be calculated after the payment of (i) the retirement of the Germany pension liability; (ii) contingency fees payable to attorneys engaged in connection with the Subsidiary Litigation; (iii) fees payable to Mach 5, the litigation financing company and (iv) the payment of all applicable taxes including income taxes in connection with the subsidiary litigation). The Company recorded a one-time non-cash gain of approximately $10.0 million in connection with IMN Capital Agreement transaction.

The operating results for the Legacy Businesses and the Nexsan Business are presented in our Condensed Consolidated Statements of Operations as discontinued operations for all periods presented and reflect revenues and expenses that are directly attributable to these businesses that were eliminated from our ongoing operations.

The key components of the results of discontinued operations were as follows:

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(In millions)	2019			2018			2019			2018
Net revenue	$	—		$	5.1		$	0.1		$	23.9
Cost of goods sold		—			3.1			0.1			13.0
Gross profit		—			2.0			—			10.9
Selling, general and administrative		—			0.9			0.3			8.3
Research and development		—			0.5			—			2.4
Restructuring and other		0.2			(2.2	)		—			(2.5	)
Other (income) expense		—			—			(0.6	)		(0.8	)
Income (loss) from discontinued operations, before income taxes		(0.2	)		2.8			0.3			3.5
Income on sale of discontinued businesses, before income taxes		—			6.1			9.6			6.1
Income tax benefit		—			0.1			0.9			0.2
Gain (Loss) from discontinued operations, net of income taxes	$	(0.2	)	$	9.0		$	10.8		$	9.8

Net income of discontinued operations for the three months ended September 30, 2019 decreased by $9.2 million compared to the same period last year mainly due to the sale of the Imation Subsidiaries. Net income of discontinued operations for the nine months ended September 30, 2019 increased by $1.0 million compared to the same period last year mainly due to the sale of the Imation Subsidiaries.

Current assets of discontinued operations were $0.0 million as of September 30, 2019. Current assets of discontinued operations as of December 31, 2018 of $3.2 million included $0.7 million of accounts receivable, $1.0 million related to funds held in escrow and $0.7 million of other current assets. The decrease of the current assets in 2019 was due to the sale of the Imation Subsidiaries.

Current liabilities of discontinued operations were $0.9 million as of September 30, 2019. Current liabilities of discontinued operations of $4.9 million as of December 31, 2018 included $1.7 million of accounts payable, $1.0 million due to CMC and $2.2 million of other current liabilities. The decrease of the current liabilities in 2019 was due to the sale of the Imation Subsidiaries.

Other liabilities of discontinued operations were $0.2 million as of September 30, 2019. Other liabilities of discontinued operations of $2.2 million as of December 31, 2018 included $0.3 million of withholding tax and $1.1 million of other liabilities. The decrease of the other liabilities in 2019 was due to the sale of the Imation Subsidiaries.

Table of Contents

Note 5 — Supplemental Balance Sheet Information

Additional supplemental balance sheet information is provided as follows:

Other assets primarily included a $4.0 million strategic investment in equity securities. The strategic investment in equity securities is consistent with our stated strategy of exploring a diverse range of new strategic asset management business opportunities for our portfolio. Historically, we accounted for such investment under the cost method of accounting. The adoption of ASU No. 2016-01 in the first quarter of 2018 effectively eliminated the cost method of accounting and the carrying value of this investment is written down, or impaired, to fair value when a decline in value is considered to be other-than-temporary. Our strategic investment in equity securities does not have a readily determinable fair value therefore the new guidance was adopted prospectively. As of September 30, 2019, there were no indicators of impairment for this investment. The Company will assess the investment for potential impairment on a quarterly basis. In addition, other assets as of September 30, 2019 also include escrowed funds related to the NXSN transaction of $0.6 million and $0.2 million of other assets. For more information regarding the NXSN Transaction, please review the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission as of August 16, 2018.

Other current liabilities primarily included pension minimum contributions of $1.9 million and $1.9 million and accrued payroll of $0.0 million and $0.2 million as of September 30, 2019 and December 31, 2018, respectively.

Other liabilities included pension liabilities of $14.4 million and $23.0 million as of September 30, 2019 and December 31, 2018, respectively. The change in the pension liabilities was due to the Subsidiary Sale.

Note 6 — Restructuring and Other Expense

Restructuring and other expense was $0.0 million and $0.1 million for the three and nine months ended September 30, 2019, respectively. Restructuring and other expense was $0.0 million and $0.1 million for the three and nine months ended September 30, 2018, respectively.

Activity related restructuring accruals was as follows:

(In millions)	Severance and Related
Accrued balance at December 31, 2018	$	0.1
Charges		0.1
Usage and payments		(0.1	)
Accrued balance at March 31, 2019	$	0.1
Charges		0.0
Usage and payments		(0.0	)
Accrued balance at June 30, 2019	$	0.1
Charges		0.0
Usage and payments		(0.0	)
Accrued balance at September 30, 2019	$	0.1

Note 7 — Stock-Based Compensation

Stock-based compensation for continuing operations consisted of the following:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions)	2019		2018		2019		2018
Stock-based compensation expense	$	—	$	—	$	—	$	(0.3	)

We have stock-based compensation awards consisting of stock options, restricted stock and stock appreciation rights under four plans (collectively, the “Stock Plans”) which are described in detail in our Annual Report on Form 10-K for the year ended December 31, 2018. As of September 30, 2019, there were 315,251 shares available for grant under the 2011 Incentive Plan. No further shares were available for grant under any other stock incentive plan.

Table of Contents

Stock Options

The following table summarizes our stock option activity:

	Stock Options			Weighted Average Exercise Price
Outstanding December 31, 2018		113		$	16,734.00
Canceled		(113	)		16,734.00
Outstanding September 30, 2019		—		$	—
Exercisable as of September 30, 2019		—		$	—

The weighted average assumptions used in the valuation of options are not applicable for the periods ending September 30, 2019 and 2018 as no options were granted over this time.

As of September 30, 2019, there was no unrecognized compensation expense related to non-vested stock options granted under our Stock Plans.

Restricted Stock

The following table summarizes our restricted stock activity:

	Restricted Stock			Weighted Average Grant Date Fair Value Per Share
Nonvested as of December 31, 2018		150		$	1,406.00
Granted		—			—
Vested		(75	)		1,406.00
Forfeited		(75	)		1,406.00
Nonvested as of September 30, 2019		—		$	—

The cost of the awards is determined using the fair value of the Company’s common stock on the date of the grant, and compensation is recognized on a straight-line basis over the requisite vesting period.

As of September 30, 2019, the company did not have any unrecognized compensation expense related to non-vested restricted stock granted under our Stock Plans.

Note 8 — Retirement Plans

Pension Plans

Beginning in September 2018, the Company entered into discussions with the U.S. Pension Benefit Guaranty Corporation (the “PBGC”), a United States government agency established by Title IV of the Employee Retirement Income Security Act of 1974 (“ERISA”) which insures certain pension plans, for the purpose of obtaining certain relief from the Company’s obligations under the Plan. The Company and the PBGC entered into an agreement on May 13, 2019 to terminate the Imation Cash Balance Pension Plan (the “Plan”) based on the PBGC’s findings that (i) the Plan did not meet the minimum funding standard required under Section 412 of the Internal Revenue Code of 1986, as amended; (ii) the Plan would be unable to pay benefits when due and (iii) the Plan should be terminated in order to protect the interests of the Plan participants. GlassBridge and all other members of GlassBridge’s (as seller) controlled group (within the meaning of 29 U.S.C. §1301(a)(14)) (the “Controlled Group Members”) were jointly and severally liable to the PBGC for all liabilities under Title IV of ERISA in connection with the Plan’s termination, including unfunded benefit liabilities, due and unpaid Plan contributions, premiums, and interest on each of the foregoing, as a result of which a lien in favor of the Plan, on all property of each Controlled Group Member, arose and was perfected by PBGC. On October 1, 2019, the Company entered into a settlement agreement with the PBGC (the “Settlement Agreement”). Pursuant to the terms and subject to the conditions set forth in the Settlement Agreement, on October 3, 2019, GlassBridge paid $3,000,000 in cash to the PBGC, which was within five days of the date of the execution of the Settlement Agreement (the “Settlement Payment”). On the 95th day following payment of the Settlement Payment to the PBGC, the PBGC will be deemed to have released all Controlled Group Members from the PBGC’s lien (the “Release Date”).

The Company had one remaining international employee-eligible retirement plan in Germany (the “German Plan” and all international plans the “International Plans”). Following the Subsidiary Sale in the first quarter of 2019, the Company no longer has any obligations under the German Plan or any other prior International Plans.

Table of Contents

Note 9 — Income Taxes

For interim income tax reporting, we are required to estimate our annual effective tax rate and apply it to year-to-date pre-tax income/loss excluding unusual or infrequently occurring discrete items.

For the three months ended September 30, 2019, we recorded income tax from continuing operations of $0.0 million on a loss of $0.5 million. For the three months ended September 30, 2018, we recorded income tax of $0.0 million on a loss of $2.1 million. The effective income tax rate for the three months ended September 30, 2019 differs from the U.S. federal statutory rate of 21% primarily due to a valuation allowance on various deferred tax assets.

During July 2019, the Company received an income tax refund of approximately $1.1 million related to the Tax Reform Act’s elimination of corporate alternative minimum tax and the ability to receive refunds of AMT credit carryovers. Another $1.1 million is still receivable over a period of three years, in 2020 through 2022.

We accrue for the effects of uncertain tax positions and the related potential penalties and interest. Our historical liability was assumed by the buyer of the foreign entities in March 2019; there is no remaining liability as of September 30, 2019.

We file income tax returns in multiple jurisdictions which are subject to review by various U.S and state taxing authorities. Our U.S. federal income tax returns for 2016 through 2019, and certain state returns from 2013 to present, are open to examination.

Note 10 — Shareholders’ Equity

Reverse Stock Split

As previously disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) as of August 22, 2019, on August 20, 2019, the Company filed an Amendment (the “Amendment”) to the Restated Certificate of Incorporation, as amended, of the Company (the “Articles”) with the Secretary of State of the State of Delaware to: (i) effect the previously announced reverse split of our common stock, par value $0.01 per share at a ratio of 1:200 (the “Reverse Stock Split”) and (ii) effect an amendment allowing the stockholders of the Company to act by written consent in lieu of meeting, subject to certain limitations (the “Written Consent Amendment”).

On August 21, 2019 (the “Effective Date”), our common stock began trading on the Reverse Stock Split-adjusted basis on the OTCQB at the opening of trading. In connection with the Reverse Stock Split, our common stock began trading with a new CUSIP number at such time. There was no change to the Company’s stock symbol.

No fractional shares of common stock were issued in connection with the Reverse Stock Split. If, as a result of the Reverse Stock Split, a stockholder would otherwise have held a fractional share, a stockholder, in lieu of the issuance of such fractional share, was entitled, upon surrender to the exchange agent of a certificate(s) representing its pre-split shares or upon conversion of its shares held in book-entry, to receive a cash payment equal to the fraction to which the stockholder would otherwise be entitled, multiplied by $106, which is the closing price per share (as adjusted to give effect to the Reverse Stock Split) on the OTCQB on the closing date immediately prior to the Effective Date.

EQ by Equiniti (“EQ”), the Company’s transfer agent, acted as the exchange agent for the Reverse Stock Split, and provided instructions to stockholders of record regarding the process for exchanging shares. EQ issued all of the post-Reverse Stock Split shares through their paperless Direct Registration System (“DRS”), also known as “book entry form.” Eligible book-entry or other electronic positions representing issued and outstanding shares of the Company’s common stock were automatically adjusted. Stockholders who held certificated shares were mailed a letter of transmittal to be completed for the exchange of all of their shares. Those stockholders holding common stock in “street name” received instructions from their brokers.

Treasury Stock

On May 2, 2012, the Board authorized a share repurchase program that allowed for the repurchase of 2,500 shares of common stock. On November 14, 2016, our Board authorized a new share repurchase program under which we may repurchase up to 2,500 shares of common stock. This authorization replaces the Board’s prior May 2, 2012 share repurchase authorization. Under the share repurchase program, we may repurchase shares from time to time using a variety of methods, which may include open market transactions and privately negotiated transactions.

Table of Contents

The Company did not purchase any shares during the three months ended September 30, 2019. Since the inception of the November 14, 2016 authorization, we have repurchased 779 shares of common stock for $0.3 million and, as of September 30, 2019, we had remaining authorization to repurchase 1,721 additional shares. The treasury stock held as of September 30, 2019 was acquired at an average price of $8,496.47 per share.

Following is a summary of treasury share activity:

	Treasury Shares
Balance as of December 31, 2018		2,402
Purchases		450
Restricted stock grants		—
Forfeitures and other		75
Balance as of September 30, 2019		2,927

Accumulated Other Comprehensive Loss

Accumulated other comprehensive loss and related activity consisted of the following:

(In millions)	Defined Benefit Plans
Balance as of December 31, 2018	$	(20.7	)
Amounts reclassified from accumulated other comprehensive income, net of tax		0.1
Balance as of September 30, 2019	$	(20.6	)

Details of amounts reclassified from accumulated other comprehensive loss and the line item in the Condensed Consolidated Statements of Operations are as follows:

	Amounts Reclassified from Accumulated Other Comprehensive Loss								Affected Line Item in the Condensed Consolidated Statements of Operations Where (Gain) Loss is Presented
	Three Months Ended September 30,				Nine Months Ended September 30,
(In millions)	2019		2018		2019		2018
Amortization of net actuarial loss	$	—	$	0.1	$	0.1	$	0.3	Other income (expense)
Cumulative translation adjustment		—		0.9		—		0.7	Discontinued operations
Total reclassifications for the period	$	—	$	1.0	$	0.1	$	1.0

Income taxes are not provided for cumulative translation adjustment relating to permanent investments in international subsidiaries. Reclassification adjustments are made to avoid double counting in comprehensive income (loss) items that are also recorded as part of net income (loss) and are presented net of taxes in the Consolidated Statements of Comprehensive Income (Loss).

Note 11 — Segment Information

The Legacy Businesses and the Nexsan Business are presented in our Condensed Consolidated Statements of Operations as discontinued operations and are not included in segment results for all periods presented. See Note 4 - Discontinued Operations for further information about these divestitures.

On February 2, 2017, we closed the Capacity and Services Transaction with Clinton. The Capacity and Services Transaction allows GBAM to access investment capacity within Clinton’s quantitative equity strategy. In addition, we have recently taken steps to build our own independent organizational foundation while leveraging Clinton’s capabilities and infrastructure. While our intention is to primarily engage in the management of third-party assets, we may make opportunistic proprietary investments from time to time that comply with applicable laws and regulations. Since the closing of the Capacity and Services Transaction, we have focused on our Asset Management Business as our primary operating business segment. See Note 13 - Related Party Transactions for additional information.

Table of Contents

In March 2017, ARRIVE was formed through a collaboration with Roc Nation, a full-service entertainment company founded by Shawn “JAY Z” Carter, Primary Venture Partners (“Primary”) and GBAM. Primary will serve as a venture advisor and GlassBridge will provide institutional and operational support. ARRIVE was created to invest alongside entrepreneurs and early stage businesses. Among other things, ARRIVE has launched a traditional venture fund in order to, among other activities, support existing portfolio companies through their subsequent growth stages and anticipates launching other special purpose investment vehicles to invest in private equity transactions. All revenue realized by GBAM in the reported periods were derived from its ARRIVE investment.

In June 2017, we launched our first GBAM-managed investment fund (the “GBAM Fund”) which focuses on technology-driven quantitative strategies and other alternative investment strategies. The fund initially performed in-line with the expectation for 2017. However, we had a difficult time raising third-party capital due to the overall under-performance of the hedge fund industry. In Q4, 2018, after an internal business review and deliberations, we decided to temporarily close the GBAM Fund to save operating costs.

We have made the determination to consolidate the GBAM Fund and, accordingly, its financial results were included in our Consolidated Financial Statements as part of the Asset Management Business shown below.

As of September 30, 2019, the Asset Management Business is our only reportable segment.

We evaluate segment performance based on revenue and operating loss. The operating loss reported in our segments excludes corporate and other unallocated amounts. Although such amounts are excluded from the business segment results, they are included in reported consolidated results. The corporate and unallocated operating loss includes costs which are not allocated to the business segments in management’s evaluation of segment performance such as litigation settlement expense, corporate expense and other expenses.

For our Asset Management Business, we include net income from the GBAM Fund activities in our performance evaluation. Net income from GBAM Fund activities primarily represents realized and unrealized gains and losses for the GBAM Fund.

Net revenue and operating loss from continuing operations by segment were as follows:

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(In millions)	2019		2018		2019		2018
Net revenue
Asset Management Business	$	—	$	—	$	0.1	$	—
Total net revenue	$	—	$	—	$	0.1	$	—

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(In millions)	2019			2018			2019			2018
Operating income (loss) from continuing operations
Asset Management Business	$	—		$	(0.9	)	$	0.1		$	(2.7	)
Total segment operating income (loss)		—			(0.9	)		0.1			(2.7	)
Corporate and unallocated		(0.5	)		(1.1	)		(2.5	)		(2.7	)
Restructuring and other		—			—			(0.1	)		(0.1	)
Total operating loss		(0.5	)		(2.0	)		(2.5	)		(5.5	)
Interest expense		—			—			—			(0.1	)
Net losses from GBAM Fund activities		—			(0.2	)		—			(0.7	)
Other income (expense), net		—			0.1			—			0.4
Loss from continuing operations before income taxes	$	(0.5	)	$	(2.1	)	$	(2.5	)	$	(5.9	)

Note 12 — Litigation, Commitments and Contingencies

The Company is a party, as either a sole or joint defendant or plaintiff, in various lawsuits, claims and other legal matters that arise in the ordinary course of conducting business (including litigation relating to our Legacy Businesses and discontinued operations). All such matters involve uncertainty and accordingly, outcomes that cannot be predicted with assurance. As of September 30, 2019, we are unable to estimate with certainty the ultimate aggregate amount of monetary liability or financial impact that we may incur with respect to these matters. It is reasonably possible that the ultimate resolution of these matters, individually or in the aggregate, could materially affect our financial condition, results of operations and cash flows.

Table of Contents

Intellectual Property Litigation

The Company is subject to allegations of patent infringement by our competitors as well as non-practicing entities (“NPEs”) - sometimes referred to as “patent trolls” - who may seek monetary settlements from us, our competitors, suppliers and resellers. The nature of such litigation is complex and unpredictable and, consequently, the Company is not able to reasonably estimate with precision the amount of any monetary liability or financial impact that may be incurred with respect to these matters. As of November 14, 2019, given the exits from the Legacy Businesses, the Company believes that the ultimate resolution of these matters in the aggregate will not materially adversely affect our financial condition, results of operations and cash flows.

Trade Related Litigation

On January 26, 2016, CMC, a supplier of our Legacy Businesses, filed a suit in the District Court of Ramsey County Minnesota, seeking damages from the Company and the Company’s wholly-owned subsidiary Imation Latin America Corp. (“ILAC”) for alleged breach of contract. CMC also brought similar claims in Japan and the Netherlands against other of our subsidiaries. As previously disclosed in the Current Report on Form 8-K we filed with the SEC on September 18, 2017, we entered into a settlement agreement with CMC on September 15, 2017 resolving all claims relating to the CMC lawsuits. Pursuant to the settlement, (i) we agreed that our subsidiary Imation Corporation Japan (“ICJ”) will cause the release and payment to CMC of approximately $9.2 million in attached assets, (ii) ICJ made a payment to CMC of $1.5 million on October 10, 2017, (iii) our subsidiary Imation Europe B.V. (“IEBV”) will cause the release and payment to CMC of approximately $825,000 in attached assets, (iv) ICJ issued to CMC an unsecured promissory note (the “CMC Note”) in the amount of $1.5 million, and (v) we guaranteed CMC ICJ’s obligations under the CMC Note. As of December 31, 2017, both ICJ and Europe B.V. had released the required payments to CMC. In January 2018, ICJ made a $0.5 million payment to CMC in relation to the $1.5 million CMC Note discussed above. On March 28, 2019, the Company, together with its subsidiaries, including IJC, entered into a pre-pay agreement (the “Pre-Pay Agreement”) with CMC providing that the Company shall pre-pay the remaining balance of $1,000,000 due and payable under the CMC Note for a one-time cash payment of $325,000, and CMC accepted such pre-payment in full satisfaction of the Company’s obligations under the settlement agreement and the CMC Note. The $325,000 payment was made on March 28, 2019.

The Company has various trade disputes with vendors related to the Legacy Businesses. The Company believes it has made adequate accruals with respect to the disputes for which such is appropriate according to our accounting policy.

Employee Matters

On March 29, 2017, three former Legacy Business employees who were among the approximately 100 similarly situated employees terminated as a result of the Restructuring Plan filed a lawsuit in the Minnesota State District Court of Ramsey County asserting state law claims for non-payment of allegedly promised severance benefits. On February 27, 2019, the Company settled the claim for $86,000.

On November 21, 2018, the Company was served by forty-five former Legacy Business employees who were asserting claims for unpaid severance allegedly promised to them by the Company. The Company entered into a settlement agreement as of July 25, 2019, to settle the claim for $150,000.

Copyright Levies

We had previously disclosed various copyright levy litigations related to our former subsidiary – IEBV. In connection with the Subsidiary Sale, the Company is no longer liable for adverse outcomes and may receive Contingent Payouts should IEBV prevail in litigation.

Indemnification Obligations

In the normal course of business, we periodically enter into agreements that incorporate general indemnification language. Performance under these indemnities would generally be triggered by a breach of terms of the contract or by a supportable third-party claim. There have historically been no material losses related to such indemnifications. As of September 30, 2019 and December 31, 2018, estimated liability amounts associated with such indemnifications were not material.

Environmental Matters

Our Legacy Business operations and indemnification obligations resulting from our spinoff from 3M subject us liabilities arising from a wide range of federal, state and local environmental laws. For example, from time to time we have received correspondence from 3M notifying us that we may have a duty to defend and indemnify 3M with respect to certain environmental claims such as remediation costs. Environmental remediation costs are accrued when a probable liability has been determined and the amount of such liability has been reasonably estimated. These accruals are reviewed periodically as remediation and investigatory activities proceed and are adjusted accordingly. We did not have any environmental accruals as of September 30, 2019. Compliance with environmental regulations has not had a material adverse effect on our financial results.

Table of Contents

Note 13 — Related Party Transactions

Certain Arrangements

On January 31, 2017, the Company held a special meeting of the stockholders of the Company at which the stockholders approved the issuance of up to 1,500,000 shares (the “Capacity Shares”) of the Company’s common stock (as adjusted to reflect the Reverse Stock Split), par value $0.01 per share, pursuant to the Subscription Agreement, dated as of November 22, 2016, by and between the Company and Clinton, as amended by Amendment No. 1 to the Subscription Agreement, dated as of January 9, 2017 (as so amended, the “Subscription Agreement”). Pursuant to the terms of the Subscription Agreement, on February 2, 2017 (the “Initial Closing Date”), the Company entered into the Capacity and Services Transaction with Clinton Group and GBAM (the “Capacity and Services Transaction”). As consideration for the capacity and services Clinton has agreed to provide under the Capacity and Services Transaction and pursuant to the terms of the Subscription Agreement, the Company issued 1,250,000 shares of the Company’s common stock (as adjusted to reflect the Reverse Stock Split) to Madison Avenue Capital Holdings, Inc. (“Madison”), an affiliate of Clinton, on the Initial Closing Date. The closing price of the Company’s common stock on the Initial Closing Date was $8.10. The Company also entered into a Registration Rights Agreement with Madison on the Initial Closing Date, relating to the registration of the resale of the Capacity Shares as well as a letter agreement with Madison pursuant to which Madison has agreed to a three-year lockup with respect to any Capacity Shares issued to it.

The Company did not have a short term investment balance in Clinton Lighthouse as of September 30, 2019 and December 31, 2018, and as such did not have any unrealized gains for the three months ended September 30, 2019. Pursuant to the Capacity and Services Agreement, the Company will no longer incur management or performance fees related to our investment in Clinton Lighthouse.

Management of the Company

On January 1, 2019, the Company and Clinton entered into a management service agreement (the “Management Service Agreement”), pursuant to which Clinton agreed to provide certain services to the Company, including accounting and treasury services, service of managing the third party fund administrator, IT services, payroll and benefit services and other administration services as reasonably requested by the Company. The initial term of this Management Service Agreement is six (6) months (the “Initial Term”) and shall renew for successive renewal terms of three (3) calendar months (each, a “Renewal Term”) unless either Party provides notice of nonrenewal to the other Party prior to the conclusion of the then current initial term or renewal term. The Company shall pay Clinton at the rate of $68,750 each quarter for the Initial Term and each Renewal Term.

Daniel A. Strauss serves as our Chief Executive Officer and Chief Operating Officer, and Francis Ruchalski serves as our Chief Financial Officer, pursuant to the terms of a the Amended and Restated Services Agreement we entered into with Clinton on March 31, 2019 (the “Amended Services Agreement”) replacing in its entirety that certain Services Agreement we entered into with Clinton on March 2, 2017 (the “Services Agreement”). The Amended Services Agreement provides that Clinton will make available certain of its employees to provide services to the Company, including CEO services, COO services and CFO services (the “Executive Services”). In addition to the Executive Services, Clinton will make available other employees of Clinton as necessary to manage certain business functions as deemed necessary in the sole discretion of Clinton to provide other management services (the “Management Services”). Under the Amended Services Agreement, Clinton may designate substitutes for Mr. Strauss or Mr. Ruchalski or any other employee providing any Management Services. In consideration for the Executive Services and Management Services, the Company shall provide to Clinton a rate of $243,750 for the initial term, such term being the first three (3) months following the execution date of the Amended Services Agreement, and to automatically renew for successive renewal terms of three (3) calendar months each, the fee for each renewal term being $243,750. Clinton will continue to pay Mr. Strauss’s and Mr. Ruchalski’s compensation and benefits and we have agreed to pay or reimburse their reasonable expenses. Pursuant to the terms of the Amended Services Agreement, we have also agreed to indemnify Mr. Strauss, Mr. Ruchalski, Clinton, any substitute for Mr. Strauss, Mr. Ruchalski, or any other Clinton employee providing services under the Master Services Agreement for certain losses. As of September 30, 2019, the Company paid Clinton $2,087,500 under the Services Agreement and recorded $858,333 and $375,000 within “Selling, general and administrative” in our Condensed Consolidated Statements of Operations for the nine months ended September 30, 2019 and 2018, respectively.

On September 30, 2019, Imation entered into an Employment Agreement with Mr. Strauss, effective October 1, 2019 (the “Strauss Agreement”), providing for, among other things, a base salary to be paid to Mr. Strauss of $175,000 in accord with Imation’s normal payroll practices, as well as eligibility to participate in the compensation and benefit programs generally available to Imation’s executive officers.

Sport-BLX, Inc.

During 2019, the Company entered into three Common Stock Purchase Agreements (the “Sport-BLX Purchase Agreement”) together with Sport-BLX, Inc., a Delaware corporation, where George E. Hall, the holder of approximately 25.78% of the Company’s outstanding common stock, is Executive Chairman and CEO (“Sport-BLX”). As per the January 4, 2019 Sport-BLX Purchase Agreement, the Company agreed to purchase from Sport-BLX 10,526 shares of Sport-BLX common stock, par value $0.001 per share, at a price equal to $95 per share, for aggregate consideration of $1,000,000. As per the September 16, 2019 Sport-BLX Purchase Agreement, the Company agreed to purchase from Sport-BLX 679 shares of Sport-BLX common stock, par value $0.001 per share, at a price equal to $263.4074 per share for aggregate consideration of $178,854. As of September 30, 2019, the Company funded the total consideration due of $1,178,854.

As per the October 18, 2019 Sport-BLX Purchase Agreement, Imation agreed to purchase from Sport-BLX 2,314 shares of Sport-BLX common stock, par value $0.001 per share, at a price equal to $263.4074 per share for aggregate consideration of $609,524.72. Imation funded the total consideration due of $609,524.72 on November 5, 2019.

On October 1, 2019, the Company made a $1,000,000 demand loan to Sport-BLX.

Table of Contents

Note 14 — Subsequent Events

As previously disclosed in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) as of October 7, 2019, on October 1, 2019, the Company entered into a Securities Purchase Agreement (the “Purchase Agreement”) with Orix PTP Holdings, LLC, a Delaware limited liability company (“Orix”). The Purchase agreement provides for the sale of 201 shares of common stock, par value $0.01 per share (the “Purchased Stock”), constituting 20.1% of all issued and outstanding stock of Imation Enterprises Corp., a Delaware corporation and formerly wholly owned subsidiary of GlassBridge (“Imation”) to Orix. The Purchase Agreement further provides for the sale and assignment from GlassBridge to Orix of (i) that certain promissory note, dated as of September 30, 2019, originally issued by Imation in favor of GlassBridge in consideration for the assignment by GlassBridge to Imation of the Levy Claims (defined below), in the original principal amount of $9,000,000 (“Levy Note”) and (ii) that certain promissory note, dated as of September 30, 2019, originally issued by Imation in favor of GlassBridge in connection with the assignment of 11,154 shares of Common Stock, par value 0.0001 per share of Sport-BLX, Inc., a Delaware corporation, in the original principal amount of $4,000,000 (“Sport-BLX Note” and collectively with the Levy Note, the “Notes”). Orix acquired the Purchased Stock and the Notes for a total consideration of $17,562,700 (“Cash Consideration”).

The “Levy Claims” mean the right to receive payments from IMN Capital Holding Inc. in connection with the settlement or final adjudication (without any ability to further appeal by any party) as to all demands, claims, counterclaims, cross-claims, third-party-claims, damages, fees (including attorney’s fees), costs and expenses, brought and raised on any matters arising from the following claims and causes of action:

Company holding the Claim	Jurisdiction	Court or Tribunal	Matter Name and Identifying Number
Imation Europe BV	France	Cour D’Appel De Paris	16/08482 -N° Portalis 35L7- V-B7A-BYR7B

Imation Europe BV	Dutch	District Court of The Hague	C/09/489719/HA ZA 15-659

Under the terms of the Purchase Agreement, the Board of Directors of Imation was expanded from three to five directors, which includes one director designated by Orix.

Also pursuant to the terms of the Purchase Agreement, GlassBridge, Orix and Imation entered into a Stockholders’ Agreement dated as of October 1, 2019 (the “Stockholders Agreement”) pursuant to which Orix may, among other rights and obligations set forth in the Stockholders Agreement, sell back all of its Purchased Shares to GlassBridge at book value after April 1, 2021 and during the three-month period after such date and shall, during the term of the Stockholders Agreement, have the right to purchase all or a portion of the shares owned by GlassBridge in Imation at book value plus 20%, subject to the right of GlassBridge to respond to the notice by Orix to exercise such right by purchasing all of the shares of Orix.

The foregoing transactions, consummated by the Company, Imation and Orix, as evidenced by the Purchase Agreement, the Notes, the Stockholders Agreement, and the assignment agreements shall altogether be referred to as the Orix Transactions.

The following unaudited pro forma condensed consolidated balance sheet for the nine months ended September 30, 2019, which gives effect to the Orix Transactions and the Settlement Agreement with the PBGC has been prepared to give effect to the Orix Transactions and the Settlement Agreement as if they had been completed and entered into, respectively, on September 30, 2019, and if the Release Date (see Note 8 – Retirement Plans) had occurred on September 30, 2019.

The unaudited pro forma condensed consolidated balance sheet is for informational purposes only and is not necessarily indicative of what our financial performance or financial position would have been had the transactions been completed on the dates assumed nor is such unaudited pro forma financial information necessarily indicative of the results expected in any future period.

Table of Contents

GLASSBRIDGE ENTERPRISES, INC.

PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET

(unaudited) (In millions, except per share amounts)

	September 30, 2019			Purchase		Settlement
	As Reported			Agreement		Agreement			Pro Forma

Assets
Current assets:
Cash and cash equivalents	$	0.6		$	13.9	$	(4.3	)	$	10.2
Accounts receivable		0.1			—		—			0.1
Other current assets		1.5			—		—			1.5
Current assets of discontinued operations		—			—		—			—
Total current assets		2.2			13.9		(4.3	)		11.8
Other assets		6.0			14.7		—			20.7
Non-current assets of discontinued operations		—			—		—
Total assets	$	8.2		$	28.6	$	(4.3	)	$	32.5
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	0.1		$	—	$	—		$	0.1
Other current liabilities		2.6			—		(2.0	)		0.6
Current liabilities of discontinued operations		0.9			—		—			0.9
Total current liabilities		3.6			—		(2.0	)		1.6
Other liabilities		15.2			10.3		(14.4	)		11.1
Other liabilities of discontinued operations		0.2			—		—			0.2
Total liabilities		19.0			10.3		(16.4	)		12.9
Shareholders’ deficit:
Preferred stock, $.01 par value, authorized 25 million shares, none issued and outstanding		—			—		—			—
Common stock, $.01 par value, authorized 50,000, 28,097 issued at September 30, 2019; 28,097 issued at December 31, 2018		0.1			—		—			0.1
Additional paid-in capital		1,049.2			—		—			1,049.2
Accumulated deficit		(1,014.6	)		14.3		12.1			(988.2	)
Accumulated other comprehensive loss		(20.6	)		—		—			(20.6	)
Treasury stock, at cost: 2,927 shares at September 30, 2019; 2,402 shares at December 31, 2018		(24.9	)		—		—			(24.9	)
Total GlassBridge Enterprises, Inc. shareholders’ equity (deficit)		(10.8	)		14.3		12.1			15.6
Noncontrolling minority interest		—			4.0		—			4.0
Total liabilities and shareholders’ equity (deficit)	$	8.2		$	28.6	$	(4.3	)	$	32.5

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Forward-Looking Statements and Risk Factors

We may from time to time make written or oral forward-looking statements with respect to our future goals, including statements contained in this Form 10-Q, in our other filings with the SEC and in our reports to shareholders.

Certain information which does not relate to historical financial information may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include information concerning the launch of our asset management business and related investment vehicles, strategic initiatives and potential acquisitions, the results of operations of our existing business lines, the impact of legal or regulatory matters on our business, as well as other actions, strategies and expectations, and are identifiable by use of the words “believes,” “expects,” “intends,” “anticipates,” “plans,” “seeks,” “estimates,” “projects,” “may,” “will,” “could,” “might,” or “continues” or similar expressions. Such statements are subject to a wide range of risks and uncertainties that could cause our actual results in the future to differ materially from our historical results and those presently anticipated or projected. We wish to caution investors not to place undue reliance on any such forward-looking statements. Any forward-looking statements speak only as of the date on which such statements are made, and we undertake no obligation to update such statements to reflect events or circumstances arising after such date. Risk factors include various factors set forth from time to time in our filings with the SEC including the following: our need for substantial additional capital in order to fund our business; our ability to realize the anticipated benefits of our restructuring plan and other recent significant changes; the negative impacts of our delisting from the New York Stock Exchange, including reduced liquidity and market price of our common stock and the number of investors willing to hold or acquire our common stock; significant costs relating to pending and future litigation; our ability to attract and retain talented personnel; the structure or success of our participation in any joint investments; risks associated with any future acquisition or business opportunities; our need to consume resources in researching acquisitions, business opportunities or financings and capital market transactions; our ability to integrate additional businesses or technologies; the impact of our reverse stock split on the market trading liquidity of our common stock; the market price volatility of our common stock; our need to incur asset impairment charges for intangible assets; significant changes in discount rates, rates of return on pension assets and mortality tables; our reliance on aging information systems and our ability to protect those systems against security breaches; our ability to integrate accounting systems; changes in tax guidance and related interpretations and inspections by tax authorities; our ability to raise capital from third party investors for our asset management business; the efforts of Clinton’s key personnel and the performance of its overall business; our ability to comply with extensive regulations relating to the launch and operation of our asset management business; our ability to compete in the intensely competitive asset management business; the performance of any investment funds we sponsor or accounts we manage, including any fund or account managed by Clinton; difficult market and economic conditions, including changes in interest rates and volatile equity and credit markets; our ability to achieve steady earnings growth on a quarterly basis in our asset management business; the significant demands placed on our resources and employees, and associated increases in expenses, risks and regulatory oversight, resulting from the potential growth of our asset management business; our ability to establish a favorable reputation for our asset management business; the lack of operating history of our asset manager subsidiary and any funds that we may sponsor; our ability to realize the anticipated benefits of the third-party investment in our partially-owned data storage business; decreasing revenues and greater losses attributable to our partially-owned data storage products; our ability to quickly develop, source and deliver differentiated and innovative products; our dependence on third parties for new product introductions or technologies; our dependence on third-party contract manufacturing services and supplier-provided parts, components and sub-systems; our dependence on key customers, partners and resellers; foreign currency fluctuations and negative or uncertain global or regional economic conditions as well as various factors set forth in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2018, and from time to time in our filings with the SEC.

Overview

GlassBridge Enterprises, Inc. (“GlassBridge”, the “Company”, “we”, “us” or “our”) is a holding company. We actively explore a diverse range of new, strategic asset management business opportunities for our portfolio. The Company’s wholly-owned subsidiary GlassBridge Asset Management, LLC (“GBAM”) is an investment advisor focused on technology-driven quantitative strategies and other alternative investment strategies.

In February 2017, we closed a transaction with Clinton Group Inc. (“Clinton”) that facilitated the launch of our “Asset Management Business”, which consists of our investment advisory business conducted through GBAM (the “Capacity and Services Transaction”). The Capacity and Services Transaction allows for GBAM to access investment capacity within Clinton’s quantitative equity strategy. The Capacity and Services Transaction was structured to provide for the quick and efficient scaling of an asset management business and designed to provide investors with access to quantitative equity strategies. By partnering with Clinton and leveraging Clinton’s proven technology-driven strategy, we intend for GBAM to bypass traditional seeding models, which typically include a lengthy roll out and substantial costs. We intend to use algorithms and other quantitative strategies with the goal of achieving consistent, competitive risk-adjusted returns for GBAM’s investors. In addition, we have recently taken steps to build our own independent organizational foundation while leveraging Clinton’s capabilities and infrastructure. While our intention is to primarily engage in the management of third-party assets, we may make opportunistic proprietary investments from time to time that comply with applicable laws and regulations.

Table of Contents

In February 2017, the Company effected a 1:10 reverse split of our common stock, without any change in the par value per share, and decreased the number of authorized shares of our common stock from 100,000,000 to 10,000,000.

On July 20, 2017, the Company notified the New York Stock Exchange (the “NYSE”) of its intention to voluntarily delist its common stock from the NYSE. After much careful discussion and deliberation, our Board of Directors (the “Board”) approved resolutions authorizing the Company to initiate voluntarily delisting from the NYSE. The Board weighed several material factors in reaching this decision, including avoiding the risks that involuntary suspension of trading could cause and the importance of a controlled transition to the OTCQX marketplace (“OTCQX”) to ensure the continuing availability of a market for trading our common stock. The last trading day on the NYSE was August 1, 2017. Our common stock began trading on the OTCQX Market under the symbol “GLAE” on August 2, 2017.

On August 16, 2018, the Company consummated the NXSN Transaction, wherein the Company, through a series of transactions, sold its partially-owned subsidiary, the Nexsan Business, to StorCentric, Inc., a Delaware company affiliated with Drobo, Inc. For more information regarding the NXSN Transaction, please review the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission as of August 16, 2018.

On August 20, 2019, the Company effected a reverse split of our common stock, par value $0.01 per share at a ratio of 1:200 (the “Reverse Stock Split”). On August 21, 2019 (the “Effective Date”), our common stock began trading on the Reverse Stock Split-adjusted basis on the OTCQB at the opening of trading. In connection with the Reverse Stock Split, our common stock began trading with a new CUSIP number at such time. There was no change to the Company’s stock symbol. See Note 10 - Shareholders’ Equity for further information.

With the wind down of our legacy businesses segments, Consumer Storage and Accessories and Tiered Storage and Security Solutions (the “Legacy Businesses”) substantially completed in the first quarter of 2016, the sale of our IronKey business in February 2016, the sale of our Nexsan Business in August 2018 and the Subsidiary Sale in March 2019 we have one operating business segment remaining: the “Asset Management Business”. Following the launch of GBAM, we have transitioned to become a publicly-traded alternative asset manager. In February 2017 we changed our name to GlassBridge Enterprises, Inc. to reflect our new primary focus on asset management. We continue to evaluate various business endeavors and opportunistic acquisitions of operating businesses to augment our current organic initiatives. As a result of the termination of our pension plan by the PBGC and final phases of legacy wind down, we have redoubled our efforts on growth initiatives that are intended to maximize shareholder value.

Important Notices and Disclaimers

This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is intended to be read in conjunction with our Condensed Consolidated Financial Statements and related Notes that appear elsewhere in this Quarterly Report on Form 10-Q. This MD&A contains forward-looking statements that involve risks and uncertainties. The Company’s actual results could differ materially from those anticipated due to various factors discussed in this MD&A under the caption “Forward-Looking Statements and Risk Factors” and the information contained in the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) on April 1, 2019, including in Part 1 Item 1A. Risk Factors of such Annual Report.

Nothing contained in this Quarterly Report on Form 10-Q constitutes an offer to sell or a solicitation to buy any securities or otherwise invest in any investment vehicle managed, advised or coordinated by GBAM (collectively, the “GlassBridge Vehicle”), and may not be relied upon in connection with any investment or offer or sale of securities. Any such offer or solicitation may only be made pursuant to the current Confidential Private Offering Memorandum (or similar document) for any such GlassBridge Vehicle, which is provided only to qualified offerees and which should be carefully reviewed prior to investing. GBAM is a newly formed entity and the GlassBridge Vehicles are currently either in formation state or have recently launched. GBAM is registered as an investment adviser with the SEC under the U.S. Investment Advisers Act of 1940, as amended, or under similar state laws, and nothing in this Quarterly Report on Form 10-Q constitutes investment advice with respect to securities.

This Quarterly Report on Form 10-Q includes tradenames and trademarks owned by us or that we have the right to use. Solely for convenience, the trademarks or tradenames referred to in this Quarterly Report on Form 10-Q may appear without the ® or ™ symbols, but such references are not intended to indicate in any way that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and tradenames.

Table of Contents

Executive Summary

Consolidated Results of Operations for the Three Months Ended September 30, 2019

	●	Net revenue from continuing operations of $0.0 million for the three months ended September 30, 2019 was flat compared with $0.0 million in the same period last year.

	●	Operating loss from continuing operations was $0.5 million for the three months ended September 30, 2019 compared to an operating loss of $2.0 million in the same period last year. This was an improvement of $1.5 million, primarily due to reductions in corporate expenses.

		Basic and diluted loss per share from continuing operations was $19.86 for the three months ended September 30, 2019, compared with a basic and diluted loss per share of $82.62 for the same period last year.

Consolidated Results of Operations for the Nine Months Ended September 30, 2019

	●	Net revenue from continuing operations of $0.1 million for the nine months ended September 30, 2019 was up compared with $0.0 million in the same period last year.

	●	Operating loss from continuing operations was $2.5 million for the nine months ended September 30, 2019 compared to an operating loss of $5.5 million in the same period last year. This was an improvement of $3.0 million, primarily due to reductions in corporate expenses.

		Basic and diluted loss per share from continuing operations was $99.44 for the nine months ended September 30, 2019, compared with a basic and diluted loss per share of $233.75 for the same period last year.

Cash Flow/Financial Condition for the Nine Months Ended September 30, 2019

●

Cash and cash equivalents totaled $0.6 million at September 30, 2019 compared with $4.1 million at December 31, 2018. The decrease in the cash balance of $3.5 million was primarily due to corporate expenses, $0.5 million in litigation settlement payments and deconsolidated international cash of $0.8 million in connection with the Subsidiary Sale. See Note 12 - Litigation, Commitments and Contingencies in the Notes to Consolidated Financial Statements for additional information on the litigation settlements.

Results of Operations

The following discussion relates to continuing operations unless indicated otherwise. The operating results of our former Legacy Businesses and the Nexsan Business are presented in our Condensed Consolidated Statements of Operations as discontinued operations and are not included in segment results for all periods presented. See Note 4 - Discontinued Operations in our Notes to Condensed Consolidated Financial Statements in Item 1 for further information on these divestitures.

Net Revenue

	Three Months Ended							Nine Months Ended
	September 30,				Percent			September 30,				Percent
(Dollars in millions)	2019		2018		Change			2019		2018		Change
Net revenue	$	—	$	—		NM	%	$	0.1	$	—		NM

Net revenue for the three and nine months ended September 30, 2019 was $0.0 million and $0.1 million, respectively.

Gross Profit

	Three Months Ended								Nine Months Ended
	September 30,					Percent			September 30,					Percent
(Dollars in millions)	2019			2018		Change			2019			2018		Change
Gross profit	$	0.0		$	—		100	%	$	0.1		$	—		NM
Gross margin		100	%		NM					100	%		NM

“NM” - Indicates the Percent Change is not meaningful

Gross margin for the three and nine months ended September 30, 2019 was $0.0 million and $0.1 million, respectively.

Table of Contents

Selling, General and Administrative (“SG&A”)

	Three Months Ended							Nine Months Ended
	September 30,				Percent			September 30,				Percent
(Dollars in millions)	2019		2018		Change			2019		2018		Change
Selling, general and administrative	$	0.5	$	1.9		(73.7	)%	$	2.5	$	5.1		(51.0	)%
As a percent of revenue		NM		NM					NM		NM

“NM” - Indicates the Percent Change is not meaningful

SG&A expense decreased for the three months ended September 30, 2019 by $1.4 million (or 73.7%) compared with the same period last year primarily due to reduced corporate expenditures and legal expenses.

SG&A expense decreased for the nine months ended September 30, 2019 by $2.6 million (or 51.0%) compared with the same period last year primarily due to reduced corporate expenditures and legal expenses.

Restructuring and Other

	Three Months Ended						Nine Months Ended
	September 30,				Percent		September 30,				Percent
(Dollars in millions)	2019		2018		Change		2019		2018		Change
Restructuring and other	$	—	$	—		NM	$	0.1	$	0.1		—	%

“NM” - Indicates the Percent Change is not meaningful

Restructuring and other expenses were $0.0 million and $0.0 million for the three months ended September 30, 2019 and 2018, respectively.

Restructuring and other expenses were $0.1 million and $0.1 million for the nine months ended September 30, 2019 and 2018, respectively.

See Note 6 - Restructuring and Other Expense in our Notes to Condensed Consolidated Financial Statements in Item 1 for further details on our restructuring and other expenses.

Operating Loss from Continuing Operations

	Three Months Ended									Nine Months Ended
	September 30,						Percent			September 30,						Percent
(Dollars in millions)	2019			2018			Change			2019			2018			Change
Operating loss from continuing operations	$	(0.5	)	$	(2.0	)		(75.0	)%	$	(2.5	)	$	(5.5	)		(54.5	)%
As a percent of revenue		NM			NM						NM			NM

“NM” - Indicates the Percent Change is not meaningful

Operating loss from continuing operations decreased by $1.5 million for the three months ended September 30, 2019 compared with the same period last year primarily due to reduced corporate expenditures and legal expenses.

Operating loss from continuing operations decreased by $3.0 million for the nine months ended September 30, 2019 compared with the same period last year primarily due to reduced corporate expenditures and legal expenses.

Table of Contents

Other Income (Expense)

	Three Months Ended							Nine Months Ended
	September 30,					Percent		September 30,					Percent
(Dollars in millions)	2019		2018			Change		2019		2018			Change
Interest expense	$	—	$	—			NM	$	—	$	(0.1	)		NM
Net gain (loss) from GBAM Fund activities		—		(0.2	)		NM		—		(0.7	)		NM
Other income (expense), net		—		0.1			NM		—		0.4			NM
Total other income (expense)	$	—	$	(0.1	)		NM	$	—	$	(0.4	)		NM
As a percent of revenue		NM		NM					NM		NM

“NM” - Indicates the Percent Change is not meaningful

Total other income (expense) for the three months ended September 30, 2019 was $0.0 million compared to $(0.1) million for the same period last year.

Total other income (expense) for the nine months ended September 30, 2019 was $0.0 million compared to $(0.4) million for the same period last year.

See Asset Management Business discussion within the Segment Results section for additional information on net gain (loss) from GBAM Fund activities.

Income Tax Benefit (Provision)

	Three Months Ended									Nine Months Ended
	September 30,						Percent			September 30,						Percent
(Dollars in millions)	2019			2018			Change			2019			2018			Change
Income tax benefit (provision)	$	—		$	—			(0.0	)%	$	—		$	—			NM
Effective tax rate		0.0	%		0.0	%					0.0	%		0.0	%

Income tax for the three months ended September 30, 2019 and 2018 was $0.0 and $0.0 million, respectively. The effective income tax rate for the three and nine months ended September 30, 2019 differs from the U.S. federal statutory rate of 21% primarily due to a valuation allowance on various deferred tax assets.

Income (Loss) from Discontinued Operations

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(Dollars in millions)	2019			2018			2019			2018
Net revenue	$	—		$	5.1		$	0.1		$	23.9
Cost of goods sold		—			3.1			0.1			13.0
Gross profit		—			2.0			—			10.9
Selling, general and administrative		—			0.9			0.3			8.3
Research and development		—			0.5			—			2.4
Restructuring and other		0.2			(2.2	)		—			(8.0	)
Other (income) expense		—			—			(0.6	)		(0.8	)
Income from discontinued operations, before income taxes		(0.2	)		2.8			0.3			9.0
Income on sale of discontinued businesses, before income taxes		—			6.1			9.6			—
Income tax benefit		—			0.1			0.9			0.2
Net loss attributable to noncontrolling interest		—			—			—			0.6
Income (loss) from discontinued operations, net of income taxes	$	(0.2	)	$	9.0		$	10.8		$	9.8

Table of Contents

Discontinued operations are comprised of results from our Legacy Businesses and the Nexsan Business. For the three and nine months ended September 30, 2019, income from discontinued operations decreased by $9.2 million and increased by $1.0 million, respectively, compared with the same periods last year due to the Subsidiary Sale.

See Note 4 - Discontinued Operations in our Notes to Condensed Consolidated Financial Statements in Item 1 for more information on our discontinued operations.

Segment Results

Following the sale of the Nexsan Business, the Asset Management Business is our only reportable segment as of September 30, 2019. The Legacy Businesses and Nexsan Business were reported within discontinued operations.

We evaluate segment performance based on revenue and operating loss. The operating loss reported in our segments excludes corporate and other unallocated amounts. Although such amounts are excluded from the business segment results, they are included in reported consolidated results. Corporate and unallocated amounts include costs which are not allocated to the business segments in management’s evaluation of segment performance such as litigation settlement expense, corporate expense and other expenses.

Information related to our segments is as follows:

Asset Management Business

	Three Months Ended							Nine Months Ended
	September 30,					Percent		September 30,					Percent
(Dollars in millions)	2019		2018			Change		2019		2018			Change
Operating income (loss)	$	—	$	(0.9	)		NM	$	0.1	$	(2.7	)		103.7	%
Net gain (loss) from GBAM Fund activities		—		(0.2	)		NM		—		(0.7	)		NM

GBAM is an investment advisor focused on technology-driven quantitative strategies and other alternative investment strategies. Revenue from our Asset Management Business would primarily consist of management and performance fees paid by the funds under our management. Since we closed the Capacity and Services Transaction in February 2017, we jump-started the Asset Management Business by leveraging Clinton’s resources. We are executing our business development plan and have been in contact with over one hundred potential strategic investors. Obtaining third party investment for similarly situated funds can take time, particularly in light of recent headwinds resulting from industry trends of under performance of our initial fund’s strategy.

In the fourth quarter of 2018, after our internal business review and deliberations the management team decided to temporarily close the GlassBridge Quantitative Equity Fund to save operating costs. We retained and utilized various consultants and outside legal counsel to assist in the development of policies, procedures and compliance functionality tailored to the launch of GBAM. These outside resources were tasked with building and launching an asset management platform designed to comply with all applicable laws and regulations. Because we intend for the scope of our Asset Management Business to increase substantially, management instructed our consultants and counsel to focus on developing a platform that is well-positioned to scale up in an efficient manner as our business grows.

Corporate and Unallocated

	Three Months Ended									Nine Months Ended
	September 30,						Percent			September 30,						Percent
(Dollars in millions)	2019			2018			Change			2019			2018			Change
Corporate and unallocated operating loss	$	(0.5	)	$	(1.1	)		(54.5	)%	$	(2.5	)	$	(2.7	)		(7.4	)%
Restructuring and other		—			—			—	%		(0.1	)		(0.1	)		—	%
Total	$	(0.5	)	$	(1.1	)				$	(2.6	)	$	(2.8	)

“NM” - Indicates the Percent Change is not meaningful

For the three months ended September 30, 2019, corporate and unallocated operating loss consists of $0.5 million of corporate general and administrative expenses, a 54.5% decrease from the prior year. Restructuring and other expenses were flat from the prior year.

Table of Contents

For the nine months ended September 30, 2019, corporate and unallocated operating loss consists of $2.5 million of corporate general and administrative expenses, a 7.4% decrease from the prior year. Restructuring and other expenses were flat from the prior year.

See Note 6 - Restructuring and Other Expense in our Notes to Condensed Consolidated Financial Statements in Item 1 for further details on our restructuring and other expenses.

Impact of Changes in Foreign Currency Rates

The impact of changes in foreign currency exchange rates to worldwide revenue was immaterial for the three and nine months ended September 30, 2019.

Financial Position

Our cash and cash equivalents balance as of September 30, 2019 was $0.6 million compared to $4.1 million as of December 31, 2018.

Our accounts payable balance as of September 30, 2019 was $0.1 million compared to $0.4 million as of December 31, 2018.

Our other current liabilities balance as of September 30, 2019 was $2.6 million compared to $3.0 million as of December 31, 2018.

Liquidity and Capital Resources

Cash Flows Provided by (Used in) Operating Activities:

	Nine Months Ended
	September 30,
(Dollars in millions)	2019			2018
Net income (loss)	$	8.3		$	3.9
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization		—			1.7
Stock-based compensation		—			(0.3	)
Pension settlement and curtailments		—			0.3
Gain on sale of assets		(9.9	)		(6.1	)
Short term investment		—			0.7
Other, net		(0.2	)		0.1
Changes in operating assets and liabilities		(2.7	)		(9.1	)
Net cash used in operating activities	$	(4.5	)	$	(8.8	)

Cash used in operating activities was $4.5 million for the nine months ended September 30, 2019, which primarily related to corporate expenditures, legal settlements and related costs. Cash used in operating activities was $8.8 million for the nine months ended September 30, 2018, primarily relating to the operating loss.

Cash Flows Used in Investing Activities:

	Nine Months Ended
	September 30,
(Dollars in millions)	2019			2018
Investment in securities	$	(0.6	)	$	—
Capital expenditures		—			(0.2	)
Disbursement related to disposal group		(0.8	)		—
Proceeds from sale of disposal group		1.2			5.0
Net cash (used in) provided by investing activities	$	(0.2	)	$	4.8

For the nine months ended September 30, 2019 cash used in investing activities includes $1.2 million received from the sale of IP addresses offset by deconsolidated international cash of $0.8 million in connection with the Subsidiary Sale and $0.6 million invested in Sport-BLX, Inc.

Table of Contents

Cash Flows Provided by Financing Activities:

		Nine Months Ended
		September 30,
(Dollars in millions)		2019		2018
Net cash provided by (used in) financing activities	$	—	$	—

No cash was used for financing activities for the nine months ended September 30, 2019 and 2018.

We have various resources available to us for purposes of managing liquidity and capital needs. Our primary sources of liquidity include our cash and cash equivalents. Our primary liquidity needs relate to funding our operations.

We had $0.6 million cash and cash equivalents on hand as of September 30, 2019.

Our cash of $0.6 million as of September 30, 2019, which in addition to proceeds of $17,562,700 from the Orix transaction on October 1, 2019, are expected to fund our operations for the next twelve months. See Note 14 – Subsequent Events for further information on the Orix transaction.

Copyright Levies

See Note 12 - Litigation, Commitments and Contingencies in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 herein for further information.

Off Balance Sheet Arrangements

As of September 30, 2019, we did not have any material off-balance sheet arrangements.

Critical Accounting Policies and Estimates

A discussion of the Company’s critical accounting policies was provided in Part II Item 7 in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018.

Recent Accounting Pronouncements

See Note 2 - New Accounting Pronouncements in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 herein for further information.

Item 3. Quantitative and Qualitative Disclosures about Market Risk.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide the information required under this item.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Based on an evaluation of our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of September 30, 2019, the end of the period covered by this report, the Chairman and principal executive officer, Joseph A. De Perio, and the Chief Financial Officer, Francis Ruchalski, have concluded that the disclosure controls and procedures were effective.

Changes in 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 Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of September 30, 2019 based on the guidelines established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO 2013). Our internal control over financial reporting includes policies and procedures that provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted accounting principles. During the quarter ended September 30, 2019, management concluded there was no change in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(e) under the Exchange Act) that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Table of Contents

PART II. OTHER INFORMATION

Item 1. Legal Proceedings.

See Note 12 - Litigation, Commitments and Contingencies in our Notes to Condensed Consolidated Financial Statements in Part I, Item 1 herein for further information regarding our legal proceedings.

The Company is subject to various lawsuits, claims and other legal matters that arise in the ordinary course of conducting business (including litigation relating to our Legacy Businesses and discontinued operations). All such matters involve uncertainty and, accordingly, outcomes that cannot be predicted with assurance. As of September 30, 2019, we are unable to estimate with certainty the ultimate aggregate amount of monetary liability or financial impact that we may incur with respect to these matters. It is reasonably possible that the ultimate resolution of these matters, individually or in the aggregate, could materially affect our financial condition, results of the operations and cash flows. Similarly, the Company is the plaintiff in a number of matters in the United States and elsewhere where the potential outcomes could be materially beneficial to the Company. These outcomes are also uncertain.

Item 1A. Risk Factors.

As a “smaller reporting company” as defined by Item 10 of Regulation S-K, we are not required to provide the information required under this item.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Not applicable.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

Not applicable.

Item 6. Exhibits.

The following documents are filed as part of, or incorporated by reference into, this report:

Exhibit Number		Description of Exhibit
10.1		Form of Promissory Note dated September 30, 2019
10.2		Form of Promissory Note dated September 30, 2019
10.3		Securities Purchase Agreement dated October 1, 2019
10.4		Stockholders Agreement dated October 1, 2019
10.5		Assignment Relating to the Assignment and Assumption of Promissory Notes dated October 1, 2019
10.6		Assignment of Claims Agreement dated September 30, 2019
10.7		Equity Assignment Agreement dated September 30, 2019
31.1		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2		Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101		The following financial information from GlassBridge Enterprises, Inc.’s Quarterly Report on Form 10-Q for the period ended September 30, 2019, formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of Operations, (ii) the Condensed Consolidated Statements of Comprehensive Income (Loss), (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) the Notes to Condensed Consolidated Financial Statements.

Table of Contents

SIGNATURE

Pursuant to the requirements 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.

		GLASSBRIDGE ENTERPRISES, INC.

Date:	November 8, 2019		/s/ Francis Ruchalski
		Name:	Francis Ruchalski
		Title:	Chief Financial Officer (duly authorized officer and principal financial officer)

Execution Version

PROMISSORY NOTE

Date: September 30, 2019

Loan Amount: $9,000,000

Interest Rate: 7.50%

Borrower: Imation Enterprises Corp., a Delaware corporation

Note Holder: GlassBridge Enterprises, Inc., a Delaware corporation

1. BORROWER’S PROMISE TO PAY

(a) In partial consideration for the assignment and transfer of the Priority Interest (as defined in that certain Assignment of Claims Agreement by and between Borrower and Note Holder, dated as of the date hereof) to Borrower, Borrower promises to pay on the Maturity Date (as defined below) to the order of Note Holder the principal amount of Nine Million Dollars ($9,000,000) (the “Loan”), or, if less, the then outstanding and unpaid principal amount of the Loan, to pay interest on the unpaid principal amount of the Loan from time to time outstanding until paid in full at the interest rates, at the times and in the manner provided for below, and to pay all other amounts required by this Note.

(b) Borrower understands that the Note Holder may transfer this Note. This Note shall be binding on Borrower and Borrower’s successors and assigns and shall inure to the benefit of Note Holder and its successors and assigns. Note Holder may assign, without the consent of Borrower, all or a portion of Note Holder’s rights under this Note and the other documents, instruments and agreements entered into in connection with the transactions contemplated hereby. Prior written notice of such assignment shall be given by Note Holder to Borrower. The Note Holder or anyone who takes this Note by transfer and who is entitled to receive payments under this Note is hereafter called the “Note Holder.” Borrower may not assign, transfer or delegate any of Borrower’s obligations or agreements hereunder. No amendment, modification or waiver of any provision of this Note shall be effective unless it is in writing and signed by the Note Holder and Borrower.

2. INTEREST

(a) Borrower agrees to pay interest in respect of the unpaid principal balance of the Loan, from the date of borrowing until the Maturity Date, and as payments become due and payable pursuant to Section 4 of this Note, at a rate per annum equal to 7.50 % (the “Interest Rate”).

(b) The Borrower further agrees to pay interest on all other Obligations of the Borrower hereunder that are not paid or performed when due at the Interest Rate plus two percent (2%) (the “Overdue Rate”), but in no event in excess of the Maximum Rate (as defined below).

(c) Throughout the term of this Note, interest shall be calculated on a 365-day year (366 days in a leap year), but shall be computed for the actual number of days in the period for which interest is charged. If any payment of principal or interest to be made by Borrower shall become due on a day other than a Business Day, such payment shall be made on the preceding Business Day, and such reduction of time shall be included in computing any interest with respect to such payment.

3. MATURITY DATE

Subject to the other terms of this Note, the unpaid principal balance hereof, together with all unpaid interest accrued thereon, and all other amounts payable by Borrower under the terms of this Note shall be due and payable on the date that is the seventh (7th) anniversary of the date of this Note (the “Maturity Date”).

4. PAYMENTS

(a) Borrower shall make all payments due under this Note for principal, interest and other amounts in U.S. dollars in the form of cash, check, wire transfer or money order, not later than 12:00 p.m. New York time, on the day of payment, to such location as the Note Holder may in writing designate from time to time.

(b) All accrued interest on the outstanding principal balance hereof shall be due and payable annually in arrears, commencing on September 30, 2020 and thereafter on September 30 of each year until the Maturity Date.

	i.	$3,461,538, payable on March 31, 2021,
	ii.	$3,461,538, payable on March 31, 2022,
	iii.	$519,231, payable on March 31, 2023,
	iv.	$519,231, payable on March 31, 2024,
	v.	$519,231, payable on March 31, 2025 and
	vi.	$519,231, payable on March 31, 2026; with a balloon payment on the Maturity Date of all the then outstanding principal amount.

(d) Payments received by Holder pursuant to the terms hereof shall be applied in the following manner: first, to the payment of all interest accrued but unpaid to the date of such payment; and second, to the payment of principal, and interest shall thereupon cease to accrue upon the principal so credited. Notwithstanding anything to the contrary contained herein, after the occurrence and during the continuation of an Event of Default (as hereinafter defined), all amounts received by Note Holder from any party shall be applied in such order as Note Holder, in Note Holder’s sole discretion, may elect, including first to the payment of expenses of collection and Overdue Rate.

5. VOLUNTARY PREPAYMENT

(a) On or after the date which is 30 months from the date hereof, Borrower has the right to make payments of principal and accrued but unpaid interest at any time before such payments are due. A payment of any such principal and/or interest prior to its due date shall be referred to as a “Prepayment.” Borrower shall give the Note Holder at least two (2) Business Days’ irrevocable written notice of any Prepayment specifying the date and amount of such Prepayment. Borrower may not designate a payment as a Prepayment if Borrower has not made any and all payments due and owing under the Note as of the date of the Prepayment.

(b) Borrower may make a full Prepayment or partial Prepayment without paying a Prepayment fee. The Note Holder will use Prepayments to reduce the amount of principal that Borrower owes under this Note. However, the Note Holder may apply Prepayments to any accrued and unpaid interest due and owing on the Loan, or towards any other Obligations owed under the Note, before applying Prepayments to reduce the principal amount of the Note.

6. LOAN CHARGES

If a law, which applies to this Loan and which sets maximum loan charges (the “Maximum Rate”), is finally interpreted so that the interest or other loan charges collected or to be collected in connection with the Loan exceed the permitted limits, then: (a) any such loan charge shall be reduced by the amount necessary to reduce the charge to the permitted limit; and (b) any sums already collected from Borrower which exceeded permitted limits will be refunded to Borrower. The Note Holder may choose to make this refund by reducing the principal amount which is owed to Note Holder under this Note or by making a direct payment to Borrower. If a refund reduces principal, the reduction will be treated as a partial Prepayment in accordance with Section 5.

7. REPRESENTATIONS AND WARRANTIES; COVENANTS

(a)

Borrower represents and warrants to the Note Holder that:

	i.	Borrower is duly organized and validly existing in good standing (or the equivalent thereof) under the laws of Borrower’s jurisdiction of formation, and is duly qualified in each foreign jurisdiction where Borrower’s business or property so requires;

	ii.	the execution, delivery and performance by Borrower of this Note and any other agreement executed in connection herewith by Borrower do not and will not violate or conflict with any law, rule, regulation, judgment or order binding on Borrower or Borrower’s assets, any agreement or instrument to which Borrower is a party or by which Borrower or Borrower’s assets are bound, or Borrower’s constituent documents;

	iii.	this Note and any other agreement executed in connection herewith by Borrower have been duly executed by Borrower and constitute legal, valid and binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar law affecting the enforcement of creditors rights generally or by equitable principles relating to enforceability;

	iv.	no authorization, consent, approval or license from, or filing or registration with, any court, governmental agency, fiscal authority or public office is necessary in connection with the execution, delivery or performance by Borrower of this Note or any other agreement executed in connection herewith by Borrower, except such as have been taken or obtained and are in full force and effect;

	v.	there are no pending or known threatened investigations, actions, suits or proceedings against or affecting Borrower before any arbitrator, court, commission, bureau or other governmental agency or instrumentality, which (A) purports to affect the legality, validity or enforceability of this Note or the consummation of the transactions contemplated hereby or (B) could reasonably be expected to have a Material Adverse Effect on the financial condition, operations, business or assets of Borrower;

	vi.	the unaudited balance sheet and statements of operations, shareholders’ equity and cash flows as of and for the eight months ended August 31, 2019 previously delivered to the Note Holder and attached hereto as Exhibit A are true and correct in all material respects and fairly present the financial condition of Borrower as of the date thereof, and there has been no material adverse change in the financial condition of Borrower since the date of such financial statements of Borrower; and

(b)

Borrower covenants and agrees with the Note Holder that:

	i.	Borrower will promptly notify the Note Holder of the occurrence of any default or Event of Default hereunder or otherwise in respect of the Loan;

	ii.	Borrower shall not sell, transfer, pledge or encumber or permit the sale, transfer, pledge or encumbrance or issuance of any interest in Borrower, directly or indirectly, that would or might cause a change in control of Borrower;

	iii.	So long as this Note or any other Obligations shall remain unpaid, the Borrower shall, unless the Note Holder shall otherwise consent in writing, perform each of the affirmative covenants set forth on Part I of Schedule A attached hereto;

	iv.	So long as this Note or any other Obligations shall remain unpaid, the Borrower shall not, without the prior written consent of the Note Holder, perform any of the covenants set forth on Part II of Schedule A attached hereto.

8. EVENTS OF DEFAULT AND REMEDIES

(a) Events of Default. The occurrence of any one or more of the following events, acts or occurrences shall constitute an event of default (an “Event of Default”) hereunder:

failure by Borrower to make any payment in respect of any Obligations within 5 Business Days when due and payable;

	ii.	any material failure by the Borrower to comply with any of the Financial Covenants;

	iii.	material breach or material default (if the effect of such breach or default is to cause obligations thereunder to become due or redeemed or to permit the holder or holders of such obligations to declare such obligations due or require such obligations to be redeemed prior to their stated maturity) by Borrower in any of the terms or conditions of any agreement between Borrower and the Note Holder;

	iv.	any representation made by Borrower to the Note Holder under this Note having been false or misleading in any material respect when made;

	v.	insolvency of Borrower (howsoever determined);

	vi.	the commencement of any proceedings by or against Borrower under any bankruptcy, reorganization, arrangement of debt, insolvency, receivership, liquidation, dissolution or similar laws relating to the relief of debtors, or the making of an assignment for the benefit of creditors, which shall not be terminated or dismissed within 60 days after the commencement thereof;

	vii.	Borrower notifying Note Holder or otherwise unequivocally demonstrating an intention to repudiate Borrower’s obligations under this Note;

	viii.	it becomes unlawful for Borrower to perform any of its obligations under the Note if the effect thereof would reasonably be expected to have a Material Adverse Effect;

	ix.	a Governmental Authority taking an action that Materially Adversely Effects the Borrower’s ability to repay the Loan; or

	x.	default in the performance or observance by Borrower of any covenant, agreement or obligation under this Note or any other contract, instrument or agreement relating to the obligations evidenced hereby, which shall continue for a period of 30 days after Borrower’s receipt of written notice from Note Holder of such Default.

(b) Remedies.

	i.	Upon the occurrence of an Event of Default described in Section 7(a)(i) above, the Note Holder may notify Borrower in writing that if Borrower does not pay the overdue amount by the date designated by the Note Holder (such date shall be at least 10 days after the date on which the notice is mailed to Borrower or delivered by other means), the Note Holder may require Borrower to pay immediately the full Loan amount then outstanding and all the interest due and owing on such amount.

	ii.	Upon the occurrence of an Event of Default described in Section 7(a)(i) above, the interest rate payable by Borrower shall increase to the Overdue Rate for the current and future periods until such time as the Event of Default is remedied, at which time the interest rate shall drop back to the Interest Rate.

	iii.	Upon the occurrence of an Event of Default described in any of Sections 7(a)(ii)-(iv), (vii) and (x) above, Note Holder may declare the principal of and interest on the Loan and all other amounts owing hereunder to be immediately due and payable, whereupon same shall become immediately due and payable, without presentment, demand, protest or notice of any kind, all of which Borrower hereby expressly waives.

	iv.	Upon the occurrence of an Event of Default described in any of Sections 7(a)(v), (vi), (viii) or (ix) above, this Loan (including the principal of and interest on the Loan and all other amounts owing hereunder) shall immediately become due and payable, without the need for action on the part of Note Holder, without presentment, demand, protest or notice of any kind, all of which Borrower hereby expressly waives.

	v.	In the event the principal balance of the Loan, interest thereon and any other amount owed hereunder is not paid when due (whether upon maturity or otherwise), the Note Holder shall have all the rights and remedies provided under law or equity. No failure or delay by the Note Holder to exercise any right, power or privilege under this Note, shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. No notice to or demand on Borrower shall entitle Borrower to any other or further notice or demand, or constitute a waiver of the Note Holder’s rights.

	vi.	If the Note Holder has required Borrower to pay immediately in full as described above, or otherwise provided Borrower with a notice of Default hereunder, the Note Holder shall have the right to be reimbursed by Borrower for all of its costs and expenses incurred in connection with protecting its rights and /or enforcing this Note to the extent not prohibited by applicable law. Such expenses include, but are not limited to, reasonable attorneys’ fees.

9. GIVING OF NOTICES

(a) Unless applicable law requires a different method, any notice that must be given to Borrower under this Note will be given in writing and shall be effective, if mailed, three days after deposit in the mails, postage prepaid; if sent by email, when sent with a confirmation received; if delivered by hand or courier, when delivered against a receipt; or if sent by overnight courier, on the next Business Day, in each case, to the address below or at a different address if Borrower gives the Note Holder a notice of such different address.

Imation Enterprises Corp.
510 Madison Ave, 9^th Floor
New York, NY 10022
Attn: Daniel Strauss, CEO

With a copy to:

Loeb & Loeb LLP
345 Park Avenue
New York, NY 10154
Attn: Lloyd Rothenberg, Esq.
Email: lrothenberg@loeb.com

(b) Unless applicable law requires a different method, any notice that must be given to the Note Holder under this Note will be given in writing and shall be effective, if mailed, three days after deposit in the mails, postage prepaid; if sent by email, when sent with a confirmation received; if delivered by hand or courier, when delivered against a receipt; or if sent by overnight courier, on the next Business Day, in each case, to the address below or at a different address if Borrower gives the Note Holder a notice of such different address.

GlassBridge Enterprises, Inc.,
510 Madison Ave, 9^th Floor
New York, NY 10022
Attn: Daniel Strauss, CEO

With a copy to:

Loeb & Loeb LLP
345 Park Avenue
New York, NY 10154
Attn: Lloyd Rothenberg, Esq.
Email: lrothenberg@loeb.com

10. WAIVERS

Borrower and any other person who has obligations under this Note waive the rights of Presentment and Notice of Dishonor. “Presentment” means the right to require the Note Holder to demand payment of amounts due. “Notice of Dishonor” means the right to require the Note Holder to give notice to other persons that amounts due have not been paid.

11. MISCELLANEOUS.

(a) THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK (WITHOUT GIVING EFFECT TO THE PRINCIPLES THEREOF RELATING TO CONFLICT OF LAWS TO THE EXTENT SUCH PRINCIPLES WOULD DIRECT THE APPLICATION OF THE LAW OF ANOTHER JURISDICTION).

(b) EACH OF BORROWER AND THE NOTE HOLDER, BY ITS ACCEPTANCE HEREOF, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT TO A JURY TRIAL IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS NOTE. THE BORROWER HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN NEW YORK COUNTY, NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN BORROWER AND NOTE HOLDER PERTAINING TO THIS NOTE OR TO ANY MATTER ARISING OUT OF OR RELATED TO THIS NOTE; PROVIDED, THAT NOTE HOLDER AND BORROWER ACKNOWLEDGE THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF NEW YORK; AND FURTHER PROVIDED, THAT NOTHING IN THIS NOTE SHALL BE DEEMED OR OPERATE TO PRECLUDE NOTE HOLDER FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO COLLECT THE OBLIGATIONS OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF NOTE HOLDER. BORROWER EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND BORROWER WAIVES ANY OBJECTION THAT IT MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS. BORROWER HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO BORROWER AT THE ADDRESS SET FORTH ABOVE.

(c) All payments hereunder shall be made without defense, setoff or counterclaim, and free and clear of, and without deduction for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, and all interest, penalties and other liabilities with respect thereto (collectively, “Taxes”), now or hereafter imposed, levied, collected, withheld or assessed by any jurisdiction, or any department, agency, state, political subdivision or taxing authority thereof or therein. If any Taxes are so levied or imposed, Borrower agrees to pay the full amount thereof, and such additional amounts as may be necessary so that each net payment received by the Note Holder will not be less than the amount provided for herein. Borrower will furnish to the Note Holder within 30 days after each payment of Taxes is due, originals or certified copies of tax receipts evidencing such payment. This provision shall survive repayment of the Loan and cancellation of this Note.

(d) This Note may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

(e) Section headings are for convenience of reference and shall not be construed as part of this Note.

12. DEFINITIONS:

“Business Day” shall mean a day other than Saturday, Sunday, a federal or state holiday, or other day on which banks in New York, New York are required or permitted to be closed.

“Financial Covenants” are the covenants set forth on Schedule A attached hereto under Part I, clause (a) and (b).

“Governmental Authority” means any governmental authority or regulatory body.

“Material Adverse Effect” means a material adverse effect on (a) the business, condition (financial or otherwise), operations, performance and properties of Borrower, (b) the rights or remedies of the Note Holder under this Note or (c) the ability of Borrower to perform any of its obligations under this Note.

“Obligations” means all amounts payable by the Borrower under this Note, and all claims of the Note Holder against Borrower, now existing or hereafter arising, direct or indirect, absolute or contingent, secured or unsecured, matured or unmatured, monetary or non-monetary, in each case above for purposes of such definition of “Obligations,” arising out of this Note and the transactions contemplated hereby and the documents related hereto, and all extensions, renewals, refunding, replacements and modifications of any of the foregoing.

“Organizational Documents” means, with respect to any legal Person, such Person’s certificate or articles of incorporation, formation or organization, bylaws, operating agreement, partnership agreement, declaration of trust or other trust instrument, or other equivalent or comparable formation and/or constitutive documents, as applicable.

“Person” means an individual, partnership, corporation (including a business trust), joint stock company, trust, unincorporated association, joint venture, limited liability company or other entity, or a government or any political subdivision or agency thereof.

By signing below, the Borrower becomes obligated under this Note.

BORROWER:

IMATION ENTERPRISES CORP.

By:	/s/ Daniel Strauss
Name:	Daniel Strauss
Title:	President

Schedule A

Part I - Affirmative Covenants:

(a)	Furnish or cause to be furnished to the Note Holder, as soon as available and in any event within forty-five (45) days following the end of each calendar quarter, an unaudited balance sheet, statement of income, statement of cash flows and statement of contingent liabilities or other comparable financial statements of the Borrower as of the end of the applicable period, which financial statements shall be prepared in accordance with generally acceptable accounting principles, and in a manner consistent with the financial statements delivered to the Note Holder in contemplation of entering into this Note and the other Loan Documents and present fairly the financial condition of the Borrower;

(b)	Furnish or cause to be furnished to the Note Holder, as soon as available, and in any event within ninety (90) days following the end of each calendar year, an audited balance sheet, statement of income, statement of cash flows and statement of contingent liabilities or other comparable financial statements of the Borrower as of the end of the calendar year, which financial statements shall be prepared in accordance with generally acceptable accounting principles, and in a manner consistent with the financial statements delivered to the Note Holder and attached hereto as Exhibit A in contemplation of entering into this Note and the other Loan Documents and present fairly the financial condition of the Borrower;

(c)	If the Borrower is a legal Person, promptly furnish to the Note Holder copies of any amendment, modification or supplement to any Organizational Document;

(d)	Comply in all material respects with all applicable laws, rules, regulations and orders, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments and governmental charges imposed upon the undersigned or the undersigned’s property, except to the extent contested in good faith and/or by appropriate proceedings and where adequate reserves are maintained;

(e)	Promptly notify the Note Holder in writing of any and all pending or threatened (in writing) litigation and any and all pending or threatened (in writing) proceedings before any Governmental Authority, which, if adversely determined with respect to the Borrower after taking into account all undisputed applicable insurance and undisputed indemnities, could reasonably be expected to have a Material Adverse Effect; and

(f)	Notify the Note Holder in writing promptly upon becoming aware of the occurrence of any Default or Event of Default together with a detailed statement by the Borrower setting forth the steps being taken to cure the effect thereof,

(g)	Maintain at all times appropriate levels of insurance coverage, as determined by the Board of Directors of Borrower.

Part II - Negative Covenants:

(a)	Sell or dispose of all or substantially all of Borrowers assets;

(b)	Enter into any lending, borrowing or other commercial transaction with any of its employees, directors, Affiliates other than loans or advances to employees in the ordinary course of business and other than commercial transactions or an arms-length; and

(c)	make any changes in any of its business objectives, purposes, or operations that could reasonably be expected to have a Material Adverse Effect on Borrower’s ability to repay the Obligations.

Exhibit A

Unaudited Balance Sheet

Attached.

Execution Version

PROMISSORY NOTE

Date: September 30, 2019

Loan Amount: $4,000,000

Interest Rate: 7.50%

Borrower: Imation Enterprises Corp., a Delaware corporation

Note Holder: GlassBridge Enterprises, Inc., a Delaware corporation

1. BORROWER’S PROMISE TO PAY

(a) In partial consideration for the assignment and transfer of the Shares (as defined in that certain Equity Assignment Agreement by and among Borrower, Note Holder and Sport-BLX, Inc., dated as of the date hereof) to Borrower, Borrower promises to pay on the Maturity Date (as defined below) to the order of Note Holder the principal amount of Four Million Dollars ($4,000,000) (the “Loan”), or, if less, the then outstanding and unpaid principal amount of the Loan, to pay interest on the unpaid principal amount of the Loan from time to time outstanding until paid in full at the interest rates, at the times and in the manner provided for below, and to pay all other amounts required by this Note.

2. INTEREST

3. MATURITY DATE

4. PAYMENTS

	i.	$1,538,462, payable on March 31, 2021,
	ii.	$1,538,462, payable on March 31, 2022,
	iii.	$230,769, payable on March 31, 2023,
	iv.	$230,769, payable on March 31, 2024,
	v.	$230,769, payable on March 31, 2025 and
	vi.	$230,769, payable on March 31, 2026; with a balloon payment on the Maturity Date of all the then outstanding principal amount.

5. VOLUNTARY PREPAYMENT

6. LOAN CHARGES

7. REPRESENTATIONS AND WARRANTIES; COVENANTS

(a) Borrower represents and warrants to the Note Holder that:

	i.	Borrower is duly organized and validly existing in good standing (or the equivalent thereof) under the laws of Borrower’s jurisdiction of formation, and is duly qualified in each foreign jurisdiction where Borrower’s business or property so requires;

	ii.	the execution, delivery and performance by Borrower of this Note and any other agreement executed in connection herewith by Borrower do not and will not violate or conflict with any law, rule, regulation, judgment or order binding on Borrower or Borrower’s assets, any agreement or instrument to which Borrower is a party or by which Borrower or Borrower’s assets are bound, or Borrower’s constituent documents;

	iii.	this Note and any other agreement executed in connection herewith by Borrower have been duly executed by Borrower and constitute legal, valid and binding obligations of Borrower, enforceable against Borrower in accordance with their respective terms, except as enforceability may be limited by applicable bankruptcy, insolvency or similar law affecting the enforcement of creditors rights generally or by equitable principles relating to enforceability;

	iv.	no authorization, consent, approval or license from, or filing or registration with, any court, governmental agency, fiscal authority or public office is necessary in connection with the execution, delivery or performance by Borrower of this Note or any other agreement executed in connection herewith by Borrower, except such as have been taken or obtained and are in full force and effect;

	v.	there are no pending or known threatened investigations, actions, suits or proceedings against or affecting Borrower before any arbitrator, court, commission, bureau or other governmental agency or instrumentality, which (A) purports to affect the legality, validity or enforceability of this Note or the consummation of the transactions contemplated hereby or (B) could reasonably be expected to have a Material Adverse Effect on the financial condition, operations, business or assets of Borrower;

	vi.	the unaudited balance sheet and statements of operations, shareholders’ equity and cash flows as of and for the eight months ended August 31, 2019 previously delivered to the Note Holder and attached hereto as Exhibit A are true and correct in all material respects and fairly present the financial condition of Borrower as of the date thereof, and there has been no material adverse change in the financial condition of Borrower since the date of such financial statements of Borrower; and

(b) Borrower covenants and agrees with the Note Holder that:

	i.	Borrower will promptly notify the Note Holder of the occurrence of any default or Event of Default hereunder or otherwise in respect of the Loan;

	ii.	Borrower shall not sell, transfer, pledge or encumber or permit the sale, transfer, pledge or encumbrance or issuance of any interest in Borrower, directly or indirectly, that would or might cause a change in control of Borrower;

	iii.	So long as this Note or any other Obligations shall remain unpaid, the Borrower shall, unless the Note Holder shall otherwise consent in writing, perform each of the affirmative covenants set forth on Part I of Schedule A attached hereto;

	iv.	So long as this Note or any other Obligations shall remain unpaid, the Borrower shall not, without the prior written consent of the Note Holder, perform any of the covenants set forth on Part II of Schedule A attached hereto.

8. EVENTS OF DEFAULT AND REMEDIES

(a) Events of Default. The occurrence of any one or more of the following events, acts or occurrences shall constitute an event of default (an “Event of Default”) hereunder:

failure by Borrower to make any payment in respect of any Obligations within 5 Business Days when due and payable;

	ii.	any material failure by the Borrower to comply with any of the Financial Covenants;

	iii.	material breach or material default (if the effect of such breach or default is to cause obligations thereunder to become due or redeemed or to permit the holder or holders of such obligations to declare such obligations due or require such obligations to be redeemed prior to their stated maturity) by Borrower in any of the terms or conditions of any agreement between Borrower and the Note Holder;

	iv.	any representation made by Borrower to the Note Holder under this Note having been false or misleading in any material respect when made;

	v.	insolvency of Borrower (howsoever determined);

	vi.	the commencement of any proceedings by or against Borrower under any bankruptcy, reorganization, arrangement of debt, insolvency, receivership, liquidation, dissolution or similar laws relating to the relief of debtors, or the making of an assignment for the benefit of creditors, which shall not be terminated or dismissed within 60 days after the commencement thereof;

	vii.	Borrower notifying Note Holder or otherwise unequivocally demonstrating an intention to repudiate Borrower’s obligations under this Note;

	viii.	it becomes unlawful for Borrower to perform any of its obligations under the Note if the effect thereof would reasonably be expected to have a Material Adverse Effect;

	ix.	a Governmental Authority taking an action that Materially Adversely Effects the Borrower’s ability to repay the Loan; or

	x.	default in the performance or observance by Borrower of any covenant, agreement or obligation under this Note or any other contract, instrument or agreement relating to the obligations evidenced hereby, which shall continue for a period of 30 days after Borrower’s receipt of written notice from Note Holder of such Default.

(b) Remedies.

	i.	Upon the occurrence of an Event of Default described in Section 7(a)(i) above, the Note Holder may notify Borrower in writing that if Borrower does not pay the overdue amount by the date designated by the Note Holder (such date shall be at least 10 days after the date on which the notice is mailed to Borrower or delivered by other means), the Note Holder may require Borrower to pay immediately the full Loan amount then outstanding and all the interest due and owing on such amount.

	ii.	Upon the occurrence of an Event of Default described in Section 7(a)(i) above, the interest rate payable by Borrower shall increase to the Overdue Rate for the current and future periods until such time as the Event of Default is remedied, at which time the interest rate shall drop back to the Interest Rate.

	iii.	Upon the occurrence of an Event of Default described in any of Sections 7(a)(ii)-(iv), (vii) and (x) above, Note Holder may declare the principal of and interest on the Loan and all other amounts owing hereunder to be immediately due and payable, whereupon same shall become immediately due and payable, without presentment, demand, protest or notice of any kind, all of which Borrower hereby expressly waives.

	iv.	Upon the occurrence of an Event of Default described in any of Sections 7(a)(v), (vi), (viii) or (ix) above, this Loan (including the principal of and interest on the Loan and all other amounts owing hereunder) shall immediately become due and payable, without the need for action on the part of Note Holder, without presentment, demand, protest or notice of any kind, all of which Borrower hereby expressly waives.

	v.	In the event the principal balance of the Loan, interest thereon and any other amount owed hereunder is not paid when due (whether upon maturity or otherwise), the Note Holder shall have all the rights and remedies provided under law or equity. No failure or delay by the Note Holder to exercise any right, power or privilege under this Note, shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. No notice to or demand on Borrower shall entitle Borrower to any other or further notice or demand, or constitute a waiver of the Note Holder’s rights.

	vi.	If the Note Holder has required Borrower to pay immediately in full as described above, or otherwise provided Borrower with a notice of Default hereunder, the Note Holder shall have the right to be reimbursed by Borrower for all of its costs and expenses incurred in connection with protecting its rights and /or enforcing this Note to the extent not prohibited by applicable law. Such expenses include, but are not limited to, reasonable attorneys’ fees.

9. GIVING OF NOTICES

Imation Enterprises Corp.

510 Madison Ave, 9^th Floor

New York, NY 10022

Attn: Daniel Strauss, CEO

With a copy to:

Loeb & Loeb LLP

345 Park Avenue

New York, NY 10154

Attn: Lloyd Rothenberg, Esq.

Email: lrothenberg@loeb.com

GlassBridge Enterprises, Inc.,

510 Madison Ave, 9^th Floor

New York, NY 10022

Attn: Daniel Strauss, CEO

With a copy to:

Loeb & Loeb LLP

345 Park Avenue

New York, NY 10154

Attn: Lloyd Rothenberg, Esq.

Email: lrothenberg@loeb.com

10. WAIVERS

11. MISCELLANEOUS.

(d) This Note may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

(e) Section headings are for convenience of reference and shall not be construed as part of this Note.

12. DEFINITIONS:

“Business Day” shall mean a day other than Saturday, Sunday, a federal or state holiday, or other day on which banks in New York, New York are required or permitted to be closed.

“Financial Covenants” are the covenants set forth on Schedule A attached hereto under Part I, clause (a) and (b).

“Governmental Authority” means any governmental authority or regulatory body.

By signing below, the Borrower becomes obligated under this Note.

BORROWER:

IMATION ENTERPRISES CORP.

By:	/s/ Daniel Strauss
Name:	Daniel Strauss
Title:	President

Schedule A

Part I - Affirmative Covenants:

(a)	Furnish or cause to be furnished to the Note Holder, as soon as available and in any event within forty-five (45) days following the end of each calendar quarter, an unaudited balance sheet, statement of income, statement of cash flows and statement of contingent liabilities or other comparable financial statements of the Borrower as of the end of the applicable period, which financial statements shall be prepared in accordance with generally acceptable accounting principles, and in a manner consistent with the financial statements delivered to the Note Holder in contemplation of entering into this Note and the other Loan Documents and present fairly the financial condition of the Borrower;

(b)	Furnish or cause to be furnished to the Note Holder, as soon as available, and in any event within ninety (90) days following the end of each calendar year, an audited balance sheet, statement of income, statement of cash flows and statement of contingent liabilities or other comparable financial statements of the Borrower as of the end of the calendar year, which financial statements shall be prepared in accordance with generally acceptable accounting principles, and in a manner consistent with the financial statements delivered to the Note Holder and attached hereto as Exhibit A in contemplation of entering into this Note and the other Loan Documents and present fairly the financial condition of the Borrower;

(c)	If the Borrower is a legal Person, promptly furnish to the Note Holder copies of any amendment, modification or supplement to any Organizational Document;

(d)	Comply in all material respects with all applicable laws, rules, regulations and orders, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments and governmental charges imposed upon the undersigned or the undersigned’s property, except to the extent contested in good faith and/or by appropriate proceedings and where adequate reserves are maintained;

(e)	Promptly notify the Note Holder in writing of any and all pending or threatened (in writing) litigation and any and all pending or threatened (in writing) proceedings before any Governmental Authority, which, if adversely determined with respect to the Borrower after taking into account all undisputed applicable insurance and undisputed indemnities, could reasonably be expected to have a Material Adverse Effect; and

(f)	Notify the Note Holder in writing promptly upon becoming aware of the occurrence of any Default or Event of Default together with a detailed statement by the Borrower setting forth the steps being taken to cure the effect thereof,

(g)	Maintain at all times appropriate levels of insurance coverage, as determined by the Board of Directors of Borrower.

Part II - Negative Covenants:

(a)	Sell or dispose of all or substantially all of Borrowers assets;

(b)	Enter into any lending, borrowing or other commercial transaction with any of its employees, directors, Affiliates other than loans or advances to employees in the ordinary course of business and other than commercial transactions or an arms-length; and

(c)	make any changes in any of its business objectives, purposes, or operations that could reasonably be expected to have a Material Adverse Effect on Borrower’s ability to repay the Obligations.

Exhibit A

Unaudited Balance Sheet

Attached.

Execution Version

SECURITIES PURCHASE AGREEMENT

This Securities Purchase Agreement (this “Agreement”), dated as of October 1, 2019, is entered into between GlassBridge Enterprises, Inc., a Delaware corporation (“Seller”), and ORIX PTP HOLDINGS, LLC, a Delaware limited liability company (“Buyer”).

RECITALS

WHEREAS, Seller owns all of the issued and outstanding shares of common stock, par value $0.01 per share (the “Common Stock”), of Imation Enterprises Corp., a Delaware corporation (the “Company”); and

WHEREAS, immediately prior to the Closing (as defined below), the Company issued to Seller (i) a promissory note, dated as of September 30, 2019, in the original principal amount of $9,000,000 and with a maturity date of September 30, 2026 (“Levy Note”) and (ii) a promissory note, dated as of September 30, 2019, in the original principal amount of $4,000,000 and with a maturity date of September 30, 2026 (“Sport-BLX Note” and collectively with the Levy Note, the “Notes”); and

WHEREAS, Seller wishes to sell to Buyer, and Buyer wishes to purchase from Seller, 201 shares of Common Stock of the Company (the “Shares”), which constitutes 20.10% of the issued and outstanding shares of Common Stock of the Company, and the Notes (collectively with the Shares, the “Securities”), subject to the terms and conditions set forth herein.

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

PURCHASE AND SALE

Section 1.1 Purchase and Sale. Subject to the terms and conditions set forth herein, at the Closing (as defined herein), Seller shall sell, transfer and assign to Buyer, and Buyer shall purchase from Seller, all of Seller’s right, title and interest in and to the Securities, free and clear of any liens, pledges, security interests, charges, claims, encumbrances, agreements, options, voting trusts, proxies and other arrangements or restrictions of any kind other than pursuant to applicable securities laws (“Encumbrances”), for the consideration specified in Section 1.2.

Section 1.2 Purchase Price. The aggregate purchase price for the Securities shall be $17,562,700 (the “Purchase Price”). Buyer shall pay the Purchase Price to Seller at the Closing in cash, by wire transfer of immediately available funds in accordance with the wire transfer instructions set forth in Section 1.2 of the Disclosure Schedules. Seller and Buyer agree that the Purchase Price shall be allocated among the Securities for all purposes (including tax and financial accounting) as shown on the allocation schedule attached hereto as Exhibit A.

Section 1.3 Closing. The closing of the transactions contemplated by this Agreement (the “Closing”) shall take place simultaneously with the execution of this Agreement on the date of this Agreement (the “Closing Date”) at the offices of Norton Rose Fulbright US LLP, New York, New York, or on such other date or at such other place as Buyer and Seller may agree in writing. The consummation of the transactions contemplated by this Agreement shall be deemed to occur at 11:59 p.m. on the Closing Date.

Section 1.4 Transfer Taxes. Buyer and Seller shall each pay one-half (1/2) of any sales, use or transfer taxes, documentary charges, recording fees or similar taxes, charges, fees or expenses, if any, that become due and payable as a result of the transactions contemplated by this Agreement.

Section 1.5 Withholding Taxes. Buyer and the Company shall be entitled to deduct and withhold from the Purchase Price all taxes that Buyer and the Company may be required to deduct and withhold under any provision of tax law. All such withheld amounts shall be treated as delivered to Seller hereunder. Buyer acknowledges and agrees that if Seller delivers a completed Form W-9 (Request for Taxpayer Identification Number and Certification), there will not be any amount deducted or withheld from the Purchase Price.

ARTICLE 2

REPRESENTATIONS AND WARRANTIES OF SELLER

Seller represents and warrants to Buyer that the statements contained in this ARTICLE 2 are true and correct as of the date hereof. For purposes of this ARTICLE 2, “Seller’s knowledge” shall mean the actual knowledge of any director or officer of Seller or the Company and any Subsidiary, or what such director or officer would reasonably be expected to have knowledge of after due inquiry of such person’s direct reports or, if different, the person at the Company or such Subsidiary who is likely to have the relevant knowledge as to the subject matter of the applicable representation and warranty.

Section 2.1 Organization and Authority of Seller; Enforceability. Seller is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware. Seller has full corporate power and authority to enter into this Agreement and the documents to be delivered hereunder, to carry out its obligations hereunder and to consummate the transactions contemplated hereby. The execution, delivery and performance by Seller of this Agreement and the documents to be delivered hereunder and the consummation of the transactions contemplated hereby have been duly authorized by all requisite corporate action on the part of Seller. This Agreement and the documents to be delivered hereunder have been duly executed and delivered by Seller, and (assuming due authorization, execution and delivery by Buyer) this Agreement and the documents to be delivered hereunder constitute legal, valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms, subject as to enforcement to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws of general application relating to or affecting creditors’ rights and to general equitable principles.

- 2 -

Section 2.2 Organization, Authority and Qualification of the Company. The Company is a corporation duly organized, validly existing and in good standing under the laws of the state of Delaware and has full corporate power and authority to own, operate or lease the properties and assets now owned, operated or leased by it and to carry on its business as it has been and is currently conducted. The Company and each Subsidiary is duly licensed or qualified to do business and is in good standing in each jurisdiction in which the respective properties owned or leased by it or the operation of its respective business as currently conducted makes such licensing or qualification necessary. All corporate actions taken by the Company in connection with this Agreement and the documents to be delivered hereunder will be duly authorized on or prior to the Closing.

Section 2.3 Subsidiaries; Equity Interests.

(a) Except as disclosed in Section 2.3(a) of the Disclosure Schedules, the Company does not have any Subsidiaries, and all of the outstanding Equity Interests (as defined herein) in such Subsidiaries set forth in Section 2.3(a) of the Disclosure Schedules have been validly issued, are fully paid and nonassessable and are owned by the Company in the amounts specified in Section 2.3(a) of the Disclosure Schedules, free and clear of all Encumbrances, other than pursuant to applicable securities laws.

(b) Except as disclosed in Section 2.3(b) of the Disclosure Schedules, neither the Company nor any Subsidiary owns, nor has any Equity Interests in any other Person (except, in the case of the Company, for Equity Interests owned in the Subsidiaries as disclosed in Section 2.3(a) of the Disclosure Schedules), and all of the outstanding Equity Interests disclosed in Section 2.3(b) of the Disclosure Schedules have been validly issued, are fully paid and nonassessable and are owned by the Company or any Subsidiary, as applicable, in the amounts specified in Section 2.3(b) of the Disclosure Schedules, free and clear of all Encumbrances, other than pursuant to applicable securities laws.

(i) “Equity Interests” means shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity ownership interests in a Person, and any warrants, options or other rights entitling the holder thereof to purchase or acquire any such equity interest.

(ii) “Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.

- 3 -

(iii) “Person” means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association, or other entity.

(iv) “Subsidiary” means, with respect to any Person, any other Person the accounts of which would be consolidated with those of such Person in such Person’s consolidated financial statements if such financial statements were prepared in accordance with GAAP (as defined herein) as well as any other Person (a) of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held, by such Person or (b) that is, as of such date, otherwise controlled by such Person by the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. Unless otherwise expressly stated, the term “Subsidiary” shall refer to a Subsidiary of the Company.

Section 2.4 No Conflicts; Consents. The execution, delivery and performance by Seller of this Agreement and the documents to be delivered hereunder, and the consummation of the transactions contemplated hereby and thereby, do not and will not: (a) conflict with or result in a violation or breach of, or default under, any provision of the certificate of incorporation, by-laws or other organizational documents of Seller, the Company or any Subsidiary; (b) conflict with or result in a violation or breach of any provision of any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to Seller or the Company; (c) require the consent, notice or other action by any Person under, conflict with, result in a violation or breach of, constitute a default or an event that, with or without notice or lapse of time or both, would constitute a default under, result in the acceleration of or create in any party the right to accelerate, terminate, modify or cancel any Contract to which Seller, the Company or any Subsidiary is a party or by which Seller or the Company is bound or to which any of their respective properties and assets are subject; (d) result in the creation or imposition of any Encumbrance on the Securities or any properties or assets of the Company or any Subsidiary; or (e) result in the loss or impairment of, diminish or detract from, or interfere with the value, use or ownership of any properties or assets of Seller, the Company or any Subsidiary. No consent, approval, waiver or authorization is required to be obtained by Seller or the Company or any Subsidiary from any Person in connection with the execution, delivery and performance by Seller of this Agreement and the documents to be delivered hereunder and the consummation of the transactions contemplated hereby and thereby.

Section 2.5 Legal Proceedings; Governmental Orders. Except as set forth on Schedule 2.5 of the Disclosure Schedules, there is no claim, action, suit, proceeding or governmental investigation (“Action”) of any nature pending or, to Seller’s knowledge, threatened (a) against or by the Company or any Subsidiary affecting any of their respective properties or assets (or by or against Seller or any affiliate thereof and relating to the Company or any Subsidiary); or (b) against or by the Company, any Subsidiary, Seller or any affiliate of Seller that challenges or seeks to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. To Seller’s knowledge, no event has occurred or circumstances exist that may give rise to, or serve as a basis for, any such Action. There is no outstanding order, writ, judgment, injunction, decree, stipulation, determination or award entered by or with any Governmental Authority and no unsatisfied judgments, penalties or awards against or affecting the Company or any Subsidiary or any of their properties or assets.

- 4 -

Section 2.6 Compliance With Laws; Permits. The Company and each Subsidiary has complied, and is now complying, with all laws applicable to it or its business, properties or assets. All permits, licenses, approvals, authorizations, registrations, certificates and similar rights required to be obtained from Governmental Authorities for the Company and each Subsidiary to conduct its respective business or own its respective properties or assets have been obtained by it and are valid and in full force and effect.

Section 2.7 Financial Statements.

(a) True, correct and complete copies of the Company’s unaudited consolidated balance sheet and statements of operations, shareholders’ equity and cash flows as of and for the eight months ended August 31, 2019 are set forth in Section 2.7 of the Disclosure Schedules (collectively, the “Financial Statements”). The balance sheet of the Company as of August 31, 2019 is referred to herein as the “Balance Sheet” and the date thereof as the “Balance Sheet Date.”

(b) The Financial Statements have been prepared in accordance with United States generally accepted accounting principles (“GAAP”) applied on a consistent basis throughout the period involved, subject to normal and recurring year-end adjustments (the effect of which will not be materially adverse) and the absence of notes, in the case of the six-month Financial Statements. The Financial Statements are based on the books and records of the Company, and fairly present the financial condition of the Company as of the respective dates they were prepared and the results of the operations of the Company for the periods indicated. The Company maintains a standard system of accounting established and administered in accordance with GAAP.

Section 2.8 Undisclosed Liabilities. Neither the Company nor any Subsidiary has any liabilities, obligations or commitments of any nature whatsoever, asserted or unasserted, known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured, or otherwise (“Liabilities”), except (a) those which are adequately reflected or reserved against in the Balance Sheet as of the Balance Sheet Date, and (b) those which have been incurred in the ordinary course of business consistent with past practice since the Balance Sheet Date and which are not, individually or in the aggregate, material in amount.

Section 2.9 Absence of MAE. Since the Balance Sheet Date, there has not been any event, occurrence or development that has had, or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. For purposes of this Agreement, “Material Adverse Effect” means any event, occurrence, fact, condition or change that is, or could reasonably be expected to become, individually or in the aggregate, materially adverse to (a) the business, results of operations, condition (financial or otherwise) or assets of the Company and its Subsidiaries, taken as a whole, or (b) the ability of Seller to consummate the transactions contemplated hereby on a timely basis.

- 5 -

Section 2.10 Employment and Employee Benefit Matters. Neither the Company nor any Subsidiary has any current or prospective employees. The Company and each Subsidiary is, and since January 1, 2016 has been, in compliance in all material respects with: (i) all applicable employment laws and agreements regarding hiring, employment, termination of employment, plant closings and mass layoffs, employment discrimination, harassment, retaliation, and reasonable accommodation, leaves of absence, terms and conditions of employment, wages and hours of work, employee classification, employee health and safety, engagement and classification of independent contractors, payroll taxes, and immigration with respect to all former employees and independent contractors; and (ii) all applicable laws relating to the relations between it and any labor organization, trade union, work council, or other body representing employees of the Company or any Subsidiary. Neither the Company nor any Subsidiary sponsors, maintains, participates in, contributes to, has any obligation to contribute to or has any Liability in respect of any Benefit Plan nor has the Company or any Subsidiary sponsored, maintained, participated in, contributed to, been obligated to contribute to or had any Liability in respect of any Benefit Plan, except as set forth on Section 2.10 of the Disclosure Schedules. “Benefit Plan” means any plan, program, policy, agreement or other arrangement that provides for retirement, cash balance, savings, profit sharing, deferred compensation, supplemental pension or savings, cash or equity incentive, other equity, medical, dental, vision, health savings, health reimbursement, long-term care or other health, life insurance, accidental death or dismemberment, or other employee insurance, tuition reimbursement, severance, retention, perquisite, fringe benefit or other employee benefit plan, program, policy, agreement or other arrangement, whether or not subject to ERISA, whether written or oral, and whether providing for direct or indirect or actual or contingent Liability. For purposes of this Agreement, “Benefit Plan” shall include, but is not limited to, a Pension Plan (an employee benefit plan that is or was subject to Title IV of ERISA or Section 412 or 430 of the Code or Section 302 of ERISA) or Multiemployer Plan (within the meaning set forth in Section 4001(a)(3) of ERISA).

Section 2.11 Tax Representations. Except as disclosed in Section 2.11 of the Disclosure Schedules:

(a) All Tax Returns required to be filed on or before the Closing Date by the Company and any Subsidiary have been, or will be, timely filed. Such Tax Returns are, or will be, true, complete and correct in all material respects. All material Taxes due and owing by the Company and any Subsidiary (whether or not shown on any Tax Return) have been, or will be, timely paid. All deficiencies asserted, or assessments made, against the Company or any Subsidiary as a result of any examinations by any Tax Authority have been fully paid. To Seller’s knowledge, there are no pending or threatened federal, state, local or foreign income or franchise Tax audits or assessments for or with respect to any Liability in respect of Taxes of the Company or any Subsidiary, and there are no liens for Taxes against any assets of the Company or any Subsidiary.

(b) To Seller’s knowledge, there is no examination, audit or administrative or judicial proceeding pending, proposed or threatened against or with respect to the Company and any Subsidiary (or in respect of the income or assets of the Company and any Subsidiary) in respect of any Taxes or Tax Returns. No issue has been raised in writing by any Tax Authority in any examination of the Company or any Subsidiary that, if raised by such Tax Authority with respect to the same or substantially similar facts arising in any other Tax period not so examined, would result in a deficiency for such other period, if upheld. No claim has ever been made by any Tax Authority in a jurisdiction where the Company, Seller or any Subsidiary does not pay Tax or file Tax Returns, in writing to the Seller, Company or any Subsidiary, that such entity is or may be subject to Tax in such jurisdiction or that a Tax Return must be filed by or on behalf of the Company or any Subsidiary in such jurisdiction.

- 6 -

(c) No waiver or extension of the statute of limitations or any extension of time with respect to a Tax assessment, reassessment or deficiency has been given with respect to any amount of Taxes of or with respect to the Company or any Subsidiary or any Tax Returns of or with respect to the Company or any Subsidiary, which period (after giving effect to such extension or waiver) has not yet expired.

(d) No closing agreements, rulings or, to Seller’s knowledge, technical advice memoranda, or, to Seller’s knowledge, similar agreements or rulings with respect to Taxes or Tax Returns have been entered into or issued by any Tax Authority with respect to any of the Company or any Subsidiary (or in respect of the income or assets of the Company or any Subsidiary).

(e) Neither the Company nor any Subsidiary owns any assets that constitute “United States real property interests” within the meaning of Section 897(c) of the Code and the regulations promulgated thereunder.

(f) The amount of Liability of the Company or any Subsidiary for unpaid Taxes for all periods ending on or before June 30, 2019 does not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) reflected on the Financial Statements. The amount of Liability of the Company or any Subsidiary for unpaid Taxes for all periods following the end of the recent period covered by the Financial Statements will not, in the aggregate, exceed the amount of accruals for Taxes (excluding reserves for deferred Taxes) as adjusted for the passage of time in accordance with the past custom and practice of the Company (and which accruals shall not exceed comparable amounts incurred in similar periods in prior years).

(g) (i) The amount, as of August 31, 2019, of the “net operating loss deduction” (within the meaning of Section 172 of the Code and the applicable Treasury regulations thereunder), as calculated in accordance Section 2.11(g) of the Disclosure Schedules, that may be carried forward or backward by the Company or any Subsidiary (the “Company NOL”) is not less than Four Hundred Fifty Four Million One Hundred Seventy Four Thousand Two Hundred Twenty Nine Dollars ($454,174,229).

(ii) Section 2.11(g) of the Disclosure Schedules accurately sets forth (i) the dates of expiration of the Company NOL or any portion thereof and the amounts expiring on each such date, (ii) a description of each limitation, if any, on the amount or usage of the Company NOL under (A) Section 381, 382, 383 or 384 of the Code or any regulation promulgated under any of such Sections (including each limitation as a result of an “ownership change” within the meaning of Section 382 of the Code and regulations thereunder and, for each ownership change, the date and amount of the limitation and the methodology used to calculate the limitation), (B) any regulation promulgated under Section 1502 of the Code, or (C) any election made by or on behalf of the Company or such Subsidiary, and (iii) information setting forth the states in which the Company has net operating losses for state income tax purposes. Seller further represents that it has not undergone an “ownership change” within the meaning of Section 382 of the Code and regulations thereunder with regards to the Company NOL.

- 7 -

(h) For purposes of this Agreement:

(i) “Taxes” means all federal, state, local, and foreign income, gross receipts, sales, use, production, ad valorem, transfer, franchise, registration, profits, license, lease, service, service use, withholding, payroll, employment, unemployment, estimated, excise, severance, environmental, stamp, occupation, premium, property (real or personal), real property gains, windfall profits, customs, duties or other taxes, fees, assessments or charges of any kind whatsoever, together with any interest, additions to tax or penalties with respect thereto and any interest in respect of such additions or penalties.

(ii) “Tax Authority” means any Governmental Authority having jurisdiction over the assessment, determination, collection, administration or imposition of any Taxes.

(iii) “Tax Return” means any return, declaration, report, claim for refund, information return, or statement or other document relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

Section 2.12 Company Contracts; Insurance.

(a) Section 2.12 of the Disclosure Schedules lists each contract, lease, deed, mortgage, license, instrument, note, commitment, undertaking, indentures, joint venture and any other agreement, commitment and legally binding arrangement, whether written or oral (each, a “Contract”), to which the Company or any Subsidiary is a party or by which the Company or any Subsidiary is bound or to which any of their respective properties and assets are subject (including, without limitation, any “side letters” entered into by Seller related to Equity Interests or other assets owned by the Company or any Subsidiary), in all such cases having a commitment of $100,000 or more annually (such Contracts set forth in Section 2.12 of the Disclosure Schedules, being “Company Contracts”).

- 8 -

(b) Each Company Contract is valid and binding on the Company in accordance with its terms and is in full force and effect. Neither the Company nor, to Seller’s knowledge, any other party thereto is in breach of or default under (or is alleged to be in breach of or default under), or has provided or received any notice of any intention to terminate, any Company Contract which could, individually or in the aggregate with other defaults or notices of termination, reasonably be expected to cause a Material Adverse Effect. No event or circumstance has occurred that, with notice or lapse of time or both, would constitute an event of default under any Company Contract or result in a termination thereof or would cause or permit the acceleration or other changes of any right or obligation or the loss of any benefit thereunder, which could, individually or in the aggregate with other defaults or notices of termination, reasonably be expected to cause a Material Adverse Effect. Complete and correct copies of each Company Contract (including all modifications, amendments, and supplements thereto and waivers thereunder) have been made available to Buyer.

(c) Seller has valid and effective insurance policies with the carriers named and providing the insurance coverage to the Company set forth in Section 2.12(c) of the Disclosure Schedules. All such insurance policies are in full force and effect, and neither of the Company nor Seller has received a notice of default or intention not to renew with respect to any such insurance policies. At the date hereof and at the Closing Date (if different), the Company will be a “subsidiary” of Seller, as defined in the insurance policies, and as such, among other things, the directors of the Company will be covered by the directors and officers liability coverage policy of Seller.

Section 2.13 Title to Assets; Real Property. The Company (or its Subsidiaries) has good and valid title to, or a valid leasehold interest in, all real property and personal property and other assets reflected in the Financial Statements or acquired after the Balance Sheet Date, other than properties and assets sold or otherwise disposed of in the ordinary course of business consistent with past practice since the Balance Sheet Date. All such properties and assets (including leasehold interests) are free and clear of Encumbrances, other than Permitted Encumbrances. Neither the Company nor any Subsidiary owns any real property. For purposes of this Agreement, “Permitted Encumbrances” means (i) mechanics’, carriers’, workmen’s, warehousemen’s, repairmen’s or other like liens arising in the ordinary course of business which are not due and payable as of the Closing Date, (ii) liens arising under original purchase price conditional sale contracts and equipment leases with third parties entered into in the ordinary course, (iii) liens for Taxes not yet due and payable and (iv) other imperfections of title, restrictions or encumbrances of record, if any, which liens, imperfections of title, restrictions or other encumbrances do not materially impair the value or the continued use or occupancy and operation of the specific assets to which they relate substantially in the manner currently operated.

Section 2.14 Intellectual Property.

(a) Section 2.14(a) of the Disclosure Schedules lists all patents, patent applications, trademark registrations and pending applications for registration, copyright registrations and pending applications for registration, and internet domain name registrations owned by the Company or any of its Subsidiaries. The Company and its Subsidiaries own or have the right to use all Intellectual Property necessary for the conduct of the Company’s and its Subsidiaries’ businesses as currently conducted (the “Company Intellectual Property”).

- 9 -

(b) (i) The conduct of the Company’s and its Subsidiaries’ businesses as currently conducted does not infringe, misappropriate, or otherwise violate the Intellectual Property of any Person, and (ii) no Person is infringing, misappropriating, or otherwise violating any Company Intellectual Property.

(c) For purposes of this Agreement, “Intellectual Property” means any and all of the following arising pursuant to the laws of any jurisdiction throughout the world: (i) trademarks, service marks, trade names, and similar indicia of source or origin, all registrations and applications for registration thereof, and the goodwill connected with the use of and symbolized by the foregoing; (ii) copyrights and all registrations and applications for registration thereof; (iii) trade secrets and know-how; (iv) patents and patent applications; (v) internet domain name registrations; and (vi) other intellectual property and related proprietary rights.

Section 2.15 Ownership of Securities.

(a) The Shares have been duly authorized, are validly issued, fully paid and non-assessable, and are owned of record and beneficially by Seller, free and clear of all Encumbrances other than pursuant to applicable securities laws. Upon consummation of the transactions contemplated by this Agreement, Buyer shall own the Shares, free and clear of all Encumbrances other than pursuant to applicable securities laws and pursuant to Encumbrances imposed by or on behalf of Buyer.

(b) The Shares were issued in compliance with applicable laws. The Shares were not issued in violation of the organizational documents of the Company or any other agreement, arrangement or commitment to which Seller or the Company is a party and are not subject to or in violation of any preemptive or similar rights of any Person.

(c) The Shares constitute 20.10% of the outstanding shares of Common Stock of the Company. Upon consummation of the transactions contemplated by this Agreement, the Shares, together with the 799 shares of Common Stock of the Company owned by Seller, shall constitute 100% of the total issued and outstanding capital stock of the Company. Neither the Company nor Seller has or is a party to any outstanding or authorized options, warrants, convertible securities or other rights, agreements, arrangements or commitments of any character relating to any equity interests in the Company or obligating Seller or the Company to issue or sell any capital stock of the Company (including shares of Common Stock), or any other interest, in the Company. Other than the organizational documents of the Company and the Stockholders’ Agreement (as defined herein), there are no voting trusts, proxies or other agreements or understandings in effect with respect to the voting or transfer of any of the shares of Common Stock of the Company.

- 10 -

(d) Seller is the sole record and beneficial owner of each of the Notes and has dispositive authority with respect to each of the Notes. The outstanding principal balance on the Notes is set forth on Section 2.15(d) of the Disclosure Schedules. The sale and delivery of the Notes to Buyer pursuant to this Agreement will vest in Buyer legal and valid title to the Notes, free and clear of all Encumbrances other than pursuant to applicable securities laws. Each of the Notes was duly authorized by all necessary corporate action by the Company and was issued and delivered against payment of the consideration therefor specified therein. Each of the Notes are valid and binding obligations of the Company, enforceable against the Company in accordance with its terms, subject as to enforcement to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws of general application relating to or affecting creditors’ rights and to general equitable principles.

Section 2.16 Company Organizational Documents. The certificate of incorporation and by-laws of the Company, each as amended to date, are set forth in Section 2.16(a) and (b), respectively, of the Disclosure Schedules. No action has been taken to further amend, modify or repeal such certificate of incorporation and by-laws of the Company, the same being in full force and effect in the attached form as of the date hereof.

Section 2.17 Brokers. Except as set forth in Section 2.17 of the Disclosure Schedules, no broker, finder, advisor or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Company or Seller.

Section 2.18 Non-Foreign Status. Seller is not a “foreign person” as that term is used in Treasury Regulations Section 1.1445-2. The Company is not, nor has it been, a United States real property holding corporation (as defined in Section 897(c)(2) of the Internal Revenue Code of 1986, as amended (“Code”)) during the applicable period specified in Section 897(c)(1)(A) of the Code.

Section 2.19 No Other Representations or Warranties. Except for the representations and warranties contained in this ARTICLE 2, Buyer acknowledges that none of Seller, the Company or any other Person on behalf of the Company, makes any other express or implied representation or warranty whatsoever, and specifically, that none of Seller, the Company or any other Person on behalf of the Company makes any representation or warranty with respect to (i) any projections, estimates or budgets delivered or made available to Buyer or any of its affiliates or representatives of future revenues, results of operations (or any component thereof), cash flows or financial condition (or any component thereof) of the Company or Seller or (ii) the future business and operations of the Company and Seller, including in the case of (i) and (ii) with respect to any information, documents, projections, forecasts or other materials made available to Buyer or its affiliates and representatives in certain management presentations in expectation of the transactions contemplated by this Agreement, and Buyer has not relied on any such information or any representation or warranty not set forth in ARTICLE 2.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES OF BUYER

Buyer represents and warrants to Seller that the statements contained in this ARTICLE 3 are true and correct as of the date hereof. For purposes of this ARTICLE 3, “Buyer’s knowledge” shall mean the actual or constructive knowledge of any director or officer of Buyer, after due inquiry.

- 11 -

Section 3.1 Organization and Authority of Buyer; Enforceability. Buyer is a limited liability company duly organized, validly existing and in good standing under the laws of the state of Delaware. Buyer has full limited liability company power and authority to enter into this Agreement and the documents to be delivered hereunder, to carry out its obligations hereunder and to consummate the transactions contemplated hereby. The execution, delivery and performance by Buyer of this Agreement and the documents to be delivered hereunder and the consummation of the transactions contemplated hereby have been duly authorized by all requisite corporate action on the part of Buyer. This Agreement and the documents to be delivered hereunder have been duly executed and delivered by Buyer, and (assuming due authorization, execution and delivery by Seller) this Agreement and the documents to be delivered hereunder constitute legal, valid and binding obligations of Buyer enforceable against Buyer in accordance with their respective terms, subject as to enforcement to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws of general application relating to or affecting creditors’ rights and to general equitable principles.

Section 3.2 No Conflicts; Consents. The execution, delivery and performance by Buyer of this Agreement and the documents to be delivered hereunder, and the consummation of the transactions contemplated hereby, do not and will not: (a) violate or conflict with the certificate of incorporation, by-laws or other organizational documents of Buyer; or (b) violate or conflict with any judgment, order, decree, statute, law, ordinance, rule or regulation applicable to Buyer. No consent, approval, waiver or authorization is required to be obtained by Buyer from any Person in connection with the execution, delivery and performance by Buyer of this Agreement and the consummation of the transactions contemplated hereby.

Section 3.3 Investment Purpose. Buyer is acquiring the Securities solely for its own account for investment purposes and not with a view to, or for offer or sale in connection with, any distribution thereof. Buyer acknowledges that the Securities are not registered under the Securities Act of 1933, as amended (the “Securities Act”), or any state securities laws, and that the Securities may not be transferred or sold except pursuant to the registration provisions of the Securities Act or pursuant to an applicable exemption therefrom and subject to state securities laws and regulations, as applicable.

Section 3.4 Brokers. No broker, finder or investment banker is entitled to any brokerage, finder’s or other fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of Buyer.

Section 3.5 Legal Proceedings. There is no Action pending or, to Buyer’s knowledge, threatened against or by Buyer or any Affiliate of Buyer that challenges or seeks to prevent, enjoin or otherwise delay the transactions contemplated by this Agreement. No event has occurred or circumstances exist that may give rise or serve as a basis for any such Action.

Section 3.6 Investment Representations.

(a) Buyer is an “accredited investor” within the meaning of Rule 501 of Regulation D under the Securities Act;

- 12 -

(b) Buyer is able to financially bear the risks of loss of its entire investment in the Shares issuable in consideration of the Purchase Price hereunder;

(c) Buyer is acquiring the Shares for its own account and not with a view to or for sale in connection with any distribution thereof;

(d) Buyer understands and consents to the placement of a legend on any certificate or other document evidencing Shares stating that such Shares have not been registered under the Securities Act and setting forth or referring to the restrictions on transferability and sale thereof; and

(e) Buyer has sufficient knowledge and experience in financial and business matters to evaluate the merits and risks associated with such purchase of the Shares and to make an informed investment decision with respect thereto and has consulted with its own advisors with respect to the purchase of the Shares. Buyer acknowledges and agrees that it is not relying upon any representations or warranties of Seller except the representations and warranties specifically set forth in this Agreement.

ARTICLE 4

CLOSING DELIVERIES

Section 4.1 Seller’s Deliveries. At the Closing, Seller shall deliver to Buyer, or cause the Company to deliver to the Buyer, as applicable, the following:

(a) A stock certificate or certificates evidencing the Shares, free and clear of Encumbrances, duly endorsed in blank or accompanied by stock powers or other instruments of transfer duly executed in blank and with all required stock transfer tax stamps affixed.

(b) The agreement relating to the assignment and assumption of each of the Notes, in the form attached hereto as Exhibit B (the “Note Assignment”), each executed by Seller and the Company.

(c) The stockholders agreement, in the form attached hereto as Exhibit C (the “Stockholders Agreement”), executed by the Company and Seller.

(d) A written consent or certified resolutions as adopted by the Company’s Board of Directors, effective simultaneously with the Closing, increasing the size of its Board of Directors to five (5) members and appointing the five (5) individuals named in Section 2.01 of the Stockholders’ Agreement to the Company’s Board of Directors.

(e) A certificate of the Secretary or Assistant Secretary (or equivalent officer) of Seller certifying as to (i) the resolutions of the board of directors (or equivalent managing body) of Seller, duly adopted and in effect, which authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby, and (ii) the names and signatures of the officers of Seller authorized to sign this Agreement and the documents to be delivered hereunder.

- 13 -

(f) A certificate of the Secretary or Assistant Secretary (or equivalent officer) of Company certifying as to (i) the resolutions of the board of directors (or equivalent managing body) of Company, duly adopted and in effect, which authorize the execution, delivery and performance of the Stockholders’ Agreement and the Note Assignment, and (ii) the names and signatures of the officers of Company authorized to sign the Stockholders’ Agreement and the Note Assignment and the documents to be delivered thereunder.

(g) A certificate meeting the requirements of IRS Notice 2018-29 and Treasury Regulations Section 1.1445-2(b) that Seller is not a foreign person within the meaning of Section 1445 of the Code.

Section 4.2 Buyer’s Deliveries. At the Closing, Buyer shall deliver the following to Seller:

(a) The Purchase Price, paid in accordance with Section 1.2 of this Agreement.

(b) The Note Assignment, executed by Buyer.

(d) A certificate of the Secretary or Assistant Secretary (or equivalent officer) of Buyer certifying as to (i) the resolutions of the board of directors (or equivalent managing body) of Buyer (or an authorized committee thereof), duly adopted and in effect, which authorize the execution, delivery and performance of this Agreement and the transactions contemplated hereby, and (ii) the names and signatures of the officers of Buyer authorized to sign this Agreement and the documents to be delivered hereunder.

ARTICLE 5

INDEMNIFICATION

Section 5.1 Survival of Representations and Covenants. Except as set forth in the next sentence with respect to Buyer Fundamental Representations (as defined herein) and Seller Fundamental Representations (as defined herein), the representations and warranties of Seller and Buyer contained in this Agreement and the certificates delivered pursuant to this Agreement shall survive for a period of two (2) years following the Closing Date, and thereafter shall be of no further force or effect. Notwithstanding the foregoing, the Buyer Fundamental Representations and Seller Fundamental Representations shall survive the Closing Date until the expiration of the applicable statute of limitations with respect thereto (giving effect to any waiver, mitigation or extension thereof) plus 60 days. All covenants and agreements contained in this Agreement and the certificates delivered pursuant to this Agreement shall survive the Closing Date in accordance with their terms. Notwithstanding the foregoing, any claims asserted in good faith with reasonable specificity (to the extent known at such time) and in writing by notice from the non-breaching party to the breaching party prior to the expiration date of the applicable survival period shall not thereafter be barred by the expiration of the relevant representation or warranty and such claims shall survive until finally resolved.

- 14 -

Section 5.2 Indemnification By Seller. Subject to the other terms and conditions of this ARTICLE 5, Seller shall defend, indemnify and hold harmless Buyer, its affiliates and their respective stockholders, directors, officers and employees (“Buyer Indemnified Parties”) from and against:

(a) all claims, judgments, damages, liabilities (including Tax liabilities), settlements, losses, costs and expenses, including attorneys’ fees and disbursements (a “Loss”), arising from or attributable to any inaccuracy in or breach of any of the representations or warranties of Seller contained in Section 2;

(b) any Loss arising from or attributable to the termination of the Company’s Benefit Plan; or

(c) any Loss arising from or relating to any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Seller pursuant to this Agreement or any document to be delivered by Seller hereunder (i) that is not a breach of any representation or warranty of Seller contained in Article 2 to the extent covered by Section 5.2(a) or (ii) which is not a Loss under Section 5.2(b). Seller covenants not to file any bankruptcy petition before the 95th day after the date of the settlement payment to the Pension Benefit Guaranty Corporation under the Settlement Agreement, dated as of September 27, 2019

(d) , between Seller and the Pension Benefit Guaranty Corporation.

Section 5.3 Indemnification By Buyer. Subject to the other terms and conditions of this ARTICLE 5, Buyer shall defend, indemnify and hold harmless Seller, its affiliates and their respective stockholders, directors, officers and employees (“Seller Indemnified Parties”) from and against:

(a) All Losses arising from or attributable to any inaccuracy in or breach of any of the representations or warranties of Buyer contained in Section 3 of this Agreement; or

(b) any Loss arising from or relating to any breach or non-fulfillment of any covenant, agreement or obligation to be performed by Buyer pursuant to this Agreement or any document to be delivered hereunder that are not a breach of any representation or warranty of Buyer contained in Article 3 to the extent covered by Section 5.3(a).

Section 5.4 Limitation of Indemnification.

(a) Limitations on the Buyer’s Indemnification. Subject to Section 5.4(b), with respect to indemnification for any Losses pursuant to Section 5.2(a), Seller shall not have any liability under Section 5.2(a) unless the aggregate amount of Losses to all Buyer Indemnified Parties exceeds the Seller Basket (as defined herein) and then Seller shall be required to pay or be liable for all such Losses from the first dollar, and no amounts of indemnity shall be payable by Seller which exceed the Seller Indemnity Cap (as defined herein).

- 15 -

(b) Seller Basket and Seller Indemnity Cap Not Applicable.

(i) Subject to Section 5.4(b)(ii), with respect to indemnification for any Losses based upon, attributable to or resulting from any inaccuracy in or breach of any Seller Fundamental Representations, Losses under Sections 5.2(b) or (c), or arising from fraud, criminal activity or willful misconduct on the part of a party hereto in connection with the transactions contemplated by this Agreement, the Seller Basket and the Seller Indemnity Cap shall not apply to any such Losses and Seller shall be liable for the full amount thereof, but not to exceed an amount equal to the Purchase Price.

(ii) Notwithstanding anything contained in this Agreement, including Section 5.4(b)(i), no Losses shall arise from or be attributable to any inaccuracy in or breach of any of the representations or warranties of Seller contained in Section 2.11(g), including, for the avoidance of doubt, clause (ii) of Section 2.11(g), unless Company NOL is in the aggregate less than Two Hundred Fifty Million Dollars ($250,000,000).

(c) Limitations on Seller’s Indemnification. Subject to Section 5.4(d), with respect to indemnification for any Losses pursuant to Sections 5.3(a), Buyer shall not have any liability under Section 5.3(a) unless the aggregate amount of Losses to all Seller Indemnified Parties exceeds the Buyer Basket (as defined herein) and then Buyer shall be required to pay or be liable for all such Losses from the first dollar, and no amounts of indemnity shall be payable by Buyer which exceed the Buyer Indemnity Cap (as defined herein).

(d) Buyer Basket and Buyer Indemnity Cap Not Applicable. Notwithstanding anything herein to the contrary, with respect to indemnification for any Losses based upon, attributable to or resulting from any inaccuracy in or breach of any Buyer Fundamental Representations or arising from fraud, criminal activity or willful misconduct on the part of a party hereto in connection with the transactions contemplated by this Agreement, the Buyer Basket and the Buyer Indemnity Cap shall not apply to any such Losses and Buyer shall be liable for the full amount thereof, but not to exceed an amount equal to the Purchase Price.

(e) Certain Definitions. For purposes of this Agreement:

(i) “Buyer Basket” means One Hundred Seventy-Five Thousand Six Hundred Twenty-Seven Dollars ($175,627).

(ii) “Buyer Indemnity Cap” means Seven Million Twenty-Five Thousand Eighty Dollars ($7,025,080).

(iii) “Buyer Fundamental Representations” means Buyer’s representations and warranties set forth in Sections 3.1 (Organization and Authority of Buyer; Enforceability), 3.4 (Brokers) and 3.6 (Investment Representations).

- 16 -

(iv) “Seller Basket” means One Hundred Seventy-Five Thousand Six Hundred Twenty-Seven Dollars ($175,627).

(v) “Seller Indemnity Cap” means Seven Million Twenty-Five Thousand Eighty Dollars ($7,025,080).

(vi) “Seller Fundamental Representations” means Seller’s representations and warranties set forth in Sections 2.1 (Organization and Authority of Seller; Enforceability), 2.2 (Organization, Authority and Qualification of the Company), 2.11(g) (Company NOL), 2.15 (Ownership of Securities) and 2.17 (Brokers).

(f) Materiality Scrape. For purposes of this ARTICLE 5, any inaccuracy in or breach of any representation or warranty shall be determined without regard to any materiality, Material Adverse Effect or other similar qualification contained in or otherwise applicable to such representation or warranty.

(g) No Duplications. Any liability for indemnification under this ARTICLE 5 shall be determined without duplication of recovery by reason of the state of facts giving rise to such liability constituting a breach of more than one representation, warranty, covenant or agreement. Without limiting the generality of the preceding sentence, if a single statement of facts, condition or event constitutes a breach of more than one representation, warranty, covenant or agreement which is subject to the indemnification obligations in Section 5.2 or Section 5.3 of this Agreement or the Note Assignment, no recovery of duplicative Losses shall be allowed.

Section 5.5 Indemnification Procedures. Whenever any claim shall arise for indemnification hereunder, the party entitled to indemnification (the “Indemnified Party”) shall promptly provide written notice of such claim to the other party (the “Indemnifying Party”). The failure to give such prompt written notice shall not, however, relieve the Indemnifying Party of its indemnification obligations, except and only to the extent that (i) the Indemnifying Party forfeits rights or defenses by reason of such failure or (ii) such failure or delay shall have adversely affected the Indemnifying Party’s ability to defend against, settle or satisfy any Third-Party Claim (as defined herein) for which the Indemnified Party is entitled to indemnification hereunder. In connection with any claim giving rise to indemnity hereunder resulting from or arising out of any Action by a Person who is not a party to this Agreement (a “Third-Party Claim”), the Indemnifying Party, at its sole cost and expense and upon written notice to the Indemnified Party, may assume the defense of any such Third-Party Claim with counsel reasonably satisfactory to the Indemnified Party, which shall include Loeb & Loeb LLP and Norton Rose Fulbright US LLP. The Indemnified Party shall be entitled to participate in the defense of any such Action, with its counsel and at its own cost and expense. If the Indemnifying Party does not assume the defense of any such Action, the Indemnified Party may, but shall not be obligated to, defend against such Third-Party Claim in such manner as it may deem appropriate, including, but not limited to, settling such Third-Party Claim, after giving notice of it to the Indemnifying Party, on such terms as the Indemnified Party may deem appropriate and no action taken by the Indemnified Party in accordance with such defense and settlement shall relieve the Indemnifying Party of its indemnification obligations herein provided with respect to any damages resulting therefrom. The Indemnifying Party shall not settle any Third-Party Claim without the Indemnified Party’s prior written consent (which consent shall not be unreasonably withheld or delayed).

- 17 -

Section 5.6 Payments. Once a Loss is agreed to by the Indemnifying Party or finally adjudicated to be payable pursuant to this ARTICLE 5, the Indemnifying Party shall satisfy its obligations within thirty (30) Business Days of such final, non-appealable adjudication by wire transfer of immediately available funds. The parties hereto agree that should an Indemnifying Party not make full payment of any such obligations within such thirty (30) Business Day period, any amount payable shall accrue interest from and including the date of agreement of the Indemnifying Party or final, non-appealable adjudication to but excluding the date such payment has been made at a rate per annum equal to five (5)%. Such interest shall be calculated daily on the basis of a three hundred sixty five (365) day year and the actual number of days elapsed, without compounding.

Section 5.7 Tax Treatment of Indemnification Payments. All indemnification payments made under this Agreement shall be treated by the parties as an adjustment to the Purchase Price for all purposes, unless otherwise required by Law.

Section 5.8 Cumulative Remedies. The rights and remedies provided in this ARTICLE 5 in connection with Losses arising from or relating to any breach of representation or warranty, or breach or non-fulfillment of any covenant, agreement or obligation to be performed by either party pursuant to this Agreement are cumulative and are in addition to and not in substitution for any other rights and remedies available at law or in equity or otherwise, including the right to seek specific performance, rescission or restitution, none of which rights or remedies shall be affected or diminished hereby. Notwithstanding anything else contained herein, neither party shall seek, nor shall any party be liable for, punitive or exemplary damages, under any tort, contract, equity, or other legal theory, with respect to any breach (or alleged breach) of this Agreement or any provision hereof or any matter otherwise relating hereto or arising in connection herewith. Nothing in this ARTICLE 5 shall limit any Person’s right to seek and obtain any equitable relief to which any Person shall be entitled or to seek any remedy on account of any party’s fraudulent, criminal or intentional misconduct.

ARTICLE 6

MISCELLANEOUS

Section 6.1 Expenses. Except as otherwise provided in Section 1.4, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

Section 6.2 Further Assurances. Following the Closing, each of the parties hereto shall, and shall cause their respective Affiliates to, execute and deliver such additional documents, instruments, conveyances and assurances and take such further actions as may be reasonably required to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.

- 18 -

Section 6.3 Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt); (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested); (c) on the date sent by facsimile or e-mail of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 6.3):

If to Seller:	GlassBridge Enterprises, Inc.
	510 Madison Ave, 9th Floor
	New York, New York 10022
	Facsimile:
	E-mail: dstrauss@glassbridge.com
	Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:

	Loeb & Loeb LLP
	345 Park Avenue
	New York, New York 10154
	Facsimile: (212) 656-1076
	E-mail: lrothenberg@loeb.com
	Attention: Lloyd L. Rothenberg, Esq.

If to Buyer:	ORIX Corporation USA
	1717 Main Street, Suite 1100
	Dallas, Texas 75201
	E-mail: Benjamin.Price@orix.com
	Attention: Benjamin Price, Assistant General Counsel

	ORIX Corporation USA
	280 Park Avenue
	New York, NY 10017
	E-mail: Gregory.Raykher@orix.com
	Attention: Gregory Raykher

	ORIX Corporation USA
	280 Park Avenue
	New York, NY 10017
	E-mail: Neil.Winward@orix.com
	Attention: Neil Winward

- 19 -

with a copy (which shall not constitute notice) to:

	Norton Rose Fulbright US LLP
	1301 Avenue of the Americas
	New York, New York 10019
	Facsimile: (212) 318-3400
	E-mail: sheldon.nussbaum@nortonrosefulbright.com
	Attention: Sheldon G. Nussbaum, Esq.

Section 6.4 Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

Section 6.5 Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify the Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

Section 6.6 Entire Agreement. This Agreement and the documents to be delivered hereunder constitute the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein, and supersede all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency between the statements in the body of this Agreement and those in documents to be delivered hereunder, the Exhibits and Disclosure Schedules (other than an exception expressly set forth as such in the Disclosure Schedules), the statements in the body of this Agreement will control.

Section 6.7 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns. Neither party may assign its rights or obligations hereunder without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed. No assignment shall relieve the assigning party of any of its obligations hereunder.

Section 6.8 No Third-Party Beneficiaries. Except as provided in ARTICLE 5, this Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

Section 6.9 Amendment and Modification. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party hereto.

Section 6.10 Waiver. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

- 20 -

Section 6.11 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction).

Section 6.12 Submission to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby may be instituted in the federal courts of the United States of America or the courts of the State of New York in each case located in the city of New York and county of New York, and each party irrevocably submits to the exclusive jurisdiction of such courts in any such suit, action or proceeding.

Section 6.13 Waiver of Jury Trial. Each party acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated and difficult issues and, therefore, each such party irrevocably and unconditionally waives any right it may have to a trial by jury in respect of any legal action arising out of or relating to this Agreement or the transactions contemplated hereby.

Section 6.14 Specific Performance. The parties agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with the terms hereof and that the parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy to which they are entitled at law or in equity. Each party hereto (i) agrees that it shall not oppose the granting of such specific performance or relief and (ii) hereby irrevocably waives any requirements for the security or posting of any bond in connection with such relief.

Section 6.15 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, e-mail or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

[Signature Page Follows]

- 21 -

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

	SELLER:

	GlassBridge Enterprises, Inc.

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	Chief Executive Officer and Chief Operating Officer

	BUYER:

	ORIX PTP HOLDINGS, LLC

	By:	ORIX Corporate Capital Inc.,
	its sole member

	By:	/s/ Paul E. Wilson
	Name:	Paul E. Wilson
	Title:	Chief Financial Officer

Exhibit A

Allocation Schedule

The Purchase Price shall be allocated as follows:

Shares	$	4,562,700
Levy Note	$	9,000,000
Sport-BLX Note	$	4,000,000

Exhibit B

Form of Note Assignment

Exhibit C

Form of Stockholders’ Agreement

Execution Copy

STOCKHOLDERS AGREEMENT

This Stockholders Agreement (this “Agreement”), dated as of September 27, 2019, is entered into among Imation Enterprises Corp., a Delaware corporation (the “Company”), GlassBridge Enterprises, Inc., a Delaware corporation (“GlassBridge”), and ORIX PTP HOLDINGS, LLC, a Delaware limited liability company (“ORIX” and, together with GlassBridge, the “Stockholders”).

RECITALS

WHEREAS, simultaneously with the execution of this Agreement, GlassBridge is selling 20.10% of the issued and outstanding common stock of the Company to ORIX (the “ORIX Purchase”) pursuant to the terms set forth in that certain Securities Purchase Agreement by and between GlassBridge and ORIX dated as of the date hereof (the “Securities Purchase Agreement”); and after giving effect thereto, GlassBridge owns 79.90% of the issued and outstanding Common Stock (as defined below) of the Company and ORIX owns 20.10% of the issued and outstanding Common Stock of the Company; and

WHEREAS, the execution of this Agreement is a condition to the closing of the ORIX Purchase.

ARTICLE I
Definitions

Capitalized terms used herein and not otherwise defined shall have the meanings set forth in this Article I.

“Acceptance” has the meaning set forth in Section 5.01(b).

“Affiliate” means with respect to any Person, any other Person who, directly or indirectly (including through one or more intermediaries), controls, is controlled by, or is under common control with, such Person. For purposes of this definition, “control,” when used with respect to any specified Person, shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract or otherwise; and the terms “controlling” and “controlled” shall have correlative meanings.

“Agreement” has the meaning set forth in the preamble.

“Applicable Law” means all applicable provisions of (a) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations or orders of any Governmental Authority, (b) any consents or approvals of any Governmental Authority and (c) any orders, decisions, advisory or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any Governmental Authority.

“Assignment and Assumption Agreement” means that certain Agreement Relating to the Assignment and Assumption of Promissory Notes by and between ORIX, GlassBridge and the Company dated as of the date hereof.

“Board” has the meaning set forth in Section 2.01(a).

“Book Value” shall be determined by dividing (a) the Company’s Net Tangible Assets Available to Common, as set out in the closing model set forth on Schedule 1, adjusted as at the end of the Company’s most recently completed fiscal quarter by (b) the number of shares of Common Stock outstanding on the last day of such fiscal quarter. The Company shall provide ORIX with all reasonably necessary Company financial and other records as ORIX may reasonably request with respect to the determination of Book Value for purposes of the Buy-Sell Offer Notice and the Subscription Notice.

“Business Day” means a day other than a Saturday, Sunday or other day on which commercial banks in the City of New York are authorized or required to close.

“Buy-Sell Offer Notice” has the meaning set forth in Section 5.01.

“By-laws” means the by-laws of the Company.

“Capital Stock” means any and all shares, stock, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership or profits interests in a Person that is another type of entity, including partnership interests, membership interests, voting trust certificates, certificates of interest, and profits interests, participations, or similar arrangements, and any and all warrants, rights or options to purchase, or other arrangements or rights to acquire, subscribe, convert to or otherwise receive or participate in the economic or other rights associated with any of the foregoing.

“Certificate of Incorporation” means the certificate of incorporation of the Company, as filed on April 17, 1996 with the Secretary of State of the State of Delaware.

“Change of Control” means any transaction or series of related transactions (as a result of a tender offer, merger, consolidation or otherwise) that results in, or that is in connection with, (a) any Third Party Purchaser or “group” (within the meaning of Section 13(d)(3) of the Exchange Act) of Third Party Purchasers acquiring beneficial ownership, directly or indirectly, of a majority of the then issued and outstanding Common Stock or (b) the sale, lease, exchange, conveyance, transfer or other disposition (for cash, shares of stock, securities or other consideration) of all or substantially all of the property and assets of the Company and its Subsidiaries (if any), on a consolidated basis, to any Third Party Purchaser or “group” (within the meaning of Section 13(d)(3) of the Exchange Act) of Third Party Purchasers (including any liquidation, dissolution or winding up of the affairs of the Company, or any other distribution made, in connection therewith).

“Claimant” has the meaning set forth in Section 9.12(b).

“Common Stock” means the common stock, par value $0.01 per share, of the Company and any securities issued in respect thereof, or in substitution therefor, in connection with any stock split, dividend or combination, or any reclassification, recapitalization, merger, consolidation, exchange or similar reorganization.

“Company” has the meaning set forth in the preamble.

“Counter Offer” has the meaning set forth in Section 5.01(b).

“Defaulting Purchaser” has the meaning set forth in Section 5.01(e).

“Director” has the meaning set forth in Section 2.01(a).

“Dispute” has the meaning set forth in Section 9.12(a).

“Exchange Act” means the Securities Exchange Act of 1934.

“Fiscal Year” means for financial accounting purposes, January 1 to December 31.

“GAAP” means United States generally accepted accounting principles in effect from time to time.

“GlassBridge” has the meaning set forth in the preamble. References to GlassBridge shall include its successors and Permitted Transferees.

“GlassBridge Director” means any Director designated by GlassBridge in accordance with Section 2.01(a).

“Government Approval” means any authorization, consent, approval, waiver, exception, variance, order, exemption, publication, filing, declaration, concession, grant, franchise, agreement, permission, permit, or license of, from or with any Governmental Authority, the giving of notice to, or registration with, any Governmental Authority or any other action in respect of any Governmental Authority.

“Governmental Authority” means any federal, state, local or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations or orders of such organization or authority have the force of Law), or any arbitrator, court or tribunal of competent jurisdiction.

“Initial Public Offering” means any offering of Common Stock pursuant to a registration statement filed in accordance with the Securities Act.

“Information” has the meaning set forth in Section 4.03(a).

“Issuance Notice” has the meaning set forth in Section 4.01(b).

“Joinder Agreement” means the joinder agreement in form and substance of Exhibit A attached hereto.

“Lien” means any lien, claim, charge, mortgage, pledge, security interest, option, right of first offer, encumbrance or other restriction or limitation of any nature whatsoever.

“Minority Rights” has the meaning set forth in Section 2.03(d).

“New Securities” has the meaning set forth in Section 4.01(a).

“Notes” means collectively (i) that certain promissory note by and between the Company, as Borrower, and GlassBridge, as Note Holder, dated as of September 26, 2019, in the original principal amount of $9,000,000 and with a maturity date of September 26, 2026 and (ii) that certain promissory note by and between the Company, as Borrower, and GlassBridge, as Note Holder, dated as of September [•], 2019, in the original principal amount of $4,000,000 and with a maturity date of September 26, 2026.

“Offer Price” has the meaning set forth in Section 5.01(a)(ii).

“Offered Shares” has the meaning set forth in Section 3.02(a).

“Offering Stockholder” has the meaning set forth in Section 3.02(a).

“Offering Stockholder Notice” has the meaning set forth in Section 3.02(b).

“Organizational Documents” means the By-laws and the Certificate of Incorporation.

“ORIX” has the meaning set forth in the preamble. References to ORIX shall include its successors and Permitted Transferees.

“ORIX Approval” means (i) with respect to any matter that must be approved by the Board (a) the affirmative vote at a meeting of the Board of at least one ORIX Director or (b) the written consent of at least one ORIX Director in lieu of a meeting or, (ii) with respect to any matter that must be approved by ORIX pursuant to the provisions of this Agreement, if no ORIX Director is serving on the Board, the written consent of ORIX.

“ORIX Director” means any Director designated by ORIX in accordance with Section 2.01(a).

“ORIX Purchase” has the meaning set forth in the recitals.

“Ownership Percentage” of any Stockholder shall mean, at any time of determination, the percentage equal to (i) the number of shares of Common Stock issued and outstanding that the Stockholder owns, divided by (ii) the total number of shares of Common Stock issued and outstanding.

“Permitted Liens” means (i) mechanics’, carriers’, workmen’s, warehousemen’s, repairmen’s or other like liens arising in the ordinary course of business, (ii) liens arising under original purchase price conditional sale contracts and equipment leases with third parties entered into in the ordinary course, (iii) liens for Taxes not yet due and payable and (iv) other imperfections of title, restrictions or encumbrances of record, if any, which liens, imperfections of title, restrictions or other encumbrances do not materially impair the value or the continued use or occupancy and operation of the specific assets to which they relate substantially in the manner currently operated.

“Permitted Transferee” means with respect to any Stockholder, any Affiliate of such Stockholder.

“Person” means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association or other entity.

“Purchaser” has the meaning set forth in Section 5.01(d)(i).

“Purchasing Stockholder” has the meaning set forth in Section 3.02(d).

“Related Party Agreement” means any agreement, arrangement or understanding between the Company and any Stockholder or any Affiliate of a Stockholder or any Director, officer or employee of the Company, as such agreement may be amended, modified, supplemented or restated in accordance with the terms of this Agreement.

“Representative” means, with respect to any Person, any and all directors, officers, employees, consultants, financial advisors, counsel, accountants and other agents of such Person.

“Request” has the meaning set forth in Section 9.12(b).

“Respondent” has the meaning set forth in Section 9.12(b).

“ROFR Notice” has the meaning set forth in Section 3.02(d).

“ROFR Notice Period” has the meaning set forth in Section 3.02(d).

“ROFR Rightholder” has the meaning set forth in Section 3.02(a).

“Securities Act” means the Securities Act of 1933.

“Securities Purchase Agreement” has the meaning set forth in the recitals.

“Selling Stockholder” has the meaning set forth in Section 5.01(d)(i).

“Special Rights” has the meaning set forth in Section 2.03(a).

“Stockholders” has the meaning set forth in the preamble. References to any Stockholder shall include the successors and Permitted Transferees of that Person.

“Subject Shares” has the meaning set forth in Section 5.01(a)(i).

“Subsidiary” means with respect to any Person, any other Person of which a majority of the outstanding shares or other equity interests having the power to vote for directors or comparable managers are owned, directly or indirectly, by the first Person.

“Tax Code” has the meaning set forth in Section 4.02.

“Third Party Purchaser” means any Person who, immediately prior to the contemplated transaction, (a) does not directly or indirectly own or have the right to acquire any outstanding Common Stock and (b) is not a Permitted Transferee of any Person who directly or indirectly owns or has the right to acquire any Common Stock.

“Transfer” means to sell, transfer, assign, pledge, encumber, hypothecate or similarly dispose of, either voluntarily or involuntarily, or to enter into any contract, option or other arrangement or understanding with respect to the sale, transfer, assignment, pledge, encumbrance, hypothecation or similar disposition of, any Common Stock owned by a Person or any interest (including a beneficial interest) in any Common Stock owned by a Person.

“Treasury Regulations” has the meaning set forth in Section 4.02.

“Waived ROFR Transfer Period” has the meaning set forth in Section 3.02(f).

ARTICLE II
Management and Operation of the Company

Section 2.01 Board of Directors.

(a) The Stockholders agree that the business and affairs of the Company shall be managed through a board of directors (the “Board”) consisting of five (5) members (each, a “Director”). For so long as the Ownership Percentage of a Stockholder equals or exceeds twenty percent (20%), such Stockholder shall be entitled to nominate that number of Directors to the Board equal to the product of: (i) the Ownership Percentage, and (ii) the total number of directors on the Board, including the number of Directors appointed or appointable to the Board and any vacancies on the Board; provided that if such product is not a whole number, then the number of Directors shall be rounded to the nearest whole number (with one-half being rounded upward) (e.g., if such product is 1.01 then the number of Directors shall be one and if such product is 1.50, then the number of Directors shall be two). In the event the Ownership Percentage of a Stockholder ceases to be equal to at least twenty (20%), then (x) such Stockholder shall cease to have the right to designate any Director(s) pursuant to this Section 2.01(a), (y) such Stockholder shall cause each Director appointed by it to resign, and (z) the Directors remaining in office shall be entitled to decrease the size of the Board to eliminate such vacancy or vacancies.

The Directors elected to the Board in accordance with the provisions of this Section 2.01(a) on the date of this Agreement are:

(i) four (4) GlassBridge Directors, who shall initially be Daniel Strauss, Daiana Sersea, Alex Spiro and Francis Ruchalski; and

(ii) one (1) ORIX Director, who shall initially be Neil Winward.

(b) Each Stockholder shall vote all shares of Common Stock over which such Stockholder has voting control and shall take all other necessary or desirable actions within such Stockholder’s control (including in its capacity as stockholder, director, member of a board committee or officer of the Company or otherwise, and whether at a regular or special meeting of the Stockholders or by written consent in lieu of a meeting) to elect to the Board any individual designated by a Stockholder pursuant to Section 2.01(a), Section 2.01(c) or Section 2.01(d).

(c) Each Stockholder shall have the right at any time to remove (with or without cause) any Director designated by such Stockholder for election to the Board and each other Stockholder shall vote all shares of Common Stock over which such other Stockholder has voting control and shall take all other necessary or desirable actions within such other Stockholder’s control (including in its capacity as stockholder, director, member of a board committee or officer of the Company or otherwise, and whether at a regular or special meeting of the Stockholders or by written consent in lieu of a meeting) to remove from the Board any individual designated by such designating Stockholder that such designating Stockholder desires to remove pursuant to this Section 2.01(c). Except as provided in the preceding sentence, unless a Stockholder shall otherwise consent in writing, no Stockholder shall take any action to cause the removal of any Directors designated by another Stockholder.

(d) In the event a vacancy is created on the Board at any time and for any reason (whether as a result of death, disability, retirement, resignation or removal pursuant to Section 2.01(c)), the Stockholder who designated such individual shall have the right to designate a different individual to replace such Director and each other Stockholder shall vote all shares of Common Stock over which such other Stockholder has voting control and shall take all other necessary or desirable actions within such other Stockholder’s control (including in its capacity as stockholder, director, member of a board committee or officer of the Company or otherwise, and whether at a regular or special meeting of the Stockholders or by written consent in lieu of a meeting) to elect to the Board any individual designated by such designating Stockholder.

(e) The Board shall have the right to establish any committee of Directors as the Board shall deem appropriate from time to time. Subject to this Agreement, the Organizational Documents and Applicable Law, committees of the Board shall have the rights, powers and privileges granted to such committee by the Board from time to time. Any delegation of authority to a committee of Directors to take any action must be approved in the same manner as would be required for the Board to approve such action directly. Any committee of Directors shall be composed of the same proportion of GlassBridge Directors and ORIX Directors as the Stockholders shall then be entitled to appoint to the Board pursuant to Section 2.01(a); provided, that for so long as any Stockholder has the right to designate a Director to the Board, any committee composed of Directors shall consist of at least one Director designated by such Stockholder.

Section 2.02 Meetings of the Board of Directors.

(a) The Board will meet no less than four (4) times a year at such times and in such places as the Board shall designate from time to time. In addition to the regular meetings contemplated by the foregoing sentence, special meetings of the Board may be called by any Director or Stockholder on no less than two (2) Business Days prior written notice of the time, place and agenda of the meeting.

(b) The Directors may participate in any meeting of the Board by means of video conference, teleconference or other similar communications equipment by means of which all persons participating in the meeting can hear each other and such participation shall constitute such Director’s presence in person at the meeting.

(c) The presence of a majority of Directors then in office shall constitute a quorum; provided, that, except as provided below, the presence of the ORIX Director at such meeting, whether of the Board or a committee thereof, shall be required in order for a quorum to be present. If a quorum is not achieved at any duly called meeting, whether of the Board or a committee thereof, such meeting may be postponed to a time no earlier than 48 hours after written notice of such postponement has been given to the Directors. If the ORIX Director is not present for two (2) consecutive meetings, whether of the Board or a committee thereof, then the presence, in person or by proxy, of Directors designated by Stockholders holding more than fifty percent (50%) of the voting securities shall constitute a quorum for the next such meeting; provided, however, no action may be taken at such meeting except as specifically indicated on the agenda for the meeting sent with the notice of the meeting.

(d) Unless otherwise restricted by this Agreement, any action required or permitted to be taken at any meeting of the Board or of any committee thereof may be taken without a meeting if all directors or members of such committee, as the case may be, consent thereto in writing or by electronic transmission, and the writings or electronic transmissions are filed with the minutes of proceedings of the Board of Directors or committee.

(e) The Company shall pay all reasonable and documented fees, charges and expenses (including travel and related expenses) incurred by each Director in connection with: (i) attending the meetings of the Board and all committees thereof and (ii) conducting any other Company business requested by the Company.

Section 2.03 Voting Arrangements.

(a) For a period of thirty (30) months from the date hereof (the “Special Rights Period”), subject to Section 2.03(b) (in respect of the business or the operations of GlassBridge Asset Management, LLC and its Subsidiaries), Section 2.03(c) and Section 2.03(e), and as the Special Rights (as defined below) may be reinstated pursuant to the terms of, and for such period of time as set forth in, the Assignment and Assumption Agreement, in addition to any vote or consent of the Board or the Stockholders required by Applicable Law, without ORIX Approval, the Company shall not, and, to the extent specifically provided below, shall cause each of its Subsidiaries not to (the “Special Rights”):

(i) amend, modify or waive the Certificate of Incorporation or By-laws;

(ii) (1) make any material change to the nature of the business as conducted by the Company as of the date of this Agreement or (2) enter into any business other than the business as conducted by the Company as of the date of this Agreement;

(iii) (1) issue or sell Capital Stock of the Company or any Subsidiary of the Company to any Person or (2) enter into or effect any transaction or series of related transactions involving the repurchase, redemption or other acquisition of Capital Stock of the Company or any Subsidiary of the Company from any Person, in each case, other than pursuant to and in accordance with the terms of this Agreement;

(iv) incur any indebtedness, pledge or grant Liens except for Permitted Liens on any assets or guarantee, assume, endorse or otherwise become responsible for the obligations of any other Person, except (1) in the ordinary course of business consistent with past practice or (2) in any arm’s length transaction providing debt financing to the Company or one of its Subsidiaries;

(v) make any loan, advance or capital contribution to any Person, except (1) in the ordinary course of business consistent with past practice or (2) in any arm’s length transaction providing debt financing to the Company or one of its Subsidiaries;

(vi) appoint or remove the Company’s auditors or make any changes in the accounting methods or policies of the Company (other than as required by GAAP);

(vii) enter into, amend in any material respect, waive or terminate any Related Party Agreement (other than, for the avoidance of doubt, any purchase(s) of Common Stock by ORIX as contemplated by this Agreement or otherwise), other than in the ordinary course of business consistent with past practice;

(viii) enter into or effect any transaction or series of related transactions involving the purchase, lease, license, exchange or other acquisition (including by merger, consolidation, acquisition of stock or acquisition of assets) by the Company of any assets and/or equity interests of any Person, other than in the ordinary course of business consistent with past practice;

(ix) enter into or effect any transaction or series of related transactions involving the sale, lease, license, exchange or other disposition (including by merger, consolidation, sale of stock or sale of assets) by the Company of any assets (other than sales in the ordinary course of business);

(x) establish a Subsidiary or enter into any joint venture or similar business arrangement;

(xi) enter into or amend any material term of (1) any employment agreement or arrangement with any senior employee, (2) the compensation (including salary, bonus, deferred compensation or otherwise) or benefits of any senior employee, (3) any stock option, employee stock purchase or similar equity-based plans, (4) any benefit, severance or other similar plan or (v) any annual bonus plan or any management equity plan, in all such cases except in the ordinary course of business consistent with past practice;

(xii) settle any lawsuit, action, dispute or other proceeding or otherwise assume any liability of a third party or agree to the provision of any equitable relief by the Company;

(xiii) initiate or consummate an Initial Public Offering or make a public offering and sale of Common Stock or any other securities;

(xiv) make any investments in any other Person other than in the ordinary course of business consistent with past practice;

(xv) dissolve, wind-up or liquidate the Company or initiate a bankruptcy proceeding involving the Company; or

(xvi) authorize or enter into any binding agreement or commitment with respect to any of the foregoing.

(b) Nothing contained in Section 2.03(a) is intended to or shall give ORIX, directly or indirectly, the right to control or direct the business or the operations of GlassBridge Asset Management, LLC and its Subsidiaries, and the Company and each of the Stockholders agree that the Company shall cause GlassBridge Asset Management, LLC and its Subsidiaries to conduct their business in the ordinary course of business (consistent with past practice and good industry practice).

(c) Notwithstanding anything contained in paragraphs (iv), (v), (vii), (viii), (ix), (xi), (xii) and (xiv) of Section 2.03(a) to the contrary, ORIX Approval shall not be required for any expenditures, commitments or other obligations of the Company that would otherwise require ORIX Approval pursuant to such paragraphs of Section 2.03(a) if such expenditures, commitment or similar obligations in a single transaction or series of related transactions or in the aggregate for the current Fiscal Year are less than $500,000 at the time such expenditure, commitment or similar obligation is made, as reasonably calculated by the Company; provided that solely with respect to paragraphs (vii) and (ix), no single transaction or series of related transactions may exceed $250,000 during a Fiscal Year.

(d) Notwithstanding anything to the contrary in this Agreement, commencing upon the expiration of the Special Rights Period, in addition to any vote or consent of the Board or the Stockholders required by Applicable Law, without ORIX Approval, the Company shall not, and shall cause each of its Subsidiaries not to, take any action which is designed to, or could reasonably be expected to, disproportionately and adversely affect the rights of ORIX with respect to its Capital Stock in favor of GlassBridge with respect to its Capital Stock or any other Person who at such time holds or is being issued Capital Stock, in any material manner (the “Minority Rights”); provided that if the Special Rights are reinstated (or are never terminated) pursuant to the terms of the Assignment and Assumption Agreement, and during such period of time as the Special Rights are reinstated (or remain in effect, to the extent never extinguished) and effective, the Minority Rights shall be suspended (i.e., it is intended that the Minority Rights shall apply and be effective at all times that the Special Rights are not in effect).

(e) Notwithstanding anything contained in Section 2.03(a) to the contrary, ORIX Approval shall not be required for any actions that would otherwise require ORIX Approval pursuant to such paragraphs of Section 2.03(a) if such action is taken solely for the purpose of, and in connection with, satisfying the scheduled payment obligations set forth in the Notes, including the sale of assets of the Company.

(f) Notwithstanding anything to the contrary in this Agreement, in the event the Ownership Percentage of GlassBridge ceases to be equal to at least twenty (20%) and no GlassBridge Director is serving on the Board, then, in addition to any vote or consent of the Stockholders required by Applicable Law, without the written consent of GlassBridge, the Company shall not, and shall cause each of its Subsidiaries not to, take any action which is designed to, or could reasonably be expected to, disproportionately and adversely affect the rights of GlassBridge with respect to its Capital Stock in favor of ORIX with respect to its Capital Stock or any other Person who at such time holds or is being issued Capital Stock, in any material manner.

Section 2.04 Observer. So long as ORIX holds five percent (5%) of the Common Stock in the Company (on a fully diluted basis), ORIX shall have the right to designate one observer to attend board meetings on behalf ORIX. The observer shall not have the right to vote on any matter presented to the Board. The observer shall be given written notice of each meeting of the Board at the same time and in the same manner as the directors, shall be provided with all written materials and other information given to the directors and shall be permitted to attend as an observer all meetings of the Board, and in the event the Board proposes to take any action by written consent in lieu of a meeting, the observer shall be given written notice thereof including the proposed text of such written consent; provided, however, that the Board shall have the right to withhold any information and to exclude the observer from any meeting or portion thereof (a) if doing so is, in the reasonable judgment of the Board, advisable or necessary to protect the attorney client privilege between the corporation and counsel, or (b) if the Board reasonably determines that attendance by the observer would conflict with the discharge of its fiduciary duties under applicable law. The observer shall have agreed to the foregoing obligation and shall agree to hold confidential all information received in such capacity.

ARTICLE III
Transfer of Interests

Section 3.01 General Restrictions on Transfer.

(a) Each Stockholder agrees that such Stockholder will not, voluntarily or involuntarily Transfer any of its Common Stock, at any time prior to the date that is 180 days after the date of this Agreement; provided, however, that ORIX may Transfer its Common Stock to a Permitted Transferee.

(b) From and after the date that is 180 days after the date of this Agreement, except as permitted pursuant to Section 3.01(c) or in accordance with the procedures described in Section 3.02 or Section 5.01, each Stockholder agrees that such Stockholder will not, voluntarily or involuntarily Transfer any of its Common Stock.

(c) The provisions of Section 3.01(b) and Section 3.02, shall not apply to any of the following Transfers by any Stockholder of any of its Common Stock:

(i) to a Permitted Transferee; or

(ii) pursuant to a merger, consolidation or other business combination of the Company with a Third Party Purchaser that has been approved in compliance with Section 2.03(a)(ix).

(d) In addition to any legends required by Applicable Law, each certificate representing the Common Stock of the Company shall bear a legend substantially in the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A STOCKHOLDERS AGREEMENT (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY). NO TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER DISPOSITION OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY BE MADE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF SUCH STOCKHOLDERS AGREEMENT AND (A) PURSUANT TO A REGISTRATION STATEMENT EFFECTIVE UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) PURSUANT TO AN EXEMPTION FROM REGISTRATION THEREUNDER. THE HOLDER OF THIS CERTIFICATE, BY ACCEPTANCE OF THIS CERTIFICATE, AGREES TO BE BOUND BY ALL OF THE PROVISIONS OF SUCH STOCKHOLDERS AGREEMENT.”

(e) Prior notice shall be given to the Company by the transferor of any Transfer (whether or not to a Permitted Transferee) of any Common Stock. Prior to consummation of any Transfer by any Stockholder of any of its Common Stock, such party shall cause the transferee thereof to execute and deliver to the Company a Joinder Agreement and agree to be bound by the terms and conditions of this Agreement. Upon any Transfer by any Stockholder of any of its Common Stock, in accordance with the terms of this Agreement, the transferee thereof shall be substituted for, and shall assume all the rights and obligations under this Agreement of, the transferor thereof.

(f) Notwithstanding any other provision of this Agreement, each Stockholder agrees that it will not Transfer any of its Common Stock (i) except as permitted under the Securities Act and other applicable federal or state securities laws, and then, if requested by the Company, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act, (ii) if it would cause the Company or any of its Subsidiaries to be required to register as an investment company under the Investment Company Act of 1940, or (iii) if it would cause the assets of the Company or any of its Subsidiaries to be deemed plan assets as defined under the Employee Retirement Income Security Act of 1974 or its accompanying regulations or result in any “prohibited transaction” thereunder involving the Company. In any event, the Board may refuse the Transfer to any Person if such Transfer would have a material adverse effect on the Company as a result of any regulatory or other restrictions imposed by any Governmental Authority.

(g) Any Transfer or attempted Transfer of any Common Stock in violation of this Agreement shall be null and void ab initio, no such Transfer shall be recorded on the Company’s books and the purported transferee in any such Transfer shall not be treated (and the purported transferor shall continue to be treated) as the owner of such Common Stock for all purposes of this Agreement.

Section 3.02 Right of First Refusal.

(a) If at any time prior to the fourth anniversary of the date of this Agreement, a Stockholder (such Stockholder, an “Offering Stockholder”) receives a bona fide offer from any Third Party Purchaser to purchase all or any portion of the Common Stock (the “Offered Shares”) owned by the Offering Stockholder and the Offering Stockholder desires to Transfer the Offered Shares (other than Transfers that are permitted by Section 3.01(c) or Transfers made pursuant to Section 5.01), then the Offering Stockholder must first make an offering of the Offered Shares to each other Stockholder (each such other Stockholder, a “ROFR Rightholder”) in accordance with the provisions of this Section 3.02.

(b) The Offering Stockholder shall, within 5 Business Days of receipt of the offer from the Third Party Purchaser which the Offering Stockholder desires to accept, give written notice (the “Offering Stockholder Notice”) to the Company and the ROFR Rightholders stating that it has received a bona fide offer from a Third Party Purchaser and specifying:

(i) the number of Offered Shares the Third Party Purchaser proposes to purchase from Stockholder;

(ii) the identity of the Third Party Purchaser;

(iii) the per share purchase price (which for the avoidance of doubt shall be payable solely in cash) and the other material terms and conditions of the Transfer; and

(iv) the proposed date, time and location of the closing of the Transfer.

The Offering Stockholder Notice shall constitute the Offering Stockholder’s offer to Transfer the Offered Shares to the ROFR Rightholders, which offer shall be irrevocable until the end of the ROFR Notice Period.

(c) By delivering the Offering Stockholder Notice, the Offering Stockholder represents and warrants to the Company and to each ROFR Rightholder that: (i) the Offering Stockholder has full right, title and interest in and to the Offered Shares; (ii) the Offering Stockholder has all the necessary power and authority to Transfer such Offered Shares as contemplated by this Section 3.02; and (iii) the Offered Shares are free and clear of any and all Liens other than those arising as a result of or under the terms of this Agreement or under applicable securities laws.

(d) Upon receipt of the Offering Stockholder Notice, each ROFR Rightholder shall have 10 Business Days (the “ROFR Notice Period”) to elect to purchase all (and not less than all) of the Offered Shares by delivering a written notice (a “ROFR Notice”) to the Offering Stockholder and the Company stating that it offers to purchase all of such Offered Shares on the terms specified in the Offering Stockholder Notice. Any ROFR Notice shall be binding upon delivery and irrevocable by the applicable ROFR Rightholder (provided the representations in Section 3.02(c) to be made by the Offering Stockholder continue to be accurate). If more than one ROFR Rightholder delivers a ROFR Notice, each such ROFR Rightholder (the “Purchasing Stockholder”) shall be entitled to purchase the number of shares equal to the product of (x) the total number of Offered Shares and (y) a fraction determined by dividing (A) the number of shares of Common Stock owned by such Purchasing Stockholder as of the date of the Offering Stockholder Notice, by (B) the total number of shares of Common Stock owned by all of the Purchasing Stockholders as of such date.

(e) Each ROFR Rightholder that does not deliver a ROFR Notice during the ROFR Notice Period shall be deemed to have waived all of such ROFR Rightholder’s rights to purchase such Offered Shares (but for clarity, not any other future Offered Shares) under this Section 3.02.

(f) If no ROFR Rightholder delivers a ROFR Notice in accordance with Section 3.02(d), the Offering Stockholder may, during the 60 Business Day period immediately following the expiration of the ROFR Notice Period, which period may be extended for a reasonable time not to exceed 90 Business Days to the extent reasonably necessary to obtain any Government Approvals (the “Waived ROFR Transfer Period”), Transfer all of the Offered Shares to the Third Party Purchaser on terms and conditions no more favorable to the Third Party Purchaser than those set forth in the Offering Stockholder Notice. If the Offering Stockholder does not Transfer the Offered Shares within such period or, if such Transfer is not consummated within the Waived ROFR Transfer Period, the rights provided hereunder shall be deemed to be revived and the Offered Shares shall not be Transferred to the Third Party Purchaser unless the Offering Stockholder sends a new Offering Stockholder Notice in accordance with, and otherwise complies with, this Section 3.02.

(g) The Offering Stockholder and each Purchasing Stockholder shall take all actions as may be reasonably necessary to consummate the Transfer contemplated by this Section 3.02, including entering into agreements and delivering certificates and instruments and consents as may be deemed necessary or appropriate by the Company and the Purchasing Stockholder.

(h) At the closing of any Transfer pursuant to this Section 3.02, the Offering Stockholder shall deliver to the Purchasing Stockholders the certificate or certificates representing the Offered Shares to be sold (if any), accompanied by stock powers and all necessary stock transfer taxes paid and stamps affixed, if necessary, against receipt of the purchase price therefor from such Purchasing Stockholders by certified or official bank check or by wire transfer of immediately available funds.

ARTICLE IV
PRE-EMPTIVE RIGHTS AND OTHER AGREEMENTS

Section 4.01 Pre-emptive Right.

(a) The Company hereby grants to ORIX the right to purchase any new Capital Stock of the Company (the “New Securities”) that the Company may from time to time propose to issue or sell to any party.

(b) The Company shall give written notice (an “Issuance Notice”) of any proposed issuance or sale described in subsection (a) above to ORIX within 5 Business Days following any meeting of the Board at which any such issuance or sale is approved (which shall include the ORIX Approval during the Special Rights Period). The Issuance Notice shall set forth the material terms and conditions of the proposed issuance, including:

(i) the number of New Securities proposed to be issued and the percentage of the Company’s outstanding Common Stock, on a fully diluted basis, that such issuance would represent;

(ii) the proposed issuance date, which shall be at least 20 Business Days from the date of the Issuance Notice; and

(iii) the proposed purchase price per share.

(c) ORIX shall for a period of 15 Business Days following the receipt of an Issuance Notice have the right to elect irrevocably to purchase, at the purchase price set forth in the Issuance Notice, either (i) all of the New Securities or (ii) the amount of New Securities equal to the product of (x) the total number of New Securities to be issued by the Company on the issuance date and (y) a fraction determined by dividing (A) the number of shares of Common Stock owned by ORIX immediately prior to such issuance by (B) the total number of shares of Common Stock outstanding on such date immediately prior to such issuance, by delivering a written notice to the Company. ORIX’s election to purchase New Securities shall be binding and irrevocable.

(d) The Company shall be free to complete the proposed issuance or sale of New Securities described in the Issuance Notice with respect to any New Securities not elected to be purchased by ORIX pursuant to Section 4.01(c) above in accordance with the terms and conditions set forth in the Issuance Notice (except that the amount of New Securities to be issued or sold by the Company may be reduced) so long as such issuance or sale is closed within 30 Business Days after the date of the Issuance Notice (subject to the extension of such 30 Business Day period for a reasonable time not to exceed 60 Business Days to the extent reasonably necessary to obtain any Government Approvals). In the event the Company has not sold such New Securities within such time period, the Company shall not thereafter issue or sell any New Securities without first again offering such securities to the Stockholders in accordance with the procedures set forth in this Section 4.01.

(e) Upon the consummation of the issuance of any New Securities in accordance with this Section 4.01, the Company shall deliver to ORIX certificates (if any) evidencing the New Securities, which New Securities shall be issued free and clear of any Liens (other than those arising hereunder and those attributable to the actions of the purchasers thereof or under securities law), and the Company shall so represent and warrant to the purchasers thereof, and further represent and warrant to such purchasers that such New Securities shall be, upon issuance thereof to ORIX and after payment therefor, duly authorized, validly issued, fully paid and non-assessable. ORIX shall deliver to the Company the purchase price for the New Securities purchased by it by wire transfer of immediately available funds and make representations and warranties regarding organization and authority, enforceability, absence of conflicts with any law, absence of consents required from any Governmental Authority, absence of legal proceedings instituted by any Governmental Authority or any other Person unaffiliated with the Company or Seller or any of its Subsidiaries and such other representation and warranties in order to ensure compliance with federal securities laws as the Company may reasonably request. Each party to the purchase and sale of New Securities shall take all such other actions as may be reasonably necessary to consummate the purchase and sale including entering into such additional agreements as may be necessary or appropriate.

Section 4.02 Section 382 Compliance. Each Stockholder will use its reasonable best efforts not to impair under Section 382 of the Internal Revenue Code of 1986 (the “Tax Code”), or the Treasury regulations promulgated thereunder (the “Treasury Regulations”), (whether by action or omission) the ability to utilize historical net operating losses to offset the Company’s taxable income. Without limiting the generality of the foregoing, each Stockholder agrees: (a) to prevent (to the extent in its reasonable control) and not knowingly to participate in or facilitate (whether by consent or approval, sharing of information or otherwise) any transaction involving it and any other Person that would cause any “owner shift,” within the meaning of Section 382 of the Tax Code or the Treasury Regulations with respect to it or any of its Subsidiaries (including the Company); and (b) it shall not, nor shall it permit any of its Subsidiaries (including the Company) to, issue any Capital Stock if such issuance would cause any “owner shift” (x) until the first anniversary of the date hereof, to exceed 37.0% and (y) thereafter, to exceed 35.0%. The Company and the Stockholders agree that any Transfer or attempted Transfer of any Capital Stock of any Person by a “5% shareholder” (as defined under Section 382 of the Code) that would create an “ownership change” within the meaning of Section 382(g)(2) of the Tax Code shall be null and void ab initio, no such Transfer shall be recorded on the books of such Person and the purported transferee in any such Transfer shall not be treated (and the purported transferor shall continue to be treated) as the owner of such Capital Stock.

Section 4.03 Confidentiality.

(a) Each Stockholder shall and shall cause its Representatives to, keep confidential and not divulge any information (including all budgets, business plans and analyses) concerning the Company, including its assets, business, operations, financial condition or prospects (“Information”), and to use, and cause its Representatives to use, such Information only in connection with the operation of the Company; provided, that nothing herein shall prevent any Stockholder from disclosing such Information (i) upon the order of any court or administrative agency, (ii) upon the request or demand of any regulatory agency or authority having jurisdiction over such Stockholder, (iii) to the extent compelled by legal process or required or requested pursuant to subpoena, interrogatories or other discovery requests, (iv) to the extent necessary in connection with the exercise of any remedy hereunder, (v) to other Stockholders, (vi) to such Stockholder’s Representatives that in the reasonable judgment of such Stockholder need to know such Information, (vii) to such Stockholder’s Affiliates, or (viii) to any potential Permitted Transferee in connection with a proposed Transfer of Common Stock from such Stockholder as long as such transferee agrees to be bound by the provisions of this Section 4.03 as if a Stockholder, provided, further, that in the case of clause (i), (ii) or (iii), such Stockholder shall notify the other parties hereto of the proposed disclosure as far in advance of such disclosure as practicable and use reasonable efforts to ensure that any Information so disclosed is accorded confidential treatment, when and if available.

(b) The restrictions of Section 4.03(a) shall not apply to information that (i) is or becomes generally available to the public other than as a result of a disclosure by a Stockholder or any of its Representatives in violation of this Agreement; (ii) is or becomes available to a Stockholder or any of its Representatives on a non-confidential basis prior to its disclosure to the receiving Stockholder and any of its Representatives, (iii) is or has been independently developed or conceived by such Stockholder without use of the Company’s Information or (iv) becomes available to the receiving Stockholder or any of its Representatives on a non-confidential basis from a source other than the Company, any other Stockholder or any of their respective Representatives, provided, that such source is not known by the recipient of the information to be bound by a confidentiality agreement with the disclosing Stockholder or any of its Representatives.

ARTICLE V
BUY-SELL AGREEMENT

Section 5.01 Buy-Sell Right. At any time, and from time to time, ORIX shall have the right, but not the obligation, to elect to implement the buy/sell procedures set forth in this Section 5.01 by delivering to GlassBridge a written notice of such election (“Buy-Sell Offer Notice”); provided, however, ORIX may not deliver more than three (3) Buy-Sell Offer Notices in any three (3) month period.

(a) Buy-Sell Election. The Buy-Sell Offer Notice shall set forth:

(i) the number of shares of Common Stock owned by GlassBridge that ORIX desires to purchase (which may be all or a portion of the shares of Common Stock then owned by GlassBridge) (the number of shares of Common Stock owned by GlassBridge that is specified in the Buy-Sell Offer Notice, the “Subject Shares”);

(ii) the aggregate purchase price for the Subject Shares, which shall be at least Book Value plus 20%) (the purchase price per share of Common Stock specified in the Buy-Sell Offer Notice, the “Offer Price”) and shall be payable exclusively in cash (unless otherwise agreed); and

(iii) the closing date for the purchase and sale of the Subject Shares (which closing date shall be on a Business Day between two (2) Business Days and seven (7) Business Days following the date of the Buy-Sell Offer Notice).

No Buy-Sell Offer Notice under this Section 5.01(a) may be rescinded without the written consent of each of GlassBridge and ORIX.

(b) Response Notice. Within two (2) Business Days following the date of the Buy-Sell Offer Notice, GlassBridge shall deliver ORIX a responsive notice, without qualification or condition, electing either:

(i) to sell to ORIX the Subject Shares at the Offer Price; or

(ii) to purchase from ORIX the lesser of (1) all (but not less than all) of the shares of Common Stock then owned by ORIX, and (2) the number of shares of Common Stock specified in the Buy-Sell Offer Notice, in either case at the Offer Price.

Any responsive notice delivered to ORIX under clause (i) above is referred to herein as an “Acceptance” and any responsive notice delivered to ORIX under clause (ii) above is referred to herein as a “Counter Offer”. No Acceptance or Counter Offer under this Section 5.01(b) may be rescinded without the written consent of each of ORIX and GlassBridge. The failure of GlassBridge to give a responsive notice (without qualification or condition) within the required time period shall be deemed notice of an election to sell to ORIX the Subject Shares under clause (i) above and shall be treated for all purposes as an Acceptance.

(c) Response to Counter Offer. In the event that a Counter Offer is delivered to ORIX, ORIX shall have the right, within two (2) Business Days following the Counter Offer, in its sole discretion to either accept or reject the Counter Offer. The failure of ORIX to respond to the Counter Offer within the required time period shall be deemed to be a rejection of the Counter Offer. If the Counter Offer is rejected, then no Transfer shall be consummated.

(d) Closing Process.

(i) The Stockholder obligated to purchase shares of Common Stock pursuant to this Section 5.01 is referred to herein as the “Purchaser” and the Stockholder obligated to sell shares of Common Stock pursuant to this Section 5.01 is referred to herein as the “Selling Stockholder.”

(ii) The closing of any purchase and sale of Subject Shares by ORIX pursuant to clause (i) of Section 5.01(b) (following delivery or deemed delivery of an Acceptance) shall occur on the date set forth in the Buy-Sell Offer Notice.

(iii) The closing of any purchase and sale of shares of Common Stock by GlassBridge following delivery of a Counter Offer that is accepted by ORIX shall take place on a Business Day between four (4) Business Days and seven (7) Business Days after the date of the Counter Offer as GlassBridge shall designate.

(iv) The aggregate purchase price payable in connection with the purchase and sale of shares of Common Stock pursuant to this Section 5.01 shall be paid at closing by wire transfer of immediately available funds to an account designated in writing by the Selling Stockholder (unless otherwise agreed). At the closing, the Selling Stockholder shall deliver to the Purchaser good and marketable title to its shares of Common Stock, free and clear of all any Liens (other than those arising hereunder or under applicable securities laws). Each Stockholder agrees to cooperate and take all actions and execute all documents reasonably necessary or appropriate to reflect the purchase of the Selling Stockholder’s shares of Common Stock by the Purchaser.

(e) Failure to Close.

(i) If the Purchaser fails to perform its obligations under this Section 5.01 (following such failure, the “Defaulting Purchaser”), the Selling Stockholder shall have all rights and remedies available to it hereunder or at law or equity, including the right to seek specific performance. If the Selling Stockholder shall fail to perform its obligations under this Section 5.01, the Purchaser shall have all rights and remedies available to it hereunder or at law or equity, including the right to seek specific performance.

(ii) Notwithstanding anything contained in this Section 5.01, if the Board determines that the consummation of the Transfer contemplated by this Section 5.01 would have a material adverse effect on the Company NOL (as defined in the Securities Purchase Agreement), including the amount, deductibility and/or timing of deductibility, as a result of any regulatory or other restrictions imposed by any tax authority, the Stockholders may not consummate such Transfer.

ARTICLE VI
Information Rights

Section 6.01 Financial Statements. In addition to, and without limiting any rights that a Stockholder may have with respect to inspection of the books and records of the Company under Applicable Laws, the Company shall furnish to each Stockholder, the following information:

(a) As soon as available, and in any event within 75 days after the end of each Fiscal Year, the audited balance sheet of the Company as at the end of each such Fiscal Year and the audited statements of income, cash flows and changes in stockholders’ equity for such year, accompanied by the certification of independent certified public accountants of recognized national standing selected by the Board in accordance with Section 2.03(a)(vi), to the effect that, except as set forth therein, such financial statements have been prepared in accordance with GAAP, applied on a basis consistent with prior years and fairly present in all material respects the financial condition of the Company as of the dates thereof and the results of its operations and changes in its cash flows and stockholders’ equity for the periods covered thereby.

(b) As soon as available, and in any event within 45 days after the end of the first three fiscal quarters of the Fiscal Year, the balance sheet of the Company at the end of such quarter and the statements of income, cash flows and changes in stockholders’ equity for such quarter, all in reasonable detail and all prepared in accordance with GAAP, consistently applied, and certified by the Chief Financial Officer of the Company.

(c) To the extent the Company is required by Applicable Law or pursuant to the terms of any outstanding indebtedness of the Company to prepare such reports, any annual reports, quarterly reports and other periodic reports (without exhibits) actually prepared by the Company as soon as available.

Section 6.02 Inspection Rights.

(a) The Company shall, and shall cause its officers, Directors and employees to, (i) afford each Stockholder that owns at least 5% of the Company’s outstanding Common Stock and the Representatives of each such Stockholder who execute a non-disclosure agreement in a form reasonably satisfactory to the Company, during normal business hours and upon reasonable notice, reasonable access at all reasonable times to its officers, employees, auditors, properties, offices, plants and other facilities and to all books and records, and (ii) afford such Stockholder the opportunity to consult with its officers from time to time regarding the Company’s affairs, finances and accounts as each such Stockholder may reasonably request upon reasonable notice.

(b) The right set forth in Section 6.02(a) above shall not and is not intended to limit any rights which the Stockholders may have with respect to the books and records of the Company, or to inspect its properties or discuss its affairs, finances and accounts under the laws of the jurisdiction in which the Company is incorporated.

ARTICLE VII
Representations and Warranties

Section 7.01 Representations and Warranties. Each Stockholder, severally and not jointly, represents and warrants to the Company and each other Stockholder that:

(a) Such Stockholder is a corporation or limited liability company, as applicable, duly organized, validly existing and in good standing under the laws of the State of Delaware.

(b) Such Stockholder has full corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated hereby. The execution and delivery of this Agreement, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby have been duly authorized by all requisite corporate action of such Stockholder. Such Stockholder has duly executed and delivered this Agreement.

(c) This Agreement constitutes the legal, valid and binding obligation of such Stockholder, enforceable against such Stockholder in accordance with its terms, except as may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors right in general. The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby, require no action by or in respect of, or filing with, any Governmental Authority, except as may be required by GlassBridge pursuant to the Exchange Act or the Securities Act.

(d) The execution, delivery and performance by such Stockholder of this Agreement and the consummation of the transactions contemplated hereby do not (i) conflict with or result in any violation or breach of any provision of any of the organizational documents of such Stockholder, (ii) conflict with or result in any violation or breach of any provision of any Applicable Law or (iii) require any consent or other action by any Person under any provision of any material agreement or other instrument to which the Stockholder is a party.

(e) Except for this Agreement, such Stockholder has not entered into or agreed to be bound by any other agreements or arrangements of any kind with any other party with respect to the Common Stock, including agreements or arrangements with respect to the acquisition or disposition of the Common Stock or any interest therein or the voting of the Common Stock (whether or not such agreements and arrangements are with the Company or any other Stockholder).

ARTICLE VIII
Term and Termination

Section 8.01 Termination. This Agreement shall terminate upon the earliest of:

(a) the consummation of an Initial Public Offering;

(b) the consummation of a merger or other business combination involving the Company whereby the Common Stock becomes a security that is listed or admitted to trading on the NASDAQ Stock Market, the New York Stock Exchange or another national securities exchange;

(d) the dissolution, liquidation, or winding up of the Company; or

(e) upon the unanimous agreement of the Stockholders.

Section 8.02 Effect of Termination.

(a) The termination of this Agreement shall terminate all further rights and obligations of the Stockholders under this Agreement except that such termination shall not effect:

(i) the existence of the Company;

(ii) the obligation of any Party to pay any amounts arising on or prior to the date of termination, or as a result of or in connection with such termination;

(iii) the rights which any Stockholder may have by operation of law as a stockholder of the Company; or

(iv) the rights contained herein which, by their terms are intended to survive termination of this Agreement.

(b) The following provisions shall survive the termination of this Agreement: this Section 8.02 and Section 4.03, Section 9.01, Section 9.02, Section 9.03, Section 9.11, Section 9.12 and Section 9.13.

ARTICLE IX
Miscellaneous

Section 9.01 Expenses. Except as otherwise expressly provided herein, all costs and expenses, including fees and disbursements of counsel, financial advisors and accountants, incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

Section 9.02 Release of Liability. In the event any Stockholder shall Transfer all of the Common Stock held by such Stockholder in compliance with the provisions of this Agreement without retaining any interest therein, then such Stockholder shall cease to be a party to this Agreement and shall be relieved and have no further liability arising hereunder for events occurring from and after the date of such Transfer.

Section 9.03 Notices. All notices, requests, consents, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been given (a) when delivered by hand (with written confirmation of receipt), (b) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested), (c) on the date sent by email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient or (d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 9.03):

If to the Company:	Imation Enterprises Corp.
	510 Madison Ave, 9th Floor
	New York, New York 10022
	E-mail: dstrauss@glassbridge.com
	Attention: Chief Executive Officer

with a copy (which shall not	Loeb & Loeb LLP
constitute notice) to	345 Park Avenue
	New York, New York 10154
	E-mail: lrothenberg@loeb.com
	Attention: Lloyd L. Rothenberg, Esq.

If to GlassBridge:	GlassBridge Enterprises, Inc.
	510 Madison Ave, 9th Floor
	New York, New York 10022
	E-mail: dstrauss@glassbridge.com
	Attention: Chief Executive Officer

with a copy (which shall not constitute notice) to:	Loeb & Loeb LLP
	345 Park Avenue
	New York, New York 10154
	E-mail: lrothenberg@loeb.com
	Attention: Lloyd L Rothenberg, Esq.

If to ORIX:	ORIX Corporation USA
	1717 Main Street, Suite 1100
	Dallas, Texas 75201
	E-mail: Benjamin.Price@orix.com
	Attention: Benjamin Price, Assistant General Counsel

	ORIX Corporation USA
	280 Park Avenue
	New York, NY 10017
	E-mail: Gregory.Raykher@orix.com
	Attention: Gregory Raykher

	ORIX Corporation USA
	280 Park Avenue
	New York, NY 10017
	E-mail: Neil.Winward@orix.com
	Attention: Neil Winward

with a copy (which shall not	Norton Rose Fulbright US LLP
constitute notice) to:	1301 Avenue of the Americas
	New York, New York 10019
	E-mail: sheldon.nussbaum@nortonrosefulbright.com
	Attention: Sheldon G. Nussbaum, Esq.

Section 9.04 Interpretation. For purposes of this Agreement, (a) the words “include,” “includes” and “including” shall be deemed to be followed by the words “without limitation”; (b) the word “or” is not exclusive; and (c) the words “herein,” “hereof,” “hereby,” “hereto” and “hereunder” refer to this Agreement as a whole. The definitions given for any defined terms in this Agreement shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. Unless the context otherwise requires, references herein: (x) to Articles, Sections, and Exhibits mean the Articles and Sections of, and Exhibits attached to, this Agreement; (y) to an agreement, instrument or other document means such agreement, instrument or other document as amended, supplemented and modified from time to time to the extent permitted by the provisions thereof and (z) to a statute means such statute as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The Exhibits referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein.

Section 9.05 Headings. The headings in this Agreement are for reference only and shall not affect the interpretation of this Agreement.

Section 9.06 Severability. If any term or provision of this Agreement is invalid, illegal or unenforceable in any jurisdiction, such invalidity, illegality or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

Section 9.07 Entire Agreement. This Agreement and the Organizational Documents constitute the sole and entire agreement of the parties with respect to the subject matter contained herein and therein, and supersede all prior and contemporaneous understandings and agreements, both written and oral, with respect to such subject matter. In the event of any inconsistency or conflict between this Agreement and any Organizational Document, the Stockholders and the Company shall, to the extent permitted by Applicable Law, amend such Organizational Document to comply with the terms of this Agreement.

Section 9.08 Successors and Assigns. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and permitted assigns.

Section 9.09 No Third-party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person or entity any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.

Section 9.10 Amendment and Modification; Waiver. This Agreement may only be amended, modified or supplemented by an agreement in writing signed by each party hereto. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power or privilege arising from this Agreement shall operate or be construed as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege.

Section 9.11 Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than those of the State of Delaware.

Section 9.12 Dispute Resolution.

(a) Subject to Section 9.13, any dispute, controversy or claim arising out of, relating to, or in connection with, this Agreement or any breach, termination or validity thereof (a “Dispute”) shall be finally settled by arbitration. The arbitration shall be conducted in accordance with the Commercial Arbitration Rules of the American Arbitration Association in effect at the time of the arbitration, except as they may be modified herein or by mutual agreement of the parties. The seat of the arbitration shall be New York.

(b) The arbitration shall be conducted by three arbitrators. The party initiating arbitration (the “Claimant”) shall appoint its arbitrator in its request for arbitration (a “Request”). The other party (the “Respondent”) shall appoint its arbitrator within 30 days of receipt of the Request and shall notify the Claimant of such appointment in writing. If the Respondent fails to appoint an arbitrator within such 30 day period, the arbitrator named in the Request shall decide the Dispute as the sole arbitrator. Otherwise, the two arbitrators appointed by the parties shall appoint a third arbitrator within 30 days after the Respondent has notified the Claimant of the appointment of the Respondent’s arbitrator. When the arbitrators appointed by the parties have appointed a third arbitrator and the third arbitrator has accepted the appointment, the two arbitrators shall promptly notify the parties of such appointment. If the two arbitrators appointed by the parties fail or are unable to appoint a third arbitrator or to notify the parties of such appointment, then the third arbitrator shall be appointed by the President of the American Arbitration Association which shall promptly notify the parties of the appointment of the third arbitrator. The third arbitrator shall act as chairman of the panel.

(c) The arbitration award shall be in writing and shall be final and binding on the parties. The award may include an award of costs, including reasonable attorney’s fees and disbursements. Judgment upon the award may be entered by any court having jurisdiction thereof or having jurisdiction over the parties or their assets.

Section 9.13 Equitable Remedies. Each party hereto acknowledges that the other parties hereto would be irreparably damaged in the event of a breach or threatened breach by such party of any of its obligations under this Agreement and hereby agrees that in the event of a breach or a threatened breach by such party of any such obligations, each of the other parties hereto shall, in addition to any and all other rights and remedies that may be available to them in respect of such breach, be entitled to an injunction from a court of competent jurisdiction (without any requirement to post bond) granting such parties specific performance by such party of its obligations under this Agreement. In the event that any party files a suit to enforce the covenants contained in this Agreement (or obtain any other remedy in respect of any breach thereof), the prevailing party in the suit shall be entitled to receive in addition to all other damages to which it may be entitled, the costs incurred by such party in conducting the suit, including reasonable attorney’s fees and expenses.

Section 9.14 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, email or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.

	THE COMPANY:

	Imation Enterprises Corp.

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	President and Treasurer

	GLASSBRIDGE:

	GlassBridge Enterprises, Inc.

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	Chief Executive Officer and Chief
		Operating Officer

	ORIX:

	ORIX PTP HOLDINGS, LLC

	By:	ORIX Corporate Capital Inc.,
	its sole member

	By:	/s/ Paul E. Wilson
	Name:	Paul E. Wilson
	Title:	Chief Financial Officer

Stockholders Agreement Signature Page

Schedule 1

Book Value Closing Model

Exhibit A

Form of Joinder Agreement

Reference is hereby made to the Stockholders Agreement, dated as of September [●], 2019 (as amended from time to time, the “Stockholders Agreement”), by and among Imation Enterprises Corp., a Delaware corporation, GlassBridge Enterprises, Inc., a Delaware corporation, and ORIX PTP HOLDINGS, LLC, a Delaware limited liability company. Pursuant to and in accordance with Section 3.01(e) of the Stockholders Agreement, the undersigned hereby acknowledges that it has received and reviewed a complete copy of the Stockholders Agreement and agrees that upon the execution of this Joinder Agreement, such Person shall become a party to the Stockholders Agreement and shall be fully bound by, and subject to, all of the covenants, terms and conditions of the Stockholders Agreement as though an original party thereto and shall be deemed to be a Stockholder of the Company for all purposes thereof and entitled to all the rights incidental thereto.

Capitalized terms used herein without definition shall have the meanings ascribed thereto in the Stockholders Agreement.

IN WITNESS WHEREOF, the parties hereto have caused this Joinder Agreement to be executed as of [●] above by their respective officers thereunto duly authorized.

	[Transferee Stockholder]

	By:
	Name:
	Title:

Acknowledged and Agreed:

	Imation Enterprises Corp.

	By:
	Name:
	Title:

Execution Version

AGREEMENT RELATING TO THE

ASSIGNMENT AND ASSUMPTION

OF PROMISSORY NOTES

This Agreement Relating to the Assignment and Assumption of Promissory Notes (this “Agreement”) is dated as of September 27, 2019 (the “Effective Date”) and is entered into by and between GlassBridge Enterprises, Inc., a Delaware corporation (the “Assignor”), ORIX PTP HOLDINGS, LLC, a Delaware limited liability company (the “Assignee”), and Imation Enterprises Corp., a Delaware corporation (the “Company”).

WHEREAS, the Assignor and the Assignee have entered into that certain Securities Purchase Agreement, dated as of even date herewith (the “Purchase Agreement”), pursuant to which, among other things, the Assignor has agreed to sell, transfer and assign to the Assignee, and the Assignee has agreed to purchase from the Assignor, all of the Assignor’s right, title and interest in and to (i) that certain promissory note by and between the Company, as Borrower, and the Assignor, as Note Holder, dated as of September 26, 2019, in the original principal amount of $9,000,000 and with a maturity date of September 26, 2026 (the “Levy Note”) and (ii) that certain promissory note by and between the Company, as Borrower, and Assignor, as Note Holder, dated as of September 26, 2019, in the original principal amount of $4,000,000 and with a maturity date of September 26, 2026 (the “Sport-BLX Note” and together with the Levy Note, the “Notes”);

WHEREAS, simultaneously with the execution of this Agreement, Assignor and the Assignee are entering into that certain Stockholders Agreement dated as of the date hereof (the “Stockholders Agreement”), pursuant to which Assignee has certain voting rights as set out in Section 2.03(a) of such agreement (“Special Rights”) which are set to initially expire upon the expiration of the Special Rights Period (as defined in the Stockholders Agreement) (the “Scheduled Special Rights Expiration Date”); and

WHEREAS, the Company is entering into this Agreement in connection with the transfer and assignment of the Notes from the Assignor to the Assignee in order to, among other things, provide the Assignee security for the payment and performance of all of the Secured Obligations (as defined below) and to set out the rights and obligations of the parties hereto in connection with a possible redemption of the Notes prior to the Maturity Date (as defined in the Notes).

NOW, THEREFORE, in consideration of the mutual covenants, terms, and conditions set forth herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:

1. Definitions.

1.1 Unless otherwise specified herein, all references to Sections herein are to Sections of this Agreement.

1.2 Unless otherwise defined herein, terms used herein that are defined in the UCC shall have the meanings assigned to them in the UCC, provided, however, that if a term is defined in Article 9 of the UCC differently than in another Article of the UCC, the term has the meaning specified in Article 9. Unless otherwise defined herein, capitalized terms used herein shall have the meanings assigned to them in the Purchase Agreement.

1.3 For purposes of this Agreement, the following terms shall have the following meanings:

“Collateral” has the meaning set forth in Section 4.

“Proceeds” means “proceeds” as such term is defined in section 9-102 of the UCC and, in any event, shall include, without limitation, all dividends or other income from the Collateral, collections thereon or distributions with respect thereto.

“Secured Obligations” means, collectively, the following obligations, covenants, duties, debts, liabilities, sums and expenses:

(a) the obligations of the Company from time to time arising under Note, this Agreement or otherwise with respect to the due and prompt payment of (i) the principal of and premium, if any, and interest on the Loan (as defined in the Note) (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise and (ii) all other monetary obligations, including fees, costs, attorneys’ fees and disbursements, reimbursement obligations, contract causes of action, expenses and indemnities, whether primary, secondary, direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of the Company under or in respect of the Notes and this Agreement; and

(b) all other covenants, duties, debts, obligations and liabilities of any kind of the Company under or in respect of the Notes, this Agreement or any other document made, delivered or given in connection with any of the foregoing, in each case whether evidenced by a note or other writing, whether allowed in any bankruptcy, insolvency, receivership or other similar proceeding, whether arising from an extension of credit, issuance of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise, and whether primary, secondary, direct or indirect, absolute or contingent, due or to become due, now existing or hereafter arising, fixed or otherwise.

“UCC” means the Uniform Commercial Code as in effect from time to time in the State of New York or, when the laws of any other state govern the method or manner of the perfection or enforcement of any security interest in any of the Collateral, the Uniform Commercial Code as in effect from time to time in such state.

2. Assignment and Assumption. Subject to and in accordance with the Purchase Agreement, as of the Effective Date, the Assignor hereby assigns and transfers, and the Assignee hereby accepts and assumes from the Assignor, all of the Assignor’s right, title and interest in and to the Notes.

3. Terms of the Purchase Agreement and the Notes.

3.1 The parties hereto acknowledge and agree that the Purchase Agreement contains certain representations, warranties, covenants, agreements and indemnities which are made by the Assignor in its capacity as Seller and which, for the avoidance of doubt, shall not be superseded by this Agreement but shall remain in full force and effect to the full extent provided therein. In the event of any conflict or inconsistency between the terms of the Purchase Agreement and the terms hereof, the terms of the Purchase Agreement shall govern.

3.2 The parties hereto acknowledge and agree that the representations, warranties, covenants, agreements and indemnities contained in the Notes shall not be superseded by this Agreement but shall remain in full force and effect, as supplemented to the extent specifically provided herein.

4. Grant of Security Interest. As collateral security for the payment and performance in full of all the Secured Obligations, the Company hereby pledges and grants to the Assignee, and hereby creates a continuing first priority lien and security interest (subject to Permitted Liens (as defined below)) in favor of the Assignee (“Priority Interest”), in and to all of its right, title and interest in and to the following, wherever located, whether now existing or hereafter from time to time arising or acquired (collectively, the “Collateral”):

(a) all personal property of every kind and nature, including all fixtures, accounts (including health-care-insurance receivables), goods, inventory, equipment, documents (including, if applicable, electronic documents), instruments, promissory notes, chattel paper (whether tangible or electronic), letters of credit, letter-of-credit rights and supporting obligations (whether or not the letter of credit is evidenced by a writing), securities and all other investment property, general intangibles, copyrights, patents, trademarks, cash or cash equivalents, deposit accounts, and any other contract rights or rights to the payment of money; and

(b) all Proceeds and products of each of the foregoing, all books and records relating to the foregoing, all supporting obligations related thereto, and all accessions to, substitutions and replacements for, and rents, profits and products of, each of the foregoing, and any and all Proceeds of any insurance, indemnity, warranty or guaranty payable to the Company from time to time with respect to any of the foregoing, and any general intangibles at any time evidencing or relating to any of the foregoing.

For purposes hereof, “Permitted Liens” means (a) purchase money security interests; (b) liens in favor of Note Holder pursuant to this Agreement; (c) liens imposed by law for taxes, fees, assessments, or other governmental charges or levies, either not delinquent or being contested in good faith by appropriate proceedings (which proceedings have the effect of preventing the enforcement of such lien); (d) liens of materialmen, mechanics, carriers, or other similar liens imposed by law arising in the ordinary course of business and securing obligations which are not delinquent or are being contested in good faith by appropriate proceedings (which proceedings have the effect of preventing the enforcement of such lien); (e) liens which constitute banker’s liens, rights of set-off, or similar rights as to deposit accounts or other funds maintained with a bank or other financial institution (but only to the extent such banker’s liens, rights of set-off or other rights are in respect of customary service charges relative to such deposit accounts and other funds); and (f) cash deposits or pledges to secure the payment of worker’s compensation, unemployment insurance, or other social security benefits or obligations, public or statutory obligations, surety or appeal bonds, bid or performance bonds, or other obligations of a like nature incurred in the ordinary course of business.

5. Perfection of Security Interest and Further Assurances.

5.1 The Company hereby irrevocably authorizes the Assignee at any time and from time to time to file in any relevant jurisdiction any financing statements and amendments thereto that contain the information required by Article 9 of the UCC of each applicable jurisdiction for the filing of any financing statement or amendment relating to the Collateral, including any financing or continuation statements or other documents for the purpose of perfecting, confirming, continuing, enforcing or protecting the security interest granted by the Company hereunder, without the signature of the Company where permitted by law, including the filing of a financing statement describing the Collateral as all assets now owned or hereafter acquired by the Company, or words of similar effect. The Company agrees to provide all information required by the Assignee pursuant to this Section promptly to the Assignee upon request.

5.2 The Company agrees that at any time and from time to time, at the expense of the Company, the Company will promptly execute and deliver all further agreements, instruments and documents, obtain such agreements from third parties, and take all further action, that may be necessary or desirable, or that the Assignee may reasonably request, in order to create and/or maintain the validity, perfection or priority of and protect any security interest granted or purported to be granted hereby or to enable the Assignee to exercise and enforce its rights and remedies hereunder or under any other agreement with respect to any Collateral; provided, however, in the event that the Notes are not held by Assignee or one of its Affiliates (as defined in the Stockholders Agreement), the Company shall not be required to perfect the security interest created by this Agreement in the Collateral that consists of deposit accounts or securities accounts by entering into any deposit account control agreement or securities account control agreement.

6. Redemption of the Notes.

6.1 On or after the Scheduled Special Rights Expiration Date, for so long as the Assignee or its Affiliate is the Note Holder (as defined in the Notes) and one or both of the Notes remains outstanding, Assignee or its Affiliate, as the case may be, as the Note Holder, may cause the Company to redeem the outstanding Note(s) and cause to be due and payable the outstanding principal amount of such Note(s), plus accrued and unpaid interest to, but not including, the redemption date (the “Redemption Price”), by delivering written notice to Assignor and the Company (“Redemption Notice”) electing for the Note(s) to be redeemed. Effective upon delivery of the Redemption Notice, (i) the Special Rights shall be reinstated (or if the Redemption Notice is provided on the Scheduled Special Rights Expiration Date, the Special Rights shall continue without interruption), and be in full force and effect, and (ii) the Minority Rights (as defined in the Stockholders Agreement) shall be suspended (or if the Redemption Notice is provided on the Scheduled Special Rights Expiration Date, the Minority Rights shall not then become effective), in all instances pending action of the Assignor as provided in Section 6.2 below.

6.2 If, within fifteen (15) days following the date of the delivery of the Redemption Notice (“Response Period”), Assignor delivers to Assignee a responsive notice (“Response Notice”) electing to maintain the reinstatement (or continued instatement, as the case may be) of the Special Rights, then (i) the Special Rights shall continue to be reinstated (or instated), and shall remain in existence with full force and effect, until the earlier of (A) the Maturity Date and (B) the date of full repayment of unpaid principal and accrued interest on the Notes (the “Repayment Date”) by the Company and (ii) the Minority Rights (as defined in the Stockholders Agreement) shall be suspended, to be reinstated (or instated for the first time, as the case may be) on the Repayment Date. For the avoidance of doubt, after the Scheduled Special Rights Expiration Date, Assignee shall not have Special Rights unless and until reinstated (or remaining in existence, as the case may be) pursuant to the terms of Section 6.1 and this Section 6.2.

6.3 If Assignor does not timely deliver the Response Notice, the Company shall redeem the Notes and the Redemption Price shall be due and payable on a Business Day (as defined in the Notes) mutually agreed between the Company and Assignee that shall be between five (5) Business Days and ten (10) Business Days after the date of the expiration of the Response Period (or if there is no such agreement, then on the tenth (10th) Business Day after the expiration of the Response Period).

6.4 The parties hereto acknowledge and agree that: (1) the terms of this Section 6 are intended to supplement the rights and obligations set forth in Section 2 of the Stockholders Agreement and in the event of any conflict or inconsistency between the terms of the Stockholders Agreement and the terms hereof, the terms hereof shall govern; (2) the rights and obligations set forth in this Section 6 may not be transferred and are not binding on Assignor or the Company upon a transfer of this Agreement, except in connection with a transfer to an Affiliate of ORIX PTP Holdings LLC; and (3) notwithstanding anything contained in the Stockholders Agreement and anything contained herein, upon a transfer to a third party that is not an Affiliate of ORIX PTP Holdings LLC that occurs on a date that is after the Scheduled Special Rights Expiration Date, the Special Rights (but not the Minority Rights, which shall remain in full force and effect) shall terminate and may not be reinstated.

7. Representations and Warranties. The Company represents, warrants and covenants as follows:

7.1 The representations and warranties in Section 2.2 (Organization, Authority and Qualification of the Company), Section 2.3 (Subsidiaries; Equity Interests), Section 2.6 (Compliance With Laws; Permits), Section 2.8 (Undisclosed Liabilities), Section 2.9 (Absence of MAE), Section 2.10 (Employment and Employee Benefit Matters), Section 2.11 (Tax Representations), Section 2.13 (Title to Assets; Real Property) and Section 2.16 (Company Organizational Documents) of the Purchase Agreement relating to the Company, its Subsidiaries and the Notes are incorporated herein by this reference and are made by the Company as if set forth herein in full.

7.2 At the time the Collateral becomes subject to the lien and security interest created by this Agreement, the Company will be the sole, direct, legal and beneficial owner thereof, free and clear of any lien, security interest, encumbrance, claim, option or right of others except for Permitted Liens.

7.3 The provisions of this Agreement create a valid and perfected Priority Interest in the Collateral, securing the payment and performance when due of the Secured Obligations, except in the case of a Priority Interest perfected only by possession, to the extent the Assignee has not obtained or does not maintain possession of such Collateral.

7.4 The Company will not, without providing at least 30 days’ prior written notice to the Assignee, change its legal name, identity, type of organization, jurisdiction of organization, corporate structure, location of its chief executive office or its principal place of business or its organizational identification number. The Company will, prior to any change described in the preceding sentence, take all actions reasonably requested by the Assignee to maintain the perfection and priority of the Assignee’s security interest in the Collateral.

7.5 The Company will not create, incur, assume, or permit to exist any lien on any property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts) or rights in respect of any thereof, except Permitted Liens.

7.6 This Agreement constitutes written notice to the Company of the transfer contemplated hereby in accordance with Section 1(b) of the Notes.

8. Payments. From and after the Effective Date, the Company shall make all payments of principal, interest, fees and other amounts in respect of the Notes to the Assignee whether such amounts have accrued prior to or on or after the Effective Date. Assignor and Assignee shall make all appropriate adjustments in payments made by the Company for periods prior to the Effective Date or with respect to the making of this assignment directly between themselves.

9. Successors and Assigns. Except as set forth in Section 6.4 hereof, this Agreement shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.

10. Governing Law. This Agreement shall be governed by and construed in accordance with the internal laws of the State of New York without giving effect to any choice or conflict of law provision or rule (whether of the State of New York or any other jurisdiction).

11. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, email or other means of electronic transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

12. Further Assurances. Each of the parties hereto shall execute and deliver, at the reasonable request of the other party hereto, such additional documents, instruments, conveyances and assurances and take such further actions as such other party may reasonably request to carry out the provisions hereof and give effect to the transactions contemplated by this Agreement.

[Signature Page Follows]

IN WITNESS WHEREOF, the parties have executed this Agreement to be effective as of the date first above written:

	ASSIGNOR:

	GlassBridge Enterprises, Inc.

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	Chief Executive Officer and Chief Operating Officer

	ASSIGNEE:

	ORIX PTP HOLDINGS, LLC

	By: ORIX Corporate Capital Inc.,
	its sole member

	By:	/s/ Paul E. Wilson
	Name:	Paul E. Wilson
	Title:	Chief Financial Officer

	THE COMPANY:

	Imation Enterprises Corp.

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	President and Treasurer

Execution Version

ASSIGNMENT OF CLAIMS AGREEMENT

This Assignment of Claims Agreement (this “Agreement”) is made and entered into as of the 30 day of September, 2019 (the “Effective Date”), by and between GlassBridge Enterprises, Inc., a Delaware corporation (“Assignor”), and Imation Enterprises Corp., a Delaware corporation (“Assignee”).

RECITALS

A. WHEREAS, Assignee is a wholly-owned subsidiary of Assignor; and

B. WHEREAS, the parties desire that Assignor assign to Assignee, and Assignee assume from Assignor, all of Assignor’s right, title and interest in the Priority Interest (as defined below) in exchange for an unsecured promissory note issued by Assignee in favor of Assignor in the principal amount of Nine Million Dollars ($9,000,000), substantially in the form attached hereto as Exhibit A (the “Promissory Note”).

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:

1. Assignment of Priority Interest to the Assigned Claims; Rights in Connection with the Priority Interest.

a. Assignor hereby irrevocably assigns and remits to Assignee, and Assignee hereby assumes from Assignor, all of Assignor’s right, title and interest to the first $14,380,270 actually collected by Assignor (the “Priority Interest”) in connection with the Assignor’s Claims Interest (as defined below). The parties acknowledge and agrees that (i) Assignor may receive payments in connection with the Assignor’s Claims Interest in one or more installments, and consequently, the remittance of payment in connection with the Priority Interest may occur in one or more installments, which shall be made promptly after receipt by Assignor, (ii) the outcome of the Levy Claims are uncertain and Assignor makes no representation or warranty with respect to their success or the outcome of the underlying litigation in connection with the Levy Claims, and (iii) no action or omission on the part of Assignor in exercising or failing to exercise its rights in connection with Assignor’s Claims Interest or in connection with or arising from all or part of the Levy Claims shall make Assignor liable to Assignee for any loss or failure to receive payment arising from the Priority Interest.

b. For purposes of this Agreement, the term “Assignor’s Claims Interest” means the Assignor’s right to receive payment from IMN Capital Holding Inc. (“IMN”) in connection with the settlement or final adjudication (without any ability to further appeal by any party) (“Settlement”) as to all demands, claims, counterclaims, cross-claims, third-party-claims, damages, fees (including attorney’s fees), costs and expenses, brought and raised on any matters arising from the claims and causes of action set forth on Exhibit B hereto (collectively, the “Levy Claims”).

2. Consideration. In consideration of Assignor’s assignment of the Priority Interest to Assignee, contemporaneously with the execution and delivery of this Agreement by each of the parties hereto, Assignee shall issue to Assignor the Promissory Note.

3. Further Assurances. Assignor shall, at any time and from time to time after the Effective Date, upon the request of Assignee, execute, acknowledge and deliver all such further deeds, assignments, transfers, conveyances, powers of attorney and assurances, and take all such further actions, as shall be necessary or desirable to give effect to the transactions hereby consummated and to collect and reduce to the possession of Assignee any and all of the interests and assets hereby transferred by Assignor to Assignee.

4. Information and Participation Rights. The parties agree that:

a. Assignor shall provide Assignee with any updates Assignor receives regarding the litigation process in connection with the Levy Claims (i) at the request of any member of the Board of Directors of Assignee (but not more than once per calendar quarter) or (ii) upon any Settlement or material court action relating to the Levy Claims;

b. Assignor shall provide to Assignee drafts of all material, substantive legal submissions and responses it receives in connection with the Levy Claims; and

c. Assignee has the right to provide input into the litigation process in connection with the Levy Claims, including providing comments to draft submissions made available for comment to Assignor by IMN; provided that nothing in this Agreement entitles Assignor the right to direct or otherwise control such litigation or any portion thereof.

5. Successors. This Agreement shall be binding upon Assignor and upon Assignor’s successors and assigns and shall inure to the benefit of Assignee and its successors and assigns.

6. Representations and Warranties. Each of Assignor and Assignee represents and warrants to the other that: (a) it has all requisite power and authority to execute and deliver this Agreement and any other assignments, instruments and documents to be executed and delivered to effectuate the assignment and assumption contemplated hereby (collectively, the “Assignment Documents”); (b) its execution and delivery of this Agreement and the other Assignment Documents and the performance of its obligations hereunder and thereunder have been authorized by all necessary action and do not violate any laws, regulations or orders by which it is bound; and (c) this Agreement and the other Assignment Documents constitute its legal, valid and binding obligations, enforceable against it in accordance with the terms hereof and thereof, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar applicable laws affecting creditors’ rights generally. Assignor further represents and warrants that (i) except as set forth on Schedule 6 hereto, Assignor is the true and lawful owner of the Assignor’s Claims Interest and has good title to the same; (ii) except as set forth on Schedule 6 hereto, Assignor has made no prior assignment or sale of the Assignor’s Claims Interest and Assignor has not granted to any other person or entity has any right, title, or interest therein; (iii) the execution and delivery of this Agreement and the other Assignment Documents by Assignor and the assignment of all its right, title, and interest in and to the Priority Interest does not contravene any agreement to which Assignor is a party or by which it is bound; and (iv) except as set forth on Schedule 6 hereto, no liens, encumbrances, charges, security interests or obligations of any kind exist on the date hereof against the Assignor’s Claims Interest.

7. Choice of Law. This Agreement shall be governed by, and construed in accordance with the laws of the New York (without giving effect to the principles thereof relating to conflicts of laws to the extent such principle would direct the application of law of another jurisdiction).

8. Third Party Beneficiary. This Agreement is entered into for the sole protection and benefit of the parties hereto and their respective successors and assigns, and no other person shall be a direct or indirect beneficiary of, or shall have any direct or indirect cause of action or claim in connection with this Agreement, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement.

9. Successors and Assigns. This Agreement and the representations and warranties, covenants and agreements herein contained shall inure to the benefit of and shall bind the respective parties hereto and their respective successors and assigns.

10. Entire Agreement. This Agreement is intended to embody the final, complete and exclusive agreement among the parties with respect to the subject matter hereof and is intended to supersede all prior agreements, understandings and representations written or oral, with respect thereto; and may not be contradicted by evidence of any such prior or contemporaneous agreement, understanding or representation, whether written or oral.

11. Amendments. This Agreement shall not be altered, modified or amended except by a written instrument signed by each of the parties hereto.

12. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement.

[Signature page follows]

IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the Effective Date.

	ASSIGNOR:

	GLASSBRIDGE ENTERPRISES, INC.,
	a Delaware corporation

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	Chief Executive Officer and Chief Operating Officer

	ASSIGNEE:

	IMATION ENTERPRISES CORP.,
	a Delaware corporation

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	President and Treasurer

EXHIBIT A

Form of Promissory Note

(attached)

EXHIBIT B

Levy Claims

Company holding the Claim	Jurisdiction	Court or Tribunal	Matter Name and Identifying Number
Imation Europe BV	France	Cour D’Appel De Paris	16/08482 -N° Portalis 35L7- V-B7A-BYR7B

Imation Europe BV	Dutch	District Court of The Hague	C/09/489719/HA ZA 15-659

SCHEDULE 6

Assignor and the U.S. Pension Benefit Guaranty Corporation (the “PBGC”) entered into an agreement on May 13, 2019 to terminate the Imation Cash Balance Pension Plan (the “Plan”) based on PBGC’s finding that (i) the Plan did not meet the minimum funding standard required under Section 412 of the Internal Revenue Code of 1986, as amended; (ii) the Plan would be unable to pay benefits when due and (iii) the Plan should be terminated in order to protect the interests of the Plan participants. Assignor and any other members of Assignor’s controlled group (within the meaning of 29 U.S.C. §1301(a)(14)) (collectively, and including the Company, the “Controlled Group Members”)) are jointly and severally liable to the PBGC for all liabilities under Title IV of ERISA in connection with the Plan’s termination, including unfunded benefit liabilities, due and unpaid Plan contributions, premiums, and interest on each of the foregoing, as a result of which a lien in favor of the Plan, on all property of each Controlled Group Member, arose and was perfected by PBGC (the “Lien”).

Execution Version

EQUITY ASSIGNMENT AGREEMENT

THIS EQUITY ASSIGNMENT AGREEMENT (this “Agreement”) is made and entered into as of September 30, 2019 (the “Effective Date”), by and between GlassBridge Enterprises, Inc., a Delaware corporation (“Assignor”), and Imation Enterprises Corp., a Delaware corporation (“Assignee”). Sport-BLX, Inc., a Delaware corporation (“Sport-BLX”), is a party to this Agreement only with respect to Sections 5, 6, 8, 9, 10, 11, 12 and 13 hereof.

RECITALS

A. Assignor is the owner of Eleven Thousand One Hundred Fifty Four (11,154) shares of Sport-BLX’s Common Stock, par value 0.0001 per share (the “Shares”), and such Shares represent all of the Shares held by Assignor in Sport-BLX.

B. Assignor has determined that it is in its best interest to contribute to Assignee all of the Shares in exchange for an unsecured promissory note issued by Assignee in favor of Assignor in the principal amount of Four Million Dollars ($4,000,000), substantially in the form attached hereto as Exhibit A (the “Promissory Note”).

NOW, THEREFORE, the parties hereby agree as follows:

1. Assignment. Subject to the terms and conditions set forth in this Agreement and in reliance upon the representations and warranties of Assignee herein set forth, Assignor hereby contributes, conveys, assigns and transfers to Assignee, its successors and assigns, effective as of the Effective Date, all of Assignor’s right, title and interest in and to the Shares, free and clear of all liens, claims, charges and encumbrances, other than pursuant to applicable securities laws, that certain Common Stock Purchase Agreement by and between Assignor, Sport-BLX and the other parties thereto, dated as of January 4, 2019 and that certain Letter Agreement Re: Common Stock Purchase Agreement, by and between Sport-BLX and Assignor, dated as of January 4, 2019.

2. Issuance of Promissory Note. As consideration for the assignment of the Shares, contemporaneously with the execution and delivery by each of the parties hereto of this Agreement, Assignee shall issue to Assignor the Promissory Note.

3. Substitution of Assignee as Stockholder; Absolute Conveyance. Assignor and Assignee intend that, effective as of the Effective Date hereof, Assignee shall become a stockholder of Sport-BLX in the place and stead of Assignor. The conveyance of the Shares hereunder is an absolute transfer to Assignee, free and clear of all liens, encumbrances, charges, security interests or obligations of any kind, except as set forth in Schedule 3 to this Agreement.

4. Acceptance and Assumption. Effective as of the Effective Date, Assignee hereby accepts the assignment to it of Assignor’s right, title and interest in and to the Shares, hereby agrees to become a stockholder of Sport-BLX in the place and stead of Assignor, and hereby assumes and agrees to be bound by and to keep, observe, discharge, pay and perform all of the obligations of Assignor as a stockholder of Sport-BLX, whether now existing or hereafter arising, known or unknown, due or to become due, fixed or contingent and howsoever arising.

5. Consent of Sport-BLX. The signature of Sport-BLX below constitutes consent by Sport-BLX with respect to Assignor’s transfer of the Shares and the admission of Assignee as a stockholder of Sport-BLX.

6. Representations and Warranties. Each of Assignor, Assignee and Sport-BLX represents and warrants to the other party that: (a) it has all requisite power and authority to execute and deliver this Agreement and any other assignments, instruments and documents to be executed and delivered by it to effectuate the contribution, assignment and assumption contemplated hereby (collectively, the “Assignment Documents”); (b) its execution and delivery of this Agreement and the other Assignment Documents and the performance of its obligations hereunder and thereunder have been authorized by all necessary action and do not violate any laws, regulations or orders by which it is bound; and (c) this Agreement and the other Assignment Documents constitute its legal, valid and binding obligations, enforceable against it in accordance with the terms hereof and thereof, subject to applicable bankruptcy, insolvency, reorganization, moratorium or similar applicable laws affecting creditors’ rights generally. Assignor further represents and warrants that (i) except as set forth in Schedule 3 to this Agreement, Assignor is the true and lawful owner of the Shares and has good title to the same; (ii) except as set forth in Schedule 3 to this Agreement, Assignor has made no prior assignment or sale of the Shares and Assignor has not granted to any other person or entity any right, title, or interest therein; (iii) the execution and delivery of this Agreement and the other Assignment Documents by Assignor and the assignment of all its right, title, and interest in and to the Shares does not contravene any agreement to which Assignor is a party or by which it is bound; and (iv) except as set forth in Schedule 3 to this Agreement, no liens, encumbrances, charges, security interests or obligations of any kind exist on the date hereof against the Shares, other than pursuant to applicable securities laws, that certain Common Stock Purchase Agreement by and between Assignor, Sport-BLX and the other parties thereto, dated as of January 4, 2019 and that certain Letter Agreement Re: Common Stock Purchase Agreement, by and between Sport-BLX and Assignor, dated as of January 4, 2019.

7. Further Assurances. Assignor shall, at any time and from time to time after the date hereof, upon the request of Assignee, execute, acknowledge and deliver all such further deeds, assignments, transfers, conveyances, powers of attorney and assurances, and take all such further actions, as shall be necessary or desirable to give effect to the transactions hereby consummated and to collect and reduce to the possession of Assignee any and all of the interests and assets hereby transferred by Assignor to Assignee. Without limiting the generality of the foregoing, Assignor hereby appoints Assignee, and its nominees, successors and assigns, the true and lawful attorney of Assignor, with full power of substitution, in the name of Assignee or in the name of Assignor but for the benefit and at the expense of Assignee, to demand and receive from time to time the benefits of the right and title to the Shares hereby conveyed, transferred and assigned, to give receipts and releases for and in respect of the same, or any part thereof, and from time to time to institute and prosecute in the name of Assignor or otherwise, for the benefit of Assignee, any and all proceedings at law, in equity or otherwise, which Assignee, its nominees, successors or assigns, may deem proper in order to collect, assert or enforce the right or title to the Shares hereby conveyed, transferred and assigned, or intended so to be, to defend and compromise any and all actions, suits or proceedings in respect of the Shares, and to do any and all such acts and things in relation thereto as Assignee, its nominees, successors or assigns, shall deem advisable; Assignor hereby declaring that the appointment hereby made and the powers hereby granted are coupled with an interest and are and shall be irrevocable by Assignor.

8. Choice of Law. This Agreement shall be governed by, and construed in accordance with the laws of the New York (without giving effect to the principles thereof relating to conflicts of laws to the extent such principle would direct the application of law of another jurisdiction).

9. No Third Party Beneficiary. This Agreement is entered into for the sole protection and benefit of the parties hereto and their respective successors and assigns, and no other person shall be a direct or indirect beneficiary of, or shall have any direct or indirect cause of action or claim in connection with this Agreement, nor is anything in this Agreement intended to relieve or discharge the obligation or liability of any third persons to any party to this Agreement.

10. Successors and Assigns. This Agreement and the representations and warranties, covenants and agreements herein contained shall inure to the benefit of and shall bind the respective parties hereto and their respective successors and assigns.

11. Entire Agreement. This Agreement is intended to embody the final, complete and exclusive agreement among the parties with respect to the subject matter hereof and is intended to supersede all prior agreements, understandings and representations written or oral, with respect thereto; and may not be contradicted by evidence of any such prior or contemporaneous agreement, understanding or representation, whether written or oral.

12. Amendments. This Agreement shall not be altered, modified or amended except by a written instrument signed by each of the parties hereto.

13. Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same Agreement.

[signature page follows]

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as of the Effective Date.

	ASSIGNOR:

	GLASSBRIDGE ENTERPRISES, INC.,
	a Delaware corporation

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	Chief Executive Officer and Chief Operating Officer

	ASSIGNEE:

	IMATION ENTERPRISES CORP.,
	a Delaware corporation

	By:	/s/ Daniel Strauss
	Name:	Daniel Strauss
	Title:	President and Treasurer

	Agreed and Acknowledged with respect to Sections 5, 6, 8, 9, 10, 11, 12 and 13 only:

	SPORT-BLX:

	SPORT-BLX, INC.,
	a Delaware corporation

	By:	/s/ Joseph De Perio
	Name:	Joseph De Perio
	Title:	President

EXHIBIT A

Form of Promissory Note

(attached)

SCHEDULE 3

Exhibit 31.1

Certification Pursuant to Section 302

of the Sarbanes-Oxley Act of 2002

I, Joseph A. De Perio, certify that:

	1.	I have reviewed this quarterly report on Form 10-Q of GlassBridge Enterprises, Inc.;

	2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

	3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

	4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a -15(e) and 15d -15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a -15(f) and 15d -15(f)) for the registrant and have:

	(a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	(b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	(c)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(d)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

	(a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	(b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

November 8, 2019

By:	/s/ Joseph A. De Perio
	Joseph A. De Perio,
	Chairman (principal executive officer)

Exhibit 31.2

Certification Pursuant to Section 302

of the Sarbanes-Oxley Act of 2002

I, Francis Ruchalski, certify that:

	6.	I have reviewed this quarterly report on Form 10-Q of GlassBridge Enterprises, Inc.;

	7.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

	8.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

	9.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a -15(e) and 15d -15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a -15(f) and 15d -15(f)) for the registrant and have:

	(e)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

	(f)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

	(g)	Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

	(h)	Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

10.

	(c)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

	(d)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

November 8, 2019

By:	/s/ Francis Ruchalski
	Francis Ruchalski,
	Chief Financial Officer (principal financial officer)

Exhibit 32.1

Certification Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of GlassBridge Enterprises, Inc. (the “Company”) on Form 10-Q for the period ended September 30, 2019, as filed with the Securities and Exchange Commission (the “Report”), I, Joseph A. De Perio, Chairman and principal executive officer of the Company, certify, pursuant to 18 U.S.C. section 1350, as adopted pursuant to section 906 of the Sarbanes-Oxley Act of 2002, that:

	(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 8, 2019

By:	/s/ Joseph A. De Perio
	Joseph A. De Perio,
	Chairman (principal executive officer)

Exhibit 32.2

Certification Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

	(1)	The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

	(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

November 8, 2019

By:	/s/ Francis Ruchalski
	Francis Ruchalski,
	Chief Financial Officer (principal financial officer)