UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

 

Date of Earliest Event Reported: July 22, 2016

 

Elite Data Services, Inc.

(Exact name of registrant as specified in its charter)

 

Florida

000-11050

59-2181303

(State or other jurisdiction of

incorporation or organization)

(Commission

File Number)

(IRS Employer

Identification No.)

 

4447 N. Central Expressway, Suite 110-135

Dallas, TX 75205

(Address of principal executive offices)

 

(972) 885-3981

(Issuer's telephone number)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a -12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d -2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e -4(c))

 

 

 
 
 

FORWARD LOOKING STATEMENTS

 

This Current Report on Form 8-K contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. By their nature, forward-looking statements and forecasts involve risks and uncertainties because they relate to events and depend on circumstances that will occur in the near future. Forward-looking statements speak only as of the date they are made, are based on various underlying assumptions and current expectations about the future. We caution readers that any forward-looking statements are not guarantees of future performance and that actual results could differ materially from those contained or implied in the forward-looking statements. Such forward-looking statements include, but are not limited to, statements about the terms and conditions of the agreement described herein. In some cases, you may identify forward-looking statements by words such as "may," "should," "plan," "intend," "potential," "continue," "believe," "expect," "predict," "anticipate" and "estimate," the negative of these words or other comparable words. These statements are only predictions. One should not place undue reliance on these forward-looking statements. The forward-looking statements are qualified by their terms and/or important factors, many of which are outside the Company's control, involve a number of risks, uncertainties and other factors that could cause actual results and events to differ materially from the statements made. The forward-looking statements are based on the Company's beliefs, assumptions and expectations about the Company's future performance and the future performance of the entity being acquired, taking into account information currently available to the Company. These beliefs, assumptions and expectations can change as a result of many possible events or factors, including those events and factors described in "Risk Factors" in the Company's Annual Report on Form 10-K, and the Company's recent Quarterly Reports, filed with the SEC, not all of which are known to the Company. The Company will update this forward-looking information only to the extent required under applicable securities laws. Neither the Company nor any other person assumes responsibility for the accuracy or completeness of these forward-looking statements

 

 
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Item 1.01 Entry into a Material Definitive Agreement

 

Termination Agreement to Definitive Agreement for the acquisition of a new subsidiary

 

Company and Properties of Merit Inc. ("POM") are parties to that certain Definitive Agreement, dated May 20, 2016, incorporated by reference in Form 8K filed with the SEC on May 24, 2016, pursuant to which the Company agreed to acquireone hundred percent (100%)of the ownership interest in POM,in the form of three (3) separate closings with the first closing originally anticipated on or before May 27, 2016, subject to certain performance requirements of both parties prior to each closing.

 

On July 22, 2016, Elite Data Services, Inc. (the "Company") and Properties of Merit Inc. ("POM") executed a Termination Agreement, pursuant to which the parties mutually agreed to terminate the Definitive Agreement dated May 20, 2016, incorporated by reference in Form 8K filed with the SEC on May 24, 2016, pursuant to which the Company agreed to acquireone hundred percent (100%)of the ownership interest in POM,in the form of three (3) separate closings, due to, among other reasons, certain events that occurred subsequent to the date of execution of the Definitive Agreement, including, but not limited to, the Company's inability to (i) become current in its reporting obligations with the Securities and Exchange Commission, and (ii) obtain the financings required to complete the first and subsequent closings to finance the ongoing activities of POM within a reasonable period of time.

 

The Termination Agreement included amongst other provisions, a mutual release of each party related to any future rights and claims against the other, except that the Company is required to repay POM for advances made to Company pursuant to the executed definitive agreement in the total amount of Seventeen Thousand Five Hundred Dollars (USD $17,500.00), on the terms set forth in executed amended convertible redeemable note (the "Amended Note"), which replaces the original note set forth in the Definitive Agreement.

 

The foregoing description of the Termination Agreement and Amended Note are qualified in its entirety by reference to the Termination Agreement and Amended Note filed as Exhibit 10.82 to this report and incorporated herein by reference.

 

Letter of Intent – WOD Market LLC

 

On July 22, 2016, the Company and WOD Market LLC ("WOD"), a Colorado limited liability company executed a Letter of Intent for the proposed acquisition by the Company of WOD in the form of a share exchange arrangement on terms to be set forth in a definitive agreement and other ancillary agreements as are customary to consummate the transaction contemplated (the "Definitive Documentation"), anticipated to be signed and closed on or before July 29, 2016.

 

Pursuant to the execution of the LOI, WOD agreed to arrange interim funding of no less than USD $40,000.00 for certain operational costs of the Company prior to closing, including expenses related to the completion of the Company's outstanding Form 10K for year ending December 31, 2015, and Form 10Q for periods ending March 31, 2016 and June 30, 2016, and other such items required in order for the Company to become a fully reporting public company, to be advanced within five (5) business days from the date of the LOI, under mutually agreed to terms to be formalized in the Definitive Documentation.

 

To date, no closing has occurred and there is no guarantee that the proposed closing will occur, which is subject to terms still to be negotiated and set forth in a final definitive agreement.

 

The foregoing description of the Letter of Intent is qualified in its entirety by reference to the Letter of Intent filed as Exhibit 10.83 to this report and incorporated herein by reference.

 

 
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Item 3.02 Sale of Unregistered Securities

 

Pursuant to the Termination Agreement dated July 22, 2016 between the Company and POM, the Company issued a six month Amended Note (as defined herein) to POM for the repayment of advances made by POM to Company, pursuant to the Definitive Agreement, in the total principal amount of Seventeen Thousand Five Hundred Dollars (USD $17,500.00), on the terms set forth in the Amended Note, which replaces the original note set forth in the Definitive Agreement. The Amended Note is due and payable on the six-month anniversary date (the "Maturity Date"), at a rate of ten percent (10%) per annum commencing on date of issuance, convertible into shares of the Company's common stock at a conversion price equal to a discount of fifty-eight percent (58%) of the lowest trading price for the ten (10) prior trading days, and other customary and standard terms and conditions set forth therein.

 

We claim an exemption from registration for the information provided herein to Section 4(2) and/or Regulation D of the Securities Act of 1933, as amended (the " Securities Act "). The securities were not registered under the Securities Act and such securities may not be offered or sold in the United States absent registration or an exemption from registration under the Securities Act and any applicable state securities laws.

 

The foregoing description of the Amended Note is qualified in its entirety by reference to the Amended Note filed as Exhibit 3.02 to this report and incorporated herein by reference.

 

Item 9.01 Financials Statements and Exhibits.

 

Those exhibits marked with an asterisk (*) refer to exhibits filed herewith. The other exhibits are incorporated herein by reference, as indicated in the following list.

 

Exhibit Number

Description

 

 

 

3.02*

 

Amended Note dated July 22, 2016 by and between Elite Data Services, Inc. and POM

 

 

 

10.82*

Termination Agreement and Amended Note dated July 22, 2016 by and between Elite Data Services, Inc. and Properties of Merit Inc.

 

 

 

10.83*

Letter of Intent dated July 22, 2016 by and between Elite Data Services, Inc. and WOD Market LLC.

 

 

 

99.1*

Press Release

 

 
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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 hereunto duly authorized.

 

ELITE DATA SERVICES, INC.

 

 

 

 

Dated: July 28, 2016

By:

/s/ Charles Rimlinger

Charles Rimlinger

Chief Executive Officer

 

 

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EXHIBIT 3.02

 

EXHIBIT B

 

AMENDED

CONVERTIBLE REDEEMABLE NOTE
(POM Advance)

 

THIS NOTE AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS NOTE HAVE NOT BEEN AND WILL NOT BE REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE "1933 ACT").

 

US $17,500.00

 

ELITE DATA SERVICES, INC.

AMENDED

CONVERTIBLE REDEEMABLE NOTE

 

FOR VALUE RECEIVED, ELITE DATA SERVICES, INC. (the "Company") promises to pay to the order of PROPERTIES OF MERIT INC. and its authorized successors and permitted assigns (" Holder "), the aggregate principal face amount of SEVENTEEN THOUSAND FIVE HUNDRED DOLLARS (U.S. $17,500.00), at ten percent (10%) interest per annum commencing on the date of execution (the " Effective Date "), due and payable to Holder by Company, plus accrued interest on the six month anniversary date following the execution of this Note (each a " Maturity Date "), pursuant to the terms of the Definitive Agreement dated even date herewith between Company and Holder, of which this Note is made apart. The Company will pay interest payment and the outstanding principal due upon this Note on the Maturity Date. The forwarding of such check or wire transfer shall constitute a payment of outstanding principal hereunder and shall satisfy and discharge the liability for principal on this Note to the extent of the sum represented by such check or wire transfer. Interest shall be payable in Common Stock (as defined below) pursuant to paragraph 3(f) herein. It is acknowledged and agreed that this Note amends and supersedes that convertible redeemable note dated May 20, 2016 between the Company and the Holder, which note shall be deemed terminated.

 

This Note is subject to the following additional provisions:

 

1. The Company shall be entitled to withhold from all payments any amounts required to be withheld under applicable laws.

 

2. This Note may be transferred or exchanged only in compliance with the Securities Act of 1933, as amended (" Act "), and applicable state securities laws. Holder shall provide the Company with 3-day written notice of the Note's transfer and shall presume that any attempted transfer to a party is deemed qualified by the Holder. Any attempted transfer to a non-qualifying party shall be treated by the Company as void. Prior to due presentment for transfer of this Note, the Company and any agent of the Company may treat the person in whose name this Note is duly registered on the Company's records as the owner hereof for all other purposes, whether or not this Note be overdue, and neither the Company nor any such agent shall be affected or bound by notice to the contrary. Any Holder of this Note electing to exercise the right of conversion set forth in Section 3(a) hereof, in addition to the requirements set forth in Section 3(b) and 3(c), and any prospective transferee of this Note, also is required to give the Company written confirmation that this Note is being converted (" Notice of Conversion ") in the form annexed hereto as Exhibit A . The date of receipt (including receipt by telecopy) of such Notice of Conversion shall be the Conversion Date.

 

 
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3. Note Conversions; Interest Payments; Prepayments, Transfers, Etc .

 

(a) The Holder of this Note is entitled, at its option, beginning on the 181th day after Effective Date, at any time, to convert all or any amount of the principal face amount of this Note then outstanding into shares of the Company's common stock (the " Common Stock ") at a price (" Conversion Price ") for each share of Common Stock equal to a discount of fifty-eight percent (58%) of the lowest trading price of the Common Stock as reported on the OTCQB marketplace which the Company's shares are traded or any market upon which the Common Stock may be traded in the future (" Exchange "), for the ten (10) priortrading days including the day upon which a Notice of Conversion is received by the Company and its transfer agent (provided such Notice of Conversion is delivered by electronic method of communication to the Company or its transfer agent after 4 P.M. Eastern Standard or Daylight Savings Time if the Holder wishes to include the same day closing price) beginning on the 181th day after Effective Date.

 

(b) If the shares have not been delivered within three (3) business days, the Notice of Conversion may be rescinded. Such conversion shall be effectuated by the transfer agent of the Company delivering the shares of Common Stock to the Holder within three (3) business days of receipt by the Company of the Notice of Conversion. Accrued but unpaid interest shall be subject to conversion. No fractional shares or scrip representing fractions of shares will be issued on conversion, but the number of shares issuable shall be rounded to the nearest whole share . To the extent the Conversion Price of the Company's Common Stock closes below the par value per share, the Company will take all steps necessary to solicit the consent of the stockholders to reduce the par value to the lowest value possible under law. The Company agrees to honor all conversions submitted pending this decrease .

 

(c) At any time or times on or after the Maturity Date, the Holder shall be entitled to convert all of the outstanding and unpaid principal amount of this Note into fully paid and non-assessable shares of Common Stock in accordance with the stated Conversion Price. The Holder shall not be entitled to convert on a Conversion Date that amount of the Note in connection with that number of shares of Common Stock which would be in excess of the sum of (i) the number of shares of Common Stock beneficially owned by the Holder and its affiliates on a Conversion Date, (ii) any Common Stock issuable in connection with the unconverted portion of the Note, and (iii) the number of shares of Common Stock issuable upon the conversion of the Note with respect to which the determination of this provision is being made on a Conversion Date, which would result in beneficial ownership by the Holder and its affiliates of more than 4.99% of the outstanding shares of Common Stock of the Company on such Conversion Date. For the purposes of the provision to the immediately preceding sentence, beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and Regulation 13d-3 thereunder. Subject to the following, the Holder shall not be limited to aggregate conversions of 4.99% ("Conversion Limitation 1"). The Holder shall have the authority to determine whether the restriction contained in this Section 3(c) will limit any conversion hereunder. The Holder may waive the conversion limitation described in this Section 3(c) , in whole or in part, upon and effective after 61-days prior written notice to the Company to increase such percentage to up to 9.99% ("Conversion Limitation 2").

 

(d) The Company shall not issue any fraction of a share of Common Stock upon any conversion; if such issuance would result in the issuance of a fraction of a share of Common Stock, the Company shall round such fraction of a share of Common Stock up to the nearest whole share except in the event that rounding up would violate the conversion limitation set forth in section 3(c) above.

 

(e) If the Company, at any time after the Issuance Date, shall issue any securities convertible into or exchangeable for, directly or indirectly, Common Stock (" Convertible Securities "), other than the Note, or any rights or warrants or options to purchase any such Common Stock or Convertible Securities, shall be issued or sold (collectively, the " Common Stock Equivalents ") and the aggregate of the price per share for which Additional Shares of Common Stock may be issuable thereafter pursuant to such Common Stock Equivalent, plus the consideration received by the Company for issuance of such Common Stock Equivalent divided by the number of shares of Common Stock issuable pursuant to such Common Stock Equivalent (the " Aggregate Per Common Share Price ") shall be less than the applicable Conversion Price then in effect, or if, after any such issuance of Common Stock Equivalents, the price per share for which Additional Shares of Common Stock may be issuable thereafter is amended or adjusted, and such price as so amended shall make the Aggregate Per Share Common Price be less than the applicable Conversion Price in effect at the time of such amendment or adjustment, then the applicable Conversion Price upon each such issuance or amendment shall be reduced to the lower of: (i) the Conversion Price; or (ii) a twenty-five percent (25%) discount to the lowest Aggregate Per Common Share Price (whether or not such Common Stock Equivalents are actually then exercisable, convertible or exchangeable in whole or in part) as of the earlier of (A) the date on which the Company shall enter into a firm contract for the issuance of such Common Stock Equivalent, or (B) the date of actual issuance of such Common Stock Equivalent. No adjustment of the applicable Conversion Price shall be made under this Section 6 upon the issuance of any Convertible Security which is outstanding on the day immediately preceding the Issuance Date. No adjustment shall be made to the Conversion Price upon the issuance of Common Stock pursuant to the exercise, conversion or exchange of any Convertible Security or Common Stock Equivalent where an adjustment to the Conversion Price was made as a result of the issuance or purchase of any Convertible Security or Common Stock Equivalent.

 

 
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(f) Interest on any unpaid principal balance of this Note shall be paid at the rate of ten percent (10%) per annum with the first payment being made on the sixth-month anniversary of this Note. Interest shall be paid by the Company in Common Stock ("Interest Shares"). Holder may, at any time after six months, send in a Notice of Conversion to the Company for Interest Shares based on the formula provided in Section 3(a) above. The dollar amount converted into Interest Shares shall be all or a portion of the accrued interest calculated on the unpaid principal balance of this Note to the date of such notice.

 

(g) The Notes may be prepaid, in whole or in part, with the following penalties: (i) if the note is prepaid within 90 days of the issuance date, then at 120% of the face amount plus any accrued interest; (ii) if the note is prepaid within 91 days after the issuance date but less than 150 days after the issuance date, then at 130% of the face amount plus any accrued interest; (iii) if the note is prepaid within 150 days after the issuance date but less than 180 days after the issuance date, then at 140% of the face amount plus any accrued interest. This Note may not be prepaid after the 180 th day without written permission from Holder. Such redemption must be closed and funded within three (3) days of giving notice of redemption of the right to redeem shall be null and void.

 

(h) Upon (i) a transfer of all or substantially all of the assets of the Company to any person in a single transaction or series of related transactions, (ii) a reclassification, capital reorganization or other change or exchange of outstanding shares of the Common Stock, other than a forward or reverse stock split or stock dividend, or (iii) any consolidation or merger of the Company with or into another person or entity in which the Company is not the surviving entity (other than a merger which is effected solely to change the jurisdiction of incorporation of the Company and results in a reclassification, conversion or exchange of outstanding shares of Common Stock solely into shares of Common Stock) (each of items (i), (ii) and (iii) being referred to as a "Sale Event"), then, in each case, the Company shall, upon request of the Holder, redeem this Note in cash for 150% of the principal amount, plus accrued but unpaid interest through the date of redemption, or at the election of the Holder, such Holder may convert the unpaid principal amount of this Note (together with the amount of accrued but unpaid interest) into shares of Common Stock immediately prior to such Sale Event at the Conversion Price.

 

(i) In case of any Sale Event (not to include a sale of all or substantially all of the Company's assets) in connection with which this Note is not redeemed or converted, the Company shall cause effective provision to be made so that the Holder of this Note shall have the right thereafter, by converting this Note, to purchase or convert this Note into the kind and number of shares of stock or other securities or property (including cash) receivable upon such reclassification, capital reorganization or other change, consolidation or merger by a holder of the number of shares of Common Stock that could have been purchased upon exercise of the Note and at the same Conversion Price, as defined in this Note, immediately prior to such Sale Event. The foregoing provisions shall similarly apply to successive Sale Events. If the consideration received by the holders of Common Stock is other than cash, the value shall be as determined by the Board of Directors of the Company or successor person or entity acting in good faith.

 

4. The Holder agrees that so long as this Note from the Holder and the Company remains outstanding, the Holder will not enter into or effect "short sales" of the Common Stock or hedging transaction which establishes a net short position with respect to the Common Stock of the Company. The Company acknowledges and agrees that upon delivery of a conversion notice by the Holder, the Holder immediately owns the shares of Common Stock described in the conversion notice and any sale of those shares issuable under such conversion notice would not be considered short sales. 

 

5. No provision of this Note shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the time, place, and rate, and in the form, herein prescribed.

 

6. The Company hereby expressly waives demand and presentment for payment, notice of non-payment, protest, notice of protest, notice of dishonor, notice of acceleration or intent to accelerate, and diligence in taking any action to collect amounts called for hereunder and shall be directly and primarily liable for the payment of all sums owing and to be owing hereto.

 

 
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7. The Company agrees to pay all costs and expenses, including reasonable attorneys' fees and expenses, which may be incurred by the Holder in collecting any amount due under this Note.

 

8. If one or more of the following described "Events of Default" shall occur:

 

(a) The Company shall default in the payment of principal or interest on this Note to the Holder by the Company as of the Maturity Date; or

 

(b) Any of the representations or warranties made by the Company herein or in any certificate or financial or other written statements heretofore or hereafter furnished by or on behalf of the Company in connection with the execution and delivery of this Note under which this note was issued shall be false or misleading in any respect; or

 

(c) The Company shall fail to perform or observe, in any respect, any covenant, term, provision, condition, agreement or obligation of the Company under this Note or any other note issued to the Holder; or

 

(d) The Company shall (1) make an assignment for the benefit of creditors or commence proceedings for its dissolution; (2) apply for or consent to the appointment of a trustee, liquidator or receiver for its or for a substantial part of its property or business; (3) file a petition for bankruptcy relief, consent to the filing of such petition or have filed against it an involuntary petition for bankruptcy relief, all under federal or state laws as applicable; or

 

(e) A trustee, liquidator or receiver shall be appointed for the Company or for a substantial part of its property or business without its consent and shall not be discharged within sixty (60) days after such appointment; or

 

(f) Any governmental agency or any court of competent jurisdiction at the instance of any governmental agency shall assume custody or control of the whole or any substantial portion of the properties or assets of the Company; or

 

(g) One or more money judgments, writs or warrants of attachment, or similar process, in excess of fifty thousand dollars ($50,000) in the aggregate, shall be entered or filed against the Company or any of its properties or other assets and shall remain unpaid, unvacated, unbonded or unstayed for a period of thirty (30) days or in any event later than five (5) days prior to the date of any proposed sale thereunder with the exception of the current litigation that is already disclosed as reported on the Company's public filings; or

 

(h) The Company shall have its Common Stock delisted from a market (including the OTCQB marketplace) or, if the Common Stock trades on an exchange, then trading in the Common Stock shall be suspended for more than ten (10) consecutive days; or

 

(i) The Company shall not deliver to the Holder the Common Stock pursuant to paragraph 4 herein without restrictive legend within three (3) business days of its receipt of a Notice of Conversion (provided that a reasonable attorney opinion has been provided by Holder to the Company in which it deems it can reasonably rely); or

 

(j) The Company shall lose the "bid" price for its stock and a market (including the OTCBB marketplace or other exchange).

 

 
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Then, or at any time thereafter, unless cured within five (5) business days, and in each and every such case, unless such Event of Default shall have been waived in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default) at the option of the Holder and in the Holder's sole discretion, the Holder may consider this Note immediately due and payable, without presentment, demand, protest or (further) notice of any kind (other than notice of acceleration), all of which are hereby expressly waived, anything herein or in any note or other instruments contained to the contrary notwithstanding, and the Holder may immediately, and without expiration of any period of grace, enforce any and all of the Holder's rights and remedies provided herein or any other rights or remedies afforded by law. Upon an Event of Default, interest shall accrue at a default interest rate of 24% per annum or, if such rate is usurious or not permitted by current law, then at the highest rate of interest permitted by law. In the event of a breach of Section 8(i) the penalty shall be $50 per day the shares are not issued beginning on the 5 th day after the conversion notice was delivered to the Company. This penalty shall increase to $100 per day beginning on the 10 th day. The penalty for a breach of Section 8(k) shall be an increase of the outstanding principal amounts by 20%. In case of a breach of Section 8(h), the outstanding principal due under this Note shall increase by 50%. Further, if a breach of Section 8(m) occurs or is continuing after the 6-month anniversary of the Note, then the Holder shall be entitled to use the lowest closing bid price during the delinquency period (after cure period) as a base price for the conversion. For example, if the lowest closing bid price during the delinquency period is $0.01 per share and the conversion discount is 50% the Holder may elect to convert future conversions at $0.001 per share. If this Note is not paid at maturity, the outstanding principal due under this Note shall increase by ten percent (10%).

 

9. At the Holder's election, if the Company fails for any reason to deliver to the Holder the conversion shares by the by the 3rd business day following the delivery of a Notice of Conversion to the Company and if the Holder incurs a Failure to Deliver Loss, then at any time the Holder may provide the Company written notice and documentary evidence indicating the amounts payable to the Holder in respect of the Failure to Deliver Loss and the Company must make the Holder whole as follows: Failure to Deliver Loss = [(High trade price at any time on or after the day of exercise) x (Number of conversion shares)]. Such failure to deliver will be repayable in the Company's Common Stock.

 

10. In case any provision of this Note is held by a court of competent jurisdiction to be excessive in scope or otherwise invalid or unenforceable, such provision shall be adjusted rather than voided, if possible, so that it is enforceable to the maximum extent possible, and the validity and enforceability of the remaining provisions of this Note will not in any way be affected or impaired thereby.

 

11. Neither this Note nor any term hereof may be amended, waived, discharged or terminated other than by a written instrument signed by the Company and the Holder.

 

12. The Company represents that it is not a "shell" issuer and has never been a "shell" issuer or that if it previously has been a "shell" issuer that at least 12 months have passed since the Company has reported Form 10 type information indicating it is no longer a "shell issuer.

 

13. The Holder agrees that so long as this Note from the Holder and the Company remains outstanding, the Holder will not enter into or effect "short sales" of the Common Stock or hedging transaction which establishes a net short position with respect to the Common Stock of the Company. The Company acknowledges and agrees that upon delivery of a conversion notice by the Holder, the Holder immediately owns the shares of Common Stock described in the conversion notice and any sale of those shares issuable under such conversion notice would not be considered short sales.

 

14. The Company will give the Holder direct notice of any corporate actions, including but not limited to name changes, stock splits, recapitalizations etc. This notice shall be given to the Holder as soon as possible under law.

 

15. Any dispute or claim arising to or in any way related to this Note or the rights and obligations of each of the parties hereto may be settled by binding arbitration pursuant. All arbitration shall be conducted in accordance with the rules and regulations of the American Arbitration Association (" AAA "). AAA shall designate an arbitrator from an approved list of arbitrators following both parties' review and deletion of those arbitrators on the approved list having a conflict of interest with either party. The Company agrees that a final non-appealable judgment in any such suit or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on such judgment or in any other lawful manner. The Company hereto knowingly and voluntarily waives any and all rights it may have to a trial by jury with respect to any litigation based on, or arising out of, under, or in connection with, this note.

 

 
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16. This Note shall be governed by and construed in accordance with the laws of Florida applicable to contracts made and wholly to be performed within the State of Florida and shall be binding upon the successors and assigns of each party hereto. The Holder and the Company hereby mutually waive trial by jury and consent to exclusive jurisdiction and venue in the courts of the State of Florida. This Agreement may be executed in counterparts, and the facsimile transmission of an executed counterpart to this Agreement shall be effective as an original.

 

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed by an officer thereunto duly authorized on the date referenced below.

 

 

 

ELITE DATA SERVICES, INC.

       

Date: July 22, 2016

By:

/s/ Charles Rimlinger

 

 

Charles Rimlinger

 
   

Chief Executive Officer

 
       

 

 
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EXHIBIT A

 

NOTICE OF CONVERSION

 

(To be executed by the Registered Holder in order to convert the Note)

 

The undersigned hereby irrevocably elects to convert $___________ of the above Note into _________ Shares of Common Stock of Elite Data Services, Inc. ("Shares") according to the conditions set forth in such Note, as of the date written below.

 

If Shares are to be issued in the name of a person other than the undersigned, the undersigned will pay all transfer and other taxes and charges payable with respect thereto.

 

Date of Conversion: ____________________________________________________________________

 

Applicable Conversion Price: _____________________________________________________________

 

Signature: ____________________________________________________________________________

[Print Name of Holder and Title of Signer]

 

Address: _____________________________________________________________________________

  _____________________________________________________________________________

 

SSN or EIN: __________________________________________________________________________

 

Shares are to be registered in the following name:

 

Name: _______________________________________________________________________________

 

Address: _____________________________________________________________________________

 

Tel: _________________________________________________________________________________

 

SSN or EIN: __________________________________________________________________________

 

Shares are to be sent or delivered to the following account:

 

Account Name: ________________________________________________________________________

 

Address: _____________________________________________________________________________

 

 

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EXHIBIT 10.82

 

TERMINATION AGREEMENT AND MUTUAL RELEASE

 

THIS TERMINATION AGREEMENT AND MUTUAL RELEASE (the "Agreement") is made and entered into as of July 22, 2016, by and among ELITE DATA SERVICES INC., a publicly-traded Florida corporation ("DEAC" including the controlling shareholders of DEAC), and PROPERTIES OF MERIT INC., a privately-held Nevada corporation ("POM" including the controlling shareholder of POM). DEAC and POM are sometimes referred to herein as the "parties" collectively or a "party" individually.

 

RECITALS

 

WHEREAS, DEAC and POM are parties to that certain Definitive Agreement, dated May 20, 2016 (the "Definitive Agreement"), attached hereto as Exhibit A, pursuant to which the Company agreed to acquire one hundred percent (100%) of the ownership interest in POM, in the form of three (3) separate closings beginning on or before May 27, 2016, subject to certain performance requirements of both parties as set forth in the Definitive Agreement.

 

WHEREAS, the parties now mutually desire to unwind and rescind the transaction referenced in the above recital pursuant to the provisions of Section 8.2 of the Definitive Agreement, due to, among other reasons, certain events that have occurred subsequent to the date of execution of the Definitive Agreement, including, but not limited to, the inability of DEAC to (i) become fully compliant with certain regulatory agencies, and (ii) obtain the financings required to complete the first and subsequent closings, in order to finance the activities of POM; and

 

WHEREAS, to accomplish the unwinding of the Definitive Agreement, the parties agree to comply with and effect the procedures set forth in Section 8.3 of the Definitive Agreement, and subject to the terms and conditions set forth below.

 

NOW, THEREFORE, the parties hereby agree as follows:

 

1. RESCISSION OF DEFINITIVE AGREEMENT.

 

Pursuant to Section 8.2 of the Definitive Agreement, and on the terms and subject to the conditions of this Agreement, DEAC and POM each agrees to terminate the Definitive Agreement, pursuant to Article VIII of the Definitive Agreement. This Agreement and termination of the Definitive Agreement shall become effective when executed and delivered by all of the parties hereto. Each of the parties shall return and deliver such items to one another as may be required pursuant to Section 8.3 of the Definitive Agreement.

 

2. MUTUAL REPRESENTATIONS AND WARRANTIES; COVENANTS.

 

Each party represents and warrants to the other party that:

 

2.1 Authorization . All corporate action on the part of the respective party and its nominees, officers, directors and shareholders necessary for the authorization, execution and delivery of this Agreement and the performance of all obligations of the respective party hereunder has been taken. This Agreement constitutes a valid and legally binding obligation of the parties, enforceable in accordance with its respective terms.

 

 
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2.2 Corporate Organization of the Company . Each of the parties is a corporation duly organized, validly existing and in good standing under the laws of the state of incorporation and has full corporate power and authority to carry on its business as it is now being conducted and to own the properties and assets it now owns.

 

2.3 Agreement Not in Contravention. Neither the execution and delivery of this Agreement, nor the consummation of the transactions provided for herein will (i) result in the material breach of or constitute a material default or give rise to any right of termination, cancellation or acceleration under any of the terms, conditions, or provisions of any lease, license, promissory note, contract, agreement, mortgage, deed of trust or other instrument or document to which each of the parties is a party, or (ii) violate any order, writ, injunction, decree, law, statute, rule or regulation applicable to any of the parties.

 

2.4 Information and Statements. No representation or warranty made by or on behalf of the parties with respect to this agreement or the Definitive Agreement contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements so made, in light of the circumstances under which they are made, not misleading.

 

3. MUTUAL RELEASE.

 

3.1 Each party on behalf of itself and its respective partners, agents, assigns, heirs, officers, directors, employees executors, and attorneys ("Affiliates") hereby forever and finally releases, relieves, acquits, absolves and discharges the other party and their Affiliates from any and all losses, claims, debts, liabilities, demands, obligations, promises, acts, omissions, agreements, costs and expenses, damages, injuries, suits, actions and causes of action, of whatever kind or nature, whether known or unknown, suspected or unsuspected, contingent or fixed, that they may have against the other party and their Affiliates, including without limitation claims for indemnification, based upon, related to, or by reason of any matter, cause, fact, act or omission occurring or arising at any moment out of the Agreement or Definitive Agreement.
 

3.2 Each party acknowledges that this mutual release does not constitute any admission of liability whatsoever on the part of any of the undersigned.

 

3.3 Each party knowingly and voluntarily waives any and all rights that it or its Affiliates has or may have under applicable law, except that DEAC shall be liable to POM for the repayment of any and all advances made by POM to DEAC, as of the date of this Agreement, under the executed Amended Convertible Redeemable Note ("POM Note" terminating that certain Convertible Promissory Note dated May 20, 2016 as set forth in Exhibit B to the Definitive Agreement ), attached hereto as Exhibit B, which was advanced to DEAC for the purposes of funding the completion of DEAC's audit and Form 10K filing with the SEC for the period ending December 31, 2015, and other actions required to become a fully reporting public company.

 

3.4 Each party represents and warrants that there has been no assignment or transfer of or giving of a security interest in or encumbrance upon any interest in any claim which he/it or his/its Affiliates may have against any other party. Each of the parties further represents that such party: (i) has carefully read this Agreement; (ii) knows the contents of this Agreement; (iii) has had the advice of counsel of such party's choosing in connection with the subject matter hereof, and the advice thereof is reflected in the provisions of this Agreement; and (iv) has not been influenced to any extent whatsoever in doing so by any other party or by any other person or entity, except for those representations, statements and promises expressly set forth herein.

 

4. INDEMNIFICATION.

 

Each party shall defend, indemnify, and hold the other harmless from and against any and all losses, damages, liabilities and expenses (including penalties and attorneys' fees) which are incurred or suffered by or imposed upon the other party arising out of or relating to (i) any failure or breach by the party to perform any of its covenants, agreements or obligations under this Agreement, or (ii) any inaccuracy or incompleteness of any of the representations and warranties of the party contained in this Agreement or in any Exhibit delivered in connection with this Agreement.

 

 
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5. MISCELLANEOUS.

 

5.1 Counterparts . This Agreement may be executed in any number of counterparts, including facsimiles thereof, each of which shall be an original, but such counterparts together shall constitute one and the same instrument.

 

5.2 Entire Agreement . Unless otherwise specifically agreed in writing, this Agreement and the Exhibit hereto represent the entire understanding of the parties with reference to the transactions set forth herein and supersede all prior warranties, understandings and agreements heretofore made by the parties, and neither this Agreement nor any provisions hereof may be amended, waived, modified or discharged except by an agreement in writing signed by the party against whom the enforcement of any amendment, waiver, change or discharge is sought.

 

5.3 Specific Performance. The parties agree that irreparable damage would occur in the event any provision of this Agreement was not performed in accordance with the terms thereof and that, prior to the termination of this Agreement pursuant to its terms, the parties shall be entitled to specific performance of the terms hereof, in addition to any other remedy at law or equity.

 

5.4 Assignment of Agreement . This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and assigns. No party may assign either this Agreement or any of its rights, interests or obligations hereunder without the prior written approval of the other party.

 

5.5 Governing Law and Attorneys' Fees . This Agreement shall be governed by and construed in accordance with the laws of the State of Florida. In the event of any action at law or suit in equity in relation to this Agreement or any Exhibit or other instrument or agreement required hereunder, the prevailing party in such action or suit shall be entitled to receive its or his attorneys' fees and all other costs and expenses of such action or suit.

 

5.6 Further Action . In case at any time after the Closing Date any further action is necessary or desirable to carry out the purposes of this Agreement, the appropriate person or persons shall take such action as promptly as practicable.

 

5.7 Survival . All representations, warranties, covenants and agreements of the parties contained in this Agreement, or in any instrument, certificate, opinion or other writing provided for herein, shall survive the Closing.

 

5.8 Severability . Any term or provision of this Agreement that is invalid or unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability of the remaining terms and provisions hereof or the validity or enforceability of the offending term or provision in any other situation or in any other jurisdiction.

 

WAIVER OF JURY TRIAL. EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THE ACTIONS OF THE PARTIES IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT.

 

[ Signature Page Follows .]

 

 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the day and year first above written.

 

 

DEAC

 

ELITE DATA SERVICES INC.

 
By:

/s/ Charles Rimlinger

 

Charles Rimlinger

 
 

Chief Executive Officer

 

 

DEAC CONTROLLING SHAREHOLDER(S)

 

By:

/s/ Dr. James G. Ricketts

 

Dr. James G. Ricketts

 

 

Shares of Series B Preferred Stock Outstanding:

 

 

2,000,000

 

 

 

 

 

 

Total Number Shares of Controlling Shareholder:

 

 

1,000,000

 

 

 

 

 

 

Number of Votes per Share per Series:

 

 

1

 

 

 

 

 

 

Number of Votes per Share to Common Stock:

 

 

1,000,000,000

 

 

 

 

 

 

Percent of Outstanding Series B Shares Consenting:

 

 

50.00 %

 

By:

/s/ Stephen Antol

 

Stephen Antol  

 

Shares of Series B Preferred Stock Outstanding:

 

 

2,000,000

 

 

 

 

 

 

Total Number Shares of Controlling Shareholder:

 

 

1,000,000

 

 

 

 

 

 

Number of Votes per Share per Series:

 

 

1

 

 

 

 

 

 

Number of Votes per Share to Common Stock:

 

 

1,000,000,000

 

 

 

 

 

 

Percent of Outstanding Series B Shares Consenting:

 

 

50.00 %

 

 
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POM

 

PROPERTIES OF MERIT INC.

 

By:

/s/ Nicola Suppa

 

Nicola Suppa

 
 

President

 

 

POM CONTROLLING SHAREHOLDER

 
By: /s/ Nicola Suppa

 

Nicola Suppa

 

 

Shares of Common Stock Outstanding:

 

 

20,000,000

 

 

 

 

 

 

Total Number Shares of Controlling Shareholder:

 

 

20,000,000

 

 

 

 

 

 

Number of Votes per Share of Common Stock:

 

 

1

 

 

 

 

 

 

Number of Votes of Controlling Shareholder:

 

 

20,000,000

 

 

 

 

 

 

Percent of Outstanding Shares Consenting:

 

 

100.00 %

 

 
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EXHIBIT A

 

Definitive Agreement

 

See Attached.

 

 
6
 

 

EXHIBIT B

 

AMENDED

CONVERTIBLE REDEEMABLE NOTE
(POM Advance)

 

See Attached.

 

 

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EXHIBIT 10.83

 

Elite Data Services, Inc.

4447 N. Central Expy., Ste. 110-135

Dallas, TX 75205

Tel. (972) 885-3981

 

 

 

July 22, 2016

 

To the Members of:

WOD Market LLC

3700 E. Jewell Ave. #319

Denver, CO 80210

 

Attn: Taryn Watson, President

 

Re:

Letter of Intent

 

Dear Sirs:

 

This Letter of Intent (" LOI ") confirms our preliminary discussions regarding a proposed acquisition of WOD Market LLC, a Colorado limited liability company (" WOD ") by ELITE DATA SERVICES, INC., a Florida corporation, ("the Company "). This LOI is intended to be a non-binding expression of the current understanding of the parties regarding the terms of the proposed transaction, except as otherwise set forth herein, to be incorporated into and superseded by the execution of the Definitive Documentation as set forth in Section 2 below, the date of execution being the formal date of the closing of the contemplated transaction ("Closing" and/or Closing Date"). The Definitive Documentation will include such additional terms, conditions, representations and warranties and undertakings as mutually agreed to by the parties. Except as provided in Paragraphs 9 and 10 below, no legally binding obligations will be created until the Definitive Documentation is executed and delivered by the Company and WOD.

 

1. Structure; Transaction Consideration.

 

(a) Structure . The Company is a publicly traded company whose common stock trades on the Over-the-Counter (OTC) Stock Exchange under the symbol "DEAC". The contemplated transaction would be accomplished by an exchange membership interests and shares (the "Share Exchange") between the members of WOD (the "WOD Members") and Company, whereby the Company acquires one hundred (100%) ownership of WOD, subject to certain performance based milestones, and new shares are issued from the Company to WOD Members to effectuate the desired capitalization in a business combination acquisition (the "Transaction"), in accordance with the terms of an executed definitive stock purchase agreement (the " Stock Purchase Agreement ") to be negotiated by the parties. It is contemplated that upon completion of the acquisition and Share Exchange the WOD Members will own a certain percentage of the issued and outstanding shares of the Company as set forth in Schedule A, attached hereto. The parties will jointly determine the optimum tax structure for the transaction in order to best satisfy tax planning, regulatory and other considerations.

 

 
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(b) Transaction Consideration . Based upon current and projected financials and other information provided by WOD, the Company's understanding of the business of WOD, and the due-diligence conducted to date, and assuming WOD and the Company continue to conduct business in the ordinary course prior to the Closing of the Transaction and there is no meaningful change in its borrowing and distribution practices, the Company would be prepared to provide total aggregate transaction consideration as set forth in Schedule A, attached hereto.

 

2. Definitive Documentation . The Company and the WOD Members shall negotiate in good faith to finalize and execute as soon as is reasonably practicable, but in any event no later than July 29, 2016: (A) a definitive agreement (the "Definitive Agreement"), containing terms and conditions consistent with those described herein, and other covenants, representations, warranties, indemnities, closing conditions and other provisions customary for transactions of this type, and (B) such other ancillary agreements as are customary to consummate the transactions contemplated herein (collectively, the " Definitive Documentation ").

 

3. Post-Closing Officers and Directors . Upon the Closing of the Transaction, pursuant to the Definitive Agreement: (A) certain officers of the Company serving at the time of the Transaction may be required to resign their respective positions with Company and be replaced by certain officers of WOD, as mutually agreed, and (B) the board of directors of Company may be required to be reconstituted such that it complies with an adopted corporate governance policy of the Company, as required by the rules and regulations set forth by Sarbanes-Oxley.

 

4. Closing Conditions . The Closing of the transactions contemplated herein would be conditioned upon the following by both WOD and Company, respectively:

 

(a) Execution of Definitive Documentation satisfactory to both parties;

 

(b) A certain amount of capital required at Closing as may be determined;

 

(c) Receipt of all required third party and governmental approvals, consents and clearances;

 

(d) Each Party being satisfied upon completion of business and legal due diligence of the other;

 

(e) Receipt of all necessary corporate approvals, including the approval of the Board of Directors of WOD and Company, respectively;

 

(f) The satisfaction of any additional conditions to each party's obligations are set forth in the Definitive Documentation (which will include that there has not been any material adverse change in WOD and Company's business or the occurrence of any event that is likely to have a material adverse effect on WOD or Company's business during the period between the date the Definitive Documentation is signed and the Closing Date).

 

5. Access . During the period from the date hereof until the termination of this LOI as provided in Paragraph 11 below, Company and its representatives and WOD and its representatives shall both be provided full access to examine the properties, books of account, corporate and human resources records and all other materials and information relating to each other's business, assets and liabilities, and the directors of both the Company and WOD shall cause its officers and employees to cooperate with such examination, as requested and required.

 

 
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6. Expenses . If the contemplated transaction is not consummated by the Company, WOD, and the WOD Members, each party shall pay their respective expenses (including fees and expenses of legal counsel, investment bankers, brokers, accountants and other representatives or consultants) in connection with the transaction contemplated herein, otherwise all expenses related to the contemplated transaction shall be borne collectively by the surviving company, post-Closing.

 

7. No Disclosure; Publicity . Neither party shall disclose to any other person (other than such party's employees, representatives and agents who are bound by confidentiality agreements or other confidentiality obligations) the terms or conditions hereof or the fact that an acquisition transaction with respect to the Transaction being considered by the Company and the WOD Members; provided , however , that the Company may make a public announcement, issue a press release or otherwise disclose the transaction if, in the opinion of its legal counsel, such announcement or disclosure is necessary or desirable based on its obligations as a publicly traded company.

 

8. Exclusivity . In consideration of the time and resources that the Company will devote to the transactions contemplated in this LOI, neither the WOD Members, WOD nor any of its affiliates will, for a period commencing on the date hereof and ending on July 29, 2016 (or such later date as may be mutually agreed by the parties), directly or indirectly, solicit or initiate or enter into discussions, agreements or transactions with, or encourage, or provide any information to, any person or entity (other than the Company or its designees) concerning any merger or sale of WOD or its ownership interest, business or assets, or any other transaction that would defeat the intent of this LOI. The WOD Members represent that neither they, WOD, nor any of its affiliates are party to or bound by any agreement with respect to any such transaction other than as contemplated by this LOI. If the WOD Members, WOD or any of its affiliates shall breach, or threaten to commit a breach of any of the agreements contained in this Section 8, the Company shall have the right, in addition to, and not in lieu of, any other rights and remedies available to it under law or in equity, to have such agreements specifically enforced by any court, including, without limitation, the right to seek entry of restraining orders and injunctions (preliminary, mandatory, temporary and permanent) against violations, threatened or actual, and whether or not then continuing, of such agreements, it being acknowledged and agreed that any such breach or threatened breach will cause irreparable injury to Company and that monetary damages will not provide an adequate remedy to Company.

 

9. Binding Effect; Termination . This LOI is only a statement of the present intentions of the parties and does not constitute a binding agreement of the parties hereto with respect to the Transaction. Accordingly, except as set forth below, the parties will be legally bound only upon execution of, and in accordance with the terms contained in the Definitive Documentation, if, as and when the same have been approved by each party's board of directors or similar governing body and have been duly executed and delivered; provided, that the parties agree that the provisions of Section 5 through 11 hereof are binding and enforceable. The provisions of Section 5, 7 and 8 shall terminate on, and have no effect following, the earlier of July 29, 2016 (unless such date is extended by the mutual agreement of the parties) or the execution of the Definitive Documentation, provided that such termination shall not excuse any breach arising prior to the date of such termination.

 

 
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10. Governing Law . This LOI shall be governed by and construed in accordance with the laws of the State of Florida, regardless of the laws that might otherwise govern under applicable conflicts of law principles. Each party hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of State of Florida, Orange County for any litigation arising out of or relating to this Agreement and the transactions contemplated herein and agrees not to commence any litigation relating thereto except in such courts.

 

11. Entire Agreement; Amendment; Assignment; Counterparts . This LOI represents the entire understanding of the parties with respect to the terms of the Transaction, and supersedes all prior and/or contemporaneous agreements, representations and understandings, written or oral. This LOI may only be amended, modified or extended by a written agreement signed by both of the parties hereto. This LOI may not be assigned without the other party's written consent. This LOI may be signed in two or more counterparts, any one of whom need not contain the signature of more than one party, but all such counterparts will constitute one and the same agreement.

 

If you are in agreement with the terms of this LOI, please sign in the space provided below and return facsimile to Company's representative below or a scanned copy by email. This proposal shall remain open until 11:59 p.m. EST on July 22, 2016. If this LOI has not been agreed to by the WOD's Members by that time, this proposal shall be deemed to have lapsed.

 

 

 

Very truly yours,

 

Elite Data Services, Inc.

       
By:

/s/ Charles Rimlinger

 

 

Charles Rimlinger

 
   

Chief Executive Officer

 

 

Acknowledged and Agreed:

 

WOD Market LLC

 

By:

/s/ Taryn Watson

 

Taryn Watson

 
 

President

 

 

 

 

Date:  July 22, 2016  

 

 
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SCHEDULE A

 

Transaction Considerations

 

(1) Stock Purchase and Share Exchange . Upon the Closing Date of the Transaction as contemplated herein, which may be in the form of one of more closings, the Company will issue to the WOD Members [x] shares of the Company's Common stock ("Common Shares") and [y] shares of the Company's Preferred stock ("Preferred Shares"), in a series and designation to be determined prior to Closing in exchange for [z] number of units of membership interests of WOD ("Ownership Interest") transferred from the WOD Members to the Company (the "Stock Purchase and Share Exchange"), subject to certain mutually agreed to terms set forth in the Definitive Documentation prior to Closing.

 

(2) Equity Capitalization at Closing. Following the final Closing of the Transaction and issuance to WOD's Members of [x] Common Shares and [y] Preferred Shares of the Company, the equity capitalization of the Company will be initially equal to: (A) a certain percentage of the ownership interest of the Company to the Members of WOD (the "New Shareholders"), and (B) a certain percentage of the ownership interest of the WOD to the Shareholders of the Company (the "Original Shareholders"), prior to the Closing Date, subject to certain mutually agreed to terms set forth in the Definitive Documentation prior to Closing.

 

(3) Other Consideration.

 

(a) Bridge Financing . Pursuant to the execution of this LOI and within five (5) business days thereafter, WOD has agreed to arrange for a wire transfer in an amount of no less than USD $40,000.00 (the "Bridge Financing"), under mutually agreed to terms which shall be formalized in writing separate from this LOI in the Definitive Documentation, advanced specifically for the purposes of funding certain operational costs of the Company prior to Closing, including, but not limited to, expenses related to the completion of the Company's outstanding Form 10K for period ending December 31, 2015, and Form 8K for period ending March 31, 2016, preparation of the Form 8K for period ending June 30, 2016, and other such items required in order for the Company to become a fully reporting public company.

 

(b) Post Transaction Funding Commitment . Post-closing of the Transaction, the Company and WOD will seek to arrange for the long term financing for the purposes of supporting the operations of WOD, pursuant to a mutually agreed upon business or operational plan, on terms set forth in the Definitive Agreement prior to Closing.

 

 

5

 

EXHIBIT 99.1

 

 

DEAC Expands Its Business Focus and Moves Forward with Its Growth Plan

(Terminates Existing Agreement and Signs New Letter of Intent)

 

DALLAS, TX -- (July 27, 2016) - Elite Data Services Inc. (OTC: DEAC ) (the "Company"), a newly restructured technology driven management company, today announced that it had terminated its business relationship with Properties of Merit Inc. ("POM"), a Nevada based mining corporation operating in British Columbia, Canada , in favor of an acquisition of WOD Market LLC ("WOD"), a Colorado based provider of intelligent retail solutions for gym owners and coaches.

 

On July 22, 2016, the Company and POM terminated the Definitive Agreement signed on May 20, 2016, incorporated by reference in Form 8K filed with the SEC on May 24, 2016, in which the Company had agreed to acquire POM under certain terms and conditions.

 

The parties mutually agreed to terminate the Definitive Agreement, due to, among other reasons, certain events that occurred subsequent to the date of execution of the Definitive Agreement.

 

Subsequently, on July 22, 2016, the Company and WOD executed a Letter of Intent (LOI) for the proposed acquisition of WOD in the form of a stock purchase and share exchange arrangement on terms to be set forth in a definitive agreement and other ancillary agreements as are customary to consummate the transaction contemplated (the "Definitive Documentation"), anticipated to be signed and closed on or before July 29, 2016.

 

Pursuant to the execution of the LOI, WOD agreed to arrange interim funding of no less than USD $40,000.00 for certain operational costs of the Company prior to and after closing, including expenses related to the completion of the Company's outstanding Form 10K for period ending December 31, 2015, and Form 10Q for periods ending March 31, 2016 and June 30, 2016, to be advanced within five (5) business days from the date of the LOI, under mutually agreed to terms to be formalized in the Definitive Documentation.

 

Charles Rimlinger, the Company's CEO stated, "It's unfortunate that we were unable to move forward with the POM transaction. Although a great opportunity, we simply could not arrange the amount of capital needed for POM to properly execute on their business plan. However, we're pleased to have the option to acquire a uniquely positioned retail solutions provider with significant growth potential with more reasonable capital requirements. We intend to close quickly and fast-track integration of WOD as a new vertical business into the Company's operations by the end of the current quarter."

 

To date, no closing has occurred with WOD and there is no guarantee that the proposed closing with WOD will occur, which is subject to terms still to be negotiated and set forth in a final definitive agreement.

 

 
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Please refer to Current Report Form 8K dated May 24, 2016, June 22, 2016 and July 27, 2016, respectively, filed with the Securities and Exchange Commission for more information on the Company's recent events.

 

About Elite Data Services, Inc.

 
Elite Data Services Inc. ("Company"), a Florida corporation, is a technology driven management company which owns and operates businesses in areas of online marketing and gaming operations. The Company is currently comprised of two (2) subsidiaries: Elite Data Marketing LLC, and Elite Gaming Ventures LLC.

 

About WOD Market LLC

 

WOD Market LLC ("WOD"), a Colorado based company, is a provider of intelligent retail solutions for gym owners and coaches. WOD services the fitness community by allowing coaches and trainers to focus on what's important while athletes have access to the products they need to perform at their highest level. WOD relieves gym owners and coaches of the burden of managing retail sales including upfront inventory purchases, ongoing inventory management, payments, marketing, etc. while also providing a service for members to have convenient access to products that help them perform better. WOD intends to forge a mutually beneficial relationship with each gym, customer and vendor to ensure the best possible experience.

 

Forward-Looking Statements

 

Non-historical statements included in this press release are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements relating to the Company's future performance are subject to many factors including, but not limited to: working capital and availability of capital, implementation difficulties, impacts involving key vendors, lenders, competitors, and other risks detailed in the Company's Form 10-K for the year ended December 31, 2014, and other subsequent SEC filings. Such statements are based upon management's current beliefs and expectations subject to significant risks and uncertainties. Actual results may differ from those set forth in the forward-looking statements. When used in this press release, the terms "anticipate", "believe", "estimate", "expect", "may", "should", "plan", "possible", "potential", "project", "will", and similar expressions identify forward-looking statements. There is no guarantee that the Company will enter into the agreements referenced herein, nor if we do, that successful implementation will transpire. The forward-looking statements contained herein are made as of the date hereof, and we do not undertake any obligation to update any forward looking statements, whether as a result of future events, new information, or otherwise.

 

Investor and Public Relations Contact

Elite Data Services, Inc.
Charles Rimlinger
Chief Executive Officer 
(615) 905-4042
info@edscompanies.com

 

 

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