Monaker Group, Inc. (Form: 8-K, Received: 01/16/2018 16:17:04)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of Earliest Event Reported): January 10, 2018

Monaker Group, Inc.

(Exact name of Registrant as specified in its charter)

Nevada

(State or other jurisdiction of incorporation)

000-52669	26-3509845
(Commission File Number)	(I.R.S. Employer Identification No.)

2690 Weston Road, Suite 200

Weston, Florida 33331

(Address of principal executive offices zip code )

(954) 888-9779

( Registrant’s telephone number, including area code )

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 (see General Instruction A.2. below):

☐	Written communications 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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. ☐

Item 1.01

Entry into a Material Definitive Agreement.

As described below, Monaker Group, Inc. (the “ Company ”, “ we ” or “ us ”) has taken steps to raise additional capital to meet keys requirement that the Company believes will enable its common stock to qualify for uplisting onto the NASDAQ Capital Market (“ NASDAQ ”). The capital was raised through the exercise of warrants by directors and a major shareholder, as discussed below. Upon completion of the uplisting, which is still in process, and still subject to NASDAQ approval and confirmation, the liquidated damage provisions of the Purchase Agreement (discussed below) will terminate.

On January 10, 2018, the Company entered into a First Amendment to Warrant with Pacific Grove Capital LP (“ Pacific ”), one of the purchasers (collectively, the “ Purchasers ”) of shares and warrants pursuant to the terms of that certain Common Stock and Warrant Purchase Agreement entered into between the Company and the purchasers named therein dated July 31, 2017 (the “ Purchase Agreement ”).

Pursuant to the First Amendment to Warrant, the Company and Pacific agreed to reduce the exercise price of the warrants to purchase 875,000 shares of common stock which Pacific acquired pursuant to the Purchase Agreement, from $2.10 per share to $1.05 per share, in consideration for Pacific immediately exercising such warrants for cash. This warrant exercise, along with the other warrants exercised as described below, provided additional funds and increased stockholders’ equity required to qualify for consideration to have the Company’s common stock uplisted onto the NASDAQ Capital Market (“ NASDAQ ”). Upon uplifting to NASDAQ, the liquidated damage provisions of the Purchase Agreement (discussed below), relating to the failure of the Company to uplist prior to the Required Uplisting Date (defined below) will cease.

Additionally, the Purchase Agreement includes certain liquidated damage provisions which require the Company to grant to the Purchasers, as partial liquidated damages for any delay in obtaining an uplisting to the NASDAQ which uplisting was required to have occurred, pursuant to the Purchase Agreement, on or before December 9, 2017 (the “ Required Uplisting Date ”), additional warrants (on substantially similar terms as the warrants granted pursuant to the Purchase Agreement) equal to each Purchaser’s pro rata share of 1% of the warrants sold pursuant to the Purchase Agreement, for each day that the Company fails to uplist its common stock to NASDAQ after the Required Uplisting Date (the “ Liquidated Damages ”). A total of up to 100% of the warrants sold pursuant to the Purchase Agreement may be issued to the Purchasers as Liquidated Damages.

Consequently, Pacific was due additional warrants to purchase 271,250 shares of the Company’s common stock in connection with the Liquidated Damages, as of the parties entry into the First Amendment to Warrant, which warrants Pacific also agreed to immediately exercise for cash at a reduced exercise of $1.05 per share (compared to the original exercise price of such warrants, $2.10 per share), pursuant to the First Amendment to Warrant.

Total consideration received from the exercise of the warrants by Pacific pursuant to the First Amendment to Warrant was $1,203,563.

The description of the First Amendment to Warrant above is not complete and is qualified in its entirety by the full text of the First Amendment to Warrant, a copy of which is filed herewith as Exhibit 10.1 , which is incorporated by reference in this Item 1.01 in its entirety.

As a result of the reduction in the exercise price of the Pacific warrants which was agreed to pursuant to the First Amendment to Warrant, the anti-dilution provisions of the Purchase Agreement and the Purchaser warrants was triggered. Specifically, because the Company issued shares of common stock below (a) the $2.00 price per share of the securities sold pursuant to the Purchase Agreement, the Purchasers are due an additional 36,142 shares of the Company’s common stock; and (b) the $2.10 exercise price of the warrants sold pursuant to the Purchase Agreement (and the warrants granted to the placement agent), the exercise price of such warrants automatically decreased to $2.05 per share.

In aggregate between the Pacific warrant exercises and the insider warrant exercises described below under Item 3.02 , the Company raised $1,664,013 in proceeds, which funds (less expenses and applicable fees) the Company required to meet the minimum stockholders’ equity required to uplist its common stock onto the NASDAQ, which uplisting the Company hopes to accomplish, subject to approval for such uplisting by the NASDAQ, by the end of January 2018.

Item 3.02

Unregistered Sales of Equity Securities.

The following Purchasers exercised the following warrants sold pursuant to the Purchase Agreement at an exercise price of $2.10 per share: the Donald P. Monaco Insurance Trust, of which Donald Monaco is the trustee and a member of the Board of Directors of the Company, exercised warrants to purchase 62,000 shares of common stock for the aggregate exercise price of $130,200 and William Kerby, the Chief Executive Officer and Chairman of the Company, exercised warrants to purchase 5,000 shares of common stock for the aggregate exercise price of $10,500. In connection with such exercises, the Company will issue an aggregate of 67,000 shares of common stock to the parties above.

Also, the Monaco Investment Partners II, LP of which Donald Monaco is the managing general partner and a member of the Board of Directors of the Company, exercised warrants to purchase 47,500 shares of common stock for the aggregate exercise price of $95,000, and Charcoal Investment Ltd. (“ Charcoal ”), which entity is owned by Simon Orange, a member of the Board of Directors of the Company, exercised warrants to purchase 100,000 shares of common stock for the aggregate exercise price of $200,000, which warrants were granted separate from the warrants granted pursuant to the Purchase Agreement. The Company plans to issue the 47,500 shares due to the trust and the 100,000 shares due to Charcoal, shortly after the date of this filing.

Additionally, as described in Item 1.01 above, in connection with the Company’s entry into the First Amendment to Warrant, Pacific exercised warrants to purchase an aggregate of 1,146,250 shares of the Company’s common stock for aggregate consideration of $1,203,563 and was issued 1,146,250 shares of the Company’s common stock.

Pursuant to the Liquidated Damages provision of the Purchase Agreement (as discussed in Item 1.01 above), and including the warrants granted to Pacific in consideration for the Liquidated Damages, the Company, through January 10, 2018, has granted warrants to purchase an additional 498,831 shares of common stock to the Purchasers and the placement agent in the offering, which also has the right to receive additional warrants as if it was a Purchaser under the Purchase Agreement.

As described above in Item 1.01 , due to the reduction in the exercise price of the Pacific warrants which was agreed to pursuant to the First Amendment to Warrant, the anti-dilution provisions of the Purchase Agreement was triggered. Specifically, because the Company issued shares of common stock below the $2.00 price per share of the securities sold pursuant to the Purchase Agreement, the Purchasers are due an additional 36,142 shares of the Company’s common stock.

We claim/will claim an exemption from registration for the issuances described above pursuant to Section 4(a)(2) and/or Rule 506 of Regulation D of the Securities Act of 1933, as amended (the “ Securities Act ”), since the foregoing issuances did not/will not involve a public offering, the recipients were/are (a) “ accredited investors ”; and/or (b) had access to similar documentation and information as would be required in a Registration Statement under the Securities Act, the recipients acquired/will acquire the securities for investment only and not with a view towards, or for resale in connection with, the public sale or distribution thereof. The securities were offered without any general solicitation by us or our representatives. No underwriters or agents were involved in the foregoing issuances and we paid no underwriting discounts or commissions. The securities are subject to transfer restrictions, and the certificates evidencing the securities contain/will contain an appropriate legend stating that such securities have not been registered under the Securities Act and may not be offered or sold absent registration or pursuant to an exemption therefrom.

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number		Description

10.1*		First Amendment to Warrant dated January 10, 2018, by and between Monaker Group, Inc. and Pacific Grove Capital LP

* Filed herewith.

SIGNATURES

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.

	MONAKER GROUP, INC.

Date: January 16, 2018	By:	/s/ William Kerby
		Name:	William Kerby
		Title:	Chief Executive Officer

EXHIBIT INDEX

Exhibit Number		Description

10.1*		First Amendment to Warrant dated January 10, 2018, by and between Monaker Group, Inc. and Pacific Grove Capital LP

* Filed herewith.

MONAKER GROUP, INC. 8-K

Exhibit 10.1

FIRST AMENDMENT TO WARRANT

This First Amendment to Warrant (this “ Agreement ”) dated January 10, 2018 (the “ Effective Date ”), is by and among Monaker Group, Inc. , a Nevada corporation (the “ Company ”) and Pacific Grove Capital LP, a Delaware limited partnership (the “ Warrant Holder ”), each a “ Party ” and collectively the “ Parties. ”

W I T N E S S E T H :

WHEREAS , on August 11, 2017, the Company closed the transactions contemplated by the Common Stock and Warrant Purchase Agreement, entered into by the Company on July 31, 2017 (the “ Purchase Agreement ”), with certain accredited investors named therein, including the Warrant Holder (collectively, the “ Purchasers ”);

WHEREAS , under the terms of the Purchase Agreement, the Company sold the Purchasers an aggregate of 1,532,500 shares of common stock (the “ Shares ”) and 1,532,500 warrants to purchase one share of common stock (the “ Offering Warrants ”);

WHEREAS , pursuant to the Purchase Agreement, the Warrant Holder subscribed for 875,000 Shares and 875,000 Offering Warrants;

WHEREAS , the Purchase Agreement included certain liquidated damage provisions which require the Company to grant to the Purchasers, as partial liquidated damages for any delay in obtaining an uplisting to the NASDAQ Capital Market, which uplisting was required pursuant to the Purchase Agreement, to have occurred on or before December 9, 2017, additional warrants (on substantially similar terms as the Offering Warrants) equal to each Purchaser’s pro rata share of 1% of the Offering Warrants sold pursuant to the Purchase Agreement (the “ Liquidated Damages ”);

WHEREAS , the Warrant Holder is due additional warrants to purchase 271,250 shares of the Company’s common stock in connection with the Liquidated Damages as of the Effective Date (the “ Liquidated Damage Warrants ” and together with the Offering Warrants, the “ Warrants ”), which Liquidated Damage Warrants the Company has granted to the Warrant Holder as of the date of this Agreement;

WHEREAS , the Company desires to incentivize the Warrant Holder to exercise the Warrants by reducing the exercise price of the Warrants from $2.10 per share to $1.05 per share, provided that the Warrant Holder agrees to immediately exercise such Warrants for cash;

WHEREAS , the Warrant Holder desires to immediately exercise the Warrants for cash subject to the reduction in exercise price described above; and

Page 1 of 5
First Amendment To Warrant

WHEREAS , the Parties now desire to amend the Warrant Agreements evidencing the Warrants (the “ Warrant Agreements ”) to reduce the exercise price of such Warrants in consideration for the immediate cash exercise of such Warrants by the Warrant Holder, pursuant to the terms and conditions of this Agreement and the Warrant Agreements as amended hereby.

NOW, THEREFORE , in consideration of the premises and the mutual covenants, agreements, and considerations herein contained, and other consideration, which consideration the Parties hereby acknowledge and confirm the receipt and sufficiency of, the Parties hereto agree as follows:

Amendment to Warrant Agreements and Warrant Holder Exercise .

(a)

Effective as of the Effective Date, the definition of “ Exercise Price ” set forth in Section 1 of the Warrant Agreements are hereby amended and replaced by the following definition:

““Exercise Price” means $1.05, subject to adjustment in accordance with Section 9.”

(b)

Effective as of the Effective Date, the Warrant Holder shall be deemed to have affected a cash exercise of the full amount of the Warrants, i.e., the Warrant Holder shall be deemed to have exercised the Warrant Agreements in full in cash at the Exercise Price as amended hereby;

(c)

Concurrently with the Warrant Holder’s entry into this Agreement and effective as of the Effective Date, but no later than two (2) Business Days after the Effective Date (the “ Deadline ”), the Warrant Holder shall provide the Company (a) Notice of Exercises in the form of Exhibit A attached hereto (the “ Notice of Exercises ”), confirming and documenting the exercise of such Warrants in cash pursuant to the terms and conditions thereof (the “ Exercise ”); and (b) the aggregate Exercise Price of the Warrants ($1,203,562.50)(the “ Aggregate Exercise Price ”).

(d)

Unless extended by the Company in its sole discretion, in the event the Notice of Exercises and the Aggregate Exercise Price are not received by the Company by the Deadline, this Agreement shall be rescinded and shall be void ab initio , the Exercise shall be voided, the Exercise Price of the Warrants shall revert to $2.10 per share, and this Agreement shall have no force or effect on the date immediately following the Deadline.

Consideration . Each of the Parties agrees and confirms by signing below that they have received valid consideration in connection with this Agreement and the transactions contemplated herein.

Page 2 of 5
First Amendment To Warrant

Mutual Representations, Covenants and Warranties . Each of the Parties, for themselves and for the benefit of each of the other Parties hereto, represents, covenants and warrants that:

(a)

Such Party has all requisite power and authority, corporate or otherwise, to execute and deliver this Agreement and to consummate the transactions contemplated hereby and thereby. This Agreement constitutes the legal, valid and binding obligation of such Party enforceable against such Party in accordance with its terms, except as such enforcement may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and general equitable principles;

(b)

The execution and delivery by such Party and the consummation of the transactions contemplated hereby and thereby do not and shall not, by the lapse of time, the giving of notice or otherwise: (i) constitute a violation of any law; or
(ii) constitute a breach of any provision contained in, or a default under, any governmental approval, any writ, injunction, order, judgment or decree of any governmental authority or any contract to which such Party is bound or affected; and

(c) Any individual executing this Agreement on behalf of an entity has authority to act on behalf of such entity and has been duly and properly authorized to sign this Agreement on behalf of such entity.

Further Assurances . The Parties agree that, from time to time, each of them will take such other action and to execute, acknowledge and deliver such contracts, deeds, or other documents as may be reasonably requested and necessary or appropriate to carry out the purposes and intent of this Agreement and the transactions contemplated herein.

Effect of Agreement . Upon the effectiveness of this Agreement, each reference in the Warrant Agreements to “ Warrant ”, “ Agreement, ” “ hereunder, ” “ hereof, ” “ herein ” or words of like import shall mean and be a reference to such Warrant Agreements as modified or amended hereby.

Exercise of Warrants In Full; Termination of Warrant Agreements . Effective upon the Effective Date and in connection with the Exercise, except for the right to receive Warrant Shares in connection with the Exercise of the Warrants pursuant to the terms of this Agreement above and the terms of the Warrant Agreements (to the extent not modified hereby), the Warrant Agreements and the Warrants shall be deemed to have been exercised in full, shall have no further force or effect, shall be deemed terminated, and the Warrant Holder shall have no further rights, and the Company shall have no further obligation under, such Warrant Agreements, effective on the Effective Date.

Page 3 of 5
First Amendment To Warrant

Benefit and Burden . This Agreement shall inure to the benefit of, and shall be binding upon, the Parties hereto and their successors and permitted assigns.

Entire Agreement . This Agreement sets forth all of the promises, agreements, conditions, understandings, warranties and representations among the Parties with respect to the transactions contemplated hereby and thereby, and supersedes all prior agreements, arrangements and understandings between the Parties, whether written, oral or otherwise.

Fully Informed; Arm’s Length Transaction . Each Party herein expressly represents and warrants to all other Parties hereto that (a) before executing this Agreement, said Party has fully informed itself of the terms, contents, conditions and effects of this Agreement; (b) said Party has relied solely and completely upon its own judgment in executing this Agreement; (c) said Party has had the opportunity to seek and has obtained the advice of its own legal, tax and business advisors before executing this Agreement; (d) said Party has acted voluntarily and of its own free will in executing this Agreement; and (e) this Agreement is the result of arm’s length negotiations conducted by and among the Parties and their respective counsel.

10.

No Presumption from Drafting . This Agreement has been negotiated at arm’s-length between persons knowledgeable in the matters set forth within this Agreement. Accordingly, given that all Parties have had the opportunity to draft, review and/or edit the language of this Agreement, no presumption for or against any Party arising out of drafting all or any part of this Agreement will be applied in any action relating to, connected with or involving this Agreement. In particular, any rule of law, legal decisions, or common law principles of similar effect that would require interpretation of any ambiguities in this Agreement against the Party that has drafted it, is of no application and is hereby expressly waived. The provisions of this Agreement shall be interpreted in a reasonable manner to effect the intentions of the Parties.

11.

Effect of Facsimile and Photocopied Signatures . This Agreement and any signed agreement or instrument entered into in connection with this Agreement, and any amendments hereto or thereto, may be executed in one or more counterparts, all of which shall constitute one and the same instrument. Any such counterpart, to the extent delivered by means of a facsimile machine or by .pdf, .tif, .gif, .jpeg or similar attachment to electronic mail (any such delivery, an “ Electronic Delivery ”) shall be treated in all manner and respects as an original executed counterpart and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any Party, each other Party shall re execute the original form of this Agreement and deliver such form to all other Parties. No Party shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such Party forever waives any such defense, except to the extent such defense relates to lack of authenticity.

Page 4 of 5
First Amendment To Warrant

IN WITNESS WHEREOF , the Parties hereto have executed this Agreement as of the day and year first written above to be effective as of the Effective Date.

(“ Company ”)

Monaker Group, Inc.

	By:	/s/ Bill Kerby

	Its:	CEO

	Printed Name:	Bill Kerby


(“ Warrant Holder ”)

Pacific Grove Capital LP

	By:	/s/ Mark Simmons

	Its:	Chief Financial Officer

	Printed Name:	Mark Simmons

Page 5 of 5
First Amendment To Warrant

EXHIBIT A

EXERCISE NOTICE

The undersigned Holder hereby irrevocably elects to purchase 875,000 shares of Common Stock pursuant to the attached Warrant. Capitalized terms used herein and not otherwise defined have the respective meanings set forth in the Warrant.

(1) The undersigned Holder hereby exercises its right to purchase Warrant Shares pursuant to the Warrant.

(2) The Holder intends that payment of the Exercise Price shall be made as (check one):

☒ “Cash Exercise” under Section 10

☐ “Cashless Exercise” under Section 10

(3) If the holder has elected a Cash Exercise, the holder shall pay the sum of $918,750 to the Company in accordance with the terms of the Warrant.

(4) Pursuant to this Exercise Notice, the Company shall deliver to the holder Warrant Shares in accordance with the terms of the Warrant.

Dated: January 10, 2018	Name of Holder:

	(Print)

	Pacific Grove Capital LP


	By:	/s/ Mark Simmons

	Its:	Chief Financial Officer

	Printed Name:	Mark Simmons
		(Signature must conform in all respects to name of holder as specified on the face of the Warrant)