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): July 21, 2021

 

NextPlay Technologies, Inc. 

(Exact name of Registrant as specified in its charter) 

  

Nevada 

(State or other jurisdiction of incorporation) 

001-38402 

(Commission File Number) 

26-3509845 

(IRS Employer Identification No.) 

 

1560 Sawgrass Corporate Parkway, Suite 130, Sunrise, Florida 33323
(Address of principal executive offices) (Zip Code) 

 

Registrant’s telephone number, including area code: (954) 888-9779 

 

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))

 

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

 

Title of each class Trading Symbol(s) Name of each exchange on
which registered

Common Stock, 

$.0001 Par Value Per Share 

NXTP

The NASDAQ Stock Market LLC 

(Nasdaq Capital Market) 

 

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.

 

Streeterville July 2021 Exchange Agreement

 

As previously reported in the Current Report on Form 8-K filed by NextPlay Technologies, Inc., formerly Monaker Group, Inc. (the “Company”, “we”, and “us”) with the Securities and Exchange Commission (the “SEC” or the “Commission”) on November 27, 2020, the Company sold Streeterville Capital, LLC (“Streeterville”), an accredited investor, a Secured Promissory Note in the original principal amount of $5,520,000 on November 23, 2020 (the “November 2020 Streeterville Note”). Streeterville paid consideration of (a) $3,500,000 in cash; and (b) issued the Company a promissory note in the amount of $1,500,000 (the “November 2020 Investor Note”), in consideration for the November 2020 Streeterville Note (which November 2020 Investor Note was funded on January 6, 2021), which included an original issue discount (“OID”) of $500,000 and reimbursement of Streeterville’s transaction expenses of $20,000.

 

The November 2020 Streeterville Note bears interest at a rate of 10% per annum and matures 12 months after its issuance date (i.e., on November 23, 2021). From time to time, beginning six months after issuance, Streeterville may redeem a portion of the November 2020 Streeterville Note, not to exceed an amount of $875,000 per month if the Investor Note has not been funded by Streeterville, and $1.25 million in the event the Investor Note has been funded in full (which as discussed above, it has). In the event we don’t pay the amount of any requested redemption within three trading days, an amount equal to 25% of such redemption amount is added to the outstanding balance of the November 2020 Streeterville Note.

 

On July 21, 2021, and effective on July 15, 2021, the Company entered into an Exchange Agreement with Streeterville (the “Streeterville Exchange Agreement”), pursuant to which Streeterville exchanged $400,000 under the November 2020 Streeterville Note (which amount was partitioned into a separate promissory note) for 200,000 shares of the Company’s common stock (the “Exchange Shares”).

 

The description of the Exchange Amendment above is qualified in its entirety by the full text of the Exchange Amendment, a copy of which is filed herewith as Exhibit 10.1, and is incorporated herein by reference. The November 2020 Streeterville Note is described in greater detail in the November 27, 2020, Current Report on Form 8-K.

 

IFEB Bank Exchange Agreement and Related Transactions

 

As previously disclosed in the Current Report on Form 8-K filed by the Company with the Commission on April 7, 2021, on April 1, 2021, we entered into a Bill of Sale for Common Stock, effective March 22, 2021 (the “Bill of Sale”), with certain third parties (the “Initial Sellers”) pursuant to which the Company agreed to purchase 2,191,489 shares (the “Initial IFEB Shares”) of authorized and outstanding Class A Common Stock (the “Class A Stock”) of International Financial Enterprise Bank, Inc., a Puerto Rico corporation licensed as an Act 273-2012 international financial entity headquartered in San Juan Puerto Rico (“IFEB”), which Initial IFEB Shares total approximately 57.06% of the outstanding Class A Stock of IFEB. The purchase price of the Initial IFEB Shares was $6,400,000, which amount was paid to the Initial Sellers on April 1, 2021.

 

IFEB was incorporated in 2017 as a corporation under the laws of the Commonwealth of Puerto Rico and received its international financial entity license on June 18, 2017 from the Office of the Commissioner of Financial Institutions of Puerto Rico, in Spanish, “Oficina del Comisionado de Instituciones Financieras” or (“OCIF”), as amended, as license #51. As a result, IFEB is regulated by OCIF.

 

 

 

Notwithstanding the terms of the Bill of the Sale, and the payment by the Company of the aggregate purchase price pursuant thereto, the transfer of the Initial IFEB Shares to the Company and the Company’s acquisition of control of IFEB was subject to review of the Company’s financial viability, as well as other matters, by OCIF, which approval of OCIF was received in June 2021, but which acquisition did not close until July 21, 2021, as discussed below in Item 2.01 hereof.

 

Separately, on July 21, 2021, the Company entered into, and closed the transactions contemplated by, a Share Exchange Agreement with various other holders of shares of Class A Common Stock of IFEB (the “Additional Sellers” and the “IFEB Exchange Agreement”). Pursuant to the IFEB Exchange Agreement, the Additional Sellers exchanged an aggregate of 1,649,614 of the outstanding Class A Stock of IFEB, representing 42.94% of such outstanding Class A Stock of IFEB in consideration for an aggregate of 1,926,750 shares of the Company’s restricted common stock (the “IFEB Common Shares”), with each one share of Class A Stock of IFEB being exchanged for 1.168 shares of restricted common stock of the Company, based on an agreed upon value of $2.50 per share for each share of Company common stock and $2.92 per share for each share of Class A Stock of IFEB.

 

The IFEB Exchange Agreement contained customary representations and warranties of the Additional Sellers and the Company.

 

The IFEB Exchange Agreement also requires that:

 

(a) three legacy board members of IFEB remain on the Board of Directors of IFEB for a period of one year after the closing date of the IFEB Exchange Agreement, subject to rights of removal if such continued appointment/service as board members would violate the fiduciary duties of any other board members;

 

(b) certain outstanding loans held by one of the legacy board members be extended, and be subject to a further extension;

 

(c) that Ms. Nithinan Boonyawattanapisut, Mr. J. Todd Bonner, Mr. Donald P. Monaco and Mr. William Kerby (each members of the Board of Directors of the Company) and Mr. Jan Reinhart, the founder of Reinhart Interactive TV AG, a company organized in Switzerland, of which the Company owns a 51% interest, will be appointed as members of the Board of Directors of IFEB;

 

(d) that Ronald Poe will be appointed as Vice President of Longroot, Inc., the Company’s wholly-owned subsidiary, and be provided a salary of $120,000 per year, pursuant to an employment agreement; and

 

(e) that Robert Fiallo, will be hired by an affiliate of the Company pursuant to an employment agreement, and be paid a base salary of $300,000 per year, plus a bonus of 3% of the profits from projects he works with or assists in developing.

 

The transactions contemplated by the IFEB Exchange Agreement closed on July 21, 2021.

 

As previously reported in the Current Report on Form 8-K which the Company filed with the Commission on May 11, 2021, on May 6, 2021, in anticipation of the acquisition of the Initial IFEB Shares, and control of IFEB, the Company and IFEB entered into a Preferred Stock Exchange Agreement, which was amended by a First Amendment to Preferred Stock Exchange Agreement entered into May 10, 2021 and effective May 6, 2021 (as amended by the first amendment, the “Preferred Exchange Agreement”), pursuant to which the Company agreed to exchange 1,950,000 shares of the Company’s restricted common stock (the “Monaker Shares”) for 5,850 shares of cumulative, non-compounding, non-voting, non-convertible, perpetual Series A preferred shares of IFEB (the “IFEB Preferred Shares”). The closing of the transactions contemplated by such Preferred Exchange Agreement remain subject to various closing conditions, including, but not limited to the filing of a formal designation of the Series A preferred stock by IFEB with the Secretary of State of Puerto Rico. As such, the transactions contemplated by the Preferred Exchange Agreement may not close on a timely basis, if at all. The Preferred Exchange Agreement can be terminated by either party with written notice to the other at any time, provided that such agreement has not yet been terminated by the parties. It is currently anticipated that the Company and IFEB will move forward with the transactions contemplated by the IFEB Exchange Agreement, subject to approval from OCIF.

 

 

 

Item 2.01. Completion of Acquisition or Disposition of Assets.

 

        As described in greater detail above in Item 1.01, which information is incorporated by reference into this Item 2.01, on April 7, 2021, we entered into the Bill of Sale with the Initial IFEB Sellers and on July 21, 2021, we entered into and closed the IFEB Exchange Agreement with the Additional Sellers, each of which closed on July 21, 2021, at which time, as a result of the closing of both transactions, we acquired control of 100% of IFEB.

 

Item 2.03. Creation of Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. 

  

To the extent required by Item 2.03, the disclosures in Item 1.01 hereof relating to the modification of the November 2020 Streeterville Note are incorporated by reference in this Item 2.03 by reference. 

 

Item 3.02 Unregistered Sales of Equity Securities.

 

On July 15, 2021, the Company entered into a letter agreement with The Benchmark Company, LLC (“Benchmark”) whereby Benchmark agreed to serve as the Company’s exclusive financial advisor to provide capital markets advisory services and guidance for a term of 12 months, unless earlier terminated due to breach or cause. Pursuant to the terms of the letter agreement, the Company agreed to pay Benchmark an advisory fee of 75,000 shares of restricted common stock in consideration for the services agreed to be rendered by Benchmark (the “Benchmark Shares”).

 

We claim an exemption from registration pursuant to Section 4(a)(2) and/or Rule 506 of Regulation D of the Securities Act of 1933, as amended (the “Securities Act”) for the offer, sale and issuance of the IFEB Common Shares and the Benchmark Shares, and plan to claim a similar exemption for the issuance of the 6,100,000 shares of Series D Preferred Stock. The transactions did not/will not involve a public offering, the recipients were/will be “accredited investors”, and 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 are/will be 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.

 

If converted in full pursuant to their terms, the maximum number of shares of common stock issuable upon conversion of the Series D Preferred Stock, once issued, will be 2,684,000 shares of common stock of the Company.

 

The disclosure of the Streeterville Exchange Agreement and the issuance of the Exchange Shares discussed in Item 1.01 above is incorporated by reference into this Item 3.02. We claim an exemption from registration provided by Section 3(a)(9) of the Securities Act for such exchange and such issuance of 200,000 shares to Streeterville, as the partitioned note was exchanged by us with our existing security holder in a transaction where no commission or other remuneration was paid or given directly or indirectly for soliciting such exchange.

 

Item 3.03. Material Modification to Rights of Security Holders.

 

The information contained in Item 5.03 of this Current Report on Form 8-K is incorporated in this Item 3.03 by reference.

 

 

 

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year. 

 

As described in greater detail in the Current Report on Form 8-K filed by the Company with the Commission on July 7, 2021, on June 30, 2021, the Company entered into a Securities Purchase Agreement (the “Go Game SPA”) with David Ng, an individual (the “Go Game Seller”). Pursuant to the Go Game SPA, the Company agreed to acquire a 37% interest in the capital stock of Go Game Pte Ltd, a Singapore private limited company (“Go Game”), a mobile game publisher and technology company, representing an aggregate of 686,868 shares of Go Game’s Class B Preferred shares (the “Initial Go Game Shares”). The Go Game SPA also included an option whereby the Company can acquire additional shares of Go Game.

 

The aggregate consideration to be paid for the Initial Go Game Shares is:

 

  (1) 6,100,000 shares of a designated series of preferred stock (Series D Convertible Preferred Stock)(representing $6.1 million of value, based on an aggregate liquidation preference of $6.1 million); and

 

  (2) $5 million in cash, with $1.25 million paid on June 30, 2021; $1.25 million payable on or before July 31, 2021; and $2.5 million payable on or before September 30, 2021.

 

On July 21, 2021, the Company designated the Series D Convertible Preferred Stock (“Series D Preferred Stock”) required pursuant to the terms of the Go Game SPA, by filing a Certificate of Designation of such Series D Preferred Stock with the Secretary of State of Nevada (the “Series D Designation”). The Series D Designation is described in greater detail below.

 

Series D Convertible Preferred Stock

 

The Series D Designation, which was approved by the Board of Directors of the Company on July 15, 2021, designated 6,100,000 shares of Series D Preferred Stock, $0.00001 par value per share. The Series D Preferred Stock has the following rights:

 

Dividend Rights. The Series D Preferred Stock does not accrue dividends.

 

Liquidation Preference. The Series D Designation provides that the Series D Preferred Stock has a liquidation preference which is (a) pari passu with respect to the Company’s common stock; and (b) junior to all current and future senior indebtedness and securities of the Company. If the Company determines to liquidate, dissolve or wind-up its business and affairs, the Company will prior to or concurrently with the closing, effectuation or occurrence of any such action, pay the holders of the Series D Preferred Stock, pari passu with the holders of the common stock, an amount equal to the Liquidation Preference per share of Series D Preferred Stock. The “Liquidation Preference” per share of the Series D Preferred Stock is equal to $1.00 per share, or $6,100,000 in aggregate.

 

Conversion Rights. Each share of Series D Preferred Stock is automatically convertible on the fifth business day after the date that the shareholders of the Company, as required pursuant to applicable rules and regulations of NASDAQ, has approved the issuance of the shares of common stock upon conversion of the Series D Preferred Stock, and such other matters as may be required by NASDAQ or SEC rules and requirements to allow the conversion of the Series D Preferred Stock, into that number of shares of common stock as equal the Conversion Rate multiplied by the then outstanding shares of Series D Preferred Stock. For the purposes of the following sentence: “Conversion Rate” equals 0.44 shares of Company common stock for each share of Series D Preferred Stock converted, which equals (i) the Liquidation Preference ($1.00 per share of Series D Preferred Stock), divided by (ii) $2.28, the average of the closing sales prices for the Company’s common stock on the Nasdaq Capital Market for the 30 days prior to July 15, 2021, rounded to the nearest hundredths place, subject to equitable adjustment for stock splits and combinations.

 

 

Voting Rights. The Series D Preferred Stock have no voting rights on general matters to come before the shareholders of the Company; however, the Company is prohibited from undertaking any of the following actions without the approval of a majority in interest of such shares:

(a)       Increasing or decreasing (other than by redemption or conversion) the total number of authorized shares of Series D Preferred Stock;

(b)       Re-issuing any shares of Series D Preferred Stock converted pursuant to the terms of the Series D Designation;

(c)       Effecting an exchange, reclassification, or cancellation of all or a part of the Series D Preferred Stock;

(d)       Effecting an exchange, or creating a right of exchange, of all or part of the shares of another class of shares into shares of Series D Preferred Stock;

(e)       Issuing any shares of Series D Preferred Stock other than pursuant to the Go Game SPA;

(f)       Altering or changing the rights, preferences or privileges of the shares of Series D Preferred Stock so as to affect adversely the shares of such series; or

(g)       Amending or waiving any provision of the Company’s Articles of Incorporation or Bylaws relative to the Series D Preferred Stock so as to affect adversely the shares of Series D Preferred Stock in any material respect as compared to holders of other series of shares.

 

Redemption Rights. The Series D Preferred Stock does not have any redemption rights.

 

* * * * *

 

The foregoing description of the Series D Designation does not purport to be complete and is qualified in its entirety by reference to the Series D Designation, a copy of which is incorporated by reference as Exhibit 3.1 to this Current Report on Form 8-K and incorporated herein by reference.

 

The 6,100,000 shares of Series D Preferred Stock have not been issued to the Go Game Seller as of the date of this filing.

 

Item 8.01. Other Events.

 

On July 27, 2021, the Company issued a press release announcing the acquisition of IFEB. A copy of the press release is attached hereto as Exhibit 99.1, and is incorporated herein by reference.

 

Forward- Looking Statements

 

This Current Report on Form 8-K and Exhibit 99.1 hereto contains forward-looking statements that are made pursuant to the safe harbor provisions within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended and the Private Securities Litigation Reform Act, as amended. Forward-looking statements are based on management’s current expectations and are subject to risks and uncertainties, many of which are beyond our control, that may cause actual results or events to differ materially from those projected. These risks and uncertainties, many of which are beyond our control, include risks described in the section entitled “Risk Factors” and elsewhere in our Annual Report on Form 10-K filed with the SEC on May 29, 2020 and our Quarterly Report on Form 10-Q filed with the SEC on July 14, 2021 and in our other filings with the SEC, including, without limitation, our reports on Forms 8-K, all of which can be obtained on the SEC website at www.sec.gov. Readers are cautioned not to place undue reliance on the forward-looking statements, which speak only as of the date on which they are made and reflect management’s current estimates, projections, expectations and beliefs. We expressly disclaim any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in our expectations or any changes in events, conditions or circumstances on which any such statement is based, except as required by law.

 

 

 

Item 9.01. Financial Statements and Exhibits.

 

(a)        Financial Statements of Businesses Acquired

The financial statements of IFEB, to the extent required to be disclosed pursuant to this Item 9.01, will be filed no later than 71 calendar days after the date that this Current Report on Form 8-K is required to be filed.

(b)        Pro Forma Financial Information

Pro forma financial information relative to acquisition of IFEB, to the extent required to be disclosed pursuant to this Item 9.01, will be filed no later than 71 calendar days after the date that this Current Report on Form 8-K is required to be filed.

  (d) Exhibits

 

  Exhibit
Number 		  Description  
  3.1*   Certificate of Designation of NextPlay Technologies, Inc. Establishing the Designation, Preferences, Limitations and Relative Rights of Its Series D Convertible Preferred Stock as filed with the Secretary of State of Nevada on July 21, 2021
  10.1*   Exchange Agreement between Streeterville Capital, LLC and NextPlay Technologies, Inc. dated July 15, 2021, and effective July 21, 2021
  10.2*#   Share Exchange Agreement effective July 21, 2021, by and between NextPlay Technologies, Inc., formerly Monaker Group, Inc., and each of the sellers party thereto
  99.1*    Press Release dated July 27, 2021
       

 * Filed herewith.

#  Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) of Regulation S-K. A copy of any omitted schedule or exhibit will be furnished supplementally to the Securities and Exchange Commission upon request; provided, however that NextPlay Technologies, Inc. may request confidential treatment pursuant to Rule 24b-2 of the Securities Exchange Act of 1934, as amended, for any schedule or exhibit so furnished.

 

 

 

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. 

  NEXTPLAY TECHNOLOGIES, INC.
   
   
Date: July 27, 2021 By: /s/ William Kerby
    Name:   William Kerby
    Title:  Co-Chief Executive Officer

 

 

 

 

 

NextPlay Technologies, Inc. 8-K

 

Exhibit 3.1

 

 

 

 

 

 

CERTIFICATE OF DESIGNATION

OF

NEXTPLAY TECHNOLOGIES, INC.

ESTABLISHING THE DESIGNATION, PREFERENCES,

LIMITATIONS AND RELATIVE RIGHTS OF ITS

SERIES D CONVERTIBLE PREFERRED STOCK

 

Pursuant to Section 78.1955 of the Nevada Revised Statutes (the “NRS”), NextPlay Technologies, Inc., a company organized and existing under the State of Nevada (the “Corporation”),

 

DOES HEREBY CERTIFY, that pursuant to the authority conferred upon the Board of Directors by the Articles of Incorporation of the Corporation, as amended, and pursuant to Section 78.1955 of the NRS, the Board of Directors, by unanimous written consent of all members of the Board of Directors on July 15, 2021, duly adopted a resolution providing for the issuance of a series of 6,100,000 shares of Series D Convertible Preferred Stock, which resolution is and reads as follows:

 

RESOLVED, that pursuant to the authority expressly granted to and invested in the Board of Directors by the provisions of the Articles of Incorporation of the Corporation, as amended and Section 78.1955 of the NRS, a series of the preferred stock, par value $0.00001 per share, of the Corporation be, and it hereby is, established; and

 

FURTHER RESOLVED, that the series of preferred stock of the Corporation be, and it hereby is, given the distinctive designation of “Series D Preferred Stock”; and

 

FURTHER RESOLVED, that the Series D Preferred Stock shall consist of 6,100,000 shares; and

 

FURTHER RESOLVED, that the Series D Preferred Stock shall have the powers and preferences, and the relative, participating, optional and other rights, and the qualifications, limitations, and restrictions thereon set forth in this Certificate of Designation (the “Designation” or the “Certificate of Designation”):

 

1.            Definitions. In addition to other terms defined throughout this Designation, the following terms have the following meanings when used herein:

 

1.1          “30-day Average” means the average of the closing prices for the Corporation’s Common Stock on The NASDAQ Capital Market, as reported by NASDAQ.com, for the thirty (30) days prior to the Closing Date.

 

1.2          “Applicable Law” means any applicable statute, law, regulation, ordinance, rule, judgment, rule of law, decree, permit, requirement, or other governmental restriction or any similar form of decision of, or any provision or condition issued under any of the foregoing by, or any determination by any governmental authority having or asserting jurisdiction over the matter or matters in question, whether now or hereafter in effect and in each case as amended (including, without limitation, all of the terms and provisions of the common law of such governmental authority), as interpreted and enforced at the time in question, including, but not limited to the NRS.

 

 

 

 

1.3          “Approval Date” means the fifth (5th) Business Day after the date that all of the requirements of Shareholder Approval are met.

 

1.4          “Business Day” means any day except Saturday, Sunday or any day on which banks are authorized by law to be closed in the city of Sunrise, Florida.

 

1.5          “Closing Date” means July 15, 2021.

 

1.6          “Common Stock” means the common stock, $0.00001 par value per share of the Corporation.

 

1.7          “Conversion Rate” shall equal (a) the Liquidation Preference, divided by the greater of (b) (1) the 30-day Average; and (2) $2.00, rounded to the nearest hundredths place.

 

1.8          “Corporation” has the meaning given to such term in the introductory paragraph hereof.

 

1.9          “Distribution” means the transfer of cash or other property without consideration whether by way of dividend or otherwise (other than dividends on Common Stock payable in Common Stock), or the purchase or redemption of shares of the Corporation for cash or property other than: (i) repurchases of Common Stock (or securities convertible into Common Stock) issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries upon termination of their employment or services pursuant to agreements providing for the right or obligation of said repurchase, (ii) repurchases of Common Stock (or securities convertible into Common Stock) issued to or held by employees, officers, directors or consultants of the Corporation or its subsidiaries pursuant to rights of first refusal contained in agreements providing for such right, (iii) other repurchases and redemptions allowed pursuant to the terms of this Designation, or (iv) any other repurchases or redemptions of capital stock of the Corporation approved by a Majority In Interest.

 

1.10        “Exchange Act” means the Securities Exchange Act of 1934, as amended (and any successor thereto) and the rules and regulations promulgated thereunder.

 

1.11        “Holder” means the person or entity in which the Series D Preferred Stock is registered on the books of the Corporation, which shall initially be the person or entity which such Series D Preferred Stock is issued to, and shall thereafter be permitted and legal assigns which the Corporation is notified of by the Holder and which the Holder has provided a valid legal opinion in connection therewith to the Corporation and to whom such Preferred Stock Shares are legally transferred.

 

NextPlay Technologies, Inc.: Certificate of Designation of Series D Convertible Preferred Stock Page 2

 

 

 

1.12        “Junior Securities” means each class of capital stock or series of preferred stock of the Corporation other than the Common Stock and Series D Preferred Stock in existence on or established after the Original Issue Date, which is junior to the Series D Preferred Stock in connection with distributions upon liquidation.

 

1.13        “Liquidation Preference” means $1.00 per share.

 

1.14        “Majority In Interest” means Holders holding a majority of the then aggregate shares of Series D Preferred Stock issued and outstanding.

 

1.15        “NASDAQ” means The NASDAQ Capital Market.

 

1.16        “Original Issue Date” means the Closing Date.

 

1.17        “Original Issue Price” means the Liquidation Preference.

 

1.18        “Outstanding Series D Preferred Stock Shares” means the total number of shares of Series D Preferred Stock issued on the Original Issue Date.

 

1.19        “Person” means an individual, corporation, partnership, limited liability company, association, trust, unincorporated organization or other entity or group.

 

1.20        “Preferred Stock Certificates” means the stock certificate(s) issued by the Corporation representing the applicable Series D Preferred Stock shares.

 

1.21        “Recapitalization” means any stock dividend, stock split, combination of shares, reorganization, recapitalization, reclassification or other similar event described in Sections 5.1 through 5.3.

 

1.22        “Restricted Shares” means shares of the Corporation’s Common Stock which are restricted from being transferred by the Holder thereof unless the transfer is effected in compliance with the Securities Act and applicable state securities laws (including investment suitability standards, which shares shall bear the following restrictive legend (or one substantially similar)): “The securities represented by this certificate have not been registered under the Securities Act of 1933 or any state securities act. The securities have been acquired for investment and may not be sold, transferred, pledged or hypothecated unless (i) they shall have been registered under the Securities Act of 1933 and any applicable state securities act, or (ii) the corporation shall have been furnished with an opinion of counsel, satisfactory to counsel for the corporation, that registration is not required under any such acts.”

 

1.23        “SEC” means the Securities and Exchange Commission.

 

1.24        “Securities Act” means the Securities Act of 1933, as amended (and any successor thereto) and the rules and regulations promulgated thereunder.

 

NextPlay Technologies, Inc.: Certificate of Designation of Series D Convertible Preferred Stock Page 3

 

 

 

1.25        “Securities Purchase Agreement” means that certain Securities Purchase Agreement dated June 30, 2021, by and between the Corporation and David Ng, as amended, modified and restated from time to time.

 

1.26        “Senior Securities” means the Corporation’s capital leases as may be in place from time to time; the Corporation’s outstanding Series B Convertible Preferred Stock and Series C Convertible Preferred Stock, and any other senior debt, equity or other security holders of the Corporation, including certain banks and/or institutions, which hold security interests over the Corporation’s assets as of the Closing Date, or which the Corporation may agree in the future to provide priority security interests to, priority right in liquidation, or priority voting rights to, which shall not require notice to, or the approval and/or consent of the Holders.

 

1.27        “Shareholder Approval” means (i) the approval by the shareholders of the Corporation, as required pursuant to applicable rules and regulations of NASDAQ, of the issuance of shares of Common Stock issuable upon conversion of the Series D Preferred Stock; and (ii) such other matters as may be required to be approved by the shareholders pursuant to the rules and regulations of NASDAQ or the SEC in order to allow for the conversion of the Series D Preferred Stock into Common Stock pursuant to the terms hereof.

 

1.28          “Transfer Agent” means initially, the Corporation, which will be serving as its own transfer agent for the Series D Preferred Stock, but at the option of the Corporation from time to time, may also mean any successor transfer agent which the Corporation may use for its Series D Preferred Stock, including, but not limited to Colonial Stock Transfer Co, Inc.

 

2. Dividends.

 

2.1          Dividends in General. The Series D Preferred Stock shall not accrue any dividends.

 

2.2          Other Distributions. Subject to the terms of this Certificate of Designation, and to the fullest extent permitted by the NRS, the Corporation shall be expressly permitted to redeem, repurchase or make distributions on the shares of its capital stock in all circumstances other than where doing so would cause the Corporation to be unable to pay its debts as they become due in the usual course of business.

 

3. Liquidation Rights.

 

3.1          Liquidation Preference. In the event of any liquidation, dissolution or winding up of the Corporation, either voluntary or involuntary (each a “Liquidation Event”), the holders of Series D Preferred Stock shall be entitled to receive prior to the holders of the Corporation’s Junior Securities, and pro rata with the holders of the Corporation’s Common Stock, but not prior to any holders of the Corporation’s Senior Securities, which holders of the Senior Securities shall have priority to the Distribution of any assets of the Corporation, an amount per share for each share of Series D Preferred Stock held by them equal to the Liquidation Preference. If upon the liquidation, dissolution or winding up of the Corporation, the assets of the Corporation legally available for distribution to the holders of the Series D Preferred Stock, Senior Securities and Common Stock (i.e., after payment of the Corporation’s liabilities and payment to any holders of the Corporation’s Senior Securities) are insufficient to permit the payment to such holders of the full amounts specified in this Section then the entire assets of the Corporation legally available for distribution shall be distributed pro rata among the holders of the Series D Preferred Stock and Common Stock in proportion to the full amounts they would otherwise be entitled to receive pursuant to this Section and Applicable Law.

 

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3.2          Remaining Assets. After the payment to the holders of the Series D Preferred Stock, Senior Securities and Common Stock of the full preferential amounts specified above, the entire remaining assets of the Corporation legally available for distribution by the Corporation shall be distributed with equal priority and pro rata among the holders of the Junior Securities in proportion to the number of shares of Junior Securities held by them.

 

3.3          Valuation of Non-Cash Consideration. If any assets of the Corporation distributed to stockholders in connection with any liquidation, dissolution, or winding up of the Corporation are other than cash, then the value of such assets shall be their fair market value as determined in good faith by the Board of Directors. In the event of a merger or other acquisition of the Corporation by another entity, the Distribution date shall be deemed to be the date such transaction closes.

 

4. Conversion.

 

4.1          Conversion. On the Approval Date, each share of Series D Preferred Stock, shall automatically and without any required action by any Holder, be converted into that number of fully-paid, non-assessable shares of Common Stock as determined by multiplying the Series D Preferred Stock shares held by such Holder, by the Conversion Rate (a “Conversion”), with such shares of Common Stock issuable upon conversion of such Series D Preferred Stock on the Approval Date rounded up to the nearest whole share of Common Stock on a per Holder basis (such shares of Common Stock issuable upon a Conversion, the “Shares”).

 

(a)             Following the Conversion, the Corporation shall promptly issue to each Holder all Shares of Common Stock which such Holder is due in connection with the Conversion (and promptly deliver such Shares to the address of Holder which the Corporation then has on record (a “Delivery”)). The Shares issuable in connection with a Conversion shall be fully-paid, non-assessable shares of Common Stock. Unless the Shares are covered by a valid and effective registration under the Securities Act or the Holder provides a valid opinion from an attorney stating that such Shares can be issued free of restrictive legend, which shall be determined by the Corporation in its sole discretion, prior to the issuance date of such Shares, such Shares shall be issued as Restricted Shares.

 

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(b)            The issuance and Delivery by the Corporation of the Shares shall fully discharge the Corporation from any and all further obligations under or in connection with the Series D Preferred Stock and shall automatically, and without any required action by the Corporation or the Holder, result in the cancellation, termination and invalidation of any outstanding Series D Preferred Stock and Preferred Stock Certificates held by a Holder or his, her or its assigns.

 

(c)            Without limiting the obligation of each Holder set forth herein (including in the subsequent clause (d)), the Corporation and/or the Corporation’s Transfer Agent shall be authorized to take whatever action necessary, if any, following the issuance and Delivery of the Shares to reflect the cancellation of the Series D Preferred Stock subject to the Conversion, which shall not require the approval and/or consent of any Holder (a “Cancellation”).

 

(d)            Notwithstanding the above, each Holder, by accepting such Preferred Stock Certificates (or such Series D Preferred Stock shares in book-entry form) hereby covenants that it will, whenever and as reasonably requested by the Corporation and the Transfer Agent, at the Corporation’s sole cost and expense, do, execute, acknowledge and deliver any and all such other and further acts, deeds, assignments, transfers, conveyances, confirmations, powers of attorney and any instruments of further assurance, approvals and consents as the Corporation or the Transfer Agent may reasonably require in order to complete, insure and perfect the Cancellation, if such may be reasonably required by the Corporation and/or the Corporation’s Transfer Agent, including, but not limited to the delivery to the Corporation of all Preferred Stock Certificates and stock powers with medallion signature guaranty in connection with the Cancellation.

 

(e)        In the event that the Delivery of any Shares is unsuccessful and/or any Holder fails to accept such Shares, such Shares shall be held by the Corporation and/or the Transfer Agent in trust (without accruing interest) and shall be released to such Holder upon reasonable evidence to the Corporation or the Transfer Agent that such Holder is the legal owner of such Shares, provided that the Holder’s failure to accept such Shares and/or the Corporation’s inability to Deliver such shares shall in no event effect the validity of the Cancellation.

 

4.2         Fractional Shares. If any Conversion of Series D Preferred Stock would result in the issuance of a fractional share of Common Stock (aggregating all shares of Series D Preferred Stock being converted pursuant to the Conversion), such fractional share shall be rounded up to the nearest whole share of Common Stock.

 

4.3         Taxes. The Corporation shall not be required to pay any tax which may be payable in respect to any transfer involved in the issue and delivery of shares of Common Stock upon Conversion in a name other than that in which the shares of the Series D Preferred Stock so converted were registered, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Corporation the amount of any such tax, or has established, to the satisfaction of the Corporation, that such tax has been paid. The Corporation shall withhold from any payment due whatsoever in connection with the Series D Preferred Stock any and all required withholdings and/or taxes the Corporation, in its sole discretion deems reasonable or necessary, absent an opinion from Holder’s accountant or legal counsel, acceptable to the Corporation in its sole determination, that such withholdings and/or taxes are not required to be withheld by the Corporation.

 

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4.4          No Charge or Payment. The issuance of certificates for shares of Common Stock upon Conversion of the Series D Preferred Stock pursuant to Section 4 shall be made without payment of additional consideration by, or other charge, cost or tax to, the Holder in respect thereof.

 

4.5          No Impairment. The Corporation will not through any reorganization, transfer of assets, merger, dissolution, issue or sale of any securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Corporation but will at all times in good faith assist in the carrying out of all the provisions of this Section 4 and in the taking of all such action as may be necessary or appropriate in order to protect the Conversion rights of the Holders of Series D Preferred Stock against impairment. Subject to the above noted limitation, nothing in this Section 4.5 shall prohibit the Corporation from amending its Articles of Incorporation, as amended, subject to any restrictions set forth herein, with the requisite consent of its shareholders and the Board of Directors.

 

4.6          Cap on Shares of Common Stock. Notwithstanding anything herein to the contrary, the maximum number of shares of Common Stock to be issued in connection with the Conversion of all of the outstanding shares of Series D Preferred Stock shares (and upon conversion or exercise of any other securities required to be aggregated with the Series D Preferred Stock shares pursuant to the applicable rules and requirements of NASDAQ), or otherwise as provided herein, shall not exceed such number of shares of Common Stock that would violate applicable listing rules of NASDAQ in the event the Corporation’s shareholders do not approve the issuance of the Common Stock issuable in connection with a Conversion, or otherwise as provided herein (the “Share Cap”). In the event the number of shares of Common Stock to be issued hereunder (and upon conversion or exercise of any other securities required to be aggregated with the Series D Preferred Stock pursuant to the applicable rules and requirements of NASDAQ) in connection with a Conversion or otherwise, exceeds the Share Cap, then such shares of Series D Preferred Stock which if converted would result in the Corporation exceeding the Share Cap shall remain outstanding and not be subject to a Conversion, provided that the remaining shares shall be subject to Conversion as provided for herein.

 

5. Adjustments For Recapitalizations.

 

5.1         Equitable Adjustments For Recapitalizations. The (a) Liquidation Preference (the “Preferred Stock Adjustable Provisions”); (b) the Conversion Rate (the “Common Stock Adjustable Provisions”), and (c) any and all other terms, conditions, amounts and provisions of this Designation which (i) pursuant to the terms of this Designation provide for equitable adjustment in the event of a Recapitalization; or (ii) the Board of Directors of the Corporation determine in their reasonable good faith judgment is required to be equitably adjusted in connection with any Recapitalizations (collectively Sections (c)(i) and (ii), the “Other Equitable Adjustable Provisions”), shall each be subject to equitable adjustment as provided in Sections 5.2 through 5.4, below, as determined by the Board of Directors in their sole and reasonable discretion.

 

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5.2          Adjustments for Subdivisions or Combinations of Common Stock. In the event the outstanding shares of Common Stock shall be subdivided (by stock split, by payment of a stock dividend or otherwise), into a greater number of shares of Common Stock, without a corresponding subdivision of the Series D Preferred Stock, the applicable Common Stock Adjustable Provisions and the Other Equitable Adjustable Provisions (if any) in effect immediately prior to such subdivision shall, concurrently with the effectiveness of such subdivision, be proportionately and equitably adjusted. In the event the outstanding shares of Common Stock shall be combined (by reclassification or otherwise) into a lesser number of shares of Common Stock, without a corresponding combination of the Series D Preferred Stock, the Common Stock Adjustable Provisions and the Other Equitable Adjustable Provisions (if any) in effect immediately prior to such combination shall, concurrently with the effectiveness of such combination, be proportionately and equitably adjusted.

 

5.3          Adjustments for Subdivisions or Combinations of Series D Preferred Stock. In the event the outstanding shares of Series D Preferred Stock shall be subdivided (by stock split, by payment of a stock dividend or otherwise), into a greater number of shares of Series D Preferred Stock, the applicable Preferred Stock Adjustable Provisions and the Other Equitable Adjustable Provisions (if any) in effect immediately prior to such subdivision shall, concurrently with the effectiveness of such subdivision, be proportionately and equitably adjusted. In the event the outstanding shares of Series D Preferred Stock shall be combined (by reclassification or otherwise) into a lesser number of shares of Series D Preferred Stock, the applicable Preferred Stock Adjustable Provisions and the Other Equitable Adjustable Provisions (if any) in effect immediately prior to such combination shall, concurrently with the effectiveness of such combination, be proportionately and equitably adjusted; provided, however, that the result of any concurrent adjustment in the Common Stock (as provided under Section 5.2) and the Series D Preferred Stock (as provided under Section 5.3) shall only be to affect the equitable adjustable provisions hereof once.

 

5.4         Adjustments for Reclassification, Exchange and Substitution. Subject to Section 3 above, if the Common Stock issuable upon Conversion of the Series D Preferred Stock shall be changed into the same or a different number of shares of any other class or classes of stock, whether by capital reorganization, reclassification or otherwise (other than a subdivision or combination of shares provided for above), then, in any such event, in lieu of the number of shares of Common Stock which the holders would otherwise have been entitled to receive, each holder of such Series D Preferred Stock shall have the right thereafter to convert such shares of Series D Preferred Stock into a number of shares of such other class or classes of stock which a holder of the number of shares of Common Stock deliverable upon Conversion of such Series D Preferred Stock immediately before that change would have been entitled to receive in such reorganization or reclassification, all subject to further adjustment as provided herein with respect to such other shares.

 

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5.5         Other Adjustments. Subject to the prior written consent of a Majority In Interest, the Board of Directors of the Corporation may adjust equitably, and shall have the right to adjust equitably, any or all of the Preferred Stock Adjustable Provisions, Common Stock Adjustable Provisions or Other Equitable Adjustable Provisions from time to time, if the Board of Directors of the Corporation determine in their reasonable good faith judgment that such values and/or provisions are required to be equitably adjusted in connection with any Corporation action.

 

5.6         Certificate as to Adjustments. Upon the occurrence of each adjustment or readjustment pursuant to this Section 5, the Corporation at its expense shall promptly compute such adjustment or readjustment in accordance with the terms hereof and furnish to each holder of Series D Preferred Stock a certificate setting forth such adjustment or readjustment and showing in detail the facts upon which such adjustment or readjustment is based. The Corporation shall, upon the written request at any time of any holder of Series D Preferred Stock, furnish or cause to be furnished to such holder a like certificate setting forth (i) such adjustments and readjustments, (ii) the Conversion Rate at the time in effect and (iii) the number of shares of Common Stock and the amount, if any, of other property which at the time would be received upon the conversion of the Series D Preferred Stock.

 

6. Voting.

 

6.1         Class Voting. Except as otherwise expressly provided in Section 7, subsection (iv) of the definition of Distribution, or as required by law, the Series D Preferred Stock shall not have any voting rights.

 

6.2         No Series Voting. Other than as provided herein or required by law, there shall be no series voting.

 

7. Protective Provisions.

 

7.1         General Protective Provisions. Subject to the rights of series of Preferred Stock which may from time to time come into existence (subject to the terms, conditions and approval requirements of the Holders (where applicable), set forth in this Designation), so long as any shares of Series D Preferred Stock are outstanding, the Corporation shall not, without first obtaining the approval (at a meeting duly called or by written consent, as provided by law) of the holders of a Majority In Interest:

 

(a)           Increase or decrease (other than by redemption or conversion) the total number of authorized shares of Series D Preferred Stock;

 

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(b)          Re-issue any shares of Series D Preferred Stock converted pursuant to the terms of this Designation;

 

(c)           Effect an exchange, reclassification, or cancellation of all or a part of the Series D Preferred Stock;

 

(d)          Effect an exchange, or create a right of exchange, of all or part of the shares of another class of shares into shares of Series D Preferred Stock;

 

(e)           Issue any shares of Series D Preferred Stock other than pursuant to the Securities Purchase Agreement;

 

(f)           Alter or change the rights, preferences or privileges of the shares of Series D Preferred Stock so as to affect adversely the shares of such series; or

 

(g)          Amend or waive any provision of the Corporation’s Articles of Incorporation or Bylaws relative to the Series D Preferred Stock so as to affect adversely the shares of Series D Preferred Stock in any material respect as compared to holders of other series of shares.

 

8.            Redemption Rights. The Series D Preferred Stock shall not have any redemption rights.

 

9.            Notices. Any notices required or permitted to be given under the terms hereof shall be sent by certified or registered mail (return receipt requested) or delivered personally, by nationally recognized overnight carrier or by confirmed facsimile or email transmission, and shall be effective, unless otherwise provided herein, three days after being placed in the mail, if mailed, or upon receipt or refusal of receipt, if delivered personally or by nationally recognized overnight carrier or confirmed facsimile transmission or email, in each case addressed to a party. The addresses for such communications are (i) if to the Corporation to, William Kerby, Co-Chief Executive Officer, 1560 Sawgrass Corporate Parkway, Suite 130, Sunrise, Florida 33323, Email: William Kerby, bill.kerby@nextplaytechnologies.com, or such other address as the Corporation shall notify the Holders of at least ten (10) Business Days prior to the effective date of such change in record address, and (ii) if to any Holder to the address set forth in the records of the Corporation or its Transfer Agent, as applicable, or such other address as may be designated in writing hereafter, in the same manner, by such person.

 

10.         No Preemptive Rights. No Holder shall have the right to purchase shares of capital stock of the Corporation sold or issued by the Corporation except to the extent that such right may from time to time be set forth in a written agreement between the Corporation and such stockholder.

 

11.         Reports. The Corporation shall mail to all holders of Series D Preferred Stock those reports, proxy statements and other materials that it mails to all of its holders of Common Stock which materials may, at the option of the Corporation, be provided to such Holders via email, which email will be deemed sufficient notice if it provides a link to the applicable Corporation filing on the Securities and Exchange Commission’s Electronic Data Gathering, Analysis, and Retrieval system (EDGAR).

 

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12.         Replacement Preferred Stock Certificates. In the event that any Holder notifies the Corporation that a Preferred Stock Certificate evidencing shares of Series D Preferred Stock has been lost, stolen, destroyed or mutilated, the Corporation shall issue a replacement stock certificate evidencing the Series D Preferred Stock identical in tenor and date (or if such certificate is being issued for shares not covered in a redemption or conversion, in the applicable tenor and date) to the original Preferred Stock Certificate evidencing the Series D Preferred Stock, provided that the Holder executes and delivers to the Corporation and/or its Transfer Agent, as applicable, an affidavit of lost stock certificate and an agreement reasonably satisfactory to the Corporation and its Transfer Agent to indemnify the Corporation from any loss incurred by it in connection with such Series D Preferred Stock certificate, and provides the Corporation and/or its Transfer Agent such other information, documents and if applicable, bonds and indemnities as the Corporation or its Transfer Agent customarily requires for reissuances of stock certificates (collectively the “Lost Certificate Materials”); provided, however, the Corporation shall not be obligated to re-issue replacement stock certificates if the Holder contemporaneously requests the Corporation to convert or redeem the full number of shares evidenced by such lost, stolen, destroyed or mutilated certificate.

 

13.         No Other Rights or Privileges. Except as specifically set forth herein, the Holders of the Series D Preferred Stock shall have no other rights, privileges or preferences with respect to the Series D Preferred Stock.

 

14.         Construction. When used in this Designation, unless a contrary intention appears: (i) a term has the meaning assigned to it; (ii) “or” is not exclusive; (iii) “including” means including without limitation; (iv) words in the singular include the plural and words in the plural include the singular, and words importing the masculine gender include the feminine and neuter genders; (v) any agreement, instrument or statute defined or referred to herein or in any instrument or certificate delivered in connection herewith means such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein; (vi) the words “hereof”, “herein” and “hereunder” and words of similar import when used in this Designation shall refer to this Designation as a whole and not to any particular provision hereof; (vii) references contained herein to Article, Section, Schedule and Exhibit, as applicable, are references to Articles, Sections, Schedules and Exhibits in this Designation unless otherwise specified; (viii) references to “dollars”, “Dollars” or “$” in this Designation means United States dollars; (ix) reference to a particular statute, regulation or law means such statute, regulation or law as amended or otherwise modified from time to time; (x) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein); (xi) unless otherwise stated in this Designation, in the computation of a period of time from a specified date to a later specified date, the word “from” means “from and including” and the words “to” and “until” each mean “to but excluding”; (xii) references to “days” means calendar days; and (xiii) the paragraph and section headings contained in this Designation are for convenience only, and shall in no manner affect the interpretation of any of the provisions of this Designation.

 

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15. Miscellaneous.

 

15.1          Cancellation of Series D Preferred Stock. If any shares of Series D Preferred Stock are redeemed pursuant to the terms of this Designation, the shares so redeemed shall be canceled and shall return to the status of designated, but unissued Series D Preferred Stock, subject to the terms of this Designation.

 

15.2          Further Assurances. Each Holder hereby covenants that, in consideration for receiving shares of Series D Preferred Stock, that he, she or it will, whenever and as reasonably requested by the Corporation, do, execute, acknowledge and deliver any and all such other and further acts, deeds, confirmations, agreements and documents as the Corporation or its Transfer Agent may reasonably require in order to complete, insure and perfect any of the terms, conditions or provisions of this Designation.

 

15.3          Technical, Corrective, Administrative or Similar Changes. The Corporation may, by any means authorized by law and without any vote of the Holders of shares of the Series D Preferred Stock, make technical, corrective, administrative or similar changes in this Designation that do not, individually or in the aggregate, adversely affect the rights or preferences of the Holders of shares of the Series D Preferred Stock.

 

15.4          Waiver/Amendment. Notwithstanding any provision in this Designation to the contrary, any provision contained herein and any right of the holders of Series D Preferred Stock granted hereunder may be waived and/or amended as to all shares of Series D Preferred Stock (and the Holders thereof) upon the written consent of a Majority In Interest, unless a higher percentage is required by Applicable Law, in which case the written consent of the Holders of not less than such higher percentage of shares of Series D Preferred Stock shall be required.

 

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15.5          Interpretation. Whenever possible, each provision of this Designation shall be interpreted in a manner as to be effective and valid under Applicable Law and public policy. If any provision set forth herein is held to be invalid, unlawful or incapable of being enforced by reason of any rule of law or public policy, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating or otherwise adversely affecting the remaining provisions of this Designation. No provision herein set forth shall be deemed dependent upon any other provision unless so expressed herein. If a court of competent jurisdiction should determine that a provision of this Designation would be valid or enforceable if a period of time were extended or shortened, then such court may make such change as shall be necessary to render the provision in question effective and valid under Applicable Law. 

 

 

 

NOW THEREFORE BE IT RESOLVED, that the Designation is hereby approved, affirmed, confirmed, and ratified; and it is further

 

RESOLVED, that each officer of the Corporation be and hereby is authorized, empowered and directed to execute and deliver, in the name of and on behalf of the Corporation, any and all documents, and to perform any and all acts necessary to reflect the Board of Directors approval and ratification of the resolutions set forth above; and it is further

 

RESOLVED, that in addition to and without limiting the foregoing, each officer of the Corporation and the Corporation’s attorney be and hereby is authorized to take, or cause to be taken, such further action, and to execute and deliver, or cause to be delivered, for and in the name and on behalf of the Corporation, all such instruments and documents as he may deem appropriate in order to effect the purpose or intent of the foregoing resolutions (as conclusively evidenced by the taking of such action or the execution and delivery of such instruments, as the case may be) and all action heretofore taken by such officer in connection with the subject of the foregoing recitals and resolutions be, and it hereby is approved, ratified and confirmed in all respects as the act and deed of the Corporation; and it is further

 

RESOLVED, that this Designation may be executed in several counterparts, each of which is an original; that it shall not be necessary in making proof of this Designation or any counterpart hereof to produce or account for any of the other.

 

[Remainder of page left intentionally blank. Signature page follows.]

 

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IN WITNESS WHEREOF, the Corporation has unanimously approved and caused this “Certificate of Designation of NextPlay Technologies, Inc. Establishing the Designation, Preferences, Limitations and Relative Rights of Its Series D Convertible Preferred Stock” to be duly executed and approved this 21st day of July 2021.

  

  NEXTPLAY TECHNOLOGIES, INC.  
     
  /s/ William Kerby   
  William Kerby  
  Co-Chief Executive Officer  

 

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NextPlay Technologies, Inc. 8-K

 

Exhibit 10.1

 

THE EXCHANGE CONTEMPLATED HEREIN IS INTENDED TO COMPORT WITH THE REQUIREMENTS OF SECTION 3(a)(9) OF THE SECURITIES ACT OF 1933, AS AMENDED.

 

EXCHANGE AGREEMENT

 

This Exchange Agreement (this “Agreement”) is entered into as of July 15, 2021 (the “Effective Date”) by and between Streeterville Capital, LLC, a Utah limited liability company (“Lender”), and NextPlay Technologies, Inc., a Nevada corporation (f/k/a Monaker Group, Inc., a Nevada corporation) (“Borrower”). Capitalized terms used in this Agreement without definition shall have the meanings given to them in the Transaction Documents (as defined below).

 

A.          Borrower previously sold and issued to Lender that certain Secured Promissory Note dated November 23, 2020 in the original principal amount of $5,520,000.00 (the “Original Note”) pursuant to that certain Note Purchase Agreement dated November 23, 2020 by and between Lender and Borrower (the “Purchase Agreement,” and together with the Original Note and all other documents entered into in conjunction therewith, the “Transaction Documents”).

 

B.          Subject to the terms of this Agreement, Borrower and Lender desire to partition a new Secured Promissory Note in the original principal amount of $400,000.00 (the “Partitioned Amount”) from the Original Note and then cause the outstanding balance of the Original Note to be reduced by an amount equal to the Partitioned Amount.

 

C.           Borrower and Lender further desire to exchange (such exchange is referred to as the “Note Exchange”) the Partitioned Amount for 200,000 shares of the Borrower’s Common Stock, par value $0.00001 (the “Common Stock”, and such 200,000 shares of Common Stock, the “Exchange Shares”), according to the terms and conditions of this Agreement.

 

D.          The Note Exchange will consist of Lender surrendering the Partitioned Amount in exchange for the Exchange Shares, which will be issued free of any restrictive securities legend.

 

E.           Other than the surrender of the Partitioned Amount, no consideration of any kind whatsoever shall be given by Lender to Borrower in connection with this Agreement.

 

F.           Lender and Borrower now desire to exchange the Partitioned Amount for the Exchange Shares on the terms and conditions set forth herein.

 

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

 

1.           Recitals and Definitions. Each of the parties hereto acknowledges and agrees that the recitals set forth above in this Agreement are true and accurate, are contractual in nature, and are hereby incorporated into and made a part of this Agreement.

 

2.           Partition. Effective as of the date hereof, Borrower and Lender agree that the Partitioned Amount is hereby partitioned from the Original Note. Following such partition of the Original Note, Borrower and Lender agree that the Original Note shall remain in full force and effect, provided that the outstanding balance of the Original Note shall be reduced by an amount equal to the Partitioned Amount. For avoidance of doubt, the rights, duties, obligations, remedies of Borrower and Lender, and other terms and conditions of the Original Note shall remain unchanged upon the entering into of this Agreement, except with respect to the reduction in the outstanding balance by the amount of the Partitioned Amount.

 

 

 

 

3.           Issuance of Shares. Pursuant to the terms and conditions of this Agreement, the Note Exchange shall occur with Borrower delivering the Exchange Shares to Lender against Lender surrendering the Partitioned Note to Borrower on the Closing Date (as defined below). Upon delivery of the Exchange Shares, the Partitioned Note shall be cancelled and all obligations of Borrower under the Partitioned Note shall be deemed fulfilled. All Exchange Shares delivered hereunder shall be delivered via DWAC to Lender’s designated brokerage account. Borrower agrees to provide all necessary cooperation or assistance that may be required to cause all Exchange Shares delivered hereunder to become Free Trading (the first date on which all Exchange Shares become Free Trading, the “Free Trading Date”). For purposes hereof, the term “Free Trading” means that (a) the Exchange Shares have been cleared and approved for public resale by the compliance departments of Lender’s brokerage firm and the clearing firm servicing such brokerage, and (b) such shares are held in the name of the clearing firm servicing Lender’s brokerage firm and have been deposited into such clearing firm’s account for the benefit of Lender.

 

4.           Closing. The closing of the transaction contemplated hereby (the “Closing”) along with the delivery of the Exchange Shares to Lender shall occur on the date that is mutually agreed to by Borrower and Lender by means of the exchange by express courier and email of .pdf documents, but shall be deemed to have occurred at the offices of Hansen Black Anderson Ashcraft PLLC in Lehi, Utah.

 

5.           Holding Period, Tacking and Legal Opinion. Borrower represents, warrants and agrees that for the purposes of Rule 144 (“Rule 144”) of the Securities Act of 1933, as amended (the “Securities Act”), the holding period of the Partitioned Amonut and the Exchange Shares will include Lender’s holding period of the Original Note from November 23, 2020. Borrower agrees not to take a position contrary to this Section 5 in any document, statement, setting, or situation. Borrower agrees to take all action necessary to issue the Exchange Shares without restriction, and not containing any restrictive legend without the need for any action by Lender; provided that the applicable holding period has been met. In furtherance thereof, prior to the Closing, counsel to Lender may, in its sole discretion, provide an opinion that: (a) the Exchange Shares may be resold pursuant to Rule 144 without volume or manner-of-sale restrictions; and (b) the transactions contemplated hereby and all other documents associated with this transaction comport with the requirements of Section 3(a)(9) of the Securities Act. Borrower represents that it is not subject to Rule 144(i). The Exchange Shares are being issued in substitution of and exchange for and not in satisfaction of the Partitioned Amount. The Exchange Shares shall not constitute a novation or satisfaction and accord of the Partitioned Amount. Borrower acknowledges and understands that the representations and agreements of Borrower in this Section 5 are a material inducement to Lender’s decision to consummate the transactions contemplated herein.

 

 2

 

 

6.            Borrower’s Representations, Warranties and Agreements. In order to induce Lender to enter into this Agreement, Borrower, for itself, and for its affiliates, successors and assigns, hereby acknowledges, represents, warrants and agrees as follows: (a) Borrower has full power and authority to enter into this Agreement and to incur and perform all obligations and covenants contained herein, all of which have been duly authorized by all proper and necessary action, (b) no consent, approval, filing or registration with or notice to any governmental authority is required as a condition to the validity of this Agreement or the performance of any of the obligations of Borrower hereunder, (c) no Event of Default has occurred under the Original Note and any Events of Default that may have occurred thereunder have not been, and are not hereby, waived by Lender, (d) except as specifically set forth herein, nothing herein shall in any manner release, lessen, modify or otherwise affect Borrower’s obligations under the Original Note, (e) the issuance of the Exchange Shares is duly authorized by all necessary corporate action and the Exchange Shares are validly issued, fully paid and non-assessable, free and clear of all taxes, liens, claims, pledges, mortgages, restrictions, obligations, security interests and encumbrances of any kind, nature and description, (f) Borrower has not received any consideration in any form whatsoever for entering into this Agreement, other than the surrender of the Partitioned Amount, and (g) Borrower has taken no action which would give rise to any claim by any person for a brokerage commission, placement agent or finder’s fee or other similar payment by Borrower related to this Agreement.

 

7.            Lender’s Representations, Warranties and Agreements. In order to induce Borrower to enter into this Agreement, Lender, for itself, and for its affiliates, successors and assigns, hereby acknowledges, represents, warrants and agrees as follows: (a) Lender has full power and authority to enter into this Agreement and to incur and perform all obligations and covenants contained herein, all of which have been duly authorized by all proper and necessary action, (b) no consent, approval, filing or registration with or notice to any governmental authority is required as a condition to the validity of this Agreement or the performance of any of the obligations of Lender hereunder, (c) Lender has taken no action which would give rise to any claim by any person for a brokerage commission, placement agent or finder’s fee or other similar payment by Borrower related to this Agreement, (d) Lender is not currently an affiliate of the Borrower and has not been an affiliate of the Borrower for the prior three months, and (f) Lender, together with its affiliates, does not, and will not following the receipt of the Exchange Shares, beneficially own more than 4.99% of the number of shares of Common Stock outstanding on the Effective Date. For purposes of Section 7(f), beneficial ownership of Common Stock will be determined pursuant to Section 13(d) of the Securities Exchange Act of 1934, as amended.

 

8.            Governing Law; Venue. This Agreement shall be construed and enforced in accordance with, and all questions concerning the construction, validity, interpretation and performance of this Agreement shall be governed by, the internal laws of the State of Utah, without giving effect to any choice of law or conflict of law provision or rule (whether of the State of Utah or any other jurisdictions) that would cause the application of the laws of any jurisdictions other than the State of Utah. The provisions set forth in the Purchase Agreement to determine the proper venue for any disputes are incorporated herein by this reference. The parties agree that the Arbitration Provisions shall apply to any dispute that may arise between Borrower and Lender under this Agreement. BORROWER HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.

 

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9.           Arbitration of Claims. This Agreement shall be subject to the Arbitration Provisions.

 

10.         Counterparts. This Agreement may be executed in any number of counterparts with the same effect as if all signing parties had signed the same document. All counterparts shall be construed together and constitute the same instrument. The exchange of copies of this Agreement and of signature pages by facsimile transmission or other electronic transmission (including email) shall constitute effective execution and delivery of this Agreement as to the parties and may be used in lieu of the original Agreement for all purposes. Signatures of the parties transmitted by facsimile transmission or other electronic transmission (including email) shall be deemed to be their original signatures for all purposes.

 

11.         Attorneys’ Fees. In the event of any arbitration or action at law or in equity to enforce or interpret the terms of this Agreement, the parties agree that the party who is awarded the most money shall be deemed the prevailing party for all purposes and shall therefore be entitled to an additional award of the full amount of the attorneys’ fees and expenses paid by such prevailing party in connection with the arbitration, litigation and/or dispute without reduction or apportionment based upon the individual claims or defenses giving rise to the fees and expenses. Nothing herein shall restrict or impair an arbitrator’s or a court’s power to award fees and expenses for frivolous or bad faith pleading.

 

12.         No Reliance. Borrower acknowledges and agrees that neither Lender nor any of its officers, directors, members, managers, equity holders, representatives or agents has made any representations or warranties to Borrower or any of its agents, representatives, officers, directors, or employees except as expressly set forth in this Agreement and the Transaction Documents and, in making its decision to enter into the transactions contemplated by this Agreement, Borrower is not relying on any representation, warranty, covenant or promise of Lender or its officers, directors, members, managers, equity holders, agents or representatives other than as set forth in this Agreement.

 

13.         Severability. If any part of this Agreement is construed to be in violation of any law, such part shall be modified to achieve the objective of the parties to the fullest extent permitted and the balance of this Agreement shall remain in full force and effect.

 

14.         Entire Agreement. This Agreement, together with the Transaction Documents, and all other documents referred to herein, supersedes all other prior oral or written agreements between Borrower, Lender, its affiliates and persons acting on its behalf with respect to the matters discussed herein, and this Agreement and the instruments referenced herein contain the entire understanding of the parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither Lender nor Borrower makes any representation, warranty, covenant or undertaking with respect to such matters.

 

15.         Amendments. This Agreement may be amended, modified, or supplemented only by written agreement of the parties. No provision of this Agreement may be waived except in writing signed by the party against whom such waiver is sought to be enforced.

 

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16.         Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties and their respective successors and assigns. This Agreement or any of the severable rights and obligations inuring to the benefit of or to be performed by Lender hereunder may be assigned by Lender to a third party, including its financing sources, in whole or in part. Borrower may not assign this Agreement or any of its obligations herein without the prior written consent of Lender.

 

17.         Continuing Enforceability; Conflict Between Documents. Except as otherwise modified by this Agreement, the Original Note and each of the other Transaction Documents shall remain in full force and effect, enforceable in accordance with all of its original terms and provisions. This Agreement shall not be effective or binding unless and until it is fully executed and delivered by Lender and Borrower. If there is any conflict between the terms of this Agreement, on the one hand, and the Original Note or any other Transaction Document, on the other hand, the terms of this Agreement shall prevail.

 

18.         Time of Essence. Time is of the essence with respect to each and every provision of this Agreement.

 

19.         Notices. Unless otherwise specifically provided for herein, all notices, demands or requests required or permitted under this Agreement to be given to Borrower or Lender shall be given as set forth in the “Notices” section of the Purchase Agreement.

 

20.         Further Assurances. Each party shall do and perform or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first set forth above.

  

BORROWER:
 
  NEXTPLAY TECHNOLOGIES, INC.
 
  By: /s/ Bill Kerby
  Name: Bill Kerby
  Title: Co-CEO

 

  LENDER:
     
  STREETERVILLE CAPITAL, LLC
     
  By: /s/ John M. Fife 
    John M. Fife, President

 

[Signature Page to Exchange Agreement] 

 

 

 

NextPlay Technologies, Inc. 8-K

 

Exhibit 10.2

 

SHARE EXCHANGE AGREEMENT

 

THIS SHARE EXCHANGE AGREEMENT (this “Agreement”), dated as of June , 2021 (the “Effective Date”), is entered into by and among (i) the parties set forth as Sellers on Exhibit A hereto (each, a “Seller” and together, “Sellers”); (ii) Monaker Group, Inc., a Nevada corporation (“Purchaser”); and (iii) International Financial Enterprise Bank, Inc., a Puerto Rico Act 273-2012 corporation with headquarters located at 268 Ponce de Leon, Suite 1012, San Juan, PR 00918 (“IFEB” or the “Company”). Each of IFEB, Sellers and Purchaser may be referred to herein as a “Party” and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, each Seller owns the number of shares of authorized and outstanding Class A common stock, par value $0.01 per share, of IFEB (“IFEB Class A Common Stock”) set forth next to such Seller’s name on Exhibit A, and Sellers collectively own One Million Six Hundred Forty-nine Thousand Six Hundred Fourteen (1,649,614) shares of IFEB Class A Common Stock in the aggregate which represents approximately 42.94% of the total issued and outstanding IFEB Class A Common Stock (collectively the “IFEB Shares”);

 

WHEREAS, Purchaser is a NASDAQ-listed company with Eighty-Seven Million One Hundred Thousand and Four Hundred Three (87,100,403) issued and outstanding shares of common stock, par value $0.00001 per share;

 

WHEREAS, Purchaser previously acquired and currently owns [2,191,489] shares of IFEB Class A Common Stock, constituting approximately 57.06% of all issued and outstanding IFEB Class A Common Stock, and now desires to acquire the IFEB Shares from Sellers, which will result in Purchaser owning 100% of the issued and outstanding IFEB Class A Common Stock;

 

WHEREAS, Sellers, subject to the terms and conditions herein, including without limitation compliance by Purchaser and IFEB of the covenants and conditions set forth in Section 8 of this Agreement, desire to effect a tax-free exchange under Section 351 of the United States Internal Revenue Code of 1986, as amended (the “Code”), or such other tax free reorganization or restructuring provisions as may be available under the Code, of their IFEB Shares for the number of shares of restricted common stock in the Purchaser, par value $0.00001 per share (“MG Stock”), set forth opposite such Seller’s name on Exhibit A, as calculated in accordance with the exchange ratio set forth herein (the “Seller MG Shares”), and the Purchaser desires to issue the Seller MG Shares to Sellers, in exchange for the IFEB Shares, subject to the terms and conditions hereof, including, without limitation Section 5; and

 

WHEREAS, the Sellers and Purchaser desire to set forth in writing the terms and conditions of their agreement and understanding concerning the exchange of the IFEB Shares for the Seller MG Shares.

 

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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 sufficiency and receipt of, the Parties hereto agree as follows:

 

AGREEMENT

 

1.            Recitals. The foregoing recitals are true, correct, and complete in all respects and are incorporated herein by this reference.

 

2.            Share Exchange. At the Closing (hereinafter defined), each Seller shall transfer, sell, convey, assign and deliver such Seller’s IFEB Shares to Purchaser and Purchaser shall issue and deliver the Seller MG Shares to the Sellers in exchange for such Seller’s IFEB Shares, calculated in accordance with Section 3 below.

 

3.            Consideration. The exchange ratio for the IFEB Shares shall be one Purchased Share in exchange for 1.168 shares of MG Stock. The exchange ratio is equal to a fraction, the numerator which reflects the agreed upon price per share of $2.92 per Purchaser Share, and the denominator which reflects the agreed upon value of each Purchaser MG Stock share of $2.50 to be used in determining the number of MG Shares necessary to equal the value of the IFEB Shares.

 

4.            [Intentionally omitted.]

 

5.            Representations and Warranties of Sellers. Each Seller, individually and not jointly or severally, represents and warrants to Purchaser as of the Effective Date and the Closing Date, that:

 

(a)           This Agreement has been duly executed and delivered by each Seller and (assuming the due authorization, execution and delivery hereof by the Purchaser) constitutes the valid and binding obligation of the respective Seller enforceable against each Seller in accordance with its terms.

 

(b)           The sale is being conducted in compliance with, and subject to, the shareholders’ agreement dated as of March 14, 2018 between IFEB and its shareholders (the “Shareholders’ Agreement”), except to the extent the terms of the Shareholder’s Agreement would not have a material and adverse effect on the consummation of the transactions contemplated hereby. Sellers acknowledge that the Shareholders’ Agreement, in addition to its other terms and conditions, requires a majority vote of the board of directors of IFEB to relinquish IFEB’s right of first refusal to purchase the IFEB Shares and for each shareholder to likewise waive its right of first refusal to purchase the IFEB Shares of the other shareholders. By its signature hereto, each Seller is waiving its right of first refusal with respect to every other Seller’s sale and exchange of IFEB Shares.

 

(c)           No Seller is an officer, director or employee of Company, except as otherwise noted on Exhibit B hereto.

 

(d)           Each Seller is the sole record and beneficial owner of the IFEB Shares and has good and marketable title to all of the IFEB Shares, free and clear of any liens, claims, charges, options, rights of tenants or other encumbrances. Each Seller has sole managerial and dispositive authority with respect to the IFEB Shares and has not granted any person a proxy or option to buy the IFEB Shares that has not expired or been validly withdrawn. The sale and delivery of the IFEB Shares held by each applicable Seller to the Purchaser pursuant to this Agreement will vest in the Purchaser the legal and valid title to the IFEB Shares, free and clear of all liens, security interests, adverse claims or other encumbrances of any character whatsoever, except for those associated with the restricted nature of the securities.

 

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(e)           The IFEB Shares being exchanged hereunder are validly issued, fully paid and nonassessable.

 

(f)           Additional Representations:

 

(i) Each Seller is an “accredited investor”, as such term is defined in Regulation D of the Securities Act of 1933, as amended (the “Securities Act”) and has completed a Certificate of Accredited Investor Status in the form of Exhibit C hereto;

 

(ii) Each Seller is acquiring the Seller MG Shares, for its or his or her own account, for investment purposes only and not with a view to, or for sale in connection with, a distribution, as that term is used in Section 2(11) of the Securities Act, in a manner which would require registration under the Securities Act or any state securities laws. Each Seller can bear the economic risk of investment in the Seller MG Shares, has knowledge and experience in financial business matters, is capable of bearing and managing the risk of investment in the Seller MG Shares. Each Seller recognizes that the Seller MG Shares have not been registered under the Securities Act, nor under the securities laws of any state and, therefore, cannot be resold unless the resale of the Seller MG Shares is registered under the Securities Act or unless an exemption from registration is available. Each Seller has carefully considered and has, to the extent it, he or she believes such discussion necessary, discussed with its, his or her respective professional, legal, tax and financial advisors, the suitability of an investment in the Seller MG Shares for its, his or her particular tax and financial situation and its, his or her respective advisers, if such advisors were deemed necessary, have determined that the Seller MG Shares is a suitable investment for it, him or her. Each Seller has not been offered the Seller MG Shares by any form of general solicitation or advertising, including, but not limited to, advertisements, articles, notices or other communications published in any newspaper, magazine, or other similar media or television or radio broadcast or any seminar or meeting where, to each Seller’s knowledge, those individuals that have attended have been invited by any such or similar means of general solicitation or advertising. Each Seller has had an opportunity to ask questions of and receive satisfactory answers from Purchaser, or persons acting on behalf of Purchaser, concerning the terms and conditions of the Seller MG Shares and Purchaser, and all such questions have been answered to the full satisfaction of each Seller (as applicable). Each Seller is relying on its, his or her own investigation and evaluation of Purchaser and the Seller MG Shares and not on any other information.

 

(iii) Each Seller understands and acknowledges that each certificate or instrument representing the Seller MG Shares will be endorsed with the following legend (or a substantially similar legend), unless or until registered under the Securities Act, or unless an exemption from registration exists in connection therewith:

 

THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR HYPOTHECATED UNLESS THERE IS AN EFFECTIVE REGISTRATION STATEMENT UNDER SUCH ACT COVERING SUCH SECURITIES, THE TRANSFER IS MADE IN COMPLIANCE WITH RULE 144 PROMULGATED UNDER SUCH ACT OR THE COMPANY RECEIVES AN OPINION OF COUNSEL FOR THE HOLDER OF THESE SECURITIES WHICH IS REASONABLY SATISFACTORY TO THE COMPANY, STATING THAT SUCH SALE, TRANSFER, ASSIGNMENT OR HYPOTHECATION IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SUCH ACT.

 

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(iv) Prior to each Seller’s entry into this Agreement, such Seller has had an opportunity to review, and has in fact reviewed, (i) the Company’s Annual Report on Form 10-K for the year ended February 28, 2021; and (ii) the Company’s current reports on Form 8-K and Form 10-Qs as filed with the SEC (which filings can be accessed by going to https://www.sec.gov/search/search.htm, typing “Monaker Group” in the “Company name” field, and clicking the “Search” button), from January 1, 2021, to the Effective Date, in each case (i) through (ii), including the audited and unaudited financial statements, description of business, risk factors, results of operations, certain transactions and related business disclosures described therein (collectively the “Disclosure Documents”) and an independent investigation made by it of the Company. Each Seller acknowledges that due to its, his and her receipt of and review of the information described above, such Seller has received similar information as would be included in a Registration Statement filed under the Securities Act.

 

(v) Each Seller acknowledges that it, she or he is a sophisticated investor engaged in the business of assessing and assuming investment risks with respect to securities, including securities such as the Seller MG Shares, and further acknowledges that the Purchaser is entering into this Agreement with such Sellers in reliance on this acknowledgment and with each Seller’s understanding, acknowledgment and agreement that the Purchaser is privy to material non-public information regarding the Purchaser (collectively, the “Non-Public Information”), which Non-Public Information may be material to a reasonable investor, such as a Seller, when making investment disposition decisions, including the decision to enter into the Agreement, and each Seller’s decision to enter into the Agreement is being made with full recognition and acknowledgment that the Purchaser is privy to the Non-Public Information, irrespective of whether such Non-Public Information has been provided to such Seller. Each Seller hereby waives any claim, or potential claim, it, he or she has or may have against the Purchaser relating to the Purchaser’s possession of Non-Public Information.

 

6.            Representations and Warranties of Purchaser. Purchaser represents and warrants to Sellers as of the Effective Date and the Closing Date:

 

(a)          This Agreement has been duly executed and delivered by the Purchaser and (assuming the due authorization, execution and delivery hereof by the Sellers) constitutes the valid and binding obligation of the Purchaser enforceable against Purchaser in accordance with its terms. The execution, delivery and performance by the Purchaser of this Agreement (i) does not contravene the terms of the Purchaser’s organizational documents, (ii) does not violate, conflict with or result in any breach or contravention of, or the creation of any lien or encumbrance under, any contractual obligation of the Purchaser or any law applicable to the Purchaser, and (iii) does not violate any orders of any governmental authority against, or binding upon, the Purchaser.

 

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(b)          Purchaser is a corporation duly incorporated, validly existing and in good standing under the laws of the State of Nevada and all jurisdictions where the nature of its business requires such licensing or qualifications. Purchaser has all necessary corporate power and authority to conduct its business in the manner which its business is currently being conducted and to enter into this Agreement and perform its obligations hereunder.

 

(c)           Except as set forth in this Agreement or otherwise obtained and delivered to Sellers prior to the Closing, no approval, consent, compliance, exemption, authorization or other action by, or notice to, or filing with, any or any entity, governmental agency, other person or individual, and no lapse of a waiting period under any applicable law, is required to be obtained by the Purchaser in connection with the execution, delivery, or performance by the Purchaser, of this Agreement.

 

(d)          All of the issued and outstanding Seller MG Shares at the Closing (i) will have been duly authorized, validly issued, fully paid and are non-assessable, (ii) will have been issued in compliance with all applicable federal and state securities laws, (iii) will not have been issued in violation of any agreement, arrangement or commitment to which Company or any of its affiliates is a party or is subject to or in violation of any preemptive or similar rights of any person, and (iv) will have the same rights, preferences, powers, restrictions and limitations of all other common stock of the Purchaser.

 

(e)          On the Effective Date, the Seller MG Shares issued to Sellers represent, in the aggregate 2.214% of the issued and outstanding shares of common stock of Purchaser.

 

(f)           Since February 28, 2021, there has been no material adverse change in the financial or other condition, properties or business operations of Purchaser which has not been disclosed in a report filed with the Securities and Exchange Commission.

 

(g)          Purchaser has conducted its own independent investigation, review and analysis of the IFEB Shares and the business and assets of IFEB, together with the results of operations, prospects, conditions (financial or otherwise) of the same and acknowledges that it has been provided adequate access to the personnel, assets, properties, premises, books and records and other documents and data of Company for such purpose. Purchaser acknowledges and agrees that in making its decision to enter into this Agreement and to consummate the transactions contemplated hereby, Purchaser has relied on its own independent investigation and due diligence and on the representations and warranties of Sellers set forth in Section 5 of this Agreement. Purchaser has not relied on any representations and warranties, express or implied, other than the representations and warranties of Sellers set forth in Section 5 of this Agreement. The Purchaser acknowledges that it is purchasing the IFEB Shares on an “As Is” basis, with no representations or warranties by the Sellers, whether express or implied with respect to the IFEB Shares or the Company other than the representations and warranties set forth in Section 5.

 

(h)          Purchaser understands that the IFEB Shares have not been registered under the Securities Act of 1933, as amended (the “Securities Act”) or any other applicable state securities laws. Purchaser is an “accredited investor”, as such term is defined in Regulation D of the Securities Act, and is purchasing the IFEB Shares for investment, for its own account and not with a view to distribution thereof.

 

5 

 

(i)            Intentionally Deleted.

 

(j)           The IFEB Shares do not trade publicly. Purchaser agrees, based on its due diligence, that the price set forth in the exchange ratio set forth in Section 3 above is fair and reasonable for the IFEB Shares.

 

7.            Representations and Warranties of Company.

 

(a)           IFEB represents and warrants to Purchaser as of the Effective Date, which representations and warranties shall also be true as of the Closing Date, as follows:

 

(i)         IFEB is a corporation duly incorporated, validly existing and in good standing under the laws of Puerto Rico and has all necessary power and authority to conduct its business and own its properties as now conducted and owned.

 

(ii)        For all periods ended on or prior to the Effective Date, IFEB has accurately completed, in all material respects, and has filed or will file within the time prescribed by law (including extensions of time approved by the appropriate taxing authority) all tax returns and reports required to be filed with the Internal Revenue Service, the Commonwealth of Puerto Rico, any other states or governmental subdivisions and all foreign countries and has paid, or made adequate provision for the payment of, all taxes, interest, penalties, assessments or deficiencies known to be due.

 

(iii)       IFEB has no subsidiaries.

 

(iv)       Since the last annual financial statement dated December 31, 2020, there has been no material adverse change in the financial or other condition, properties or business operations of IFEB.

 

(v)        There are no suits, proceedings or investigations pending or, to IFEB’s knowledge, threatened against or affecting IFEB or an officer of IFEB which is reasonably likely to have a material adverse effect on the business, assets, or financial condition of IFEB.

 

(vi)       IFEB is operated under its certificate of incorporation, bylaws and the permit to commence operations issued by the Office of the Commissioner of Financial Institutions of Puerto Rico (the “Commissioner”), which office granted IFEB an amended and restated permit to organize as an international financial entity under Act 273-2012, dated November 1, 2017, subject to the conditions and limitations set forth in such permit. IFEB is in material compliance with its corporate governing documents and all applicable laws and regulations related to its business.

 

(vii)      The sole class of common voting equity of Company is its Class A common stock. All of the issued and outstanding IFEB Shares (i) have been duly authorized, validly issued, fully paid and are non-assessable, (ii) subject to Section 5(e) above, have been issued in compliance with all applicable federal and state securities laws, (iii) will not have been issued in violation of any agreement, arrangement or commitment to which Company or any of its affiliates is a party or is subject to or in violation of any preemptive or similar rights of any person, and (iv) will have the rights, preferences, powers, restrictions and limitations of IFEB’s Class A common stock.

 

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(viii)     Company is not subject to any formal order (other than orders applicable to international financial entities generally and as set forth in its charter and permit to organize) with any federal or state agency charged with the supervision or regulation of banks, including, without limitation, the Federal Deposit Insurance Corporation (“FDIC”). IFEB is not FDIC-insured.

 

(ix)        Prior to the Closing, Company will not issue any stock or other equity to any party, and the percentage of issued and outstanding Class A common stock of the Company being purchased by Purchaser shall be as set forth in the Recitals.

 

(b)           IFEB and Monaker acknowledge and agree that the covenants set forth in Section 8 of this Agreement are an additional consideration for each Seller, including without limitation, Richard Balles (“Balles”), Robert Fiallo (“Fiallo”), Ronald Poe (“Poe”), David Nissman (“Nissman”) and Steven Solomon (“Solomon”), entering into this Agreement and transferring the IFEB Shares to Purchaser. IFEB and Purchaser hereby represent and warrant to each Seller, including without limitation Balles, Fiallo, Poe, Nissman and Solomon, that IFEB will abide by the covenants set forth in Section 8 and will take no action in contravention of the covenants set forth Section 8.

 

8.            Covenants of Purchaser and IFEB. As condition to the closing on the sale of the IFEB Shares to Purchaser, Purchaser, and Todd Bonner and Bill Kerby do hereby covenant and agree:

 

(a)           (i) Solomon, Nissman and Balles (the “Legacy Board Members”) shall remain on the Board of Directors of IFEB (the “Board”) for a period of one year after the Closing and delivery of the Seller MG Shares, in the amounts determined in accordance with Section 3 of this Agreement, to each Seller (the “Legacy Control Period”), subject to rights to remove such Legacy Board Members if such continued appointment/service as board members would violate the fiduciary duties of any other Board members.

 

(ii) From and after the Closing until the end of the Legacy Control Period, the Legacy Board Members, along with all other members of the Board shall each be paid, at the Option of Purchaser, (x) Five Thousand Dollars ($5,000.00) per month or (y) in the form of MG Shares, the amount of MG Shares necessary to equal payments of $5,000.00 per month based on the trading price of the MG Shares at the close of business of the last trading day of the prior calendar month. Notwithstanding the above, Nissman, in his sole discretion, shall have right to elect to receive payments of $5,000.00 in cash as opposed to receiving MG Shares valued at $5,000.00 each month.

 

(iii) It is understood and agreed that Balles or parties affiliated with Balles have two loans outstanding with IFEB, the first is a loan from IFEB to Galveston Place Properties, LLC in the original principal amount of $705,000.00 (the “Galveston Loan”) and the second is a loan from IFEB to 3626 Georgia AVE., LLC in the original principal amount of $835,000.00 (the “Georgia Loan” with the Georgia Loan and the Galveston Loan being collectively referred to as the “Balles Loans”). The Balles Loans will be extended for a period of 90 days following the Closing (the “Initial Extension”) with Balles having the right, in his sole discretion, to further extend one or both of the Balles Loans for an additional period of 60 days (the “Second Extension”) upon payment of an extension fee in the amount of 0.5% of the outstanding principal balance of each such extended Balles Loan. In the event Balles does not repay the Balles Loans by the end of the Second Extension period, Balles will resign his position on the Board and the Board shall select either Fiallo or Poe to replace Balles on the Board. In addition to the above, during the period that one or both of the Balles Loans remains unpaid or outstanding, Balles agrees to pledge a portion of Balle’s Seller MG Shares equal to 100% of the outstanding principal balance of the Balles Loans as further collateral for the repayment of the Balles Loans.

 

7 

 

 

(b)          At Closing, Purchaser will elect or otherwise appoint Todd Bonner, Jess Bonner, Don Monaco, Bill Kerby and Jan Reinhart as approved by the Legacy Board as additional directors to the Board

 

(c)          At or prior to the Closing, Poe shall be hired as Vice-President of Longroot, Inc., a Delaware corporation (“Longroot”), an affiliate of Purchaser, pursuant to a separate employment agreement to be mutually agreed upon between Poe and Longroot (the “Poe Employment Agreement”) pursuant to which Poe will be given a salary of $120,000.00 per year and profit sharing as more particularly set forth in the Poe Employment Agreement. The term of the Poe Employment Agreement shall be for a period of one year and shall be executed and delivered at Closing.

 

(d)          At or prior to Closing, Fiallo shall be hired by a newly-formed entity (the “Parent Entity”), which shall be an affiliate of Purchaser, the Company, Longroot, a to be formed Fin-Tech Company (the “Fin-Tech Entity”, with the Fin-Tech Entity, the Company, Purchaser and Longroot, together with any other subsidiaries of the Parent Entity being collectively referred to as the “Parent Subsidiaries”) pursuant to a separate employment agreement (the “Fiallo Employment Agreement”). Should the Parent Entity not be formed by Closing, Fiallo shall continue to be employed by the Company or such other company acceptable to Fiallo in his sole, but reasonable discretion, with such employment and the respective compensation set forth in this sub-section (d) guaranteed by Purchaser and the Company until such time as the Parent Entity is formed and the Parent Subsidiaries have been added as subsidiaries of the Parent Entity. At such time as the Parent Subsidiaries become subsidiaries of the Parent Entity, Fiallo will become a member of the Board of Directors of Parent Entity in addition to having the title of Managing Director in charge of business development. The Fiallo Employment Agreement shall provide that Fiallo will receive a base salary of $300,000.00 per year, plus a bonus equal to 3% of the profits for the Parent Subsidiaries and any other business units or affiliates of the Parent Entity related to profits from projects Fiallo works with or assists in business development as jointly determined by Fiallo and the Parent Entity. The term of the Fiallo Employment Agreement shall be for a period of one year and shall be executed simultaneously with the purchase of the Seller IFEB Shares at Closing. The Fiallo Employment Agreement may only be terminated for cause as defined in the Fiallo Employment Agreement. In addition to Fiallo’s duties under the Fiallo Employment Agreement, Fiallo shall remain as interim chief executive officer of IFEB until a suitable candidate is selected by Fiallo and hired by IFEB.

 

9.            The Company shall terminate Ralph Fatigate (“Fatigate”) as CEO of IFEB. In connection with such termination, the Company will endeavor to enter into a settlement, non-solicitation and non-disparagement agreement with Fatigate (the “Fatigate Agreement”), whereby Fatigate is prohibited from having any contact with the Company, or any of their respective employees, officers, directors, and/or shareholders. Any payments made to Fatigate pursuant to the Fatigate Agreement shall be the responsibility of the Purchaser.

 

8 

 

 

10.         Closing. The purchase and sale of the IFEB Shares shall take place at a closing to be held at such time, place and manner as shall be agreed upon by the Parties (the “Closing” and the date on which the Closing occurs, the “Closing Date”). The Closing shall occur on or before July 14, 2021, subject to the conditions to closing occurring as discussed below. As a condition to Closing:

 

(a)        Each of the representations and warranties of Purchaser hereunder shall be true and correct at the Closing as though made at the Closing Date and Purchaser shall have performed all covenants which by their terms are required to have been performed prior to Closing. Without limiting the foregoing, Purchaser shall have fulfilled, to the reasonable satisfaction of the Seller, all of its obligations pursuant to Section 8 of this Agreement (to the extent to be performed on or prior to the Closing Date), including without limitation the execution and delivery of the Poe Employment Agreement, Fiallo Employment Agreement and the Fatigate Agreement.

 

(b)        Each of the representations and warranties of Sellers and the Company hereunder shall be true and correct at the Closing as though made at the Closing Date and Sellers shall have performed any covenants which by their terms are required to have been performed prior to Closing.

 

(c)        Each Seller shall have delivered to Purchaser stock certificates, stock powers or such other instruments as necessary to evidence the transfer of the IFEB Shares and a signed and completed Certificate of Accredited Investor Status.

 

(d)        Purchaser shall have delivered to each Seller such stock certificates or other instruments as necessary to evidence the issuance of the Seller MG Shares to each Seller in the amounts as set forth in Exhibit A of this Agreement.

 

(e)        Purchaser shall have obtained all consents, orders, approvals, and/or waivers required to consummate the transactions contemplated herein, including without limitation the approval of its board of directors and shareholders in accordance with applicable law, and shall have delivered to Sellers evidence of the same in form and substance reasonably satisfactory to Sellers.

 

(f)         The Company shall have obtained any corporate consents or approvals in accordance with applicable law and delivered to Purchaser evidence of the same in form and substance reasonably satisfactory to Purchaser.

 

11.         Restrictions on Transfer. Each certificate of IFEB Shares shall bear the following legend: “THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES OR BLUE SKY LAWS. THESE SECURITIES MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM UNDER SAID ACT OR LAWS. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO A SHAREHOLDERS’ AGREEMENT DATED AS OF MARCH 14, 2018 BETWEEN IFEB AND THE OTHER PARTIES NAMED THEREIN. THE TERMS OF SUCH SHAREHOLDERS’ AGREEMENT INCLUDE, AMONG OTHER THINGS, RESTRICTIONS ON TRANSFER. A COPY OF SUCH AGREEMENT MAY BE OBTAINED AT NO COST BY WRITTEN REQUEST MADE BY THE HOLDER OF RECORD OF THIS CERTIFICATE TO THE SECRETARY OF IFEB.”

 

9 

 

 

12.         Termination.

 

(a)          This Agreement may be terminated prior to the Closing as follows:

 

(i)         By the mutual written agreement of the parties;

 

(ii)        By either Purchaser or Sellers by written notice to the other party hereto if the Closing shall not have occurred by July 29, 2021,, unless such date is extended by the mutual written consent of the Sellers and the Purchaser; provided, however, that such right shall not be available to any party whose breach of any representation, warranty, covenant or agreement under this Agreement has been the cause of, or resulted in, the failure of the Closing to occur on or before such date.

 

(iii)       By either party by written notice to the other party, if such other party is in material breach of, or noncompliance with, any of its representations, warranties, covenants, agreements or Closing conditions hereunder, and such material breach, if cureable, is not cured within [10] business days of delivery of written notice of such breach.

 

(b)          If this Agreement terminates in accordance with this Section 11, it shall become null and void and have no further force or effect, except as provided in Section 11(c).

 

(c)          In the event Closing does not occur as the result of Purchaser’s failure to proceed in accordance with the terms of this Agreement, Purchaser shall pay all reasonable costs and expenses incurred by Sellers, including, but not limited to all reasonable attorneys’ fees of Seller.

 

13.          Notices. All notices, demands and other communications provided for or permitted hereunder shall be made in writing and shall be by registered or certified first-class mail, return receipt requested, telecopier, e-mail, courier service or personal delivery and shall be deemed to have been duly given (i) when delivered by hand, if personally delivered; (ii) one business day after being sent, if sent via a reputable overnight courier service guaranteeing next business day delivery; (iii) five (5) business days after being sent, if sent by registered or certified mail, return receipt requested, postage prepaid; and (iv) when receipt is mechanically acknowledged, if telecopied or e-mailed, in each case to the following addresses:

 

(i)

if to the Sellers:

Steven A. Solomon

11401 Palatine Drive

Potomac, Maryland 20854

 

with a copy to:

 

Robert Fiallo

7706 Tilbury Street

Bethesda, MD 20814

 

with a copy to:

 

Neuberger, Quinn, Gielen, Rubin & Gibber, P.A.

One South Street, 27th Floor

Baltimore, Maryland 21202

Attn: Robert M. Ercole, Esq.

Email: rme@nqgrg.com

 

10 

 

(ii) if to the Purchaser:

 

William Kerby

1560 Sawgrass Corporate Parkway

Suite 130

Sunrise, FL 33323

 

with copy to:

David Love

The Loev Law Group

6300 West Loop South, Suite 280

Bellaire, Texas 77401

 

14.          Miscellaneous.

 

(a)           Further Assurances. Each party shall do and perform, or cause to be done and performed, all such further acts and things, and shall execute and deliver all such other agreements, certificates, instruments and documents, as the other party may reasonably request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby.

 

(b)           Attorney’s Fees. IFEB shall pay the respective reasonable legal fees and expenses in connection with the preparation of this Agreement and the subsequent Closing.

 

(c)           Severability. Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

 

(d)         Brokers. Each Party represents that is has not dealt with any broker, finder, commission agent, or other similar person in connection with the offer or sale of the IFEB Shares and the transaction contemplated by this Agreement and is under no obligation to pay any broker’s fee, finder’s fee, or commission in connection with such transaction.

 

(e)           Headings. The headings of sections contained in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this Agreement.

 

(f)           GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS RULES OR CHOICE OF LAWS RULES THEREOF OR OF ANY STATE.

 

11 

 

 

(g)          Assignability and Binding Effect. This Agreement shall inure to the benefit of and be binding upon the Parties and their respective successors, heirs, and permitted assigns. This Agreement is personal to the Parties and the rights and obligations hereunder shall not be assignable without the express written consent of all Parties.

 

(h)           Third Parties. Nothing herein expressed or implied is intended or shall be construed to confer upon or give to any Person other than the Parties and their successors, heirs, or permitted assigns, any rights or remedies under or by reason of this Agreement.

 

(i)            Multiple Counterparts. This Agreement may be executed in multiple counterparts, including by facsimile signature, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument.

 

(j)            Amendment. This Agreement may not be modified, amended, or supplemented except by an agreement in writing signed by all of the Parties.

 

(k)           Entire Agreement. This Agreement constitutes the entire understanding between the parties hereto and supersedes all prior agreements regarding the subject matter hereof, including, but not limited to the Prior Purchase Agreements which have been rescinded.

 

(l)            Review and Construction of Documents. Each Party represents to the others 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.

 

[Signature Page to Share Exchange Agreement Follows]

 

12 

 

 

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first set forth above to be effective as of the Effective Date.

 

  SELLERS:       PURCHASER:  
  BC Trust 375,000  shares     Monaker Group, Inc.  
               

  By: /s/ Nelson Jose Maranho de Sousa      By: /s/ William Kerby   
    Nelson Jose Maranho de Sousa, as Trustee       Name: William Kerby  
            Title:   CEO  

  CM Trust 375,000  shares        
            COMPANY:  

  By: /s/ Pamela Lima         International Financial Enterprise Bank, Inc.  
    Pamela Lima, as Trustee                 
          By: /s/ Richard Balles  
  RMB Trust 259,148  shares      Name: Richard Balles  
            Title:  EVP  

  By: /s/ Cobbie Prather        
    Cobbie Prather, as Trustee     As to the Covenants in Section 8 only  
             
  TJ Trust 375,000  shares          
            By: /s/ William Kerby  

  By: /s/ Todd Lubar        William Kerby  
    Todd Lubar, as Trustee        

            By: /s/ Todd Bonner     
  Capital Venture Trust 170,000  shares     Todd Bonner  
               

  By: /s/ Richard Balles         
    Richard Balles, as Trustee        
             

  Santa Clara [Trust] 95,464.7  shares      
             
  By: /s/ Carline Moraes      
    Carline Moraes, as Trustee          
    20,000  shares      
             

  By: /s/ Gary Hoyer       
    Gary Hoyer, an individual and employee      
           
           

 

13 

 

[Signature Page to Share Exchange Agreement cont’d]

 

    20,000 shares      
           
  By: /s/ Ingrid Periz      
    Ingrid Periz, an individual      
           
    1,000 shares      
           
  By: /s/ Richard Balles      
    Richard Balles, an individual and director      
           
    1,000 shares      
           
  By: /s/ Tracy Berriman      
    Tracy Berriman, an individual and director      
           
    1,000 shares      
           
  By: /s/ Gavriel Kahane      
    Gavriel Kahane, an individual and former director      
           
    1,000 shares      
           
  By: /s/ David Nissman      
    David Nissman, an individual and director      
           
    1,000 shares      
           
  By: /s/ Steve Solomon      
    Steve Solomon, an individual and director      

 

14 

 

NextPlay Technologies, Inc. 8-K

 

Exhibit 99.1 

 

NextPlay Technologies Closes Acquisition of 100% of International Financial Enterprise Bank, to Advance Fintech Solutions for eCommerce and Digital Media Platforms

 

SUNRISE, FL - - July 27, 2021 - - NextPlay Technologies, Inc. (NASDAQ: NXTP), a technology solutions company building a digital business ecosystem for digital advertisers, consumers, video gamers and travelers, reported today that it has closed its previously announced acquisition of International Financial Enterprise Bank (IFEB), a global financial institution headquartered in San Juan, Puerto Rico.

The Company is pleased to announce that it has increased its previously disclosed intended stake in IFEB, and formally closed the acquisition of 100% of the Bank as of July 21st after receiving previously reported formal regulatory approval from the Office of the Commissioner of Financial Institutions of Puerto Rico (OCIF) for up to 100% ownership. Additionally, OCIF has granted NextPlay approval to change the bank’s name to NextBank International.

Consideration for the IFEB purchase included a $6.4 million cash payment made in April 2021, for a 57.1% ownership of IFEB and a further payment of $4.8 million to acquire the remaining 42.9% of IFEB, which was paid by way of issuing 1,926,750 shares of NextPlay’s restricted common stock (which is equivalent to US$2.50 per share issued).

IFEB brings NextPlay a full range of Fintech solutions, including concierge banking, online and mobile banking, credit cards, deposit and loans and escrow services. The bank’s charter and Fintech technology allows it to conduct business and serve customers anywhere in the world. Its mobile app is available to download for free from the Apple App Store or Google Play. Additionally, IFEB complements NextPlay’s Longroot initial coin offering (ICO) portal.

“The 100% acquisition of IFEB complements our Longroot Initial Coin Offering (ICO) unit and expands Longroot’s capabilities to potentially include access to cryptocurrency exchanges, online payments, digital wallet and mobile banking capabilities supporting the ICO portal with IFEB Fintech banking solutions,” commented NextPlay Co-CEO, Bill Kerby who further stated, “In addition to existing customers, revenue and targeted cashflow contributions, IFEB should strengthen our other business segments by providing unencumbered and dynamic access to merchant services for gaming, in-game advertising and travel.”

Additional information about the IFEB acquisition is available in NextPlay Technologies’ Current Report on Form 8-K filed today with the U.S. Securities and Exchange Commission and available at www.sec.gov.

About NextPlay Technologies

NextPlay Technologies, Inc. (Nasdaq: NXTP) is a technology solutions company offering games, in-game advertising, crypto-banking, connected TV and travel booking services to consumers and corporations within a growing worldwide digital ecosystem. NextPlay’s engaging products and services utilize innovative AdTech, Artificial Intelligence and Fintech solutions to leverage the strengths and channels of our existing and acquired technologies. For more information about NextPlay Technologies, visit www.nextplaytechnologies.com and follow us on Twitter @NextPlayTech and LinkedIn.

   

 

 

Forward-Looking Statements

This press release includes “forward-looking statements” within the meaning of, and within the safe harbor provided by the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements give our current expectations, opinions, beliefs or forecasts of future events and performance. A statement identified by the use of forward-looking words including “will,” “may,” “expects,” “projects,” “anticipates,” “plans,” “believes,” “estimate,” “should,” and certain of the other foregoing statements may be deemed forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, these statements involve risks and uncertainties that may cause actual future activities and results to be materially different from those suggested or described in this news release. Factors that may cause such a difference include risks and uncertainties related to our need for additional capital which may not be available on commercially acceptable terms, if at all, which raises questions about our ability to continue as a going concern; the fact that the COVID-19 pandemic has had, and is expected to continue to have, a significant material adverse impact on the travel industry and our business, operating results and liquidity; amounts owed to us by third parties which may not be paid timely, if at all; certain amounts we owe under outstanding indebtedness which are secured by substantially all of our assets and penalties we may incur in connection therewith; the fact that we have significant indebtedness, which could adversely affect our business and financial condition; uncertainty and illiquidity in credit and capital markets which may impair our ability to obtain credit and financing on acceptable terms and may adversely affect the financial strength of our business partners; the officers and directors of the Company have the ability to exercise significant influence and voting control over the Company; stockholders may be diluted significantly through our efforts to obtain financing, satisfy obligations and complete acquisitions through the issuance of additional shares of our common or preferred stock; if we are unable to adapt to changes in technology, our business could be harmed; if we do not adequately protect our intellectual property, our ability to compete could be impaired; our long-term travel business success depends, in part, on our ability to expand our property owner, manager and traveler bases outside of the United States and, as a result, our travel business is susceptible to risks associated with international operations; unfavorable changes in, or interpretations of, government regulations or taxation of the evolving travel, Internet and e-commerce industries which could harm our operating results; risks associated with the operations of, the business of, and the regulation of our recent acquisitions of Longroot Holding (Thailand) Company Limited (Longroot), HotPlay Enterprise Limited (HotPlay) and IFEB; the markets in which we participate being highly competitive, and because of that we may be unable to compete successfully with our current or future competitors; our potential inability to adapt to changes in technology, which could harm our business; the volatility of our stock price; risks associated with the integration of the operations of HotPlay, Longroot and IFEB, which acquisitions we recently competed; the fact that we may be subject to liability for the activities of our property owners and managers, which could harm our reputation and increase our operating costs; and that we have incurred significant losses to date and require additional capital which may not be available on commercially acceptable terms, if at all. More information about the risks and uncertainties faced by the Company are detailed from time to time in the Company’s periodic reports filed with the SEC, including its most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, under the headings “Risk Factors”. These reports are available at www.sec.gov. Other unknown or unpredictable factors also could have material adverse effects on the Company’s future results and/or could cause our actual results and financial condition to differ materially from those indicated in the forward-looking statements. Investors are cautioned that any forward-looking statements are not guarantees of future performance and actual results or developments may differ materially from those projected.

 

The forward-looking statements in this press release are made only as of the date hereof. The Company takes no obligation to update or correct its own forward-looking statements, except as required by law, or those prepared by third parties that are not paid for by the Company. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

 

Source: NextPlay Technologies

 

Company Contacts:

NextPlay Technologies, Inc

Richard Marshall

Director of Corporate Development

Tel (954) 888-9779

richard.marshall@nextplaytechnologies.com